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Co-operation between Harmony, trade union saves thousands of jobs

HARMONY Gold has saved about 3 000 jobs at the company’s loss-making Doornkop mine outside Johannesburg.

The company said yesterday it had given Doornkop a lifeline after reaching a deal with labour unions to implement a new operational plan focused on improving efficiencies.

The plan followed a twomonth consultation process with organised labour in terms of section 189a of the Labour Relations Act to find ways to return the mine to profitability.

The deal meant Harmony had put the brakes on idling the mine and metallurgical plant, which would have affected 3 100 employees including contractors, it said yesterday. In terms of the newly agreed plan, only 526 employees including contractors will be affected by the restructuring.

The majority of these employees had been transferred to other operations, the company said, adding: “Of the 526, about 183 people will either be reskilled for redeployment elsewhere in the group or may elect to accept a voluntary severance package.”

Harmony in May proposed the restructuring at Doornkop due to the low gold price and that it could not afford the sig- nificant capital investment required to sustain the operation.

Milestone

Chief executive Graham Briggs said the agreement was a milestone for the company.

“The outcome of the Doornkop discussions is testimony to what can be achieved when all parties engage with the same aim in mind – finding a sustainable solution to ensure the viability of the mine and at the same time securing the majority of jobs,” Briggs said yesterday.

Doornkop had posted a R210 million operating loss in the 2014 financial year and a further R98m loss in the nine months to March. The mine was rocked by an underground fire in May, which occurred in an old mined-out area where some cleaning operations had taken place.

The National Union of Mineworkers (NUM) welcomed the move saying it would secure much-needed jobs.

Kanetso Matabane, the NUM’s regional chairman of the PWV region, said the working hours in the new business plan had remained unchanged.

“The plan is good because we managed to save jobs and fortunately the new business plan will not affect our working hours,” Matabane said.

Harmony said gold production during the June 2015 quarterly was likely to be 4 percent to 5 percent higher quarter on quarter, while gold production for 2015 financial year to June was estimated to be 1.08 million ounces. The NUM has previously blamed mining companies for side-stepping regulations in plans for restructuring that may cut about 20 000 jobs.

It said about 30 firms had issued notices that could lead to 20 000 job losses. Mining companies have blamed soft commodity prices and high input costs for the job cuts.

Harmony’s share price rose 1.96 percent to close at R14.59.