* Freeport union demands 40 pct pay hike over two years
* Management says pay on offer beats Indonesian industry
* Union says deadline for pay talks extended to Oct. 4
By Yayat Supriatna
JAKARTA, Sept 20 Pay talks at Freeport-McMoRan
Copper & Gold Inc's Indonesian unit have stalled but a
deadline for an end to negotiations has been extended, a union
official said on Thursday, easing the threat of any immediate
Pay negotiations between workers and management at
Freeport's remote Grasberg mine in Papua, the world's
second-biggest copper mine, resumed in late June after being
suspended in May when a tunnel collapse killed 28 people.
"Freeport only offered us a quarter of the pay rise that we
are demanding," Juli Parorrongan, spokesman for workers' unions,
told Reuters, after talks this week involving Freeport Indonesia
CEO Rozik Soetjipto and Freeport CEO Richard Adkerson.
"Workers cannot accept the offer because it is considered
too low," said Parorrongan, adding that workers were pushing for
a 40 percent pay increase over two years or two annual 20
Relations between Freeport and unions have been strained in
recent years following a three-month strike in late 2011, May's
deadly tunnel collapse and a series of minor spats.
Freeport unions agreed a deal for a 37 percent pay rise over
two years in late 2011, after initially pushing for a pay rise
to as much as $200 an hour compared with a pay rate at the time
of $2-$3 an hour.
Under the current wage agreement, which is due to end on
Sept. 30, the majority of workers are paid 4.6 million rupiah to
7.7 million rupiah ($410-$680) a month, said Parorrongan on
Freeport Indonesia employs about 24,000 workers, including
contractors and staff. About three-quarters are union members.
Talks on a new pay deal had been expected to last up to 60
days, and Parorrongan said a new deadline of Oct. 4 had been set
for talks to conclude.
"Within the context of the challenging financial condition
of the company and the current global drop of commodity price
market for copper and gold, we believe that the management's
offering is competitive compared with the industry in
Indonesia," Freeport Indonesia spokeswoman Daisy Primayanti said
in an email.
The management's offer, if accepted, would mean that
Freeport Indonesia workers would be earning more than their
counterparts in the same industry in Indonesia, Primayanti
The Arizona-based miner reported a 32 percent drop in
second-quarter earnings in July on weak metal prices and higher
Freeport unions had yet to decide what action to take if no
agreement was reached by the new deadline, Parorrongan said.