The National Union of Metalworkers of SA (Numsa) has asked the state to nationalise troubled steelmaker ArcelorMittal SA (Amsa) to drive local manufacturing and save jobs.
On Monday, the labour court ruled that Amsa must reinstate the employees it retrenched at its Newcastle and Vereeniging plants on October 21 and restart a consultation process with Numsa.
Amsa spokesperson Tami Didiza told Business Day on Tuesday that the company was appealing the ruling.
“Amsa has applied for leave to appeal the decision, and the effect of such application is that the order of the court is suspended. Amsa maintains that it has complied with its obligations to consult fairly,” Didiza said.
In January, Amsa, Africa’s largest steel producer, announced its decision to close its long steel operations in Newcastle and Vereeniging, affecting at least 3,500 jobs, which have now risen to about 4,000.
The decision was due to “prolonged weak economic conditions, logistics and energy challenges, and unsustainable competition from low-cost imports”.
It has been a torrid few years for Amsa’s long steel business, with it having posted cumulative losses of R1.7bn since 2023.
“The wind-down decision has been deferred since November 2023 in an attempt to explore alternative solutions, and during this time there has been extensive consultation with all stakeholders including labour, yet, unfortunately, solutions could not be found by the end of the deferral period [September 2025],” Didiza said.
“In the circumstances there was no option but to proceed to place the longs business into care and maintenance, as any further delay would have prejudiced the entire company.”
Numsa general secretary Irvin Jim said the union approached the courts on an urgent basis on October 8 for an order compelling Amsa to issue a fresh Section 189 notice dealing with retrenchments, “or at the very least engage in further consultations pursuant to the January 8 Section 189 notice issued earlier this year”.
“Amsa unilaterally terminated the consultation process on retrenchments at the beginning of March, and while there were no consultations thereafter, with major intervening events and developments, Amsa simply wanted to proceed with dismissals in October on the basis of the process it had terminated in March,” he said.
The court ruled that Amsa must follow a fair process by restarting talks with Numsa and that the steelmaker was not allowed to dismiss workers based on the January notice. “Amsa will have to pay workers who were retrenched their salaries for the period they were retrenched. This is a victory for the union because it provides an opportunity to possibly look at alternatives to retrenchment,” Jim said.
He called on the department of trade, industry and competition, the Presidency, and the Industrial Development Corporation (IDC) to take “drastic measures” and look for alternatives to the retrenchments.
“Otherwise Numsa will be left with no option but to do everything possible to prevent job losses, both in Newcastle and Vereeniging. If Amsa fails to do this, Numsa will be left with no option but to follow the Companies Act and apply to place Amsa legally under business rescue,” Jim said.
“Furthermore, it is time for the government to nationalise Amsa and these endless negotiations between IDC and Amsa must be brought to a close. The government must do everything to ensure that Newcastle is not closed,” he said.
“Nationalisation of Amsa will also mean that the government must take over Amsa entirely, and this includes the plant in Saldanha Bay (which has been mothballed) in the interest of driving local manufacturing and industrialisation.
