Workers 'betrayed' as Gujarat sheds 90 jobs

Hundreds of Illawarra mine workers endured weeks without pay this year as they tried to save their ailing employer and hang on to their jobs.

But, just as some families were getting back on track after months of financial strain, Gujarat NRE Coking Coal employees have been told the company needs to shed 20 per cent of its workforce by January.

Chairman Jasbir Singh announced a "workforce restructure" on Wednesday, saying about 90 job losses would come mostly from voluntary redundancies.

Union talks down effect of Gujarat job cuts

He said the company would "make every effort to keep forced redundancies to an absolute minimum".

"Coming on top of the recent turmoil with employees' wages and the fight to keep the mines operational, this is a bitter blow but one that is necessary for the sustainability of the mining operations into the future," Mr Singh said.

One worker said he and his colleagues felt betrayed when they were told the news.

"A lot of people do feel betrayed after the work we've done to help the company, but some people are just so well and truly fed up with the situation that they'll be glad to get out of there," he said.

"There's a few blokes who are just going to take the money and get out, because they've had a gutful.

"But there are others who know that, quite simply, if they walk out the door there are no other jobs in Wollongong.

"And that means they're either going to have to pack their families up and leave, or leave their families here and work interstate doing fly-in fly-out."

Workers will have until December 23 to apply for voluntary redundancies, before the company finalises the payouts on January 10.

Redundant workers will leave the mines by January 17.

Under former chairman Arun Jagatramka, Gujarat NRE did not pay wages for almost two months from September 18 and failed to make superannuation payments from March, causing some families to turn to charity or union hardship funds for food and petrol vouchers.

Despite these weeks of hardship, the worker said morale hit a new low at the Wongawilli and Russell Vale mines yesterday.

"It's not looking very promising and everyone is way back down in the dumps," the worker said.

"It's just becoming obvious that the last owner left the place in such a shemozzle ... this new mob is very unlikely to be able to keep it open.

"This is the nail in the coffin, and I think it's distinctly possible that this place could close in the next six months."

Since Mr Singh's employer, Indian steel producer Jindal Steel, bought majority control in the struggling Illawarra miner in October for $68 million, it has poured an extra $58 million into the company in an effort to pay back some of its debt.

However, Mr Singh said production costs, global markets and delayed expansion approvals meant "significant operational changes" were now necessary.

Also on Wednesday, Gujarat NRE announced to the stock exchange that it would extend its offer of new shares until January 10, which coincides with the date the company is expected to make redundancy offers.

It is hoped the deal, which allows shareholders to buy the stocks for every two they already hold, will raise an extra $50 million to pay creditors and keep the mines running.

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