Wage claims and violence hit South African mines

The turmoil in South Africa’s mining industry appears to be escalating despite a settlement at Lonmin’s Marikana platinum mine, where 46 people were killed and 78 injured in violent clashes with police in August.

The world’s largest platinum producer, Anglo American Platinum – known as Amplats – sacked 12,000 striking miners at Rustenberg who had defied an order to report for disciplinary hearings. The dismissed miners were among 28,000 who had downed tools in a pay dispute. As a result, Amplats lost production and 700m rand ($80m, £50m, €62m) in profits, and closed four mines.

Amplats mineworkers in Limpopo province joined the fray by refusing to go underground and presented wage and other demands.

In the gold mining sector, unions and employers have offered hope of calm by reaching a deal giving a 10.8% pay rise until next year. Negotiations will restart in February.

Earlier, around 11,000 striking employees in Gold Fields’ mines had returned to work but the remaining 8,500 were sacked. More than 7,000 of these are challenging their dismissals in court.

Meanwhile, more closures and sackings are threatened by AngloGold Ashanti, the world’s third-largest gold producer. Already, the company has halted operations as most of its 35,000 employees have joined an illegal pay strike.

In South Africa’s first industrial action in the coal sector, employees at a Coal of Africa colliery walked out after rejecting a pay and benefits deal equating to a 22% rise.

The disquiet has even hit boardrooms. Aquarius Platinum chief executive Stuart Murray resigned, apparently in response to clashes at the company’s Kroondal mine. In August, three people died and at least 20 were injured in strikes and violence between rival unions while, in September, work was temporarily suspended.

Earlier, Impala Platinum CEO David Brown left and Neville Nicolau quit as Amplats’ chief executive.

However, peace has returned to Marikana, where Lonmin agreed to pay rises of between 11% and 22%, but observers fear this could fuel the inter-union rivalry that was partly responsible for the original violence.

The established National Union of Mineworkers appears to be losing members to the more militant Association of Mineworkers & Construction Union (AMCU), suggesting dissatisfaction with existing collective bargaining.

Industry-watchers suspect AMCU’s increased power could make strikes and violence more likely. In addition, the unprecedented Marikana deal could provoke miners elsewhere to strike for better pay.

n In Mongolia, the World Bank is considering a $900m (£560m, €695m) loan package and up to $1bn in political risk insurance for Rio Tinto’s Oyu Tolgoi copper and gold mining project, despite criticisms that the company has not consulted nomadic herders, some of which have lost animals or been forced to resettle. Rio Tinto rejects these and other allegations.