Peru says Cerro Verde must respect strike or pay fine

By Caroline Stauffer and Marco Aquino

LIMA (Reuters) - Government labor inspectors said Freeport-McMoRan must stop relying on volunteer workers to keep its Cerro Verde mine in Peru open during a strike or pay a fine, according to documents obtained by Reuters on Tuesday.

Workers have been on strike for 13 days and are demanding higher pay at the mine, which churned out 312,336 tonnes of copper in 2010, or about 2 percent of global supply.

"The company ... must refrain from acts that would impede the exercise of the right to strike by 1,099 workers affiliated with the Cerro Verde union organization and stop replacing the tasks of workers who are on strike," said a report from the labor ministry that was obtained by Reuters.

Labor inspectors indicated the company had reassigned jobs held by union members to other staffers to weather the strike.

Government officials confirmed that a letter signed by labor ministry officials says Cerro Verde has until Wednesday to heed the government's request or face fines of between $14,505 and $26,383.

The strike has dragged on in part because the government, for the first time in Cerro Verde's 40-year history, declared that the walkout was legal. That meant workers could stay on the picket line without fear of being fired.

Cerro Verde has said it has been "legally operating" the facility with approximately 600 personnel that volunteered to work under strike conditions since the strike began on September 29.

A spokesman for Freeport-McMoRan <FCX.N>, which is also facing a strike at its huge Grasberg mine in Indonesia, said on Tuesday it was "operating in accordance with Peruvian law with employees who have chosen to work under strike conditions."

He did not say whether the company would pay the fine.

The company maintains it has averted an impact on Peru production so far.

The government's latest action suggests leftist President Ollanta Humala is taking a more sympathetic approach to organized labor in the world's No. 2 copper producer as part of a broader push to calm social tensions over the spoils of natural resources.

Former President Alan Garcia was widely seen as putting companies before workers. His drive to secure foreign investment in mines and energy in the country's rural hinterland spurred massive protests, many from communities that felt left out of a decade-long economic boom.

Prime Minister Salomon Lerner recently told the country's foreign press club that Humala's government "has changed its attitude toward organized labor."

(Editing by Terry Wade, Andrea Evans and Jim Marshall)