More than 8,000 Glencore coal workers will be forced to take annual leave as the mining giant shuts down its Australian coal operations due to an oversupply of the commodity.

Glencore will shut down all of its 20 coal mines across NSW and Queensland from mid-December, cutting production by five million tonnes.

Annual leave will be imposed on employees over the Christmas period, and leave will be brought forward for those employees who have low holiday balances.

Hundreds of employees who conduct critical maintenance will be unaffected by the shutdown.

Glencore said the move was driven by the current oversupply of coal, which has hurt prices.

“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,” it said in a statement.

All of the commodity giant’s coal operations remain under review after two years of cost cutting.

The company acknowledges the shutdown is unlikely to affect global prices.

It is unable to rule out future shutdowns if coal prices remain weak, but is confident demand for coal will grow and the oversupply would be addressed over the medium term.

“We remain confident in demand growth for our products and believe that the supply and demand balance will be restored in the medium term,” Glencore said.

The global seaborne coal market is more than one billion tonnes, and spot prices for thermal coal have more than halved to around $US60 per tonne since 2011.

Glencore plans to continue shipping coal to meet its existing sale requirements.

The company owns 20 coal mines at 13 mine complexes across NSW and Queensland, which produced more than 80 million tonnes of thermal and coking coal in 2013 and employed around 8,600 people.

CFMEU mining and energy Queensland president Stephen Smyth said workers were surprised by the decision, particularly casual staff.

“The other unfortunate thing is all the labour hire employees at the mine, those poor bastards won’t get any money,” he said.

“That’s the nature of the role they’re in, that’s why employers like them – they can just turn them off for three weeks and put them on the dole line for three weeks.”

Mr Smyth said he hoped full-time workers with low leave balances would be allowed to work in a maintenance capacity.