The National Union of Metalworkers of SA (Numsa) says it is consulting its legal team after a decision by steel producer ArcelorMittal SA (Amsa) to retrench 107 workers after a section 189 process under the Labour Relations Act that began about three months ago.
Numsa Sedibeng regional secretary Kabelo Ramokhathali said the union, SA’s largest with more than 450,000 members, would hold a general meeting at the weekend “to determine the way forward on this vicious attack on our [work] benefits and conditions [of employment]”.
The steel and engineering sector is a vital component of the economy, contributing about 1.5% to GDP and counting household names such as Amsa.
The steel sector, which employs about 200,000 people and provides the automotive, mining, construction, aero and defence, and rail industries with steel, has been a victim of declining prices due to an increase in cheap imports.
Ramokhathali criticised Amsa for demonstrating inhumanity towards its workforce as it was about to embark before the festive season holidays.
“Amsa has decided to retrench 107 workers. We concluded a section 189A process [dealing with retrenchments] which began in August of this year. We did not agree with the company’s rationale for the retrenchments because we are not convinced that the only option is job cuts. Only a cruel and uncaring management can toss workers out into the sea of unemployment just before Christmas, and this is why they must be strongly condemned,” Ramokhathali said.
The retrenchments come after Amsa and Numsa signed a three-year wage agreement in May 2023 for increases of 6.5% in the first and second years, and an inflation-related increase capped at 6.5% in the final year of the deal, effective from April 1 2023 to March 31 2026.
The inflation rate has been going down, easing to 3.8% in September from 4.4% in August.
As part of the three-year pay deal workers would receive a one-off cash bonus of R10,000; the medical aid subsidy would increase by 6.5% in the first year and consumer price inflation (CPI) related increases capped at 6.5% in the outer years of the deal; the funeral benefit would increase from R10,000 to R20,000, and Amsa’s medical aid contribution would remain at 60% in the first year. In May 2022, parties signed a one-year deal for a 6.5% pay increase across the board.
Ramokhathali said in August Amsa served Numsa with a section 189A notice of its intention to close the coke-making battery section 6 and 7, stating that the batteries “are at the end of their life and cannot be repaired or restored any more”.
“Numsa does not agree with retrenchments as the solution. We think that Amsa has not fully disclosed all the information which can help us to save these jobs. We are told there are vacancies in other parts of the plant. We want full disclosure so we can find alternatives for these workers,” he said.
The union was aware some older workers wished to take early retirement, but “Amsa refuses to allow for voluntary severance packages for those workers who wish to take early retirement. There are workers who are not part of the coke-making department who wish to leave but Amsa claims they are not affected and will not grant them early retirement.
“It is our view that these job cuts are targeting the most militant section of the workforce. They are getting rid of people who are likely to mobilise workers,” Ramokhathali said.
“At the same time, the flat steel plant is undergoing reorganisation which will result in at least 200 workers possibly losing their benefits and conditions, because they will be transferred to other departments.
“We are concerned that this may result in lower wages and changes to their conditions, especially because Amsa did not consult. Amsa wants to transfer them to other departments and, in some cases, their core functions will be outsourced. This is worrying because these transfers may tamper with their basic conditions of employment. They are refusing to be transparent on this issue and it makes us suspicious.”
Amsa spokesperson Tami Didiza said Amsa’s coke-making battery sections 6 and 7 “reached the end of their operational lifespan and the planned closure was effected in quarter four of 2024”.
“The decision to initiate a section 189A of the Labour Relations Act under the auspices of the CCMA (Commission for Conciliation, Mediation and Arbitration), which began in August 2024, was made after consultation with labour representatives, including Numsa. A commissioner of the CCMA oversaw the process and we actively engaged with Numsa and other relevant stakeholders throughout each stage of the consultation process, providing all pertinent information.”
Didiza said the reorganisation at Amsa’s flat steel plant was intended to optimise operational efficiency and “we will continue to engage with employees to clarify any concerns related to their roles and benefits. We emphasise that any reassignment of roles within ArcelorMittal SA will operate strictly in accordance with SA labour legislation, and the company is committed to ensuring that no employee’s conditions of employment will be unfairly compromised.”
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