Kumba Iron Ore wage negotiations reach a deadlock due to leadership failure

Wage negotiations between Kumba Iron Ore and four trade unions – Solidarity, NUM, AMCU, and Numsa – have reached a deadlock following five months of talks.

The salary increase offers for the first year of the agreement range between 4,5% and 5%, depending on the job level, with increases linked to the Consumer Price Index (CPI) for the second and third years. The company is also offering increases of between 4% and 6% to the housing allowance, as well as an increase of between 3,5% and 4% to the shift allowance.

According to Gideon du Plessis, General Secretary of Solidarity, the salary increase offers are not the cause of the deadlock.

Du Plessis explains that the primary stumbling block in the negotiations is Kumba’s condition that salary and allowance increases be made contingent upon employees agreeing to a new shift roster and pattern – one that would make working on all 12 public holidays mandatory.

The company argues that cost pressures and performance challenges form the basis for the proposed significant overhaul of the shift system.

Although the trade unions are sympathetic toward the company’s challenges, union officials and representatives are now expected to assume management’s responsibility by persuading employees to accept the new shift system and its associated requirements.

According to Du Plessis, this abdication of responsibility is, in itself, partly indicative of the reasons why the company is struggling with performance challenges. Senior management is clearly unwilling to take personal responsibility for managing this change.

“In our view, the executive committee, senior members of the management team, and the human resources department are failing to fulfil their responsibilities.

“It is their duty to engage directly with employees regarding the rationale for – and the implications of – such a fundamental change to their conditions of employment, under which working on all 12 public holidays would become mandatory,” says Du Plessis.

According to Du Plessis, Kumba’s employees are consequently having to learn the details of this unpopular decision from trade union officials.

This is happening while, at the same time, the trade unions are expected to listen to and address employees’ concerns, as well as attempt to find solutions to the disruption that this drastic change will cause for families.

The dispute is, therefore, essentially the result of a failure in management and labour relations, as management has shifted its own responsibilities onto the trade unions. This has happened despite the unions’ repeated requests that management discuss the matter directly with its employees.

“Solidarity even arranged a meeting at which management could have explained the proposed changes to employees, but Kumba consistently refused to take on this responsibility,” adds Du Plessis.

According to Solidarity, the dispute can only be resolved once Kumba’s leadership realises that difficult and unpopular decisions – no matter how necessary they may be – cannot be delegated to trade unions, but must instead be addressed within the workplace.

According to Solidarity, the deadlock in the negotiations is therefore the direct result of a failure of leadership at Kumba.

The trade union calls on Kumba’s top management to show some backbone, take responsibility for its decisions, and fulfil its obligations towards employees by ensuring that internal operational matters are not turned into issues for negotiation.

If Kumba’s management fulfils its responsibilities, referral of the dispute to the Commission for Conciliation, Mediation and Arbitration can be avoided.