Newmont subsidiary urges union to resume operations at Mexico mine

Just over a month after unionized workers started a strike at US company Newmont's Peñasquito gold mine in Mexico's Zacatecas state, forcing operations to be suspended, local subsidiary Minera Peñasquito reiterated its call for employees to resume activities and continue talks to reach a long-term solution.

On June 7, more than 2,000 members of the mining, metallurgical and steel workers union led by Napoleón Gómez Urrutia, who is also a senator representing the ruling Morena party, voted to strike, claiming that the company had committed various infringements of the collective agreement and failed to make required payments.

"We reiterate the call to resume activities and continue with transparent and constructive dialogue that translates into sustainable agreements in the long term and benefits for all," Minera Peñasquito said in a statement.

Mexico's leading gold producer, with output of 566,000oz in 2022, according to mining chamber Camimex, warned that while the Peñasquito mine has a potentially bright future in the country, this situation affects the sustainability of its operations and forces it to rethink its activities and future investments.

“The strike impacts not only next year's profits, but also the income of more than 5,000 families of employees and contractors, 25 communities in the area of influence of the mine and 28,000 indirect jobs that depend on the value chain,” it added.

Last week, the company reported that it met with union representatives but the issue of profit-sharing was still not resolved "due to unrealistic demands." It said it had informed the workers of "its dissatisfaction regarding not respecting the CCT [collective labor agreement] that they signed only a year ago.”

The mining company also claims that the calculation of the workers' share of profits (PTU) was carried out in "strict" compliance with the collective bargaining agreement and applicable laws.

“If the union disagrees with the calculation of the PTU, there is recourse with the SAT [tax administration service] other than a strike, to review and, where appropriate, challenge the calculation. At all times, the company has acted transparently and provided information that supports its position," said Peñasquito.

The company added that, on May 30, 2023, it paid all eligible employees the PTU benefit at 10% without a cap, in accordance with the CCT signed in 2022. This payment represented approximately 13 months' basic salary for each union member, it said.

Peñasquito also recalled that “in 2022 the union signed an agreement in which (i) it expressly recognized that Minera Peñasquito paid the PTU with a maximum of 3 months in accordance with the law; and (ii) in addition to that payment, it requested a single complementary bonus ('extraordinary bonus'), which was duly accounted for by the company, in accordance with the law.”

Last week, Camimex warned that the strike at Peñasquito will have a significant impact on national mining production as it is one of the largest mining companies in the country.

If the suspension at the mine is prolonged, it would also impact already-weak national mining production figures not only for June and July but for the whole of 2023.

Between January and May, Mexican mining production contracted 0.1% year-on-year, according to the most recent figures from statistics agency Inegi.