Business

'Shades of Marikana' taint platinum

Thalia Holmes

Experts have called for an intervention as union tensions shake an already volatile industry.

Union tensions have shaken an already volatile industry. (Madelene Cronje_MG, M&G)

The country is holding its breath as tensions in the platinum sector continue to add up to what many see as a toxic cocktail for the struggling industry.

A volatile market, delays in the Farlam Commission and new union recognition agreements, accusations of political favour-finding, union in-fighting, a perceived lack of government intervention and looming wage negotiations are dogging the industry.

Against this backdrop, suspicion between rival unions — the Association of Mineworkers and Construction Union (Amcu) and the National Union of Mineworkers (NUM) — is growing, as violent deaths continue to stack up on both sides. The factors have combined to create a situation that some view as strikingly similar to the one that ushered in the violent deaths of 44 people at Lonmin nine months ago.

"Obviously, it's a very challenging environment at the moment," said Roger Baxter, chief economist at the Chamber of Mines. "The last three or four years have seen more than one million ounces platinum surplus."

With producer Anglo Platinum announcing 6 000 retrenchments, the platinum index losing more than R5-billion in a single day, and a wildcat Amcu strike resulting in the entire workforce of the beleaguered Lonmin mine grounded for two days this week, there are few who disagree.

On Wednesday, Amcu's president Joseph Mathunjwa said that Amcu management had not formally called for the strike.

However, workers said that they would not return to work until NUM had left the mine, accused rivals of brandishing firearms in the workplace and speculated that NUM-turned-Amcu leader Mawethu Steven was killed by NUM members. The situation has ignited concerns that the rising conflict between the two groups is beyond the control of its leaders.

Representation
"The most immediate root of the tension is the collapse of NUM support among workers in platinum and gold, and the refusal by the NUM and leaders of the Congress of South African Trade Unions as well as the mining bosses and the ANC government to accept this," said Liv Shange, a representative of the Democratic Socialist Movement, which is one of the initiators of the new Workers and Socialist Party.

In August last year, NUM enjoyed a majority representation at Lonmin mine. Mine management had not counted representation for years and saw no need to, due to the "50% plus one member" requirement for recognition that was put in place through negotiations with NUM years before.

The agreement created a "closed shop where minority unions have no rights," wrote labour writer Jan de Lange in online mining publication Miningmx.com. The same stipulation existed at several other mines, including Impala Platinum and BHP Billiton.

According to De Lange, the profile of NUM's workforce has changed over the years. Originally born out of foreigners and illiterate migrant labourers who operated the lowest job categories of South African mineworkers, that number has now "dropped to below 40%".

Most of NUM's office bearers are now skilled workers who are literate, well-spoken and wealthy compared with the general underground workers, he said.

This was underscored by NUM's general secretary, Frans Baleni, who said on Wednesday that the union still retained majority representation of the "higher levels" of the workforce at Lonmin.

Amcu's growing popularity was born of its accusation that NUM was becoming increasingly elitist and politically connected. The party was no longer "representative" of the workforce, it argued.

Still not represented at the mine
Nine months later, Amcu comprises more than 70% of Lonmin's workforce. But despite this, it is still not represented at the mine and NUM still retains full bargaining rights. Negotiations for a new recognition agreement between Amcu and Lonmin management began in January. According to Mathunjwa, progress has been "slow". In the meantime, Amcu is constrained to a limited organisational rights agreement. And it is becoming increasingly frustrated.

On Tuesday, Amcu "workers presented a memorandum to management", Mathunjwa said on Talk Radio 702 on Wednesday.

"[The memorandum addressed] the issue of NUM not being de-recognised at the mine after failing to reach 50 plus one percent [representation]. The employer failed to answer ... our memorandum."

According to Mathunjwa, NUM and other minority parties at the mine signed an 18-month sunset clause to leave the premises. "That ended a long time ago."

But Baleni was adamant that Amcu's demands flew in the face of a peace accord that was signed in February by all the unions at Lonmin. "We signed that there would be freedom of association, and that everyone would respect the laws of the country," he said.

Lonmin had not been able to respond to a request for clarity at the time of going to print.

Amcu is arguing that NUM should abide by the agreement it drafted, and walk away from Lonmin as the non-majority party. However, NUM said that it had tolerated Amcu as a minority party, and Amcu should do the same for it.

"We admit that for many years on the issue of threshold, it was 50 plus one," said NUM spokesperson Lesiba Seshoka.

"As a union we have lost the majority at Lonmin," he said. "We are prepared to give Amcu the opportunity to lead. But they must give us the space to exist, as we did when they were a minority."

On Wednesday Mathunjwa said that the party was prepared to negotiate for unions representing 30% of the workforce or more to be recognised at the mines.

Political leadership and alignment
Nine months ago, analysts criticised the political vacuum surrounding the Marikana shootings. The space was somewhat occupied by former ANC Youth League leader, Julius Malema, who organised rallies and a memorial service for the deceased.

Mathunjwa noted the absence of a strong political leader. "We have written to the honourable [police] minister, Nathi Mthethwa several times on the matter, and he has not responded."

Mthethwa did, however, issue a statement condemning Tuesday's violence. "We condemn any senseless killing of any person and we will do our best as law enforcement to ensure that the perpetrators are apprehended and punished," he said.

Sej Motau, the Democratic Alliance's national spokesperson for labour, has called for political leadership in a situation "that could cost lives and further cripple a struggling economy. I have called on the Minister of Labour [Mildred Oliphant] to mediate for calm earlier than she did last year," Motau said.

"I believe she would be the right minister to facilitate peaceful negotiations among the union members. The earlier she steps up to the plate the better. The DA will support any reasonable intervention she makes to cool the temperature and calm tempers between the unions."

Shange, however, feels that government intervention would spell catastrophe. "We have seen the outcome of the government's previous attempts to "manage" the situation in the death toll at Marikana, among other disasters," she said. "The only meaningful intervention ... will come from the workers themselves."

Wage negotiations
Apart from ailing share prices and a speculation that unrest may lead to another downgrade of the country's fiscal rating, mining bosses are sure to feel the effects of the rivalry in wage negotiations, due to start in a few weeks' time.

The tension "could mean very high opening wage increase demands. That could make it very difficult for an amicable settlement to be reached swiftly and without violent strike action," said Motau.

Emerging markets economist Peter Attard Montalto at Nomura is predicting dire ramifications. The situation would likely lead to the unions "competing outlandish claims for wage increases they can achieve, aggressive recruitment and counter recruitment, and politicisation of the process," he said.

Seshoka acknowledged that the rivalry would change the rules of engagement: "Of course it will affect the way we interact with employers [during negotiations]. As workers we are supposed to be on one side, but if we are competing among ourselves, it's going to be a problem. There is a saying that says where elephants fight, it is the grass that suffers."


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