Johannesburg - Precious metals metals producer Pan African Resources is set to retrench 30 percent of its subsidiary Evander Gold Mines' Mpumalanga workforce as the company seeks to reduce the fixed costs of underground operations at Evander.
The company said the move followed a productivity and human capital assessment that was initiated “some time ago.”
Pan African Resources said Evander Mines concluded a retrenchment agreement with the National Union of Mineworkers (NUM), with the facilitation of the Commission for Conciliation, Mediation and Arbitration.
It said as part of the agreement approximately 976 of Evander Mines employees would be retrenched at an estimated cost of R54million.
The retrenched workers were designated as redundant for Evander Mines to meet production targets, it said.
Re-engage
“In order to minimise the number of job losses, Evander Mines will seek to re-engage a number of retrenched employees when site activities for Elikhulu commences,” the company said. Elikhulu is a R1.7 billion gold tailings retreatment project at Evander.
The NUM yesterday confirmed that the conclusion of the voluntary separation package and retrenchment agreements with Evander, after the company informed it of intentions to retrench 2400 workers.
“We concluded both the voluntary separation package and retrenchment agreements before we can conclude the retrenchment process, for the company to be able to source funds to avoid the closure of the mine which will affect more than 2000 employees, whose majority are our members.
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“We have agreed that we will start with voluntary separation package and redeployment to other mines to reduce the number of 976 affected employees. Should the voluntary severance package and redeployment not assist in avoiding retrenchment, we will then engage in the retrenchment process,” NUM said.
Accepted
The union said its members have accepted both agreements in order to avoid the closure of the mine.
In terms of the agreement, the NUM and Evander would continue until April 21 “to consult with a view to replace existing contractors with employees that have been identified for compulsory retrenchment to minimise the number of forced retrenchments.”
The company has suspended underground mining operations for refurbishment and maintenance on Evander’s shaft infrastructure. The shaft refurbishment would cost cost R40 million.
It said independent and internal engineering studies to assess the condition of Evander´s underground mining infrastructure - at Evander 7 and 8 shafts - identified what it said were critical infrastructure issues that required remedial action to ensure safe and sustainable operation of the shafts.
Last month the company said the the nature of these refurbishments required a suspension of Evander´s underground mining operations for a period of up to 55 days.
Pan African shares on the JSE closed 2.08 percent higher at R2.45.