HomeBusinessAngloGold initiates retrenchment talks

AngloGold initiates retrenchment talks

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ANGLOGOLD Ashanti has become the third gold miner in recent months to start talks with unions and employees on retrenchments against a backdrop of weakening gold prices and rising costs.

Gold prices have fallen 4% this year to $1 150/oz on a strong dollar and expectations of rising interest rates. In rand, gold has dropped about 14% from its March peak to about R41 000/kg.

anglogold ashanti
anglogold ashanti

Last month, Sibanye Gold said it was holding talks with labour and other stakeholders about potential retrenchments at its Cooke 4 shaft, which employs 2 500 people.

Harmony Gold put its Target 3 operation on care and maintenance in August and started a section 189A process (negotiations on job losses required under the provisions of the Labour Relations Act) with employees.

News agency Reuters, citing a company memo sent to unions, reported on Tuesday that AngloGold was offering voluntary retrenchment packages with a preference for applications from those more than 55-years-old.

AngloGold spokesman Chris Nthite confirmed the company wanted to reduce staff numbers in key areas across the business and at all levels.

“We wouldn’t want to presume to be able to predict gold price movements,” he said.

“However, given how volatile it is and by how much it has fallen over the past two months, we have to position the business to withstand further gold price shocks.”

Nthite declined to specify the number of jobs at risk as he said talks were under way with unions. AngloGold had no plans to close any of its operating mines.

National Union of Mineworkers acting spokesman Livhuwani Mammburu said the union met AngloGold management on Friday and was told that the miner was overstaffed in certain categories.

They agreed to look at ways to avoid forced retrenchments and one option was to offer voluntary packages.

Sibanye Gold spokesman James Wellsted said a section 189 process at Cooke 4 was ongoing, making it difficult to say if any jobs would be jeopardised.

“At the moment the gold price isn’t the issue, but clearly if it declines much further we may have to review our plans,” he said.

Harmony CEO Graham Briggs said about 900 of the 1 324 mine employees from Target 3 would be, or had been, accommodated in vacant positions at other units.

Asked about possible retrenchments at Kusasalethu where Harmony is drawing up plans to restore profitability, Briggs said the mine’s production performance had continued to be problematic.

“Until such time as the alternative plan has been finalised, it is simply too early to say whether or not there will be any retrenchments.”

Matt Brenzel, a fund manager at Cadiz Asset Management, said while mining companies had some control over their volumes of production, they could not control the gold price, which was squeezing margins.

– BDLive

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