Bloomberg News

Impala Fires 17,200 Workers at World’s Biggest Platinum Mine

February 03, 2012

(Updates with union comment in seventh paragraph.)

Feb. 2 (Bloomberg) -- Impala Platinum Holdings Ltd., producer of about a quarter of global platinum, fired 17,200 workers after an illegal pay strike halted its Rustenburg mine, the world’s biggest for the metal.

The number includes 13,000 employees who joined the stoppage, declared illegal by court order, after they failed to return to work by yesterday’s deadline, the Johannesburg-based company said in a statement today. The strike is costing Impala about 3,000 ounces of platinum daily, the equivalent of $4.9 million in sales a day.

The Rustenburg operation, northwest of Johannesburg, accounts for half of Impala’s total production and about two- thirds of its profit. The mine produced 941,200 ounces in Impala’s last fiscal year. South Africa is the world’s largest producer of the metal used in car components and jewelery.

Impala fell 2.5 percent to 170.68 rand by the close of Johannesburg trading, compared with larger rival Anglo American Platinum Ltd.’s 0.5 percent decline.

Disruptions at the mine, which employed 46,653 permanent and contract workers last year, started on Jan. 20 when about 5,000 rock-drill operators began a strike over pay. They were dismissed. By Jan. 26, about 15 percent of them returned to work at the mine.

The strike widened this week when the majority of staff didn’t report for duty, Impala said Jan. 30, adding the Association of Mineworkers and Construction Union, which isn’t formally recognized by Impala, “attempted to gain recognition” at the mine.

‘Big Battle’

The National Union of Mineworkers, which represents most Impala workers and is recognized by the company, dispatched a team “to help normalize the situation,” NUM spokesman Lesiba Seshoka said yesterday.

“It will be a very big battle,” Seshoka said, and production is unlikely to resume soon.

The Congress of South African Trade Unions, whose NUM affiliate represents most employees at the operation, asked Impala to reinstate the jobs.

“A process of rehiring for those employees who wish to reapply for their positions will be undertaken in due course,” Impala said today.

Jeff Mphahlele, general secretary for the Association of Mineworkers and Construction Union, which represents some of the rock drill operators, couldn’t immediately comment when reached by mobile phone. Dumisani Nkalitshana, the union’s national organizer, didn’t respond to a message left on his mobile phone.

Rock-drill operators went on strike because they weren’t given the same pay increases other categories of worker were awarded, Seshoka said yesterday.

--Editors: John Viljoen, Reed Landberg

To contact the reporters on this story: Carli Lourens in Johannesburg at clourens@bloomberg.net; Jana Marais in Johannesburg at jmarais@bloomberg.net

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


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