Harmony Gold signs deal with unions to continue operations at Doornkop mine

16 July 2015 (Last Updated July 16th, 2015 18:30)

South Africa's Harmony Gold has signed an agreement with unions to continue operating its loss-making Doornkop mine and retain jobs.

South Africa's Harmony Gold has signed an agreement with unions to continue operating its loss-making Doornkop mine and retain jobs.

Harmony has been facing losses at the gold mine due to slump in gold prices and earlier planned to cut jobs.

At its mine, the company commenced a 60-day consultation process with organised labour in terms of section 189a of the Labour Relations Act, 66 of 1995 in May.

The consultation was aimed at finding ways to return the mine to profitability or to place it on care and maintenance.

"We would like to acknowledge the role of union leadership and wish to thank them for assisting us in securing Doornkop's future."

After carrying out several meetings with the labour, Harmony and the unions have agreed to a new operational plan for Doornkop.

Under the newly agreed plan with the unions, only 526 employees would be affected while 3,100 jobs will be retained, which include employees and contractors.

Harmony has transferred the majority of these affected employees to other operations.

An expected 183 people out of the 526 affected jobs will either be retrained for redeployment elsewhere in the company or may choose a voluntary severance package, the company said.

Harmony Gold chief executive officer Graham Briggs said: "The outcome of the Doornkop discussions is testimony to what can be achieved when all parties engage with the same aim in mind, finding a sustainable solution to ensure the viability of the mine and at the same time securing the majority of jobs.

"We would like to acknowledge the role of union leadership and wish to thank them for assisting us in securing Doornkop's future."