Mining and commodities giant Glencore Xstrata said on Friday it would close its Australian coal mines for three weeks during Christmas owing to weak prices and oversupply.
The shutdown will start in mid-December and affect the company's 13 mines, which have 8,600 workers and produce more than 80 million tonnes of thermal and coking coal, across the states of New South Wales and Queensland.
"Glencore has decided to implement production shut downs across our Australian coal operations for three weeks commencing mid-December," the Swiss company said in a statement.
"This is a considered management decision given the current oversupply situation and reduces the need to push incremental sales into an already weak pricing environment.
"We remain confident in demand growth for our products and believe that the supply and demand balance will be restored in the medium term."
However, union leaders have reacted angrily as it is understood full-time staff will be required to take leave during the period. And those with low holiday balances would have to bring forward leave from next year.
It is not yet clear what pay arrangements would be put in place for casual and contract staff.
The miners' union CFMEU said Glencore did not consult workers about the shutdown and the firm could be in breach of workplace arrangements.
"It demonstrates the arrogance of management, who could have negotiated with workers to find mutually suitable ways to reduce production -– like letting workers take public holidays," CFMEU national president Tony Maher said.
Glencore said the temporary closures were expected to reduce its Australian output by about five million tonnes.
Australian thermal coal prices remain close to five-year lows as Chinese demand weakens. Prices slumped to about US$62 a tonne in October from US$120 three years ago.