Amplats says to begin cutting 6,900 S.Africa jobs

World number one producer Anglo American Platinum said Monday it will begin laying off around 6,900 workers in South Africa on September 1, prompting immediate strike threats.

“A month’s notice period for affected employees will commence on 1 September,” said Amplats CEO Chris Griffith, finalising plans to cut 6,000 mine and 900 corporate jobs to save around $400 million a year.

The ultimate number will depend on “voluntary severance packages, early retirement, redeployments and the filling of internal vacancies.”

The plan, initially put forward in May, comes after talks with the government and unions.

Unions, including the ruling ANC-aligned National Union of Mineworkers (NUM), have vowed to oppose the layoffs with strike action if needed.

“We are now shocked by this huge figure. It’s totally unacceptable,” said NUM spokesman Lesiba Seshoka.

“We will oppose it at all cost, even it means embarking on a strike.”

Amplats had first proposed around 14,000 job cuts.

The firm, which accounts for almost 40 percent of global platinum sales, said it will aim for production of 2.2 to 2.4 million platinum ounces per year.

“The implementation of our proposals will help us create stability for the business,” said Griffith.

NUM said the decision goes against an agreement reached between unions and the firm of cutting only 3,000 jobs.

“Last week we agreed that workers were going to be allowed to take early voluntary retirement not this,” said Seshoka.

An official from the Association for Mineworkers and Construction Union (AMCU) said the union was trying to convince the workers not to resort to a strike over the firm’s position.

“We are trying to contain the situation… if the company doesn’t withdraw the layoffs, they will strike,” said Gadaffi Mdoda, an AMCU branch manager at Rustenburg.

Amplats has been one of several major international mining companies that have been pummelled by labour unrest.

Many of the firm’s most productive mines are in the restive Rustenburg area, which is also home to Lonmin’s Marikana platinum mine, the scene of deadly violence a year ago.

On Friday the comrades and families of 34 miners shot dead by South African police marked the first anniversary of the bloodbath which shocked the world, and the mining sector.

Amplats profits have been obliterated by high wage bills and increased electricity costs.

At the same time, expensive deeper mines yielded lower grade metals.

Amplats is one of the largest employers in the private sector.