Precious metals miner Sibanye-Stillwater on Wednesday advised that it would start consultations with relevant stakeholders in terms of Section 189A of the Labour Relations Act, regarding the restructuring of its Marikana operations and associated services and the planned reduction of about 5 270 jobs.

This will affect about 3 904 employees and 1 366 contractors.

The consultations follow the completion of a detailed three-month review of the Marikana operations, post the Lonmin acquisition becoming effective in June, and is pursuant to ongoing financial losses experienced at these operations, with some shafts having reached the end of their economic reserve lives.

“The proposed restructuring is contemplated to ensure the sustainability of the Marikana operation, which is not a going concern as an independent entity.

“Whilst the review process concluded that certain shafts, most of which were at the end of their operating lives, would be affected, other shafts which had previously been at risk, such as 4B shaft, K3 mining into Siphumelele ground, Roland mining into MK2 ground, as well as the K4 concentrator, will continue to operate, thereby lessening potential job losses.

“Overall, the outcome will be a more sustainable business which is able to secure employment for the majority of the Marikana workforce for a much longer period,” Sibanye CEO Neal Froneman commented.

The restructuring will result in the rationalisation of overheads and the realisation of other synergies and efficiencies required to restore profitability and ensure the sustainability of the remaining shafts at the Marikana operations, the company said in a statement.

Sibanye and affected stakeholders will, together, consider measures to avoid and mitigate possible retrenchments and seek alternatives to the potential cessation or downscaling of operations at the affected shafts and associated services.

Subject to the completion of the consultation, the following actions have been deemed necessary to ensure the sustainability of the operation.

Firstly, reducing and optimising the operational footprint. This will include, among others, placing the East 1, the West 1 and Hossy shafts, as well as the opencast operations, on care and maintenance.

Sibanye also plans to optimise the downstream concentrators, smelter and refineries by closing the Eastern Platinum C-stream and Rowland concentrator plants.

Secondly, the application of the Sibanye operating model to all mining and metallurgical processing units at Marikana and the extensions of the existing Sibanye services to improve efficiencies and achieve cost savings necessary for sustainability.

Sibanye noted that the six-month moratorium on forced retrenchments imposed by the Competition Commission Appeal Court would lapse on December 7.

RESPONSE
The Department of Mineral Resources and Energy said it was "disheartening" to hear of the potential job losses at Sibanye.

In line with Section 52 of the Mineral and Petroleum Resources Development Act (MPRDA), the department urged all stakeholders to "engage in good faith and explore all possible options to save jobs."

Further, it called for stakeholders to act responsibly and with due care as they deal with this matter, which involves the livelihoods of employees and their immediate families, it noted.

The Association of Mineworkers and Construction Union (AMCU), meanwhile, said that while it was still reviewing the notice received from Sibanye before commenting more comprehensively, "this notice again clearly shows the principle of profit over people."

"The sad reality is that, if workers escape being killed while working in these mines, Section 189 of the Labour Relations Act becomes another weapon to secure the superprofits of mining bosses. AMCU will spare no resource to ensure the job security of workers."

Meanwhile, trade union Solidarity said the affected employees were paying the price for trade union AMCU’s five-month strike in 2014 and former Lonmin CEO Ben Magara’s “mismanagement”. 

“Magara was more focused on keeping AMCU happy than focusing on the mines’ sustainability and effective management. As a result, Sibanye now has to deal with Magara’s mess and innocent employees have to pay the price,” Solidarity general secretary Gideon du Plessis stated.

Solidarity said it would do everything it could to prevent retrenchments, or alternatively, to ensure that no forced retrenchments took place before the end of the year.