NUM opposes the retrenchment of 120 permanent workers at universal coal in Mpumalanga

The National Union of Mineworkers in the Highveld Region is shocked and saddened by Universal Coal intention to retrench 120 permanent workers in Mpumalanga.

Universal Coal served the NUM with Section 189(3) notice of the Labour Relations Act to retrench 120 permanent workers. The NUM is opposed to these retrenchments at Universal Coal. The retrenchment of 120 permanent workers is bad given the fact that the majority of mineworkers support 10 people per family which mean that a lot of people will be negatively affected by these retrenchments.

The company informed the NUM that the retrenchments are as a result of their business model which uses contractors as opposed to permanent employees.  

“The NUM doesn’t agree with the rationale where Universal Coal indicated that their operating model is to use contractors as opposed to permanent employees. Our understanding is that those contractors deserve to be permanent employees as well,” said Tshilidzi Mathavha, NUM Highveld Regional Secretary/

“Universal Coal took this operation from Exxaro in 2018 through section 197 of LRA. This simply means that Universal Coal undertook to operate this operation ongoing concern where employees were to enjoy the same benefits from the previous employer. However after a year the process of restructuring started leaving workers frustrated. The NUM was not fully involved in the transaction between Exxaro and Universal Coal since until today. The NUM is not aware who approved the transaction on behalf of workers which is a requirement in the competition commission,” Mathavha added.

It is clear that Exxaro uses Universal Coal to do their mining operations. All operations that Exxaro cease to operate are taken over by Universal Coal and there is no open bidding process like in other mining companies.

The NUM is still worried that section 52 of MPRDA does not find expression in section 189 of the LRA. The NUM is concerned that when mining companies issue Section 189 of the Labour Relations Act they do not align it with Section 52 of the MPRDA 2002, which states the following: “The holder of a mining right must, after consultation with any registered trade union or affected employees or their nominated representatives where there is no such trade union, notify the Minister in the prescribed manner- (a) where prevailing economic conditions cause the profit to revenue ratio of the relevant mine to be less than six percent on average for a continuous period of 12 months; or (b) if any mining operation is to be scaled down or to cease with the possible effect that 10 percent or more of the labour force or more than 500 employees, whichever is the lesser, are likely to be retrenched in any 12 months.”

Equally the Department of Minerals and Energy (DME) exist to detriment of the workers since there are no actions taken when these companies opt for restructuring without following the section alluded above.

In the beginning, when Universal Coal wanted a water use license, workers were promised that the company has a lifespan of 10years.

The company is adamant to implement section 189 of LRA and have since contracted Frazer Alexander to run the operation. With the shortfalls in the LRA which gives the employer to retrench provided that they inform and consult the union within 60 days despite the objections by the union. The NUM demands that all employees be absorbed by the same contractor than to allow workers to remain unemployed. This is a compromise position because these workers used to enjoy a wide range of benefits from Exxaro including medical aid which are not available in the new company. Exxaro should have transferred its employees to other business units when they become aware that they will dispose of these assets.

For more information, please contact:

Tshilidzi Mathavha, NUM Highveld Regional Secretary, 066 305 7424


7 Rissik Street.

Cnr Frederick,

Johannesburg 2001

Tel: 011 377 2111