Peru Unions Accuse Southern Copper of Wage Intransigence

LIMA, Aug 23, 2010 (Dow Jones Commodities News via Comtex) –

Workers at Peru's Southern Copper Corp.'s (SCCO, SCCO.VL) are accusing the company of "intransigence" and systematically sabotaging wage negotiations.

A union statement published in newspaper La Republica Sunday called the company's 2010 wage increase offer of 128 soles ($46.00) per month per worker "miserable."

A union spokesman said Monday the PEN128 offer represented a 5% wage increase, while the union was looking for a minimum increase of 8%. The statement also accuses Southern Copper, which owns mines in Peru and Mexico and is controlled by Grupo Mexico (GMEXICO.MX), of being "high-handed and undemocratic," and of ignoring solutions proposed by the unions.

In the statement, the unions request that future wage negotiations be held in Lima with a team of conciliation experts in conjunction with the Labor Ministry.

If this doesn't happen, the statement suggests workers may strike, saying they will take "legitimate means" to defend their rights

The last strike at Southern Copper, also over wage negotiations, was in July 2007, the union spokesperson said.

A Southern Copper spokesman said the company was waiting for a response from its human resources department before issuing a comment on the statement.

Southern Copper is aiming to sharply boost copper output with a large-scale expansion program currently underway. This year's production, however, could be slightly less than the 500,000 tons it produced last year due to lower grade ore at some mines, the company said recently.

Peru is the world's second largest producer of copper.