It was day 18 of a cold and hungry strike, haunted by death. At Western Holdings, an Anglo American mine in Welkom, in the Free State province of South Africa, the mood of the penniless crowd threatened to turn ugly; many were angry and wanted to go back to work.
To make matters worse, the news had broken that the mining companies had begun firing workers over the strike for a 30% pay rise. In two turbulent winter weeks of 1987, police had shot and beaten strikers to death; along with worker kangaroo courts, for strike breakers, it brought the death toll to nine. The first flexing by the new National Union of Mineworkers (NUM) proved painful.
Into the eye of this angry storm stepped fresh-faced strike leader Frans Baleni to address 50,000 strikers at Western Holdings.
“I was 27 years old. I was very nervous, I was shaking, I was not sure what was going to be the reaction,” he recalls nearly 30 years to the day.
<blockquote>“I told them we had two choices: stay out, or go back to work and forget the people who died. I said if you don’t accept this, kill me.”</blockquote>
There was deafening silence for a few seconds and then a chant of: “Amandla (power to the people).”
“All of a sudden, I was in the sky. The crowd had picked me up and were carrying me, singing, to the beer hall about 800 meters away. I was not sure whether I was going to fall. When we got there they bought me a drink!”
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The joy was short lived. The mining companies threatened to fire 50,000 miners and on the 21st day the strike caved in. For current South African deputy president Cyril Ramaphosa – the lawyer who founded the NUM in 1982 – it must have been a bitter blow made worse by the fact he heard the news, not from the employers, but from a journalist. Many years ago I interviewed an activist who went with Ramaphosa on an early appeal for union recognition at one of the big mines in Carletonville, west of Johannesburg, one rainy afternoon. They had to use the backdoor and were forced to stand, soaking wet, before the seated bosses in the boardroom.
The first strike ended in defeat, but Baleni, who went on to head the NUM in 2006, believes it was worth it.
“We didn’t get a pay rise but it saw the birth of the provident fund that is now worth R27 billion ($2 billion)!” chuckles Baleni.
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Baleni also believes the strike opened the way for black workers to be trained for whites-only jobs. He helped the employers to select candidates, but his activism saw him fired in 1988 and he never was trained himself.
One of the chosen was Senzeni Zokwana, who trained as a shift boss and safety specialist at President Steyn Gold Mine in the Free State. In 2000, he became president of the NUM and in 2014 he became probably the first minister of agriculture in South Africa’s history to hold an underground blasting license.
Out of three weeks of misery and violence sprang some good.

‘I Said Kill Me, They Said Cheers!’

Carletonville, 60km west of Johannesburg, is a town teeming with miners, but on this day there are none to be seen. The reason: a gold miners’ strike over pay for the first time in more than six years.
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It is a strike that cost the gold mining industry 15,900 ounces of gold production a day, meaning losses of $23 million daily, according to Kobus Nel, a mining analyst at Stanlib in Johannesburg. The strike will dent the share prices of South Africa’s largest gold miners: AngloGold Ashanti, Gold Fields and Harmony. The reason—one of the most fractious rounds of pay talks in South African mining history. The negotiations, held every two years, are crucial for planning for the industry as wages make up more than half of mining costs.
The gold companies thought they were going to have an easy ride this year with inflation at around 5%. The employers hoped to settle swiftly for between 8 and 9% and many labour analysts agreed. Employers were, however, flabbergasted in May when the National Union of Mineworkers (NUM)—the most powerful union in the land—asked for 14% and a package of costly demands. The employers calculated that these demands translated to an effective 25% increase in costs. Elize Strydom, the chief negotiator for the employers, described the demands as “disappointing and distressing”.
An opening offer of 4% was rejected with disdain by unions. To complicate matters further, the gold companies were divided. AngloGold Ashanti and Gold Fields were happy to raise the offer, while Harmony, with its old and marginal shafts, stuck to a lower offer. The unions in South Africa are on a mission, encouraged by a record high gold price, to close the wage gap between the lowest paid, toiling with shovels, and the highest paid, sitting in boardrooms. “These employers have rested on their laurels for too long—we want 14%, or we will strike,” said Lesiba Seshoka, the national spokesman for the NUM. It all boiled down to a deadlock at an offer between 8 and 9% on July 25, followed by an all-out gold strike three days later.
On the day, AngloGold Ashanti and Harmony were down about 3%, closing at R281.11 and R91.19 respectively. “If the strike lasts a week, the loss of production will represent 6.5% of quarterly production, quite a hit on the industry,” said Nel.
Surprisingly, Gold Fields closed flat at R103.50. Nel said Gold Fields may have been unscathed because it had already been aggressively sold o‑ due to its exposure to Peru where there was a threat of an increase in taxes. With stock markets forward looking, much of the negative impact of the strike had already been priced into the shares .Also on the day, investors were jittery about the European debt crisis and the political brinkmanship playing out in the United States over the great debt limit saga. These fears kept investors buying gold, pushing the price to record highs. Nel expects  the  gold  price  to  rise  and  rise  in  the months  to  come.  He  sees  it  peaking  at  $1,677  per  troy ounce  in  the  first  quarter of 2012.
AngloGold Ashanti, Gold  Fields  and  Harmony  the  day after  the  commencement  of  the  strike  were  relatively  flat closing  at  R281.00,  R103.60  and  R90.75  respectively. All  in  all,  the  last  week  in  July  proved  an  expensive one  for  South  Africa’s  three  gold  giants  and  their shareholders.

Tag: NUM

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‘I Said Kill Me, They Said Cheers!’

Gold Shutdown