Lonmin in talks with AMCU for recognition agreement

Lonmin's shares rose Friday following reports it was in discussions with Association of Mineworkers and Construction Union (AMCU) to conclude a new union recognition agreement.

AMCU has confirmed it is in talks with to be recognised as the majority union at Lonmin's platinum mine.

"Lonmin continues to believe in the principle of an all-inclusive recognition agreement with all other parties as the solution to long-term sustainability in the industry," the company said in a statement.

The National Union of Mineworkers (NUM) was formerly the majority at the Lonmin mine, near Rustenburg, in North West. Lonmin has now given the union until May 30th to leave its offices at the eastern and western mines.

However, the Labour Court in Johannesburg on Thursday ordered that the current recognition agreement with NUM would run from April 16th to July 16th.

"Lonmin will terminate [the recognition agreement] on July 16th, if by that date the NUM is unable to show that it is sufficiently representative in terms of the current recognition agreement," the company said.

NUM will be allowed to access Lonmin's current office and transport facilities during the notice period.

Its rival union, AMCU, now wants recognition rights as a majority union and is demanding NUM vacate the offices.

The contention between the two unions is part of a judicial inquiry into the death of at least 44 people near Lonmin's Marikana operations, of which 34 were killed by police. There was a two-day walkout after an AMCU official was killed at the mine on May 10th.

Lonmin's production has been hit by labour market unrest in South Africa since August.

The National Treasury warned that South Africa's economic growth is at risk of slowing if labour union unrest that has halted mining production continues.

RD