Gina asks staff to take pay cuts

Gina Rinehart has asked her employees to accept pay cuts as the lower iron ore price and high costs continue to take a bite out of the viability of her $10 billion Roy Hill project in the Pilbara.

As flagged by WestBusiness last month, Roy Hill Holdings chief executive Barry Fitzgerald has asked employees to accept pay cuts of between 5-10 per cent, with executive and senior management expected to wear the biggest reductions.

However about 50 per cent of the company’s “lower remuneration band” employees will be immune to the cuts.

Mr Fitzgerald said in exchange, the company would retain its family friendly rosters and strive to minimise future job cuts.

“Retaining as many jobs as we can for our existing employees was one of the outcomes we were looking for from our review of rosters and remuneration,” he said.

“We felt it was more important for our people to retain their job rather than pursue workforce reductions as a cost saving strategy in response to market conditions.”

Mr Fitzgerald said the resources boom had increased salaries to levels which were not sustainable in the long term.

“Reducing base salaries for existing and future employees is a prudent measure in today’s market, as it establishes a remuneration structure which supports us to remain a competitive, long-term business,” he said.

The 55 million tonne per annum Roy Hill project is now more than 85 per cent complete, with the project still scheduled to deliver first ore on ship at the end September this year. The project comprises an open cut mine, railway line and port facilities.

When in operation, Roy Hill will have a peak workforce of about 2000 people on site.

Gina Rinehart's Hancock Prospecting is the majority owner of Roy Hill Holdings, with a 70 per cent stake.

The remaining 30 per cent is held through a consortia comprising Marubeni Corporation, POSCO and China Steel Corporation