Lonmin says South Africa seeks "peace accord" in labor dispute

Reuters News
Posted: Aug 24, 2012 12:14 PM
Lonmin says South Africa seeks "peace accord" in labor dispute

JOHANNESBURG (Reuters) - The South African government is working with Lonmin to reach a "peace accord" between warring factions after violence stemming from a union turf war killed 44 people last week, the world no. 3 platinum producer said on Friday.

"Lonmin's management is committed to this process and its absolute focus in the coming days will be to reach a peace accord, under the auspices of the Department of Labor, which allows for a peaceful return to work," the company said in a statement.

Lonmin's South African operations have been paralyzed since an illegal strike involving 3,000 rock driller operators started two weeks ago and exploded into violent clashes that killed 44 people including 34 striking workers gunned down by police.

The violence stems from a fight for members between the dominant National Union of Mineworkers (AMCU) and the small but militant Association of Mineworkers and Construction Union (AMCU) which has been spreading through the sector.

"We welcome the Department of Labor's efforts in facilitating the peace accord," Lonmin's acting chief executive Simon Scott said.

Lonmin accounts for about 12 percent of global platinum output and the freezing of its mining operations has driven the price of the white metal up by around 10 percent.

The company said about 23 percent of its 28,000-strong workforce showed up for shifts on Friday but that is far short of the numbers needed to started pulling ore from the earth.

"Mining operations will only resume once we have sufficient workers in attendance and the necessary safety procedures have been undertaken," Lonmin said.

The striking workers have been demanding a monthly wage of 12,500 rand ($1,500). The company says they currently get about 9,800 rand per month with an average monthly bonus of 1,500 rand.

($1 = 8.2871 South African rand)

(Reporting by Ed Stoddard; editing by James Jukwey)