JOHANNESBURG - Trade union Solidarity has suggested that Lonmin - the world’s third-biggest platinum producer - sell its luxury game farm and conference centre outside Mooinooi, in North West, amid the company’s plan to retrench 1139 employees by Christmas.
“It is insensitive to retrench mineworkers who form part of Lonmin’s core business, while enjoying the luxury of a game farm and the accompanying modern facilities,” Gideon du Plessis, Solidarity’s general secretary, said yesterday.
Lonmin, which employs around 33000 workers, said on Monday that the job cuts, including employees and contractors, had been necessitated by the low platinum price environment and increasing production costs. It said it expected that some 446 people, accounting for 1.8percent of the total workforce, could be affected.
Lonmin also said the Section 189 process was part of a review of Lonmin’s operations intended to protect the employment of the majority of the workforce, improve efficiencies, streamline the business and optimise cash generation. Lonmin previously said that, as part of the review, it planned to cut overhead costs by R500million by September next year.
Solidarity made the suggestion on Wednesday during the consultation process under sections 189 and 189(A) of the Labour Relations Act, as part of ensuring sustainability of the business.
Yesterday, Lonmin rejected claims that it had neglected to meet its socio-economic commitments. It said it had signed procurement contracts with its host community, the Bapo Ba Mogale, to the tune of R1.65billion.
The R1.65bn contract with the Bapo included stockpile management, ore transport, passenger transport and personal protective equipment supply. It also said that in addition to the empowerment deal in 2014, Bapo’s equity for royalty was converted into cash.
“In this regard, Lonmin pays the Bapo community R20m every year since 2015 until this amount reaches R100m. In addition, a minimum of R5m per annum is being paid to the Bapo Trust, created to uplift the Bapo community,” the company said.
This week the Mining Forum of South Africa and Bapo Ba Mogale Investments, acting on behalf of the Bapo Traditional Council, called for all Lonmin operations to be suspended after a Department of Mineral Resources (DMR) audit found the miner had failed to meet its Social and Labour Plan (SLP) commitments between 2014 and 2017.
The Bapo, on whose land Lonmin has been mining since 1969, became a 2.5percent shareholder in the company following an empowerment transaction in 2014, said the company was not doing enough to “share the spoils of the mineral wealth”.
The Mining Forum is a non-governmental organisation focused on promoting equitable access to the country’s mineral wealth. Lonmin blamed the Mining Forum for a flawed assessment of Lonmin’s SLP compliance, which it said was based on “doubtful methodology”.
It also said that Blessings Ramoba, the Mining Forum president, had offered to consult for the company at a fee of R33.1m, an allegation which Ramoba has denied. Lonmin said yesterday that, following the annual SLP audit, conducted by the DMR in August, it had been requested to submit an action plan to address the areas identified.
It would now give the DMR regular progress updates on the implementation of the action plan. It said that the current SLP was still in its implementation phase and ran from 2014 to December 2018.
In that period, Lonmin had to restructure the company, resulting in about 6000 employees being re-skilled, with some losing their jobs. Lonmin also planned to retrench 1139 contractors and employees by Christmas.
- BUSINESS REPORT