Police Asked to End Weeklong S. Africa Underground Mine Strike

Village Main Reef Ltd. (VIL) said it’s asked the police to help it end a weeklong underground sit-in by workers at one of its gold and antimony shafts in South Africa.

Some employees are preventing negotiators from accessing about 100 miners inside the Monarch Decline Shaft at the Consolidated Murchison mine in Limpopo province, the Johannesburg-based company said in a statement today. They have been in the mine since July 10, Operations Director Dalubuhle Ncube said by phone. The strike, which has halted the operation, involves 918 employees and those underground have had access to food, water and electricity, the company said.

The miners, who are members of the National Union of Mineworkers, are demanding they be paid out funds or dividends from an share trust set up by the company that Village bought the mine from in 2010. Unions including the NUM this the week rejected a 4 percent wage increase offered by the Chamber of Mines, which negotiates pay on behalf of gold-mining companies. The NUM asked for a 61 percent raise for some entry-level employees.

“Village has obtained a Labour Court interdict in terms of which the dismissal of employees engaged in the unprotected strike will now proceed,” the company said. It has also asked the police to help secure access to the shaft to prevent any further damage to property.

The trust hasn’t paid out dividends since Village’s purchase of the mine from Metorex Ltd., and workers only realized this now because the shares would have vested in five years’ time, William Mabapa, the NUM’s regional secretary for Limpopo, said by phone.

Strike Participants

Getting permission to strike legally would take at least 30 days and workers are afraid the company may be sold or closed down, he said. “If we do it the legal way we may still be the losers,” Mabapa said.

Village hasn’t received any binding offers for the operation, Ncube said.

The company is one of the producers that this month signed a framework brokered by Deputy President Kgalema Motlanthe to restore peace and stability to the mining industry after unrest shaved 0.5 percentage point off growth last year and cost the economy about 15 billion rand in lost output.

As part of that pact, the government promised to enforce the rule of law, it said in a July 3 statement.

Some members of the mine’s security force are taking part in the strike, and the police hasn’t yet provided help, Ferdi Dippenaar, managing director of Village’s gold unit, said by phone. The company has brought in outside security personnel, he said.

Thabethe Simon Mpembe, the police commissioner for Limpopo, didn’t immediately respond to a call and e-mail requesting comment. Calls to Hangwani Mulaudzi, the police’s spokesman in the province, didn’t connect.

About 2,400 platinum miners were trapped underground at Anglo American Platinum Ltd. (AMS)’s Thembelani operation in Rustenburg, northwest of Johannesburg, last month. The dispute was resolved after one night on June 15.

To contact the reporter on this story: Kevin Crowley in Johannesburg at kcrowley1@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

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