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Behind the Amcu deal

Jul 08 2014 10:53

Amcu members dance after declaring an end to a five-month long strike in the platinum sector. (Mujahid Safadien, AFP)

Johannesburg - Forty-eight hours after talks to end South Africa's longest strike hit a brick wall when Mining Minister Ngoako Ramatlhodi suddenly pulled out, a bishop and an anti-establishment corporate lawyer engineered a deal at a secret meeting in a ritzy hotel.

The events, revealed by interviews with key players in the five-month platinum strike, expose the impotence of the bargaining structures that have underpinned labour relations since the end of white-minority rule in 1994.

They also cast a shadow over the ruling African National Congress, which admonished the minister for inviting the lawyer to the talks after he had left the ANC to be elected to parliament for the ultra-leftist Economic Freedom Fighters (EFF).

The chastened Ramatlhodi then withdrew from the negotiations, almost scuppering an agreement between the world's three biggest platinum firms and the striking Association of Mineworkers and Construction Union (Amcu), which has informal ties to the EFF.

"They did not tell me how to withdraw," Ramatlhodi, told Reuters. "They just told me: 'We think you have done enough. We want you to go slow on this.'"

With its share of the vote waning 20 years after the end of apartheid and a key political ally, the National Union of Mineworkers (NUM), threatened by Amcu, the ANC was keener to avoid conceding political points than resolve the worst strike in the 130-year history of the mines, analysts say.

The ruling party wanted the strike to end but in a way that did not mean the NUM bleeding more members to Amcu, William Gumede, head of the Democracy Works Foundation think-tank, said.

"We're now getting into a self-preservation period in the politics of the ANC alliance which potentially could destabilise sections of the labour market and polarise the country," he said.

The strike claimed five lives and dragged the economy to the brink of recession but the Commission for Conciliation, Mediation and Arbitration (CCMA) said it was largely toothless in the face of politically tinged union militancy.

CCMA director Nerine Kahn said other countries allowed agencies such as hers to force parties to stop striking for a period to allow for mediation.

"We don't have that right," she said.

Wing and a prayer

After countless rounds of failed talks, many South Africans thought only divine intervention would end the stand-off between the 70 000-strong Amcu and Anglo American Platinum [JSE:AMS], Impala Platinum [JSE:IMP] and Lonmin [JSE:LON]

Those at the key June 11 meeting in Johannesburg's Palazzo Hotel shared that view.

They included Bishop of Pretoria Jo Seoka, who had initially intervened in platinum belt unrest after the 2012 police killing of 34 wildcat Amcu strikers at Lonmin's Marikana mine, the bloodiest security incident since apartheid.

Alongside him were Dali Mpofu, a prominent but controversial lawyer who had taken up the cause of the slain Marikana miners, and Joseph Mathunjwa, an evangelical Christian and the charismatic leader of Amcu.

Opposite the trio, dubbed the 'Three Musketeers' since the Marikana killings, was Ben Magara, the Zimbabwean chief executive of London-listed Lonmin and one of the few black CEOs in South Africa's mining sector.

"We started the meetings with prayers and we closed them with prayers because we felt we needed a bit of extraordinary assistance," one person involved, who asked not to be named, told Reuters.

As head of the worst-hit platinum firm - analysts say Lonmin was only a few months from running out of money - Magara had the most to gain from pursuing talks to end the strike.

But his background was also crucial to overcoming bad blood between Amcu, the platinum firms and the ANC rooted in the festering inequalities left by apartheid and in the raw anger stirred up by the Marikana killings. Amcu blames the police and ANC for the 2012 miners' massacre, a charge they deny.

In contrast to Chris Griffiths and Terence Goodlace, his white counterparts at Anglo and Impala, Magara started his career underground, working his way up through the ranks and into the boardroom.

"Ben has worked in the mines," one person involved in the final negotiations told Reuters.

"His view and understanding of the suffering is different from Griffiths because he has lived it. Coming from a black community in Zimbabwe, he has some feel for the suffering."

