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Johannesburg – The mining ministry is meeting producers and unions for two days of talks on alternatives to cutting as many as 10 000 jobs as companies face higher costs and low prices for their output.
At least seven mining and metal companies have announced plans to reduce their workforces in the past two months. The second- largest union in the gold industry has rejected an offer by operators after almost two months of talks as the metal trades close to a five-year low.
READ: Mining sector in trouble, says Ebrahim Patel
“We need an honest, frank conversation about what each one needs to do to arrest the current crisis,” Mineral Resources Minister Ngoako Ramatlhodi told reporters on Wednesday in Pretoria.
“None of us should leave this meeting without committing something to the table. It is not an exercise in finger-pointing.”
Talks over wages between SA’s largest gold producers and unions need to consider the future job security of workers, Ramatlhodi said.
The Association of Mineworkers and Construction Union (Amcu), the second-biggest representative of gold employees in the talks, has rejected an offer by Sibanye Gold [JSE:SGL] and AngloGold Ashanti [JSE:ANG] to raise monthly pay for entry-level workers by 13% in the first 12 months of a three-year deal. The inflation rate was 4.7% in June.
READ: Amcu snubs higher wage offer
Gold Talks
Some members of the National Union of Mineworkers (NUM), the largest representative of gold employees, aren’t accepting the proposals, according to a person familiar with the discussions. The NUM has yet to announce its official stance.
The NUM lowered its demand last month for basic pay to R9 500. Still, that’s at least 60% more than the current wage of about R5 800 monthly.
“I’m appealing to the companies to be transparent and I’m appealing to the unions to negotiate with reasonable prudence,” Ramatlhodi said. “They’ve got to approach this issue on the basis that we need to save jobs while we don’t need to accept slavery wages.”
The ministry is pursuing separate talks with Glencore’s [JSE:GLN] Optimum Coal unit over the suspension of its mining license due to non-compliance with labour regulations, Ramatlhodi said.
READ: Glencore blames Eskom deal for Optimum woes
Optimum’s license was suspended Tuesday as the coal producer said it would seek bankruptcy protection due to an unprofitable supply deal with Eskom. Optimum also cut jobs amid a slump in coal prices.
“We are asking and assisting on a particular process to resolve the downscaling issues,” he said. “It is not in our interest that it gets shut down.”
The Chamber of Mines is taking part in the talks to help find ways to minimise job cuts, President Mike Teke told reporters.
“We don’t go out and shed jobs because we like shedding jobs,” Teke said. “We’d like this meeting to come up with something constructive.”
