Union members at South32's Worsley Alumina refinery in Western Australia began a 48-hour stoppage on Nov. 10, seeking binding protection for pay and conditions before Alcoa's planned acquisition of South32's aluminium assets.
The action by Electrical Trades Union and Australian Manufacturing Workers' Union members coincides with a scheduled shutdown at the refinery's main processing plant. AMWU state secretary Steve McCartney said around 200 union members are employed at Worsley. Workers want existing earnings protected before ownership changes.
Incentive payments at center of dispute
Short-term incentive payments are a key issue. McCartney said Worsley workers have received an average bonus of 10% over the past five years and want the payments secured in their enterprise agreement. The union says South32 has cited incentive payments when discussing overall remuneration but has not provided a binding guarantee. McCartney said the request is not for higher pay but for continuation of benefits workers have consistently received.
Working hours and conditions also differ between South32 and Alcoa employees in comparable roles. ETU WA secretary Adam Woodage said Alcoa's shift and day workers have a 36-hour week, compared with 42 hours for Worsley shift workers. South32's day workers complete 40 hours over four 10-hour days. Woodage said these differences would face greater scrutiny as the companies combine aluminium operations, and employees want an agreement that recognizes their skills, contributions and role.
Company response and deal structure
South32 said it is engaging constructively with employees and representatives during enterprise agreement negotiations. It said Worsley employees receive benefits beyond base wages and that its existing short-term incentive policy would continue after the transaction. The company also said plans are in place to maintain operations during the industrial action and it does not expect the stoppage to affect production.
Alcoa's acquisition, announced in July 2026, has an implied enterprise value of up to USD 5.6 billion. It covers South32's 86% interest in Worsley Alumina, full ownership of the Hillside Aluminium smelter in South Africa, 33% of the Mineração Rio do Norte bauxite mine in Brazil, 36% of the Brazil Alumina refinery and 40% of the Brazil Aluminium smelter. Consideration includes USD 3.1 billion in cash, about USD 1 billion in newly issued Alcoa shares, around USD 750 million in assumed net debt and lease liabilities, and up to USD 750 million in contingent cash payments tied to alumina and aluminium price targets through 2030. Alcoa will also assume rehabilitation provisions estimated at about USD 1.2 billion, separate from the implied enterprise value.
South32 plans to distribute roughly half of the Alcoa shares it receives, worth about USD 500 million at the time of announcement, to eligible shareholders through a fully franked special dividend after completion. Mozal Aluminium in Mozambique is excluded and remains under South32 ownership on care and maintenance. Completion is targeted for June 29, 2027, subject to regulatory and closing conditions. South32 shareholders approved the transaction on Oct. 15, 2026.
Worsley's role in the expanded portfolio
Worsley has annual alumina production capacity of about 4.4 million tonnes. Wood Mackenzie estimates the acquisition would raise Alcoa's attributable bauxite production by 53.6% to nearly 53 million tonnes annually, attributable alumina production by 51.6%, and aluminium smelting capacity by around 26%. Alcoa expects about USD 900 million in net present value from operational synergies, including better integration between Worsley and its existing Western Australian operations. The expanded portfolio is expected to produce about 14.8 million tonnes of alumina and 3.2 million tonnes of aluminium annually after completion.
Securing experienced employees and maintaining stable operations at Worsley will remain important as Alcoa integrates the acquired assets. The outcome of the enterprise agreement negotiations could shape employment conditions at one of the key facilities in the proposed acquisition.