Mine Appeals to Strikers to Consider Final Wage Offer

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By Mbatjiua Ngavirue WINDHOEK Rosh Pinah Zinc has repeated its earlier wage offer to striking workers at the mine and appealed to them to seriously consider accepting what it described as its final wage offer. The company made the appeal in a notice sent to all striking employees towards the end of last week by parent company, Kumba Resources. The company says management believes the final offer to increase wages is a fair, reasonable and responsible one. The increase offered by the company is 9% for Grades 8, 7 and 6 and 8% for Grades 5, 4 and 4.1. According to Kumba, the offer is considerably above the September 2006 annual inflation rate in Namibia, which amounted to 5.5%. This offer the company feels is on par with – or better than – average industry increases. “It should be considered in the context of wage increases that have been granted at other mining companies in the region, which range from 7% to 8.5%. “The wage offer should not be viewed in isolation, as there is a bigger picture involving many other benefits that Rosh Pinah employees enjoy,” the company explains. To bolster its argument, Kumba Resources Group mentioned its policy on granting annual bonuses. The company says that during the 2005 financial year, Rosh Pinah employees received bonuses equal to three months’ additional salary (25% of annual salary) in recognition of employees’ contribution to business performance. According to Kumba, these bonuses are far more generous than the normal practice in the mining industry because in most other mining companies the bargaining unit employees generally qualify for performance bonuses that are equal to only one month’s salary. The company held out the possibility that employees may potentially qualify for similar bonuses (equal to 3 months’ salary) in the current 2006 financial year. It points out that the company will spend N$15 million on housing in 2006, and that a further N$25 million per annum is planned annually for 2007, 2008 and 2009. Employees were asked to note that while it was true that Rosh Pinah’s operating income increased considerably this year due to the higher market prices and demand for zinc concentrate, there were many years when the mine had made huge financial losses. “It is not good financial management for a company to spend its earnings as fast as it is makes it. A company must manage its finances carefully as the next year or the following years could again bring hard times – times when the company will need to have cash reserves in order to survive,” Kumba told employees. The company claims that in the years when Rosh Pinah was losing money, its employees were subsidized by the rest of the Kumba Group and they still received annual wage increases in line with the rest of the Group, namely 9% in 2003, 7% in 2004 and 7.6% in 2005. They also had job security, which Kumba says could be expected to continue into the future because the company is “well managed”. The notice to employees in fact claims that in 2003 Rosh Pinah made losses amounting to N$35.5 million, and that in 2004 its losses were N$29.4 million. “Management appeals to striking employees to seriously consider accepting the final wage offer, call off the strike and return to work. This will be in the interest of all parties,” the company concluded.