Evander loses 1 722 jobs

“The unions have been consulted by the mine about the dire financial situation,”

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The Bulletin Newspaper

The National Union of Mineworkers (NUM) said on Sunday that Evander Gold Mines will cut 1 722 jobs. Evander Gold Mines is a subsidiary of Pan African Resources. The NUM was shocked and saddened by Evander Gold Mine’s intention to retrench 1 722 mineworkers in Mpumalanga.
“Pan African Resounces (PAR) informed NUM that the job losses are due to deteriorating and inadequate infrastructure at the mine, high operating costs, such as rising electricity and labour costs and a low gold price,” according to NUM.
PAR acquired the mine from Harmony Gold in 2012 for 1,5 billion rand. The transaction was concluded in February 2013. Evander Gold Mines is capable of producing 95,000oz/annum according to the Pan African Resources web page. The current operations comprise of no 8 shaft, several potential development projects: Poplar, Evander South, Rolspruit and the Kinross metallurgical processing plant and tailings storage facility.
On the 8th of September 2017, PAR CEO Cobus Loots broke soil at its R1,7 billion Elikhulu Tailings Retreatment project in Evander. Speaking at the sod-turning ceremony Cobus said, “Elikhulu’s capital expenditure of approximately R1,7 billion is a substantial investment in the South African mining industry and is expected to contribute materially to economic development and employment in the Mpumalanga province.” (Read the full article about the Elikhulu project in the Bulletin’s publication dated 15 September 2017).
Elikhulu is scheduled to produce first gold in the final quarter of the 2018 calender year and deliver an average of 50,000 ounces per annum for the next 13 years, at an all-in sustaining cost of more than US$550 per ounce.
The job layoffs will have a huge effect on the workforce in the Govan Mbeki Municipal area. A total of 1 722 jobs out of a total of 1812 will be cut according to NUM Highveld regional secretary Tshilidzi Mathavha. That will leave a workforce of 90. “Evander Gold Mines is a subsidiary of the Pan African Resources. Evander Gold Mine served the NUM with [a] section 189(3) notice of the Labour Relations Act to retrench workers,” he said. “The retrenchment of 1 722 permanent workers is bad given the fact that the majority of mineworkers support 10 people per family which means that a lot of people will be negatively affected by these retrenchments,” the union said.
The mine layoffs will also affect approximately 484 contractors (PAR web page) that provide services to the mine.
The NUM totally opposed the retrenchments at Evander Gold Mines.
“The NUM is concerned that when mining companies issue section 189 of the Labour Relations Act they do not align it with section 52 of the MPRDA 2002 [Mineral and Petroleum Resources Development Act], which states the following: ‘The holder of a mining right must, after consultation with any registered trade union or affected employees or their nominated representatives where there is no such trade union, notify the minister in the prescribed manner – (a) where prevailing economic conditions cause the profit to revenue ratio of the relevant mine to be less than six percent on average for a continuous period of 12 months; or (b) if any mining operation is to be scaled down or to cease with the possible effect that 10 percent or more of the labour force or more than 500 employees, whichever is the lesser, are likely to be retrenched in any 12-month period’,” Tshilidzi said.
“There was a need for real transformation in the mining industry that emphasised human development, not only profits,” Tshilidzi said. “The process will be finalised on the 24th of April, as per the notice of the employer.”
“The employer has indicated that they are to retrench 1 700 employees. Which will actually mean that is the closure of the mine, because the company is currently operating with a strength of over 2 000 workers.”
The Bulletin spoke to Mr. Anthony Maki, Manager HR at Evander Gold Mines. During 2017 it announced that as part of the agreement approximately 976 of Evander Mines employees would be retrenched at an estimated cost of ZAR 54 million. The actual retrenchment was 612. Approximately 150 people have now been absorbed into the Elikhulu project. Another 250 (approximately) is being put through a “Portable Skills Program” to equip them to survive outside of the mining environment.
“The unions have been consulted by the mine about the dire financial situation,” said Anthony, “this have been done through the Future Forums as well as monthly union and manager meetings since February 2016. It was not a surprise to the unions.”
The mine has a projected production of 95,000oz but were only capable of producing approximately 45,000oz. Closing a shaft will mean that nearly half of that production will also fall away and with the gold price as it is at the moment, momentous losses can be expected. “Evander Gold Mines will close the underground operations completely” says Anthony.
Evander Gold Mines have applied for facilitation by the CCMA in the process of retrenchment. Evander Gold Mines has also applied to the Minister of Mineral Resources in terms of section 52;1A & 1B of the Minerals and Petroleum Resources Development act 28 of 2002. In accordance with the act they have informed the Minister that their profit to revenue ratio has been less than 6% for a continuous period of 12 months, from February 2017 up to January 2018.
The final retrenchment figures are not determined yet as a consultation process with the unions is not yet completed
We will bring you news on further developments as they become available.

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