Labour difficulties spread to Northam
IF THERE is one platinum group CEO who has reason to feel particularly exasperated at present it is Northam’s Glyn Lewis.
The company endured a six-week strike in 2010 that stripped R380m from revenue. It consequently has a relatively liberal labour agreement, which allowed it to escape the storm that swept through the platinum sector last year as unprotected strikes shut down the world’s three biggest platinum producers and a number of smaller ones. Included in that agreement are clauses that allow for smaller unions to secure recognition and, potentially, bargaining rights.
The labour action last year had its roots in the struggle for members between the established National Union of Mineworkers (NUM) and relative newcomer the Association of Mineworkers and Construction Union (Amcu).
Amcu broke the NUM’s dominance in the platinum belt by using pockets of worker unhappiness with the NUM’s closeness to the government, and dissatisfaction with the way it was dealing with issues on the shop floor.
One of the hotbeds of discontent was in a niche group of underground workers, the rock drill operators, who ended up benefiting most from the settlement that eventually ended last year’s strikes. Now Northam is dealing with demands from about 450 drill operators for improved bonuses, despite a bonus calculation methodology having been agreed in 2010. The trouble is that that agreement was with the NUM. weans on the contract to date, 13% of whom are female.
Only a handful of the employees have been South Africans, which will please Zimbabwean Indigenisation Minister Saviour Kasukuwere. The company says 220 Zimbabwean suppliers and 19 subcontractors are involved in the project, with R447m already spent on them. All materials and supplies are being procured locally, except for what is not available in Zimbabwe.
Group Five says its local spend in Zimbabwe since inception of the contract in October 2011 is R627m. About R11m has also been ringfenced to benefit a number of community development projects along the contract route from Plumtree in the west to Mutare in the east.
The development loan for the contract was provided by the Development Bank of Southern Africa, and is the largest single loan granted by the bank for a development project in Zimbabwe, and the second-biggest loan it has granted outside SA. Funding is structured as a three-way loan agreement with Zimbabwe’s national road administration, the ministry of transport, communications and infrastructural development, and the ministry of finance.
Dave Marrs edits Company Comment (marrsd@bdfm.co.za)