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Gold Fields issues ultimatum

Oct 16 2012 17:57 Sapa

Company Data

GOLD FIELDS LIMITED [JSE:GFI]

Last traded 37.02
Change -1.48
% Change -0.04
Cumulative volume 2986543
Market cap 28.70bn

Last Updated: 31/10/2014 at 04:29. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - About 15 000 Gold Fields [JSE:GFI] workers could be fired if they did not return to work by 2pm on Thursday, company CEO Nick Holland said.

"We are now in the unfortunate position where we have exhausted all reasonable and legal alternatives," he said in a conference call on Tuesday.

"We are now left with no option but... to protect people, assets, and business."

Workers who did not return to work by the deadline faced immediate dismissal.

The ultimatum applied to illegally striking workers at Gold Field's Beatrix one, two and three shafts in the Free State, and the KDC West mine near Carletonville, Gauteng.

Workers at Beatrix one, two and three shafts started returning to work on Tuesday morning. They had been on a wildcat strike since September 24.

Holland said around 5000 people were back at work, while about 1200 workers had not reported for duty yet.

"It is too early to say if the strike is over... but we are assessing the situation and will make an announcement in due course."

Eleven-thousand workers out of a workforce of 14 300 at KDC West have been on an illegal strike since September 9.

The ultimatum did not apply to the 8500 KDC East mineworkers who went on strike on Sunday. The mine's total workforce is 12 400.

Those who returned to work by the deadline would be benefit from an agreement reached under the auspices of the Chamber of Mines "notwithstanding that the offer has expired", Holland said.

The chamber, acting on behalf of AngloGold Ashanti, Gold Fields, and Harmony, had proposed doing away with the lowest wage category to increase the industry's entry-level wage. A new category would be created for locomotive, loader, winch, and water jet operators, to improve their salaries.

Other employees would have their pay adjusted to preserve the integrity of the present job grading framework. A skills allowance for rock drill operators was also proposed. The pay of all affected employees would be increased by another two percent. On Monday workers rejected the offer.

A total of 23 540 out of 35 700 Gold Fields employees remained on strike.

Gold Fields had lost about R1.2bn in revenue and 65 000 ounces in gold production due to the strike.

The company had saved R900m in wages over the same period, Holland said.

He said Gold Fields had been left with little option but to issue the ultimatum, given the escalating violence among strikers. This included intimidation, attempted murder, and damage to property.

He said over the weekend workers ransacked a police station in Westonaria. On Monday night, a worker was pulled from a company vehicle and seriously assaulted and stabbed, while the vehicle was set alight. Security personnel who came to his rescue were shot at with live ammunition, Holland said.

The illegal strikes could put the future of Gold Fields' South African operations at risk and lead to job losses.

"Every day that the operations stand idle, further infrastructural (sic) damage takes place and working places become more unsafe, thereby requiring costly rehabilitation and time-consuming maintenance to ensure the safety of employees when normal operations resume."

Gold Fields had secured a number of court interdicts declaring the strikes illegal, but workers had ignored them.

They had also ignored a campaign asking workers to return, and opportunities to make representations on why they should not be dismissed for continuing to participate in unprotected strikes.

The company put into effect a nine to 10 percent wage increase in July 2012.
gold fields  |  nick holland  |  ultimatum  |  mining unrest
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