Union members at South32's Worsley Alumina refinery in Western Australia began a 48-hour stoppage on November 10, seeking binding protection for pay and conditions before Alcoa's planned acquisition of South32's aluminium assets. The action involves members of the Electrical Trades Union and the Australian Manufacturing Workers' Union and coincides with a scheduled shutdown of the refinery's main processing plant. About 200 union members are employed at Worsley, according to AMWU state secretary Steve McCartney.
McCartney said the workers want their existing earnings protected through an enterprise agreement. Short-term incentive payments are a central issue: he said Worsley employees have received an average bonus of 10 per cent over the past five years and want those payments secured in the agreement. The union argues that South32 has referred to incentive payments when discussing overall remuneration but has not provided a binding guarantee. McCartney said the request is not for higher payments but for continuation of benefits workers have consistently received.
Working-hours gap adds to dispute
Differences in working hours have also become contentious. ETU WA secretary Adam Woodage said Alcoa's shift and day workers have a 36-hour working week, compared with 42 hours for shift workers at Worsley, while South32's day workers complete 40 hours over four 10-hour days. Woodage said those differences would face greater scrutiny as the companies move toward combining their aluminium operations, and that employees want an agreement recognising their skills, contributions and role in the business.
South32 said it is engaging constructively with employees and their representatives during enterprise agreement negotiations. The company said Worsley employees receive benefits beyond base wages and that its existing short-term incentive policy would continue after the transaction is completed. It also said it has plans to maintain operations at Worsley during the industrial action and does not expect the stoppage to affect production.
Alcoa deal covers alumina and aluminium assets
Alcoa's transaction, announced in July 2026, has an implied enterprise value of up to USD 5.6 billion. It covers South32's 86 per cent interest in Worsley Alumina, full ownership of the Hillside Aluminium smelter in South Africa, a 33 per cent interest in Brazil's Mineração Rio do Norte bauxite mine, a 36 per cent interest in the Brazil Alumina refinery and a 40 per cent interest in the Brazil Aluminium smelter.
The implied enterprise value comprises USD 3.1 billion in cash, about USD 1 billion in newly issued Alcoa shares, around USD 750 million in net debt and lease liabilities to be assumed by Alcoa, and up to USD 750 million in contingent cash payments tied to agreed alumina and aluminium price targets through 2030. Alcoa will also assume rehabilitation provisions associated with the acquired assets, estimated at about USD 1.2 billion, separate from the implied enterprise value. South32 intends to distribute approximately half of the Alcoa shares it receives, worth around USD 500 million at the time of announcement, to eligible shareholders through a fully franked special dividend after completion. The deal excludes Mozal Aluminium in Mozambique, which remains under South32 ownership and on care and maintenance. Completion is targeted for June 29, 2027, subject to regulatory and other closing conditions; South32 shareholders approved the transaction on October 15, 2026.
Worsley's role in the expanded portfolio
Worsley has an annual alumina production capacity of about 4.4 million tonnes. Wood Mackenzie estimates that the acquisition will raise Alcoa's attributable bauxite production by 53.6 per cent to nearly 53 million tonnes a year and attributable alumina production by 51.6 per cent, while increasing aluminium smelting capacity by around 26 per cent. Alcoa expects the deal to generate about USD 900 million in net present value through 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 workers and stable operations at Worsley will remain important as Alcoa prepares to integrate the acquired assets. The outcome of the enterprise agreement negotiations could therefore shape employment conditions at a key facility in the proposed acquisition.