Kensington Mine cuts 20% of pay for some hourly employees, citing financial woes

A manager walks past Kensington Gold Mine’s Elmira deposit on Oct. 15, 2019. It’s one of the areas Coeur Alaska is currently exploring. (Jacob Resneck/CoastAlaska)

Kensington Mine recently cut pay by 20% for all of its hourly employees hired before 2016, according to a memo obtained by KTOO.

The gold mine is owned by Coeur Alaska and is about 45 miles northwest of Juneau, near Berners Bay. It’s only accessible by air or water. 

In the memo, which was sent in early January, the mine’s general manager Steve Ball wrote that the amount of pay that would be cut beginning on Jan. 21 was originally offered as a premium, and it was not supposed to last forever. The memo said the premium was introduced back in 2016 as “short-term financial relief.”

The memo said that, moving forward, all hourly employees would be paid the same amount for the same job, regardless of their hire date. 

Kensington began commercial production in 2010. Now, with about 400 employees, the company is the second largest private employer in the City and Borough of Juneau.

The company did not answer KTOO’s questions about how many employees would be affected and what financial impact the premium has had on the mine. Rochelle Lindley, the mine’s community and government affairs manager, provided a statement from the company saying it does not comment on employee compensation matters.

According to Ball’s memo, the mine’s mill grade and overall production have dropped almost 20% over the past three years, and labor costs per employee have increased 7% in the same period. He wrote that the mine is not in a financial position to continue the premium and will struggle to remain viable long-term if it does not find ways to reduce costs.

 In 2022, the U.S. Forest Service approved a controversial expansion of the mine’s operations, which extends the life of the gold mine for at least another 10 years. 

If you are a Kensington Mine employee affected by the cut, you can reach reporter Clarise Larson here.