BHP, the global mining company, is reportedly reducing short-term incentives for all employees by 20 per cent for the 2023-24 fiscal year. As reported by the Australian Financial Review on 4 July, the reduction comes in response to BHP failing to meet its internal performance targets.
The company’s management attributed the incentive cuts to unmet cost and production goals in certain divisions, as well as a tragic incident in January at the Saraji coal mine in Queensland, where a worker lost their life.
As part of its cost-cutting measures, the company has also disbanded certain global corporate teams.
This is not the first time BHP has trimmed employee incentives globally. In 2019, the company also reduced them by 20 per cent following several operational mishaps, including a train derailment in Western Australia in November 2018 and a fatality at the Saraji coal mine a month later.
Then-CEO Andrew Mackenzie saw his annual pay shrink by nearly a quarter by the end of 2019 due to additional issues, including equipment failures at the Olympic Dam in South Australia and the Escondida mine in Chile.
Last year, Mike Henry, CEO pledged to enhance safety measures across all operations following further fatalities.
In February, BHP reported that profits for the first half of the year were impacted by a $2.5 billion impairment charge related to its nickel business in Western Australia and an additional $3.2 billion in payments connected to the Samarco dam disaster in Brazil.
