Earlier this month, the company announced a change from an eight-days-on, six-days-off cycle to the traditional pre-boom roster of two weeks on, one week off.
It is understood equipment operators and truck drivers at the Christmas Creek and Cloudbreak mines were informed of redundancies on Tuesday morning.
“Fortescue is very upset by the impact of these changes on some of our people which are due to circumstances beyond our control,” an FMG spokesman said.
“We have communicated with our workforce consistently since the roster change decision was announced two weeks ago.”
FMG has made a range of support services available to those impacted, including chaplaincy and counselling support, and outplacement services.
Earlier this month, FMG CEO Nev Power refused to confirm how many jobs would be cut, but it’s understood the redundancies are the first in a series due to the roster changes.
The final figure is likely to be several hundred, though the company will explore the possibility of redeployments where possible.
“As we transition to our new operational roster, which will bring our rosters into line with the standard rosters worked in the Pilbara iron ore industry, we are working through changes to our organisational structure across our sites,” the spokesman said.
“As part of this process, all opportunities for internal transfers are being fully explored.”
FMG took the steps to reduce costs in the wake of a slump in the iron ore price.
Iron ore fell as low as $US47.08 per tonne earlier this month, but has rebounded to near-$60/t.
FMG said the roster changes would help it achieve a C1 cost of $18/t for the 2016 financial year and a breakeven cost of $39/t.
UBS initially estimated a breakeven cost of $44/t, but since lifted that figure to $45/t, due to interest costs associated with FMG’s expensive debt refinancing last week.
The refinancing, coupled with a rally in the iron ore price, has seen FMG shares rise as much as 35% over three sessions in the past week.
FMG shares were trading at $A2.19 today.
