AMCU boss Mathunjwa ends damaging five-month gold strike at Sibanye-Stillwater

Joseph Mathunjwa, president, AMCU

JOSEPH Mathunjwa, president of the Association of Mineworkers & Construction Union (AMCU), told members assembled at the premises of Sibanye-Stillwater’s West Rand gold mines this afternoon that they should end the near five-month strike by returning to work.

The strike was at the premises of Kloof and Driefontein mines in Carletonville, and the Beatrix mine in the Free State.

This comes just a week after Mathunjwa told a PGM investment conference that his union would never bow to Sibanye-Stillwater which has been in dispute with the union since mid-November after it refused to sign a new three-year wage agreement.

Sibanye-Stillwater subsequently confirmed the strike end in an announcement to the Johannesburg Stock Exchange in which the group’s CEO, Neal Froneman, said the company was pleased, but saddened by the “losses and hardship” employees had suffered.

The announcement confirmed Miningmx speculation that in accepting the wage offer first tabled by Sibanye-Stillwaer in November, AMCU had also taken up the firm’s March 1 ‘back to work’ proposal which included such inducements as a one-off ‘peace and stability’ payment of R4,500 to the striking workers, and a R5,000 salary advance to be repaid by the workers who went on strike.

As part of the agreement, AMCU is to sign a peace pact within 30 days. There was no evidence in the announcement, as suggested by a market source, that AMCU had undertaken to act with due care when it and the company meet again to discuss annual wage increases in the platinum sector. Sibanye-Stillwater owns Rustenburg Mines and is bidding to take control of Lonmin where AMCU has significant employee representation.

The agreement is a major fillip for Sibanye-Stillwater which last week took extraordinary measures to ease debt on its balance sheet by means of a R1.75bn forward gold sale and a R1.7bn share placement in the event exogenous factors, such as strike action, afflicted its operations in the long-term.

At some 104,000 ounces, Sibanye-Stillwater’s first quarter gold production was 90% of anticipated levels, but only 36% the level of production of the first quarter in the previous financial year. “Unit operating and all-in sustaining costs will be negatively impacted by the reduced production levels,” Sibanye-Stillwater said.

Sibanye-Stillwater said that post the agreement with AMCU, initial shifts at the affected mines will consist of fit-for-work medicals, training and assessing work places before mining activities can re-commence. “We are pleased that the extended strike at our gold operations has ended, without undermining other stakeholders or compromising their rights,” said Froneman, who added he was hopeful the company could re-base its relationship with AMCU.

“It is with sadness that we reflect on the losses and hardship resulting from the strike, which include lives lost and serious injuries sustained,” he said.

In terms of the agreement now accepted by AMCU – and earlier accepted by the National Union of Mineworkers, Solidarity and UASA – employees will receive an increase in the basic wages of category 4-8 surface and underground employees at the gold mines Kloof, Driefontein and Beatrix of R700 in year one; R700 in year two; and, R825 in year three.

The agreement also says that miners, artisans and officials would receive increases of 5.5% in year one and 5.5% or CPI (whichever is the greater) in years two and three of the wage agreement.

9 COMMENTS

  1. Five longs months, and you still come empty handed. This is a demise to Amcu. I wonder how are they going handle negotiations at platinum sector after this huge failure. Mathunjwa is self centered hypocrite who is enriching himself from the poor

    • And in the end the only ones not sacrificing their salaries are? Yes, that’s correct kids! Joseph Mathunjwa and the other leaders of AMCU received FULL pay during this time…. It is really heartwarming how the AMCU leadership is prepared to sacrifice OTHER people’s lives….

  2. The relief is palpable. Focus on that.

    The end of the strike coincides within a day or two of the announcement that Citibank will be acting as a gold mining company, on behalf of Sibanje for the fourth quarter.

    Coincidence?

    The strike has cajoled the company into selling, almost, the entire fourth quarter of its 2019 production to Citibank at a capped price of $1323 per ounce.

    Citibank has secured supply and upside.

    “Okay Joseph, they have signed the deal. You can end the strike now”

  3. And do we see a 9% increase in the shares, almost, but a lot of sceptic shareholders/analists and a bad company decision to overnight place R1.7 bil worth of shares on the market has now taken its toll with the share price going nowhere!!

    And the saga with this company’s strange decisions continue?

    • Company management will react to circumstances in order to protect the business – that is their legal duty.
      Blaming them for making those decisions does not provide a suitable long term answer to the many anomalies that are occurring for this business.

      Creating circumstances in order to influence company decisions is a far more subtle strategy, which is outside of the immediate thought of the average observer and would most likely be brushed aside as hearsay when mentioned.

      Several, sequential events have occurred, culminating in massive forward sales and share dilution with certain parties benefiting from the fallout, Based on this, it appears to be, that there is far more to the picture than meets the eye.

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