The four-month strike at Newmont’s Peñasquito mine, in Mexico, is officially over, but it will take several weeks for the mining operation to ramp up to stable production levels, the US-based gold major said on Monday.
The company stated that its priority was to safely return the workforce to Peñasquito and that it would provide a status update next week during its third-quarter earnings call. “This unnecessary strike has caused significant hardship for all of our employees, contractors, host communities, suppliers and customers,” said president and CEO Tom Palmer. “We will continue to honour our commitments, comply with the law and the collective bargaining agreement, and work to protect the long-term value of Peñasquito.”
Newmont and the National Union of Mine, Metal and Allied Workers submitted their agreement to the Mexican Labour Court on October 13, officially ending the strike that started on June 7 over demands for additional profit sharing. Newmont said that, in terms of the agreement reached with the union last week, the miner would not pay any additional incremental profit sharing for 2022. Also, as a consequence of the strike, if the Peñasquito mine reports no profit in 2023, then Newmont will pay an additional bonus in the second quarter next year, equivalent to two months’ wages as the company recognises the hardship employees have experienced given the duration of the strike.
Newmont will also pay employees a fixed amount, roughly equivalent to 60% of wages lost, since the strike began on June 7. This payment is intended to mitigate the financial impact that the strike has had on the workforce. In addition, as part of the separate, yearly, wage negotiations under the collective bargaining agreement, Newmont and the union have agreed to an 8% wage increase, in line with Mexican mining industry wage increases for 2023. These wage negotiations are not part of the union’s claims as grounds for taking the strike action.
