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Gold Fields' South Deep mine has lost R178m in revenue since the strike by the National Union of Mineworkers started nearly four weeks ago, and workers have missed out on more than R56m in wages, due to the no-work, no-pay principle, according to company data.
The NUM downed tools on November 2 against retrenchments of 1 100 permanent employees and 460 contractors at the loss-making South Deep mine, in Westonaria, West of Johannesburg.
So far, 171 staff members have taken up voluntary severance packages (VSPs) and retrenchment payments will be paid out to the remaining 911 employees.
South Deep is the world's second largest gold-bearing ore mine, but has been unprofitable for a decade, due to deep deposits and rising costs.
In a letter to staff on Wednesday, Gold Fields' executive vice president for South Africa, Martin Preece, and Head of Operations, Benford Mokoatle, said a draft proposal they had worked on with NUM leadership – to end the strike and increase severance and retrenchment packages – had been rejected.
According to the draft proposal, the strike would have been immediately called off by NUM and the deductions for the no-work, no-pay principle for the three weeks of industrial action would have been spread across four months.
Preece and Mokoatle said the retrenchments were irreversible, as cost-cutting measures had to be implemented to save the remaining 3 500 positions.
Instead, they suggested that all retrenchment employees, including VSPs, would receive an additional once-off payment of four weeks' salary.
Under the proposed agreement, the number of full-time NUM shop stewards and health and safety representatives would have been cut from 24 to 8.
"The Company unfortunately now finds itself in a position where it has to process retrenchment payments, without the additional once-off payment included (as per the settlement proposal) and the full impact of no-work no-pay being applied for the November 2018 pay month," wrote Preece and Mokoatle.
NUM branch secretary at South Deep Thulani Mashibini told Fin24 the union rejected the proposal, as the company had not reduced the number of retrenchments or "engaged meaningfully" on the proposals to avert job losses they had put forward, during the two-month consultation period.
He acknowledged that employees were losing out on pay for every day the strike continued, and said the NUM was committed to meeting Gold Fields to try to negotiate an end before the festive season.
The beleaguered mining sector is facing several separate strike actions. The Association of Mineworkers and Construction Union (AMCU) embarked on a wage strike at Sibanye-Stillwater 's gold operations on Wednesday night, and the company will apply for a court interdict following one miner being killed and several others wounded, allegedly during strike-related violence.
AMCU has also threatened to down tools at platinum operations Sibanye is involved in – Anglo American Platinum mines in Rustenburg and Lonmin, which the precious metal company is planning to acquire.