For nearly two months, labor unrest in South Africa has crippled the economy, as workers in nearly every sector demand higher wages. The unrest has led to temporary closures of many platinum mines around the country as owners and laborers face off over pay and working conditions.
Strikes at platinum producer Lonmin PLC left 46 miners dead before the unrest was resolved last month with an 11%-22% pay increase for miners. Now, miners throughout the country continue to strike in hopes that they will receive a similar wage increase.
Rather than following suit with Lonmin, mining company Anglo American Platinum (Amplats) refused to recognize striking workers’ demands for increased wages and safer working conditions, choosing instead to fire 12,000 miners in early October. Amplats, the world’s largest platinum producer, fired the miners four days after issuing an ultimatum to the 26,000 strikers to return to work. Only 20% of workers complied with the ultimatum, forcing Amplats mines to remain closed. Since the closures began in mid-September, Amplats claims to have lost over $80 million in revenues.
Despite being fired, strike leader Evans Ramokga vowed to make it difficult for Amplats to hire replacement workers, suggesting Amplats would hire new employees “over our dead bodies.” In fact, local police confirmed Friday they are investigating claims that one worker was killed when police fired rubber bullets and tear gas to disperse a group of strikers gathered near the mine.
Human Rights Watch attributes South Africa’s increase in violent strikes largely to worsening poverty, increasing social inequality, low wages, and poor social service delivery. Increasing inequality between miners and their bosses certainly has added fuel to the ongoing labor disputes. While Amplats workers are in the middle of a two-year wage agreement which grants them between 8% and 10% wage increases annually (in the face of 5% inflation in South Africa), Anglo American chief executive Cynthia Carroll received a 38% increase in pay in 2011.
Even as labor unrest is unhinging the accuracy of the rand value as a “barometer of global risk appetite,” foreign investors are seizing mine company stocks at bargain rates in hopes of making a quick profit off of the workers’ struggle for fair wages and safe working conditions. Risk-taking investors may be right that mining will bounce back, but it can only sustainably grow the South African economy if laborers’ rights are respected and their demands met in a way that sustains not only executives’ profits but South African miners’ living wages as well.
Whitney Denning is a 2L and a staff editor on the Denver Journal of International Law and Policy.
