UPDATE 2-Australia's top iron ore port may face delays as union fight escalates
* Union says stoppages planned at low tide for minimal impact
* Port handles more than half of Australia's iron exports
* BHP says engineers' work stoppage would be illegal (Recasts with BHP comment)
By Sonali Paul
MELBOURNE, Aug 6 (Reuters) - Tug boat engineers at Port Hedland, Australia's biggest iron ore port plan to stop work for four hours on Aug. 9, 11 and 13 over a pay dispute, which would slow exports from BHP Billiton and Fortescue Metals Group.
The threatened industrial action marks a step up in the dispute between tug workers and operator Teekay Shipping at Port Hedland, which handles a quarter of the world's seaborne iron ore, mostly going to China, Japan and South Korea.
However BHP, the top exporter out of Port Hedland, and Teekay said they would take steps to stop the industrial action by the Australian Institute of Marine and Power Engineers (AIMPE) as they believed the union had missed a deadline to file notice of a work stoppage.
"BHP Billiton believes the proposed action by the AIMPE is unlawful given it falls outside the protected action ballot order, and the company intends to pursue all options available to prevent it," the company said in a statement emailed to Reuters.
Tug boat captains, engineers and deck hands have been demanding higher pay and more leave from Teekay following a one-third increase in iron ore shipments through Port Hedland over the past year that has stretched their work hours as the tug boats guide iron ore vessels in and out of the port.
"Teekay is continuing to negotiate with the three unions and is considering its legal options," the company said in a statement emailed to Reuters.
The engineers' strike would be the first to hit Port Hedland following three months' of threats, but the union said the work stoppages would have minimal impact on shipments as they have been timed to coincide with low tides at the port.
"It's a shot across the bow. We're hoping it focuses minds so we can sit down and common sense will prevail," Andrew Williamson, senior national organiser for the Australian Institute of Marine and Power Engineers, told Reuters.
The union said it had given three days notice to Teekay, just ahead of the expiration of an approved period for taking industrial action at the port. It believed the deadline for starting to take action was Aug. 9.
(Reporting by Sonali Paul; Editing by Richard Pullin)