Amplats has tough sell for job cuts

File image: Reuters

File image: Reuters

Published Mar 26, 2013

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Rustenburg - Cattle graze the fields around Anglo American Platinum's South African mines, a familiar sight for workers with a rural past, and possibly a hint of their future as the world's largest platinum producer plans 14,000 job cuts.

Amplats' consultation process on the job cuts, which would mothball two mines near the platinum belt city of Rustenburg, ends on March 31.

A final decision is expected to be announced soon after, possibly next week.

“For many of our workers, their natural affinity is farming. You can see this from the cattle, which many of our mineworkers own,” said Mpho Litha, Amplats head of community engagement.

“Supporting programmes to make them better cattle farmers back in their home villages is one option,” she said.

Much of South Africa's mining labour force is semi-literate and from rural areas, so a move back to the land may be among their few options.

But it will be a hard sell, one of many Amplats will have to make as it strives to restore profits.

When Amplats announced the planned job cuts in January, chief executive Chris Griffith said the company had “designed a comprehensive social plan” to mitigate the impact.

Amplats said this week in an e-mailed response to Reuters queries that the social plan's proposals are a “framework of suggestions” at this stage, and 800 million rand ($86 million) has been allocated to it.

They include a 300 million rand development fund Amplats says would create up to 6,000 jobs and more than 15,000 homes. But these construction jobs would be temporary.

Agri-business development in the “labour-sending areas” - poor rural regions in the Eastern Cape province that have traditionally supplied the mine workforce - are also being discussed.

 

VICIOUS CIRCLE

Amplats, a unit of Anglo American, posted its first loss last year, but cutting jobs could stoke tensions that would hit production and profits further.

Last year's losses partly stemmed from low prices but also from illegal strikes rooted in a bloody turf war for members between the militant Association of Mineworkers and Construction Union (AMCU) and the dominant National Union of Mineworkers.

AMCU won and is now the biggest union at Amplats, representing 40 percent of its labour force. It closed mines briefly in January when the plan to shed jobs was unveiled.

Activists from AMCU, who form the nucleus of a “Workers Committee” at Amplats, say they will bring production to a halt again if the company forges ahead with its plan.

“If Anglo goes to retrench 14,000 workers, we are going back to a strike,” said Siphamandla Malchanya, a leader of the Amplats' Workers Committee.

Workers are unimpressed with talk of a social development plan to mitigate job losses, and Malchanya said the Workers Committee has been excluded from talks on the issue.

This bodes ill for getting workers to buy into the plan. Much of the Amplats' workforce that has switched allegiance to AMCU hails from the rural areas in the Eastern Cape.

Even without AMCU's influence, going back to their rural roots may not be an attractive option for many platinum miners.

Even a low-wage job in the shafts was a step up for an illiterate subsistence farmer from the marginal rural areas where many black South Africans were forced to eke out an existence during white rule.

The gold mining sector shed tens of thousands of jobs from 1994 to 2004, and land became stressed by erosion and overgrazing when many of the workers returned to the villages.

“Land erosion and deterioration ... are already seen as results of this newly induced population pressure,” researchers noted in a 2004 study in the Journal of the South African Institute of Mining and Metallurgy.

Gold producers also cut those jobs before the rise of AMCU, which has poached from NUM, a key ally of the ruling ANC.

This has made the political environment tougher. The ANC has lashed out at Amplats over the job cuts - though it presided over the far more devastating decline in the gold industry, which had to restructure as grades fell and mine depths plunged.

All mines employ a third fewer South Africans than before the end of white rule two decades ago, while the population has grown by over 40 percent since 1990.

The average mineworker also supports around eight dependents and because of the migrant labour system - deeply embedded in the apartheid era - many workers are supporting family members back in their villages and also around the mines.

So a return home may also mean bringing dependents back with them to rural communities where farming is no longer viable. Many of these areas are not suitable for agriculture anyway - which is why black families were dumped there under white rule. - Reuters

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