Lonmin: The death toll rises with no resolution in sight

Suzie Neuwirth
(Source: Getty)

Lonmin held a hasty media call this afternoon to talk about the 17-week strike and subsequent violence currently taking place in South Africa, which gave little reassurance that the situation will be resolved soon.

The platinum miner, along with its two larger peers, Amplats and Implats, have collectively lost 18.5bn rand (£1.1bn) in revenue, as workers, led by the dominant Association of Mineworkers and Construction Union, have been on strike demanding higher pay.

Workers have lost 8.5bn rand in wages during the strike and Lonmin has lost one third of its output. Lonmin claims that most of its employees have expressed a desire to return to work – although it will not quantify this.

But a number of those trying to return to work last week have been stabbed or burnt to death, amid reports of threats and intimidation, leaving Lonmin’s plans to resume production in jeopardy.

“This is a socio-economic tragedy on an unprecedented scale,” said Lonmin’s chief executive Ben Magara today. “The strike must be used as an opportunity to change our mining landscape forever,” said Magara, explaining that Lonmin is keen to work on long-term solutions to address the widespread worker discontent.

But in the meantime, Lonmin failed to give a definitive answer to how it will end the strike. Magara said repeatedly that the first priority was to reach an agreement with Amcu and get its employees back to work, after which it would “assess all legal options”.

So what are the legal options? The team would not commit to an answer. A court case would most likely be of little use, as the striking workers are protected by South African law and cannot be fired.

Unless Amcu and Lonmin can negotiate a wage agreement, the outlook is hazy for the beleaguered platinum miner – and its workers, who will surely be fearing a return to the wildcat strike in the summer of 2012 that resulted in over 40 deaths.

Shares were down around 2.5 per cent this afternoon.