January 28, 2013 / 8:45 PM / 5 years ago

UPDATE 2-Chile Escondida workers OK new contract proposal- union

* Deal to ease fears of Escondida labor unrest
    * Escondida is the world's No. 1 copper mine
    * Proposal accepted with 59.9 pct of votes- union


    By Alexandra Ulmer
    SANTIAGO, Jan 28 (Reuters) - Workers at Chile's Escondida
have voted to approve a new contract proposal, the union told
Reuters on Monday, calming fears of labor unrest in the world's
largest copper deposit.
    Controller BHP Billiton said this month the mine
was on track to increase its copper output by 20 percent in the
2013 financial year. The deposit's output in the
January-to-September period of last year was 787,000 tonnes, up
31.6 percent from 2011 levels. 
    "With 59.9 percent of votes in favor, Escondida mine's
proposal was accepted," the union posted later on its web site.
     The wage offer entailed a 5 percent raise in salaries, as
well as bonuses and benefits for a total of roughly 23 million
pesos (around US$48,665) per worker, union leaders said earlier
this month. 
    "This will place an enormous additional burden on the
company," Commerzbank said earlier this month of the contract
proposal. "Thus the trend towards rising production costs - and
in this case wage costs in particular - continues, and will have
to be cushioned by higher prices."
    The mine is seen as setting a benchmark in terms of
collective negotiations in the Andean country's mining sector. 
    BHP was not immediately available to comment.
    
    
    
    Escondida's union stunned the copper market in 2011 by
staging a two-week strike, sending the mine's output tumbling
and raising the specter of an increase in labor action. 
    Workers at the giant Chuquicamata mine, owned by Chile's
state-run copper firm Codelco, said in December they
had accepted a wage offer, soothing fears of labor unrest. Chile
is the world's leading copper producer. 
    BHP and Rio Tinto , which owns 30 percent of
Escondida, have approved plans for a $4.5 billion expansion of
the mine to boost output.

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