Glencore Xstrata is running the risk of conflict with unions in the Queensland coal sector, following the Swiss conglomerate's decision to alter a workplace deal for its Collinsville mine.

The resource giant decided to alter its workplace arrangements at the Queensland coal mine following its axing of Thiess as mining contractor and the conversion of the mine to in-house operation, in order to help restore the project to profitability.

Glencore Xstrata has since stated that it would continue to employ people who were “committed to our future vision for the mine,” and that “flexible workplace arrangements without restrictive work practices” would be a key part of the mines operation in future, in order to ensure its ongoing viability.

“We have no set preference for any specific type of labour agreement but any agreement must be modern, flexible and without restrictions,” said the company in a letter addressed to works.

Glencore Xstrata’s statements have already drawn censure from the Construction, Forestry, Mining and Energy Union.

Stephen Smtyh, district president of CFMEU Queensland, said that any future negotiations with mine employees regarding workplace deals would have to be done “in the usual way” if Glencore Xstrata wishes to make changes.

“The industrial regulation at the mine will not be a matter of your preference. It is a matter of law and law provides that the current agreement will apply,” Mr. Smyth said.

Industrial relations in the coal sector have worsened of late as a result of increasingly difficult market conditions, with spot prices still tepid and chief export market China entering a period of more modest growth. Glencore informed a Senate inquiry held in April that over 30 per cent of coal mines in Australia were unprofitable as a result the current economic environment.

Both BHP and Mitsubishi have seen strikes during the past several years at their joint venture coal projects in Queensland.