Fin24

Wildcat strikes spread to more mines

2012-10-03 16:32

Johannesburg - A series of wildcat miners' strikes in South Africa spread to a new sector, iron ore, on Wednesday and hit another gold firm in an escalation of the labour unrest that is testing President Jacob Zuma's leadership.

The industrial action at Kumba Iron Ore [JSE:KIO], a unit of global miner Anglo American [JSE:AGL], further dented investor confidence in the continent's wealthiest economy as it showed the protests had moved beyond platinum and gold mines.

Workers at the Kusasalethu mine near Johannesburg, operated by South Africa's No. 3 bullion producer Harmony Gold Mining Company [JSE:HAR], also downed tools in what management called an "unlawful" action launched outside the normal collective bargaining channels.

Zuma is under fire for failing to address and contain the workers' protests demanding wage increases, which stem in large part from glaring wealth inequalities persisting in South Africa since the end of apartheid in 1994.

As many as 75 000 miners, or 15% of the South African mining sector's total workforce, are already out on strike, while a national truckers' stoppage is squeezing fuel suppliers. Analysts said if it lasts another week, some petrol stations could run dry and some banks' ATMs could run out of cash.

Kumba, one of the world's top 10 iron ore producers, said the wildcat strike at its giant Sishen Mine in the Northern Cape involved only 300 employees and was limited to one area in the open cast mine, leaving most of the facility unaffected.

"The action is being dealt with in line with the Company's labour relations procedure, with due consideration to the safety of the vast majority of workers who are not taking part in the unprotected strike," Kumba said in a statement.

Kumba's share price was over 4% lower on the news.

Shares of Harmony Gold fell 1.5% in Johannesburg.

The recent weeks of labour strife, in which around 50 people have been killed, have stirred up criticism of the ruling African National Congress and the presidency of Zuma, who faces a challenge from ANC rivals ahead of a party leadership conference in December.

In another illegal strike over wages by contractors at mining company Petmin, a security guard was hacked to death this week by knife-wielding assailants at the Somkhele mine in KwaZulu-Natal, local media quoted police as saying.

The rand fell one percent in early trade on Wednesday, partly due to the escalation of the mines conflict.

Fears of more mines clashes


Kumba was regarded as immune to the strike contagion because rank and file employees there in December who had worked for at least 5 years were given a lump sum of about R345 000 each after taxes as part of a share scheme.

This represented a fortune to workers earning as little as R7 000 a month. But it was not immediately clear if any of the 300 reported strikers were among the 6 200 who had benefited from the plan.

"We thought the share plan meant this would not happen there," said Gideon d u Plessis, the deputy secretary general of trade union Solidarity which represents skilled workers.

Solidarity is not taking part in the strike.

Kumba produced 41.3 million tonnes of ore in 2011.

Seven weeks of labour unrest and strikes, which originally erupted at Lonmin's Rustenburg operations, have now spread across the South African mining industry.

The world's No. 1 platinum producer Anglo American Platinum is also grappling to resolve a strike at its Rustenburg operations in the country's "platinum belt" about 120 km (75 miles) northwest of Johannesburg. Worker attendance at Amplats' Rustenburg mines has fallen to below 20%.

Some 21 000 Amplats workers have joined the illegal walkout.

Fifteen thousand miners at Gold Fields KDC West mine downed tools on Sept. 10, hitting production at the world's fourth-biggest bullion producer. Gold Fields bosses have refused to negotiate with them.

The spreading labour unrest has raised fears the country could see a repeat of the stand-off with police at Lonmin's platinum mine in August that led to the shooting of 34 miners.

It was South Africa's bloodiest security incident since the end of apartheid in 1994, and an official commission of enquiry started a probe this week into the killings.

The commission on Wednesday adjourned its hearings until October 22 to give lawyers involved more time to prepare and collect copies of relevant documents and testimony.

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Comments
  • kobus.hattingh.5 - 2012-10-03 17:19

    And whilst the country/economy is going up in smoke Pres Zuma is dead quiet and busy planning his R220 million rand tax payers money village.

  • george.michaelides.71 - 2012-10-03 17:23

    Do It.....push the price down.....sell high ...buy low......

  • clint.rusford.3 - 2012-10-03 17:24

    remember wat i sed that time wat gna hapen if marikana workers get wat they want frm employers??? Yip i saw this cuming a mine away!!!

  • heathway.master - 2012-10-03 17:47

    I have finally come to realise that the masses generally have the mind of a child. Their main drivers in life are envy and greed, and now, entitlement added. They will be unbelievably excited at their new bicycle and will ride it all day all over the veld. Should the kid next door however get a bike with a bell and a front light, then their bike will suddenly become not good enough, and they will scream, sulk, stamp their feet until they get a bell and a light. If the next door kid now gets a fancy leather seat, then their bike once again will not be considered good enough. and they will scream, sulk, and stamp their feet until they get a shiny new leather saddle. i.e. whatever they presently have, no matter how it may be improved, they always will want more and better. The latest attitude is that if the boss can drive a nice car and get a higher salary than them, this is discriminating, as they do the work to give him these things. They of course want to work in an environment where the tea girl, gardener, and car washer, all get the same salary and perks as the boss. After all they are black and have been oppressed for 300 years. We are consultants dependent on mine work, which has all but dried up. Management are already looking at mass retrenchment. Good luck strikers as you drive the country’s economy into the dust. May you live a life of continuing prosperity, excesses and luxury, as your education, skills and management ability so clearly warrant.

  • acm.munro - 2012-10-03 18:17

    Lonmin opened this can of worms. Strikers havent the faintest idea of what the future holds for them, they are killing the goose that lays their monthly eggs ... Job losses will follow. As I'm writing this the rand is already down to R8,43/US $ - exports will be down, balance of payments takes a knock, a hike in petrol and food prices, the Government tax inflow takes a knock as the mines wont be paying tax ... so where will they find money to balance their books?? A hike in VAT??

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