Sibanye-Stillwater has announced additional restructuring at some of its SA gold mining operations that could result in 4,000 more job losses, underscoring the troubles facing the mining house, which recently wrote off almost R50bn worth of assets.
The company, the biggest employer in the sector, said about 3,000 permanent jobs and 915 contractors were are at risk. This means the group is slashing its workforce for the third time in a year.
It is consulting organised labour and representatives of affected non-unionised employees as required by law.
The latest restructuring happens just a month after Sibanye swung from a R19bn profit in 2022 to a R37.4bn loss in the year to end-December.
It impaired R47.5bn against various assets due to a plunge in precious metals prices.
Sibanye, one of the largest producers of gold and platinum globally, cut about 2,600 jobs at its platinum group metal (PGM) operations in SA earlier this year.
Thousands more jobs were lost or are on the line as metal and mineral prices plummet. The sector also continues to be dogged by logistics challenges and load-shedding.
Coal miners Glencore and Seriti launched retrenchment processes last year, while Kumba Iron Ore announced in February it planned to cut as many as 490 jobs.
Anglo American Platinum started talks with unions in February that could affect 3,700 jobs. Impala Platinum shed more than 1,000 jobs in the second half of last year.
Earlier in 2024, Sibanye reported that despite higher gold prices it had swung to a loss in the year to end-December after a 33% year-on-year drop in the average PGM basket price.
That resulted in a “dramatic fall” in the profitability of its PGM operations in the US and SA, which in recent years contributed the bulk of the group’s earnings and cash flow.
At Sibanye’s 2023 annual results presentation in March, CEO Neal Froneman said the group was cutting costs, and this was expected to save about R6.6bn.
That included the closure in 2023 of Kloof 4 shaft at its gold operations near Carletonville, which resulted in more than 1,000 job losses — 575 employees were retrenched and 550 accepted separation packages.
The proposed restructuring at its SA gold operations will affect the Beatrix 1 shaft at the Beatrix mine in the Free State, and the Kloof 2 plant, which has had insufficient processing material available to cover overheads since the closure of Kloof 4 shaft, the group said. The Beatrix 1 shaft had been unable to “deliver planned production”.
In addition, the deferral of capital expenditure at the Burnstone gold mining project in Mpumalanga, announced in February, also required restructuring after a reduction in planned capital activities, it said.
The restructuring at Sibanye’s PGM operations includes the closure of the Simunye shaft at the Kroondal operation, conditional operations of the 4 Belt shaft at Marikana, and “rightsizing” of Siphumelele shaft in the Rustenburg operation and the Rowland shaft at Marikana.
“We continue to act prudently to protect the balance sheet and ensure the sustainability of the group. We are committed to constructively engaging with affected employees and through their representatives to minimise job losses,” Froneman said in a statement.
Trade union Solidarity questioned the timing of the proposed retrenchments.
"[We are] extremely disappointed with and find it despicable that Sibanye will once again plunge a large number of its employees, contractors and their dependants into uncertainty and poverty. The timing of the retrenchments, just before the start of the salary negotiations, is to be questioned,” said general secretary Gideon du Plessis.
According to Du Plessis, the heads of the Sibanye executives should be the ones to roll.
“In 2021 Neal Froneman, in his reaction to his R300m remuneration package, boasted how Sibanye set the world alight under his leadership, when it was simply favourable market conditions and the employees’ hard work that led to its good performance. Now that times are tough, apart from the favourable gold price, everything except the Sibanye leadership is being blamed for the poor performance,” he said.
National Union of Mineworkers spokesperson Livhuwani Mammburu said the potential job losses were unacceptable. "[Sibanye] has been retrenching workers every year intending to cut costs while making huge profits at the expense of poorly paid mineworkers,” he told Business Day.
He called into question Sibanye’s commitment to mining in SA.
Update: April 11 2024
This story has been updated with new information.
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