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South Africa: Labor unrest, strikes wind down with Amplats deal
South African labor law requires clear formal processes for strikes and walk-outs. Those that do not go through all the proper hoops are considered illegal, and can result in striking workers being sacked.
Mining firms usually reinstate dismissed workers because it is more expensive to train a new workforce. But some of the job losses could be permanent with employers using the labor strife to shut down marginal mines in South Africa.
ANC Election
The deal at Amplats comes after Cynthia Carroll, chief executive of parent Anglo American, announced her resignation on Friday. She had come under pressure from investors over the firm’s lagging share price and continued dependence on strike-hit South Africa.
Anglo owns 77 percent of Anglo American Platinum. Although responsible for 24 percent of its parent’s 2011 revenue, Amplats brought in just 8 percent of total operating profit because of soaring costs.
If the workers do return to Amplats, South African President Jacob Zuma will have likely weathered a labor storm that threatened to cause problems for him as he seeks re-election as leader of the ruling African National Congress at a party meeting in December.
If Zuma wins the race to lead the party that dominates South African politics, he will be on a path to remain the country’s president for another term lasting until 2019.
