[South African] Mines face profound shift in labour relations – by Carol Paton (Miningmx.com – July 10 2014)


[miningmx.com] – AFTER the labour turmoil of the past two-and-a-half years, what can mining employers and investors expect in the years ahead?

Since January 2012, when the first illegal mining strike at Impala Platinum (Implats) rocked the industry, so much has changed that the labour market dynamics are hardly recognisable.

Trade unions, employee expectations, and the established mode of conducting negotiations over wages have been suddenly and violently swept away, leaving uncertainty and confusion behind.

Although conditions have changed, too much has stayed the same. Tied up with the new revolt are embedded production and labour market models: a low-skill, labour intensive industry based on a 150-year-old tradition of migrant labour. It is the legacy institutions that the new labour revolt will ultimately displace, whether by intent or as an unintended consequence.

In mid-2014, that fight is far from over because South Africa’s mining industry will be under pressure to change in fundamental ways. This will include many things: from the way it values, rewards and communicates employees and how it takes care of their social needs of employees to the extent to which it is able to mechanise, get by with fewer employees who are more productive, more skilled, less migratory and better paid.

Those are the big picture, long-term issues that, as the recurrence of strikes in 2014 shows, are neither easy to solve, nor will they go away.

In the short term, there are also immediate issues that will have a bearing on labour market conditions.
While it will be a relief that no major wage negotiations in mining are expected in 2015, the fight over wages for the industry is far from over.

Strike contagion is now a possibility following the collective agreement between Anglo American Platinum (Amplats), Implats, and Lonmin and the Association of Mineworkers & Construction Union (AMCU) which agreed wage increases significantly above the 10% the National Union of Mineworkers (NUM) secured in the gold and coal sectors.

It is also possible that union rivalry in gold and coal will intensify, as workers lose faith in NUM and depart for AMCU.

Reaching a collective agreement was vital to restoring industrial peace. Industrial sociologist and mining labour expert, Gavin Hartford, said that as well as a deal being the only way to “ensure an orderly non-violent and mass resumption of production”, it is also necessary to “lay the basis for productivity improvements” and to rebuild relationships between employers and employees.

This was borne out by the 2012 wave of illegal mining strikes. Of the platinum companies, only Lonmin signed an agreement with employees with the result that its ability to get back to former production levels far exceeded that of Implats and Amplats, for example, where stoppages continued on and off for months after the strike ended.

Job Losses

The higher wages agreed between AMCU and the platinum producers raises the strong possibility of job losses. Both Amplats and Lonmin have indicated this to be likely. This will make future talks with labour over productivity improvements even more important if a round of retrenchments is to be avoided.

For the rest of this article, click here: http://www.miningmx.com/page/special_reports/mining-yearbook/mining-yearbook-2014/1643986-Mines-face-profound-shift-in-labour-relations#.U77v6PldVzs