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Amplats Mines Halted by Strike Over South Africa Job Cuts

Sept. 27 (Bloomberg) -- Anglo American Platinum Ltd. mines halted as workers started a strike to protest against 3,300 planned job cuts at the South African operations of the world’s largest producer of the metal.

Less than 20 percent of employees reported for duty at the company’s mines near Rustenburg and north of the Pilanesberg in the North West province, Anglo Platinum, known as Amplats, said in today in a statement.

“Production will be impacted by the strike although sales will not be impacted at this point,” the Johannesburg-based company said.

The Association of Mineworkers and Construction Union, the biggest at Amplats, is challenging last month’s decision by the company to consolidate five mines into three at its Rustenburg complex to curb costs. The mines are losing more than 1 billion rand ($100 million) every six months, Chief Executive Officer Chris Griffith said Aug. 30. Amplats produces as much as 40 percent of world supply.

Employees not affiliated with AMCU also were affected. While minority union UASA isn’t striking, “there is very little other workers can do without AMCU’s members,” said Franz Stehring, head of mining at UASA.

The company’s processing unit isn’t affected, Amplats said.

The stock was unchanged at 440 rand at the close in Johannesburg.

Cuts Necessary

“The company is under tremendous economic pressure,” Griffith said in today’s statement. “Strikes and work stoppages will result in further losses that will hamper plans for future sustainability.”

In separate talks held yesterday, Amplats offered workers wage increases of 6 percent, UASA’s Stehring said. AMCU rejected the offer and declared a deadlock with management, union Treasurer Jimmy Gama said by phone.

“The company was not attending to our demand for a living wage,” Gama said. The union wants entry-level pay more than doubled to 12,500 rand a month. Inflation was 6.4 percent in August, according to Statistics South Africa.

Amplats spokeswoman, Mpumi Sithole, today refused to comment on the wage talks with AMCU, saying only that “the outcome of the negotiations will be communicated at the conclusion of the negotiations.”

To contact the reporter on this story: Andre Janse van Vuuren in Johannesburg at ajansevanvuu@bloomberg.net

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

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