Lonmin job cuts could bring more unrest in South African mines

JOHANNESBURG Wed Oct 31, 2012 1:13pm EDT

Striking miners chant slogans at the AngloGold Ashanti mine in Carletonville, northwest of Johannesburg October 18, 2012. REUTERS/Siphiwe Sibeko

Striking miners chant slogans at the AngloGold Ashanti mine in Carletonville, northwest of Johannesburg October 18, 2012.

Credit: Reuters/Siphiwe Sibeko

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JOHANNESBURG (Reuters) - Lonmin management and workers appeared on Wednesday to be shaping up for a new battle after the strike-hit mining company said jobs would be cut.

The world's third largest platinum producer, Lonmin is scrambling to get back on its feet after a violent six-week strike at its Marikana mine that crippled production and led it to ask shareholders for $800 million in a rights issue on Tuesday.

It also gave unions notice of a restructuring, with proposed job losses in its 25,000-strong work force expected to be implemented in early 2013.

"We haven't decided how many employees will be impacted. What we have said is we are freezing our production target at 750,000 ounces for the next two years," Lonmin spokeswoman Sue Vey said.

"What we are doing is shaping the business accordingly."

The company had said earlier the strike would cause it to miss targets. With production almost halving in the three months to September 30, it has postponed its aim of increasing output to more than 900,000 ounces a year.

The National Union of Mineworkers (NUM) said it would fight any job cuts.

"Of course, we are in principle opposed to retrenchments. We will discourage them from going on a restructuring process that would see any jobs being lost," NUM spokesman Lesiba Seshoka said.

The union hoped to meet management next week, he said.

The timing of the move is delicate as a wildcat strike is still gripping the nearby Anglo American Platinum mines at Rustenburg - where police fired rubber bullets and tear gas at strikers on Tuesday - and Lonmin workers only having been back at work for a month since their strike.

Emotions are also still high after the police killing of 34 striking Lonmin miners at Marikana on August 16, the bloodiest security incident since the end of white-minority rule in 1994.

Tens of thousands of gold miners have also only returned to work in the last two weeks and lay-offs at Lonmin could trigger sympathy strikes.

Gideon du Plessis of the white-collar Solidarity trade union said he was not surprised by the Lonmin notice but he feared middle-management rather than the rock-drillers who led the strikes would bear the brunt of cuts.

"The focus will be on management levels but that means they are punishing those who did not participate in the strikes," Du Plessis said.

"These innocent people are now casualties."

(Reporting by Sherilee Lakmidas; Editing by Ed Cropley and Angus MacSwan)

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