Business Maverick


NUM, Amcu members to down tools at Sibanye’s gold ops on 9 March

NUM, Amcu members to down tools at Sibanye’s gold ops on 9 March
Sibanye's Driefontein Gold Mine

The strike is set to begin with the evening shift on Wednesday, 9 March, at a time when the gold price is near record highs. This looks to be a situation where everyone loses, but labour will likely be the biggest loser. One of the unintended consequences of Russia’s invasion of Ukraine is that surging food and fuel prices will severely test the striking workers at a time when Sibanye’s platinum group metals operations will reap a windfall. From Russia with love. 

Sibanye said in a statement on Tuesday that it had received the strike notice from NUM and Amcu. The protected industrial action is due to start with the evening shift from Wednesday. 

Business Maverick understands that on Tuesday afternoon there were still last-ditch talks to resolve the impasse but it was not clear if progress would be made.

As South African mining strikes go, this one has been a slow burn. Wage talks between Sibanye and four unions collapsed in a heap late last year and it was clear the impasse would likely not be resolved. Still, while unions got the go-ahead from the Commission for Conciliation, Mediation and Arbitration two months ago to embark on a strike, they did not pull the trigger – until now. Unions could make the case that this shows they have been patient with Sibanye and open to negotiation. 

In the long run labour may wish it had shown more patience. 

Sibanye will lose out on revenue and profits as the gold price has breached $2,000 an ounce, placing it a short sprint from its record highs reached in August 2020. But the company last week unveiled record earnings underpinned by the performance of its South African platinum group metals (PGM) business. And palladium, coveted as a catalyst in petrol engines, this week scaled record peaks above $3,000 an ounce – a direct result of the invasion of Ukraine by Russia, a major producer of the precious metal which is now facing a range of potentially crippling sanctions.

The upshot of this is that Sibanye can probably ride out a strike in its gold sector so long as its PGM operations keep churning cash. It is in a far more advantageous position than Harmony Gold, which last year signed an historic agreement with five unions including NUM and Amcu. That provided the R1,000 a month pay hike over three years which the unions are now seeking from Sibanye’s gold division. But Harmony is welded to its deep-level South African gold operations and Sibanye – which began life just that way as a Gold Fields spin-off – is far less reliant on them. 

Sibanye’s overall performance has not been lost on the unions, who have pointedly noted the profits it is making. One union official sent this correspondent a WhatsApp message a few days ago saying: “There is no way these guys can plead poverty.” Sibanye’s position is that it is not “pleading poverty”. Rather, its policy is not to subsidise one unit with the money made by another – all must stand or fall on their own. 

In the current social and economic environment, that may strike many of its workers as tight-fisted, to put it politely. 

Sibanye, for its part, might well point to the wages and benefits it paid in 2020 to employees who could not show up to work because of the pandemic-triggered lockdowns. It might also draw attention to the basic services that it provides in the areas in which it works because of the government’s utter failure to do so. Then there are the taxes it is paying, which – along with those paid by Sibanye’s peers – have helped the government to continue providing a welfare lifeline of sorts to the poorest of the poor. In short, it would make the plausible case that it has done its bit on the socioeconomic front.

That is cold comfort to employees facing increased demands of their own. One of the factors at play here is no doubt the fact that mine workers, who by some estimates have an average of eight dependants, probably now have more mouths to feed because of the rising ranks of the jobless and the poor. 

This in turn is squeezing their income, while rising interest rates will hurt those burdened by debt. The unions are demanding increases of R1,000 a month for the lowest-paid categories for three years, starting from July of 2021. Sibanye’s latest offer, which it maintains is set in stone, is R700 a month over three years, representing a hike of 6.8% in the first year and 6% in the third.

Inflation began moderating in January with the consumer price index breaking to 5.7% from 5.9% in December. But food inflation, which literally eats into the household income of the working class, was 6.2%. And fuel and food prices are set to surge because of the unfolding conflict in Ukraine. 

This will take its biggest toll on the poor and the working class, including the NUM and Amcu members at Sibanye’s South African gold division. If the strike – and the war in Europe – become prolonged, inflationary pressures alone could force the unions to end the strike and accept the offer from Sibanye, whose hand will be strengthened by the cash flowing to its PGM operations. 

Russian President Vladimir Putin’s invasion of Ukraine has given business a distinctive advantage in this dispute, while undermining the position of organised labour. This seems to be lost on Putin admirers among the RET faction of the ANC, but they are only interested in their own self-enrichment so that is no surprise. 

From Russia with love.  

And Amcu surely has fresh and bitter memories of the five-month strike it undertook at Sibanye’s gold operations, which ended in 2019 with its members forced to accept the same deal provided to rival unions – after losing five months’ worth of wages. This is surely one of the reasons Amcu has united with its former archenemy. It is hardly a sign of strength and its members may well lose again – thanks in part to the Kremlin.

The last Amcu strike at Sibanye’s gold operations was often violent and linked to several deaths. Hopefully, this one won’t take that route. But the path ahead is going to be difficult and labour looks set to have a tougher one to tread than capital. DM/BM



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