BHP Billiton, Escondida workers far apart one week into strike

By Gram Slattery and Fabian Cambero

SANTIAGO/ANTOFAGASTA (Other OTC: ANFGF - news) , Feb 16 (Reuters) - The positions of BHP Billiton (NYSE: BBL - news) and the striking union at its Escondida copper mine in Chile (Stuttgart: 704599.SG - news) , the world's largest, remain distant even as the two parties agreed this week to return to the table.

Escondida's 2,500-member union officially walked off the job on Feb. 9 after contract talks with the company ended in failure. Copper prices then spiked to 20-month highs on supply concerns.

The rally cooled on news Tuesday that the parties had agreed to meet to see if talks could be restarted.

But the proposals of the company remain far from those of the workers, union spokesman Carlos Allendes told reporters in Santiago on Thursday, after meeting with Chile's labor minister.

BHP declined to comment on the union spokesman's remarks.

Allendes said the union had three non-negotiable demands and were prepared for a long fight should those demands not be met.

"These three points are basic for us, they're very, very fundamental," he said.

First (Other OTC: FSTC - news) , workers demand that every miner be offered the same benefits package. The union has said that BHP is offering new employees benefits that are less generous than those already at Escondida, which workers see as a ploy to undermine a new labor code going into effect in Chile in April.

Second, the two sides are in disagreement as to whether shift patterns should be changed.

Third, workers are demanding that the company not reduce any benefits, such as vacation and healthcare, which are in the previous contract signed four years ago.

And the two sides will also need to address the thorny issue of the one-time bonus typically given to miners when labor contracts are renegotiated in Chile.

In 2013, when copper prices were significantly higher, the company paid out a bonus of $49,000 per miner, the highest ever in Chilean mining.

In current talks, the workers have been asking for $38,000 - more than in 2013, in local currency terms. But the company is offering just $12,000.

The union, however, says the size of the bonus remains a relatively distant issue.

"We haven't even negotiated that," Allendes told reporters. "We haven't even come close to considering it."

BHP has repeatedly said that its offer maintains the current salary structure and benefits for workers with existing contracts, and includes some new benefits.

Escondida, majority-controlled by BHP with minority participations by Rio Tinto (Hanover: CRA1.HA - news) and Japanese companies including Mitsubishi Corp (LSE: 7035.L - news) , produced about 5 percent of the world's copper last year. (Reporting by Fabian Cambero and Gram Slattery, Editing by Rosalba O'Brien and Grant McCool)