Solidarity: 500s to be laid off at South32 Hillside Aluminium smelter

SMM2 20-month news: solidarity (Solidarity) said on Tuesday that it had received a notice of production cuts from South32's Hillside aluminum plant in (Richards Bay), Richards Bay.

The announcement added to concerns about South Africa's steel industry, which cut about 8000 jobs in 2018, according to Marius Krakamp (Marius Croucamp), deputy secretary-general of the Union of Unity.

Although the initial notice did not mention the number of employees [at the smelter] who might face layoffs, the company said in a request to (CCMA), the settlement, mediation and arbitration commission, that it intended to cut 500 jobs.

A spokesman for South32 told Creamer Media, that it had informed employees of the Hillside smelter that it intended to begin negotiations with them in accordance with article 189 of the Labour Relations Act.

The advice is related to the proposed restructuring of the business, which aims to reduce the costs of Hillside and improve its resilience to volatility in commodity markets.

In its financial report released last week, South32 said Hillside's earnings before interest and tax fell 133%, or $159 million, in the first half of fiscal 2019.

Despite the increase in sales, Hillside experienced a loss of $39 million due to higher input costs for raw materials, higher redelivery costs for cans and adverse changes in inventory.

Croucamp points out that the restructuring process in South32's plan is highly complex because it involves layoffs, restructuring and pay adjustments at the same time. The company intends to achieve three goals in one process, which he sees as a daunting task.

The South32 spokesman could not confirm Unionism's claim that 500 jobs would be affected as the consultation process had not yet begun.

Croucamp indicated that more information would be provided once the CCMA appointed a commissioner as mediator and initiated the consultation process.

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