Three days of suspense

The Palazzo meeting produced an "in principle" deal to increase basic wages by R1 000 a month, a hike equivalent to nearly 20% for most workers.

Even though Mathunjwa had not signed it, the three firms announced it the next day, June 12, just as the Amcu boss was presenting it to workers at mass rallies at platinum mines near Rustenburg.

The mood on the platinum belt was ecstatic as shop stewards stepped up to the microphone to chant "Sign, Mathunjwa! Sign!", eliciting roars of approval from miners who had not seen a pay cheque in nearly half a year.

The jubilation was in marked contrast to three days earlier when the sudden absence of mediation from the new mining minister stymied progress.

Sworn in on May 26 after another comfortable national election victory by the ANC earlier in the month, Ramatlhodi, an advocate with no mining experience, won the personal approval of President Jacob Zuma to do whatever it took to end the strike.

Besides Amcu, the three firms and a posse of government officials, Ramatlhodi also dragged in Seoka and Mpofu - two of the few non-Amcu people whom Mathunjwa trusted. Under his ad hoc auspices, the talks made progress.

Amcu refused to drop its totemic demand of a "living wage" of R12 500/month basic pay. But the two sides gradually brought their target dates for progressive implementation of the hike - equivalent to a 150% rise if taken in one year - together until they had a broad deal, Ramatlhodi said.

When a week of talks ended on June 6, the only outstanding issue was over a R400/month 'living out allowance' for workers opting out of company accommodation, he told Reuters.

"If mcu had given that up, they would have had a deal that Friday (June 6)," he said. "At that point, it was done."

Minister 'cautioned'

Then Ramatlhodi dropped his bombshell.

At a hastily convened Saturday morning news conference on the sidelines of a meeting of the ANC top brass, the minister said he was pulling out of the talks to avoid setting the precedent of government being the mediator of last resort.

"South Africa has strong, credible institutions to carry out that task," he told the media. "We can take them to the river, but we can't make them drink."

The decision stunned negotiators, with one person at the heart of the talks dismissing his reasoning as "very flimsy".

The next day, ANC secretary general Gwede Mantashe - known for his dislike of Mathunjwa - revealed more: the minister had been "cautioned" about the inclusion of Mpofu, recently sworn in as an EFF MP.

The ANC is openly hostile towards the EFF, which became South Africa's third-largest party in the May 7 elections. With Zuma missing the ANC meeting due to illness, Ramatlhodi said he lacked the one big-hitter who could fight his corner, and felt obliged to pull out.

ANC spokespeople did not respond to requests for comment.

'Back to square one'

When negotiations resumed on Monday, June 9, the trust was gone and the mood was grim. An attempt by an official from the CCMA to kickstart the talks back into life went nowhere.

The CCMA has since refused to take the blame, saying Ramatlhodi had muddied the waters. It has also demanded more institutional teeth in the face of growing union militancy.

"Each time a different person steps in, you go back to the beginning and that's very, very problematic for the CCMA," director Kahn said.

A labour court judge-turned-mediator also hit a brick wall as the minister's team slowly retreated to their offices. Ramatlhodi stayed in the room but made clear he was there only in a "personal capacity".

As night fell, Mathunjwa emerged to tell waiting reporters the talks had deadlocked once again.

"We were back to square one," one person involved said.

Magara was particularly upset.

"I've never seen him so emotional. He thought it was done and he was so low," the person said. "At that stage he had no idea a deal was actually about to happen."

Alarmed at the prospect of an even longer strike and sensing Magara's weakness, Seoka and Mpofu took their chance and arranged to see him at breakfast the next day.

After more meetings in hotels in the suburban sprawl between Pretoria and Johannesburg, Mpofu and Seoka finally managed to get Mathunjwa to agree to see Magara in person at the Palazzo.

"They needed to get Magara and Mathunjwa in the same room - and that's when we got them," another source involved said

When he arrived, the bishop, the lawyer and the Lonmin CEO had already signed the deal. Mathunjwa never inked it, but his handshake was enough to convince Magara it was in the bag, one person involved said.

"There was huge relief."

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