About 200 union members at South32's Worsley Alumina refinery in Western Australia began a 48-hour stoppage on November 10, seeking firmer protection for pay and conditions before Alcoa completes its acquisition of the company's aluminium assets. The action by members of the Electrical Trades Union (ETU) and the Australian Manufacturing Workers' Union (AMWU) coincides with a scheduled shutdown of the refinery's main processing plant.
AMWU state secretary Steve McCartney said the workforce wants existing earnings secured through the ownership change rather than an increase in pay. The unions have framed the dispute as a question of continuity, not of new entitlements.
Incentive payments remain the sticking point
Short-term incentive payments form a significant part of remuneration at Worsley, with workers receiving an average bonus of 10 per cent over the past five years, according to McCartney. The unions want those payments written into the enterprise agreement so they survive the transition.
McCartney said South32 has referred to incentive payments when discussing employees' overall remuneration but has not provided a binding guarantee to protect those earnings. He said the request was for the continuation of benefits workers had consistently received, not for higher payments.
Working hours differ between the two workforces
Differences in hours and employment conditions between South32 and Alcoa employees performing comparable roles have also become a point of contention. 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 across four 10-hour days.
Woodage argued that these differences would come under greater scrutiny as the two companies move towards combining their aluminium operations, and that employees want an agreement recognising their skills, contributions and role in the business.
South32 says talks are constructive
South32 said it was engaging constructively with employees and their representatives during enterprise agreement negotiations. The company maintained that Worsley employees receive benefits beyond their base wages and that its existing short-term incentive policy would continue after the transaction is completed. It also said plans were in place to maintain operations at Worsley Alumina during the industrial action and that it did not expect the stoppage to affect production.
What the Alcoa transaction covers
The dispute comes as Alcoa prepares to take over a substantial part of South32's aluminium value chain in a deal with an implied enterprise value of up to USD 5.6 billion, announced in July 2026. The package includes:
- South32's 86 per cent interest in Worsley Alumina in Western Australia;
- 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, approximately USD 1 billion in newly issued Alcoa shares, around USD 750 million in net debt and lease liabilities assumed by Alcoa, and up to USD 750 million in contingent cash payments linked to agreed alumina and aluminium price targets through 2030. Alcoa will also assume rehabilitation provisions estimated at about USD 1.2 billion, which sit outside the enterprise value.
South32 intends to distribute roughly half of the Alcoa shares it receives, worth around USD 500 million at the time of announcement, to eligible shareholders as a fully franked special dividend after completion. Mozal Aluminium in Mozambique is excluded and remains with South32 under care and maintenance. Completion is targeted for June 29, 2027, subject to regulatory and other closing conditions, and South32 shareholders approved the transaction on October 15, 2026.
Worsley's place in the enlarged portfolio
The Worsley refinery has an annual alumina production capacity of about 4.4 million tonnes. According to Wood Mackenzie, the acquisition would lift 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 approximately 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 once completed.
Against that backdrop, securing experienced staff and keeping operations stable at Worsley will matter as Alcoa prepares to absorb the assets, and the outcome of the enterprise agreement talks could shape employment conditions at one of the key facilities in the transaction.