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Amplats Mine Stalled Just as Unions Pledge to Halt Labor Unrest

June 14 (Bloomberg) -- Workers disrupted output at a South African mine owned by Anglo American Platinum Ltd., the world’s biggest producer of the metal, just as unions and the companies were agreeing on ways to restore peace after violent unrest.

Some miners at the Thembelani operation in Rustenburg, about 120 kilometers (75 miles) northwest of Johannesburg, have prevented about 2,400 workers from returning to the surface in protest against the suspension of four union organizers, the company said in a statement.

“People can’t go under to start their shift tonight, so production has been disrupted,” Mpumi Sithole, a spokeswoman for the Johannesburg-based company known as Amplats, said by phone. Security teams are at the mine and management is speaking to unions to resolve the situation, Amplats said.

South African mining companies including Amplats, labor unions and the government today agreed on a draft pact outlining how they will restore peace in the industry.

The country is trying to defuse union rivalry that has led to three worker deaths since May at shafts owned by Lonmin Plc, the third-largest platinum producer. This followed the killings of at least 44 people, including 34 shot by police in one day, near Lonmin’s operations in the country last year.

Labor unions will discourage their members from taking the law into their own hands and will ensure disputes are managed through the country’s legal framework, while companies pledged to resolve labor issues as quickly as possible, according to a draft of the agreement distributed today in Pretoria, the capital.

Previous Attempt

The government plans to start a mine-crime combating forum and will ensure law-enforcement agencies act impartially, it said.

A previous attempt to restore peace in mines in the nation, which has the world’s biggest known reserves of platinum, failed even as all unions and the biggest mine operators agreed to a pact brokered by Mines Minister Susan Shabangu.

“The peace accord was there, but the gap is that we didn’t deal with issues of implementation,” Shabangu said in an interview today.

The draft follows a meeting this morning that was hosted by Deputy President Kgalema Motlanthe. The parties will consult for the next two weeks and a final version should be ready by June 26, he said. Companies, the unions and the government will meet every quarter for the next 12 months to ensure that the commitments are implemented. Unions didn’t promise that they will refrain from any legal strikes between now and June 26, he said.

Labor Conflict

The rand erased losses against the dollar after the announcement, strengthening as much as 0.2 percent. It traded 1.2 percent down at 9.9619 by 5:21 p.m. in Johannesburg.

The currency’s movement was prompted by Motlanthe’s announcement, William van Rijn, a currency trader at Nedbank Group Ltd., said by phone from Johannesburg.

Conflict has surrounded competition between the National Union of Mineworkers, an ally of the ruling African National Congress, and the Association of Mineworkers and Construction Union. The AMCU is now the biggest representative of employees at the world’s three largest platinum companies, all of which have the bulk of their operations in South Africa. Motlanthe is a former general secretary of the NUM.

Economic Cost

Mining strikes last year caused almost 15 billion rand ($1.5 billion) in lost output and shaved about 0.5 percentage point off gross domestic product, according to government figures. Unrest has cut a further 0.3 percentage point off growth this year, President Jacob Zuma said yesterday.

The AMCU yesterday delayed its plan to start a strike over organizational rights at Lonmin to participate in today’s talks. AMCU President Joseph Mathunjwa was present, as was Lonmin Acting Chief Executive Officer Simon Scott and leaders of the Chamber of Mines.

“I definitely think we’ve come a long way” since February’s peace accord, chamber Vice President Mike Teke said in an interview. “The previous agreement was led by the Department of Mineral Resources. Here, you have a much bigger buy-in from more sectors of government.”

Gold and coal companies, working through the chamber, are due to start wage negotiations with unions in the middle of this month. The NUM has asked for employees who operate at the surface of mines to be increased by as much as 61 percent, and for gains of 15 percent in other worker categories.

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