Union politics, the Chamber of Mines’ attempt to maintain unity and frank analysis . . . Welcome to mining’s strike season
A strike in the gold mining sector is all but certain next week, after the sector’s majority union, the National Union of Mineworkers (NUM), issued a 48-hour strike notice to employers on Friday.
The fact that the other three unions have not issued notices could be almost as important: first as a test of the NUM’s real support and membership in the gold sector; and secondly, as a test for the Chamber of Mines’ resolve to maintain a united front.
Only members of the NUM will be able to start a protected strike on Tuesday.
The result is that mines where the NUM has the overwhelming majority could be completely paralysed while those where the Association of Mining and Construction Union (Amcu) has the majority should be able to continue working.
Amcu formally has about 17% representation, but claims that in reality it has far more.
On Friday, Amcu president Joseph Mathunjwa said the NUM’s strike would “qualify” its official representivity of more than 60%. “Watch this space,” he said.
This rift in union strategy comes as the Chamber of Mines this week struck an uncompromising posture on mine-specific deals – precisely the outcome Amcu has been gunning for.
If the mines broke ranks, it would very likely end with Amcu getting better deals. This is simply because it has most successfully recruited at a handful of large gold mines that have better operating margins than the average, especially at Sibanye Gold.
“Any union holding out for a separate deal is going to be disappointed. Separate deals will only increase rivalry, serve to incite violence and result in an unworkable outcome,” Harmony Gold’s chief executive, Graham Briggs, said in a statement.
Harmony would be badly placed if the central forum broke into company-specific settlements as it is currently operating at the worst margins of the three gold majors.
Meanwhile, metal workers’ union Numsa has shelved plans to call out a strike in fuel retail and automotive component industries tomorrow.
Instead, the union will meet with employers at the end of the week and decide whether or not to launch the strike next Monday, it said in a statement.
Although there are many strikes ongoing and some threatened, the gold strike holds by far the greatest potential for tangible economy-wide effects.
According to Nerina Visser, the head of Beta Solutions at Nedbank Capital, “it is fair to say” that some strikes will have limited economic impacts “if you look at them unemotionally”.
Strikes in crucial manufacturing industries, like the seven vehicle manufacturers, hardly register on the JSE at all because those companies are not listed.
Mining companies weigh disproportionately on the stock exchange, but also on the rand due to South Africa’s reliance on gold and platinum for earnings in foreign exchange.
According to Visser, South Africa’s dominance in platinum supply means that large strikes can push the metal’s price higher and “in a bizarre way, almost be good” for the companies’ revenue.
“Gold does not have that relationship,” she said.
At the other end of the spectrum is the possible strike of petrol station forecourt attendants as part of Numsa’s wage-negotiation round with the automotive sector. “This is not a critical job. In most countries, people pump their own fuel,” says Visser.
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