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Wave of wildcat strikes whips SA

Sep 26 2012 19:48 Reuters

Thousands of minerworkers have taken to the streets for better wages.. Picture: Lucky Nxumalo/City Press

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Anglo American Plat Ltd [JSE:AMS]

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Last Updated: 19/09/2014 at 04:26. Prices are delayed by 15 minutes. Source: McGregor BFA

GOLD FIELDS LIMITED [JSE:GFI]

Last traded 45.99
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Last Updated: 19/09/2014 at 04:26. Prices are delayed by 15 minutes. Source: McGregor BFA

Lonmin plc [JSE:LON]

Last traded 37.17
Change 0.37
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Market cap 21.21bn

Last Updated: 19/09/2014 at 04:26. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - An illegal strike spread through the local operations of AngloGold Ashanti [JSE:ANG] on Wednesday, while Anglo Platinum [JSE:AMS] (Amplats) said it could start firing unlawful strikers on Thursday, as the country’s miners grapple to rein in weeks of labour unrest.

A wave of wildcat action is roiling South Africa’s mines despite the end of an illegal six-week stoppage at platinum producer Lonmin [JSE:LON] in which 46 people were killed and the price of the white metal was pushed higher.

Mining shares tanked in Johannesburg on Wednesday, with Amplats extending steep losses to over 6% after its chief executive Chris Griffith described the country’s platinum sector as “in crisis”.

Most of AngloGold’s 35 000 workers have joined the wildcat action that began last week at its Kopanang mine. The company is the world’s No.3 bullion producer and South Africa accounted for about 32% of its global output of close to 2 million ounces of gold in the first half of 2012.

Illegal strike action has also gripped Gold Fields [JSE:GFI] and the world’s top platinum producer Amplats, a unit of global mining group Anglo American [JSE:AGL].

Amplats said attendance at its four Rustenburg mines remained below 20% and it would take action against strikers from Thursday, including the prospect of dismissals.

Platinum sector 'in crisis'

It has made such threats before but then extended the deadlines, perhaps mindful of the violence unleashed when rival Impala Platinum [JSE:IMP] fired strikers in January.  

But CEO Griffith struck a tough tone in a conference call with journalists, saying: “At some point in time, we have got to put our foot down and we have now reached that position.”

“We are not going to entertain wage negotiations at this point in time,” he said.

Much of the platinum sector in South Africa has been battling with soaring costs and weak demand and Anglo American launched a review of its Amplats’ operations months ago.

“Our Rustenburg mining operations are under considerable economic pressure and their future is already under review,” Griffith said.

“The platinum industry is in dire straits at the moment. This is an industry that is in crisis,” he said.

In total there are close to 75 000 workers on strike or prevented from going to work because of intimidation across South Africa’s mining sector, about 15% of the workforce.

Malema to address Implats workers

The steep 11% to 22% pay hikes extracted in the bloody standoff at Lonmin have been a red rag for others in an industry marked by glaring income and wage disparities.

ANC renegade Julius Malema, a populist who has backed the wildcat strikes and called for the nationalisation of the country’s mines, said he planned to address Implats’ workers on Thursday to encourage them to press for higher wages.

“Tomorrow I’m going to a mine, Impala mine in Rustenburg. I’m going to encourage the workers to demand 12 500 (rand a month),” Malema said outside a court in the northern city of Polokwane where he was charged with money laundering.

Malema, the former head of the ruling ANC’s Youth League who was ousted from the party for ill-discipline in April, is tapping into a swelling vein of anger among miners to revive his political career and campaign to unseat President Jacob Zuma.

Lesiba Seshoka, spokesperson for the National Union of Mineworkers (Num), said the AngloGold strikers wanted a minimum of R16 000 ($2 000) a month but the company said it had not received a formal wage demand yet.

If the demand is R16 000 it would represent a rise of as much as 400% on the basic wages of the lowest-paid workers in the sector. AngloGold and some of its rivals have two-year wage deals that are in place until the middle of 2013.

The Num does not support the strikes but elsewhere demands have included the resignation of its leaders, a reflection of discontent among miners who regard the union as out of touch and too close to mine managers and the ANC government.

Reneged on a deal

Gold Fields, the world’s fourth largest producer, said on Tuesday workers had reneged on a deal Num claimed to have sealed to end a two-week strike at its KDC West operation and miners at its Beatrix mine had also downed tools.

Illegal strikes erupted in the platinum sector in the form of a bloody turf war between the Num and the more militant Association of Mineworkers and Construction Union (Amcu).

The strikes have now spread elsewhere but there is no evidence yet of Amcu involvement in the unrest.

Meanwhile, the country’s truck drivers are also on a legal strike over wages.

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