Gold Fields improves severance terms at South Deep in bid to end strike

• by Reuters
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JOHANNESBURG (Reuters) – Gold Fields said on Wednesday it had offered union members striking at its South Deep mine in South Africa an increased severance package to try to resolve the dispute which has halted production.

Gold Fields, which employs about 3,600 people in South Africa, said in August it would restructure its South Deep operations and would cut about 1,100 jobs, nearly a third of the

workforce, to save money. In response, the National Union of Mineworkers (NUM) went on strike at the mine on Nov.2.

South Deep, the company’s last South African asset, has lost money over the past five years and Goldfields has been working to mechanise operations in the face of challenging geology 3 kms (2 miles) below the surface.

The company said its offer, which expires on Friday, included increasing severance payments by four weeks, or a total of as much as 45 million rand ($3 million), funding for skills training and preferential re-employment if positions become available.

“If the offer is not accepted by Friday then it’s difficult to predict how long the strike will continue for,” Chief Executive Officer Nick Holland said.

He also defended the plan to cut jobs after mining minister Gwede Mantashe on Monday criticised Gold Fields for not acting in good faith in talks with the government over the layoffs.

“We have really come in here with what we believe is the absolute minimum to keep the operation sustainable into the future and even then its going to be a challenge for us to do so,” Holland said.

Sources at the NUM, which represents most the employees at the mine, said that the national leadership wanted to resolve the strike but the branch leaders were digging in.

NUM branch leader Kanetso Matabane told Reuters this was not the case and Gold Fields was not entertaining any of their suggestions.

Gold Fields earlier this month reported third-quarter production falling to 533,000 ounces from 552,000 in the same period last year, with South Deep producing just 50,000 ounces in that period, against 81,000 ounces a year earlier.

($1 = 13.9639 rand)

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