Labour unions have blamed poor leadership and management of Sibanye-Stillwater for failing to turn around the company’s struggling shafts after it announced plans to begin consultations that could affect about 4 000 employees from its South African gold mining operations.
The multinational mining and metals processing group yesterday said it that it would enter into consultations in terms of section 189A of the Labour Relations Act (s189) with organised labour and other representatives of affected non-unionised employees, regarding the proposed restructuring at its South African gold operations and its southern Africa region services functions.
Further worsening the retrenchments by Sibanye at its South African gold mining operations is a rationalisation exercise for its southern Africa services.
Sibanye’s spokesperson, James Wellsted, said this was further to previous restructuring, which was concluded during the latter half of 2023 and the early part of 2024, following an ongoing group business review that had identified a further need to address loss-making operations.
“As a result of the reduction of the operational footprint in the SA region due to the recent restructuring and closure of the loss-making shafts, the capacity of the direct and shared services functions for the SA region and the operations are surplus to current and future requirements,” Wellsted said.
“As a result, we have also proposed restructuring the regional services and other services structures to align with the requirements of the reduced operational footprint. This will serve to lower regional and other overhead costs which are allocated to operations, thereby contributing to the sustainability of the SA region operations.”
The proposed restructuring could potentially affect 3 107 employees and 915 contractors, with 1 794 of the potentially 3 107 affected jobs possibly being reduced, although subject to consultations this may be lower.
Trade union Solidarity’ general secretary, Gideon du Plessis, told “Business Report” in an interview yesterday that Sibanye’s CEO, Neal Froneman, should shoulder the blame for the group’s poorly performing shafts as he had bragged about the company doing well only a few years ago.
“In 2021, Neal Froneman was bragging how he was shooting the lights out and that’s why he deserved his R300 million package and now that things are not going so well they don’t take the blame for it but blame market conditions. That’s telling of the kind of leadership the company is under,” Du Plessis said.
Sibanye said an ongoing review of its business had now identified the “need to address losses at the Beatrix 1 shaft, which has been unable to deliver planned production, and the Kloof 2 plant which, after the closure of the Kloof 4 shaft during 2023, has had insufficient processing material available” to cover overheads.
It said the deferral of capital expenditure at the Burnstone project, which was announced in February 2024, also required restructuring aligned with the reduction in planned capital activities.
In a statement, Froneman said Sibanye was acting to protect its balance sheet after sinking into a loss of $2 billion (R37.4bn) in 2023.
“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,” Froneman said.
Job losses in the mining industry have become prevalent recently as the industry is struggling against lower commodity prices, and Sibanye has already cut about 2 600 jobs at its platinum group metals operation in South Africa this year.
The National Union of Metalworkers of SA (Numsa) general secretary Irvin Jim also blamed Sibanye’s management for failing to turnaround non-profitable shafts.
Jim said they were disappointed to see the JSE-listed gold and platinum group metals (PGM) producer adding to its already concluded retrenchments in the PGM sector.
“We obviously condemn any intention to retrench workers by any company or mine, including Sibanye. In many cases these companies announced retrenchments and issue section 189 when the intention is to restructure with the aim to maximise profit,” he said.
Jim called for the intervention of the Department of Mineral Resources and Energy (DMRE) to stem the tide of retrenchments in the sector at a time when gold prices have remained supportive around their highest levels.
“We call on government in particular DMRE to stand with unions in opposing these retrenchments of workers as it completely looks like a failure of management to plan and come out with turn around that preserve jobs, given that the price of gold is booming,” Jim said.
BUSINESS REPORT