Labour unions Solidarity and the National Union of Mineworkers (NUM) have called for mining and metals processing multinational Sibanye-Stillwater's management to step down after launching a third retrenchment process at its South African operations within one year.

Sibanye has announced that it will enter into consultations with organised labour and other stakeholders in terms of Section 189A of the Labour Relations Act regarding the proposed restructuring at its South African gold operations and its Southern Africa region services functions.

Further to previous restructuring concluded during 2023 and in the first quarter of this year, the ongoing group business review has identified a need to address losses at the Beatrix 1 shaft, which has been unable to deliver planned production, as well as at the Kloof 2 plant, which, after the closure of the Kloof 4 shaft during 2023, has had insufficient processing material available to cover overheads.

The deferral of capital expenditure at the Burnstone project, announced in February, also requires restructuring aligned with the reduction in planned capital activities.

Meanwhile, the restructuring and closure of loss-making shafts and from proposed future restructuring or closures, has resulted in the capacity of the direct and shared services functions for the Southern African region and operations being surplus to current and future requirements.

As a result, the company proposes a re-alignment of the regional services, shared services and direct services structures to align with the requirements of the reduced operational footprint. This will reduce direct operational services costs and regional overhead costs, which are allocated to the operations, thereby contributing to the sustainability of the Southern African region operations, the company states.

The proposed restructuring of the operations and services could potentially affect 3 107 employees and 915 contractors, Sibanye says.

The company, organised labour and other stakeholders will, as part of the Section 189A process, consider alternative measures to minimise job losses, while ensuring the long-term sustainability of the South African operations.

“We continue to act prudently to protect the balance sheet and ensure the sustainability of the group. We are committed to constructively engaging with affected employees and through their representatives to minimise job losses,” says Sibanye CEO Neal Froneman.

Sibanye in December confirmed the retrenchment of 575 employees, as well as more than 550 contractors, at its Kloof 4 shaft.

It initially announced that 2 389 employees may lose their jobs as a result of the shaft closure, but 1 057 employees accepted transfers to fill vacant positions at the group's other South African gold operations, while 550 employees were granted voluntary separation or early retirement packages.

Meanwhile, the group had also announced in October last year that it was considering the restructuring of four shafts within its South African platinum group metals (PGMs) business, with up to 3 500 employees and 595 contractors potentially facing retrenchment.

It announced in February that 467 fewer jobs had to be cut as a result of natural attrition, while 351 employees accepted transfers to other PGM shafts and 1 208 accepted voluntary separation or early retirement packages.

Following negotiations with organised labour, the decision was taken not to close the 4B shaft as long as it does not incur net losses on a monthly basis. This resulted in 1 496 employees and 54 contractors retaining their jobs.

Forty-seven employees were retrenched, while about 800 contractor employees were affected by the shaft closures.

In addition to its South African gold and PGM operations, Sibanye owns PGM operations in the US, lithium and nickel mines in Europe and zinc and copper assets in Australia.

UNIONS RESPOND
Solidarity general secretary Gideon du Plessis says the retrenchments and the timing thereof are unacceptable.

“Solidarity is extremely disappointed with and finds it despicable that Sibanye will once again plunge a large number of its employees, contractors and their dependants in uncertainty and poverty. The timing of the retrenchments, just before the start of the salary negotiations, is to be questioned," he states.

“In 2021, Neal Froneman, in his reaction to his R300-million remuneration package, boasted how Sibanye set the world alight under his leadership, when it was simply favourable market conditions and the employees’ hard work that led to its good performance. 

“Now that times are tough, apart from the favourable gold price, everything except the Sibanye leadership is being blamed for the poor performance,” Du Plessis adds.

The NUM has also questioned the timing of Sibanye's announcement ahead of wage negotiations, as well as the fact that this is happening at a time when the gold price is high.

Du Plessis, meanwhile, says it is ironic that fellow South African gold miner Harmony Gold, which operates gold mines in the same area as Sibanye, is yielding good financial results.

“Harmony’s share price continues to rise and a five-year wage agreement has just been signed with the unions in terms of which Harmony employees will receive inflation-related increases throughout the next five years. 

“The last time Harmony embarked on a retrenchment process was 13 years ago. While Harmony’s leadership has to be given the credit for the company’s success, the time has now come for Sibanye’s leadership to accept responsibility for its own poor management,” Du Plessis asserts.

He says Solidarity intends to request that the consultations with Sibanye be postponed until after salary negotiations have been concluded.

"Then the retrenchments will be opposed, and Solidarity will do everything in its power to protect its members’ jobs," he says.