Northam clarifies public letter to NUM General Secretary

Johannesburg, 28 November 2013. Shareholders and stakeholders will have noted Northam’s public communication initiative last week with the NUM. This public initiative complements and follows on Northam’s direct communications with its employees, investors, the government and the public at large.

The decision to embark on this initiative was informed by the following factors:

  • A clear disconnect in information-sharing between the union and employees. It had become apparent that the strike at Northam’s Zondereinde operation was part of a bigger play by the NUM, and had little to do with actual wage negotiations at Zondereinde. This communication became more challenging since many employees had returned to their homes around the country, and neighbouring countries.
  • Misinformation in the media and public domain perpetuated by the NUM, which is potentially harmful to Northam. NUM’s communication has been misleading and disingenuous. By way of example:
    • NUM claims not to have gone on strike at Northam last year, when the rest of the platinum industry was on strike. They fail to mention that the NUM did not call a strike anywhere on the platinum belt, and that NUM’s two-week unprotected strike earlier this year at Northam lost the company R200m in revenue, without any material benefits to employees.
    • The NUM has by-passed Zondereinde and Northam management and has tried to engage the board in wage negotiations. It has done this in a highly public way, and on matters not related to wage negotiations.
    • Allied to this, the NUM has made vague but many allegations about racism and the lack of transformation at Northam, again in the public domain.
    • NUM’s failure to mention that while the company has revised its offer three times during the wage negotiations, the union has not moved from its original position.
    • Finally, the NUM’s very public and planned march to Northam’s corporate office was intended to publicly denounce management, and further NUM’s public positioning.
  • The refusal by NUM national leadership, and in particular, Mr Baleni to engage with Northam at all during these wage negotiations.

Given that the union is one of many stakeholders, our communications extended also to employees, surrounding communities and neighbours, with government, the media, and shareholders and the public at large.

We did this through:

  • Regular updates to our shareholders and to the media on Northam’s position.
  • A letter to the Minister of Mineral Resources providing background on the negotiations, the strike and the industry and company position.
  • We embarked on a campaign on local radio stations around the Zondereinde mine, and in Mozambique, Lesotho and the Eastern Cape, giving employees information on the offer, and why it was important for us to work together to save the mine and jobs.
  • We wrote and delivered to Frans Baleni the open letter that was later published in the media. This was delivered to his office on Friday 22 November, two days prior to its publication first in City Press and then on Monday in Business Day and receipt of this document was signed for.

We believe that our communications initiative achieved the following:

  • Our investors remain informed.
  • There has not been any negative commentary from the government.
  • The response from the media has largely been understanding of Northam’s position; and
  • For the first time, Frans Baleni has engaged in the debate; and was visible at the NUM march on the Northam coroprate offices. We are hopeful now that the NUM may actually come to the negotiating table. This may indeed be a break-through.

It is regrettable that we have had to resort to a highly public position in this way. This is not Northam’s traditional style. But, having entered the fourth week of a strike, we needed to take unusual steps to break the impasse.

The management of Northam remains willing to engage with NUM leadership, to reach and finalise an amicable settlement. We urge the NUM to reconsider its substantive position with regard to wages and communicate openly and honestly with all affected parties.

Issued by
Russell & Associates
Tel +27 (0)11 880 3924