AGL, one of Australia’s largest electricity companies, has announced plans to cut hundreds of jobs as part of a major restructuring initiative. The purpose of this move, according to the company, is to release new capital to expedite the firm’s shift away from coal and towards renewable energies. The layoffs will hit 700 employees, including up to 300 at two coal-fired plants and eight hydroelectric sites. The layoffs are threatening to start as soon as December.
Last week, economic uncertainty grew after Rio Tinto signalled the possible closure of its Tomago aluminium smelter. This facility is one of the Washoe’s top employers, providing jobs to more than 1,000 employees. It serves as AGL’s most critical customer, too.
AGL’s Commitment to Transitioning Away from Coal
AGL’s recent decision further emphasizes the company’s willingness to focus on moving its energy portfolio away from fossil fuels and toward renewable resources. In their release, AGL focused on the need to balance continued productivity and competitiveness with new investment in initiatives of the future.
“As we transition our portfolio, and connect our customers to a sustainable future, we need to ensure that today’s business remains productive and competitive in this changing market while we continue to invest in our business for tomorrow,” – AGL.
Furthermore, the company is reviewing both labor and non-labor costs to enhance productivity and instill cost discipline throughout the organization.
“As part of this focus, we’re proposing changes to our organisational structure and reviewing both labour and non-labour costs to improve productivity and embed cost discipline across the enterprise,” – AGL.
Impact on Employment and Local Community
The potential loss of 169 downtown jobs has jolted the area’s labor community and local employees. Grahame Kelly, General Secretary of the Mining and Energy Union, pointed to the increasing anxiety among the coal-fired power station workforce. He added that it’s making all their preoccupation over the future much worse.
“Coal-fired power station workers around the country are already facing stress and uncertainty with moving timelines for closures,” – Grahame Kelly.
Kelly said the announcement of additional job cuts brings another blow to the town. These communities were already reeling from the thousands of potential job losses at the Tomago smelter.
“News that hundreds of jobs will be cut as soon as this December is a further blow,” – Grahame Kelly.
The Role of Government Support
The federal government’s newly formed Net Zero Economy Authority has developed a just transition framework that can be a guide. At the same time, alarm bells are being sounded over just how quickly energy companies are firing workers. Kelly explained why she was worried about the rapid rate. She worries that it could circumvent important retraining and redeployment requirements to help displaced workers.
“We are very concerned about energy companies fast-tracking job cuts to avoid potential retraining and redeployment obligations in future,” – Grahame Kelly.
As AGL continues down the path of its restructuring agenda, the potential impacts on employees and the Australian community are profound.
