IMPALA Platinum (Implats), the world’s second-biggest producer of the metal, yesterday provided a graphic insight into the effects on companies of the labour dispute that is spreading across the platinum sector.
Inter-union rivalry has added a new dimension to the traditional standoff between mine owners and workers, with start-up union, the Association of Mineworkers and Construction Union (Amcu) sharply challenging the established National Union of Mineworkers (NUM).
The labour unrest has spread beyond Lonmin’s Marikana mine, with workers at Royal Bafokeng Platinum embarking on a stoppage on Wednesday, and workers at other platinum mines threatening to follow suit.
Seeking a way through the labour disruptions and bloodshed, Implats CEO Terence Goodlace said yesterday the world’s largest platinum producers were discussing a move to collective bargaining to try to defuse tensions.
The platinum sector currently negotiates with unions on a company-by-company basis, leaving individual firms open to labour discontent as rival organisations promise workers they can cut better deals.
This situation has also created wage disparities between platinum companies that do not exist in the gold and coal sectors which bargain collectively, further fuelling resentment.
"It’s been very complicated talking between the two parties, to broker anything like normality between the two parties and to ensure we advance this process," Mr Goodlace said.
"We are walking a tightrope. If you look at what’s happening in and around us and the demands all across the industry, it would be irresponsible for us to say nothing could happen to us.
"These developments pose a significant risk to the industry. At this point we believe we have a measure of stability, but it is unreasonable to say nothing will happen to us," he said, at a presentation on the company’s results which showed a 38% drop in headline earnings.
Implats has cut capital expenditure by R1bn for the 2013 financial year after reporting a 37% drop in profit for the year to end-June, to R4.3bn. The key reasons are the six-week illegal strike in February and March marked by violence and intimidation, and subdued metal prices.
Implats will now start a process of verifying membership claims by the NUM and Amcu next Wednesday.
It has roped in a facilitator from the Commission for Conciliation, Mediation and Arbitration, after eight independently audited attempts to count membership were rejected by both unions.
If the verification shows NUM membership has fallen below 50% plus one of the workforce, Implats can issue it with a notice that it faces de-recognition as the dominant union, and that it has three months to bump up its membership.
If the NUM is unable to regain its majority membership, Implats will then be able to recognise Amcu.
Lonmin management said the unions’ battle for membership was behind the violence that has brought its Marikana mine to a standstill.
Implats and Lonmin halted operations yesterday to mourn the dead.
Implats has set up interim workers’ committees so that it can engage unions regularly and this has brought some semblance of stability to the company’s mines, Mr Goodlace said. Asked at an Implats results presentation yesterday by JP Morgan Cazenove analyst Steve Shepherd if there was "industrial anarchy" on platinum mines, Mr Goodlace disagreed.
The situation was manageable, he said, but this entailed talking to all unions and to provide guidance to Amcu, which is a relatively new union compared to the well-established NUM.
"No, I wouldn’t say that. It’s manageable. We’ve started doing a lot of work with the emerging workers’ committees to say this is how you operate and these are the systems," he said.
"Bear in mind, a lot of these people are not as experienced as NUM.
"It’s taking up an inordinate amount of time, but it’s the only way to keep operations going and making sure dialogue exists," Mr Goodlace said.
Implats has upgraded its participation in the Chamber of Mines to full membership to facilitate dialogue.
One of the main issues the Marikana violence has raised is the presence of informal settlements that have sprung up around mines, where miners and their families live in squalor.
Mining companies are compelled by law to convert hostels into single or married quarters.
They pay a living-out allowance of about R1,800 to workers who do not live in mine accommodation. Some miners have preferred to pocket that payment and live in shacks.
There is a constant influx of people coming to live near the mines, which are increasingly drawing their labour from local communities, adding to the mushrooming of informal settlements.
Mining companies pay a mining royalty, which goes to the fiscus rather than being ring-fenced for the benefit of communities living near mines or in labour-providing areas.
"Dare I say, the mining royalties we are paying government, maybe some of that should come back to the communities," Mr Goodlace said.
Impala mines near Rustenburg had paid R400m in royalties in the 2012 financial year.
With Reuters
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