HomeGoldGold Fields may lay off 1 500

Gold Fields may lay off 1 500

Number Nine shaft at
the Driefontein gold
Johannesburg, South Africa — MININGREVIEW.COM — 22 January 2009 – Gold Fields Limited – the world’s number four and Africa’s second- largest producer of the metal – is considering laying off about 1 500 workers in South Africa.

Revealing this to Reuters, National Union of Mineworkers (NUM) deputy general secretary Oupa Komane said the union had resisted the move in a meeting with the company in December. It had asked the group to show why the proposed cuts – mostly in services rather than mining jobs – were needed. Gold Fields did not want to comment on the proposed cuts.

So far more than 14 000 jobs in South Africa’s key mining sector are under threat due to the global financial crisis, and analysts predict that even more jobs could be lost.

Komane said Gold Fields chief executive Nick Holland, and Vishnu Pillay, the executive head of the group’s South African operations, had met with the NUM – South Africa’s biggest union – just before Christmas.

“The intention was to persuade us to agree to the need to cut jobs, mostly in protection services, the company’s academy and in stores – not so much in mining itself,” Komane explained. “The company wants to lay off about 1 500 workers, but only a few of those jobs will be in mining,” he said.

“We asked for a comprehensive analysis on why they want to retrench the workers, and are awaiting a response,” he continued. “They said reduction of production was the reason for downsizing and rightsizing some of their operations.”

Komane expressed the opinion that Gold Fields had not based its proposed job cuts on the credit crunch as the metal had not been badly affected. At its first-quarter results presentation in October, the group had reported that its finances had not been affected by the global credit crisis, and that despite the current depressed commodity and equity market, it was keen to acquire assets anywhere in the world that would enhance its profile.

In December, Gold Fields said it was on track to meet its 840 000 ounce output forecast for the December quarter.

Komane said the NUM had also met with Anglo American Plc’s platinum-producing unit, Anglo Platinum (Angloplat), which is the No. 1 producer of the metal globally.

At the meeting attended by Angloplat CEO Neville Nicolau, the company said it planned to trim production, but would not lay off workers in the process.

“Angloplat said they had no intention to lay off workers, but that they will reduce production, and will re-deploy some workers and re-train others. They believe the economic downturn that has badly affected platinum will not be permanent,” Komane added.

Angloplat said last month it would reduce 2009 capital expenditure to R9.1 billion and that it expected to produce 2.4 million ounces of refined platinum this year.