NUM vows to challenge proposed job losses at Assmang's Beeshoek Iron Ore Mine

Banele Ginidza

The National Union of Mineworkers (NUM) is gearing up for a legal battle as it seeks to protect nearly 700 jobs at Assmang’s Beeshoek Iron Ore Mine in the Northern Cape.

The union on Wednesday expressed strong opposition to any attempts at fast-tracking potential retrenchments that stem from the mine’s financial struggles, which are primarily linked to the economic woes of its major client, ArcelorMittal South Africa (AMSA).

NUM's Kimberley regional secretary, Mosepedi Sanane, signalled the union's readiness to engage in consultations to explore alternatives to what could be one of the most significant job losses in the region.

"The NUM will engage meaningfully in the forthcoming consultations. However, we are clear that we will robustly challenge any attempt at unfair job losses," Sanane said.

"Our members will be kept fully informed of every development, and we will consider collective action if the employer acts in bad faith." 

The union said it would engage in consultations to explore all possible alternatives to retrenchment, including hiring and overtime freezes, redeployment within Assmang or other Africa Rainbow Minerals (ARM) joint ventures, and reskilling opportunities and voluntary separation packages. 

"We will ensure the employer provides robust social support structures for our members during this period. No worker will face this process alone. We remind the employer that this consultation process must be meaningful and conducted in good faith," Sanane said.

Assmang's Beeshoek Iron Ore Mine found itself in dire straits as AMSA vacillates on a crucial three-year contract, reflecting broader challenges within the mining sector.

Without a steady influx of revenue, Beeshoek incurs monthly operational expenses of R72 million, translating into annual losses totaling R2.6 billion for AMSA.

In a notice to stakeholders, Assmang revealed that its plans for recovery hinged significantly on securing a three-year contract with AMSA for a minimum of 2.2 million metric tons of iron ore per year.

However, the recent failure to finalise this contract has left the mine's viability hanging by a thread.

Over the past three years, the mine has reported impairment losses of R3.6bn across its assets, underscoring the dire economic realities it faces. Currently, Beeshoek has an operational lifespan of just six years, producing a mere 2.2 metric tons annually.

In light of this precarious situation, the NUM has called for full transparency from Assmang regarding the redundancy process.

The union said it demands full transparency from the employer and expects full disclosure on the commercial reasons for the proposed retrenchments and why other alternatives were rejected and why the rationale for considering "Care and Maintenance" instead of outright closure.

It insisted that it would demand to know the precise number of employees who will be affected, which is currently estimated at 688, the impact on the community and existing long-term contracts, especially those related to outsourced services as well as the proposed selection criteria, details regarding severance pay, and benefits such as medical aid and long-term policies.

Trade union Solidarity also voiced concerns on Tuesday regarding the proposed retrenchments, calling them a devastating blow not just to employees but also to the local community around Postmasburg, which relies heavily on the mine's economic contributions.

Adéle Rossouw, Solidarity's organiser for the mining sector, emphasised the dire implications of the mine's potential closure, citing its significance as a lifeline for local families.

“The problem is that Beeshoek supplies iron ore only nationally and is therefore at the mercy of the steel industry’s own failings. Yet, Beeshoek has always been able to deliver profitable, high-quality ore, and surely there must be a suitable market,” Rossouw said.

“Due to the fact that they do not export, and since their only client can no longer buy from them, the worst possible option is now being considered.”

Meanwhile, Assmang's Cato Ridge Works (CRW) operations and business will also close permanently and all 600 affected employees will be retrenched on August 31, 2025. Its Malaysia business is also being sold.

BUSINESS REPORT