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R55m and counting: The cost of the South Deep strike as NUM rejects offer - City Press

Thursday, 22 November 2018

The National Union of Mineworkers has rejected proposals made by the management of the loss-making South Deep gold mine, in an attempt to end a strike at the operation that has lasted almost three weeks.

In a letter addressed to South Deep staff on Wednesday, Martin Preece, the head of Gold Fields’ local operations, and Benford Mokoatle, South Deep’s manager, said that they were “extremely disappointed” that the union had rejected their proposal. City Press has a copy of the note.

NUM branch secretary at South Deep, Thulani Mashibini, said the key reason why the union had rejected the mine’s proposals was because there had been no movement by the company on the level of retrenchments.

“They are sticking to the retrenchments of 1084 – that is a problem,” he added. The strike would continue as long as there was no movement on that front, Mashibini said.

Preece and Mokoatle said that the striking South Deep employees had lost almost R55 million in wages and earnings. South Deep is located west of Johannesburg.

In a statement on Thursday, Gold Fields, which owns the mine, said that the mine had been losing R6 million a day since the strike started.

“There is nothing to gain in this strike – the company is not in a position to reverse the decision to proceed with the retrenchments,” Preece and Mokoatle said.

On August 14, South Deep announced it was looking to cut up to 1560 jobs as a result of continuing losses.

Gold Fields chief executive Nick Holland said in a statement issued on Thursday that: “There is nothing to gain in this strike – the company is not in a position to reserve the retrenchments, which are a critical component of the restructuring of the mine and essential to save the remaining 3500 jobs. The strike therefore benefits nobody and only places South Deep at greater risk.”

“The impact of the decision to reject the proposed settlement terms for our employees is devastating. In addition to the fact that their jobs could now also be placed in potentially further jeopardy, they will continue to incur financial loss as the strike drags on,” Preece and Mokoatle said.

The South Deep mine proposed the following, according to Preece and Mokoatle’s note:

  • That NUM call off the strike;
  • The no work, no pay principle will still apply. However, the deduction relating to the period that employees did not work will be spread over a four-month period;
  • No change to the number of 1084 employees who will be retrenched;
  • All employees subject to retrenchment or voluntary severance packages would get an extra once-off payment equal to four weeks of salary;
  • The number of NUM full-time shop stewards and health and safety representatives should be reduced from 24 to a maximum of eight;
  • The recognition and other agreements between the NUM and South Deep should be re-negotiated;
  • The NUM and South Deep mine management will embark on a “relationship building by objective exercise”; and
  • A full operational and financial review of South Deep would be conducted.

Gold Fields has invested R32 billion, including the acquisition price of R22 billion, since acquiring South Deep.

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