THE South Deep regional branch of the National Union of Mineworkers (NUM) declined to accept an improved retrenchment package offered by Gold Fields, raising the prospect of prolonged strike action at South Deep mine.
“I can confirm the offer was not accepted so it’s the status quo; it’s where we were,” said Sven Lunsche, spokesman for Gold Fields. An official announcement from Gold Fields was due in the next one to two hours, he added.
In addition to a retrenchment package sweetener, Gold Fields would spread the impact of the no work, no pay over four months which would lessen the impact of virtually no pay at all ahead of Christmas, as well as ease the financial burden thereafter.
Affected employees would also be provided with portable skills training and a call back provision – essentially retrenched employees would be given first option to return to their jobs if their resources were required in the future.
Gold Fields said on August 14 that it would retrench 1,560 staff including 1,082 permanent employees in an effort to stem R756m in cash burn (at that time). The mine has also been written down for R4.8bn in August following a R3.5bn impairment taken out in February. Of the employees identified for retrenchment, 904 had been paid out and had left the mine.
The incremental cost of the sweetener was an estimated R40m.
“However long the strike continues, it cannot and will not lead to changes in the restructuring plans, including the 1,082 retrenchments, that are necessary for South Deep’s long-term sustainability and saving the remaining 3,500 jobs,” said Nick Holland, Gold Fields CEO, in a later statement.
“Should the strike continue for an extended period of time though, it could potentially place more jobs at risk,” he said.
Holland, said earlier this week there was evidence that employees wanted to return to work after some 1,900 of them had registered their interest in doing so, many of which the company suspected were members of the striking NUM.
South African mines minister, Gwede Mantashe, took aim at Gold Fields following consultations with the company saying it had merely taken a “tick box” approach to the retrenchment process.
Holland responded by saying that the company couldn’t have done more given the fact South Deep was unable to support the affected employees and might even struggle to operate in the future even with the 4,000 employees left behind. Mantashe had wanted Gold Fields to revisit the retrenchment numbers, but Holland said that was impossible.
“We had been in consultation with the NUM even before starting the 189 Section process (of restructuring in terms of the Labour Relations Act). We completed that process and so there’s no chance of going back,” he said. “We have been cautious in keeping to the letter of the law, but we have also followed the intent and spirit of the law,” he said.