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February 25, 2009
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The Kilusang Mayo Uno-Cordillera and its affiliate, the Lepanto Employees Union-NAFLU-KMU strongly criticize and oppose the anti-worker policies of the Lepanto Consolidated Mining Company (LCMC) that persecutes the workers through unfair labor practices, gross violation of the Collective Bargaining Agreement (CBA) and union busting.

By employing temporary closure, reduction of workdays to 15 days for the underground workers and 20 days per month for the surface workers; forced retirement, delayed and partial wages and non-remittance of social benefit contributions, the LCMC management clearly violated workers' rights to security of tenure, social benefits, their signed CBA and a trend to subsequently bust the unions.
In a drastic action, LCMC showed its cruel and merciless nature. On October 2008, it temporarily closed the operations of the Diamond Drilling Company of the Philippines, the Shipside, Inc., and the Paramina, all subsidiaries of the company leaving some 300 workers jobless and their families hungry.

Stealing workers' social benefits

The company had been stealing the workers contributions to the Social Security System (SSS), PhilHealth and the Pag-ibig, payment of other loans and some of their monetary and non-monetary benefits. The company had been regularly deducting these contributions from the workers' payroll and not remitting the same to the concerned agencies. This had been going on for two years now.

LCMC still has to remit some P52,220,509.43 for premiums and loan payments to the SSS and P 3.4 million un-remitted to PAG-IBIG since April 2007 and others for Pag-ibig and coop loan payments. Moreover, the company has to pay back wages retroactive to November 2007 after the 24TH CBA was concluded on March 8, 2008.

Infringing agreement

Aiming to foster industrial peace, the LEU-NAFLU-KMU, the LSFU-NAFLU-KMU and The Lepanto Local Staff Union (LLoSU) signed a MOA wherein the company promised to pay its financial obligations to concerned agencies for its workers' social benefits. The management failed to comply to the terms of the memorandum of agreement it signed with at least three labor unions inside its operations. This shows their insincerity and hypocrisy. The MOA was signed on July 2008 at the office of the National Conciliation and Mediation Board of the Department of Labor and Employment - Cordillera Administrative Region (NCMB-DOLE-CAR).

Losing income yet aggressively expanding

The company, unofficially, is claiming that it is losing. But the following data and workers' accounts say otherwise.

1. From Lepanto's annual report, they have retained earnings of P1.096 billion for 2007 and another P736.138 million for the second quarter of 2008;

2. The company lately signed a memorandum of understanding with Zijin Mining Group of Company, Ltd for the immediate development and operation of the Far Southeast Project, a deep-seated gold-copper porphyry located in Mankayan, Benguet. Zijin is one of the biggest gold producers in China;

3. Another significant development is the reopening of the Enargite mine on order to achieve the copper flotation plant's full capacity of 3,500 tonnes per day;

4. Contrary to LCMCs claim, there is actually a continuing increase of gold and metal prices at the international market. Early this year, gold price rose to $695.39/oz from last year's $603.73.oz. Gold prices have reached unprecedented levels this year even breaching the US1000/ounce mark;

5. Lepanto is aggressively expanding northward, southward, westward and eastward from Benguet to its outside. It has expansion applications, approved, at Cervantes, Ilocos Sur; Bakun, Kibungan, Atok, Kabayan, Bokod in Benguet; Tinoc, Hungduan, and Asipulo in Ifugao; Kayapa and Bambang in Nueva Vizcaya ; Bauko, Tadian,Sagada, Sabangan, Bontoc, and Sadanga in Mountain Province; Tubo in Abra; and Calanasan, Kabugao, Pudtol, and Luna in Apayao;

6. Its subsidiaries Far Southeast Project, Shipside, Inc., and Diamond Drilling Company of the Philippines have their respective expansion areas in Benguet, Ilocos and Mt. Province; and

7. Underground workers claim that operation of some high-grade ore veins were closed down temporarily in order to find other more gold or copper porphyries. In this way, it will appear that there is a low production outcome.

While maintaining sufficient production for its operational costs, Lepanto is now focused on developing other sites preserving high-grade areas for later production to mask the truth and to justify their claim of low production.
Seemingly, Lepanto's income from production is low because it requires the acquisition of additional underground equipment for the development of more gold/copper areas in its expansion areas.

LCMC's anti-worker policies are clear attempts to repress workers rights and demolish the militant labor movement. We appeal to the public to support the Lepanto workers' struggle for just wages, security of tenure, and right to organize. Lepanto must be held accountable for its injustices and violation of economic rights.

Kilusang Mayo Uno-Cordillera


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