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War of words as Gwede Mantashe accuses Gold Fields of bad faith in strike - BusinessLIVE

Tuesday, 27 November 2018

The producer offers a better retrenchment deal for 1,500 South Deep workers and gives union NUM until end of week to accept

A war of words has broken out between mineral resources minister Gwede Mantashe and Gold Fields over the antiretrenchment strike at South Deep that has halted the mine for nearly a month with a loss of R70m in unpaid wages.

With no sign of an end to the impasse between Gold Fields and the National Union of Mineworkers (NUM) over the company's plan to  retrench 1,500 employees at the perennially unprofitable mine, Mantashe, a former general secretary of the union, has intervened.

Mantashe, who is also the chairman of the ANC, accused Gold Fields of acting in bad faith and merely going through the motions in the process.

“We don’t believe the company is acting in good faith. They have merely engaged in a tick-box exercise for compliance purposes. This is a disturbing approach, and we remain unhappy with the way the process has unfolded thus far,” he said after meeting management and CEO Nick Holland on Monday night.

“We continue to urge employers in the sector to be responsible, as we are dealing with people’s lives when we talk of possible retrenchments, and not mere numbers,” Mantashe said.

South Deep, the last mine Gold Fields operates in SA, was running up expenses of R6m a day after it was shut down on November 2 when the strike started and quickly turned violent as the union stood accused of intimidating nonmembers into staying away.

The mine, which Holland said was losing R100m a month, had already consumed R32bn to buy and reconfigure after buying it in 2006. Gold Fields has tried various strategies and plans to make the 3km-deep mechanised mine profitable, without success.

“The company understands and is sensitive to the impact on families and communities of job losses due to the restructuring. That is why the retrenchments currently being carried out were the last resort following many interventions over a long period,” said Holland.

“Gold Fields believe that it has acted in utmost good faith through these difficult months.”

Gold Fields had offered to improve the severance deal by a further four weeks’ worth of salary and access to a R10m skills-development fund. The union had until the end of the week to accept it and call off the strike, said Holland.

Earlier promises of production topping 800,000oz a year have been steadily eroded to about 350,000oz, and even that is now in doubt.

Holland has referred to 2018 as a “write-off” for the mine and the business imperative of restructuring the mine to fit a new, lower production model that can make money with a 3,500-strong workforce.

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