Workers in Limbo As Debswana Shuts Down Mines
The fate of approximately 580 workers at Debswana's Damtshaa Mine and Orapa Mine's No. 2 plant will be decided this week when negotiations between the Botswana Mineworkers Union and management are concluded.
Damtshaa Mine and Orapa Mine's No. 2 plant will be closed for 2009 as a cost-cutting measure as the stranglehold of the global economic downturn tightens.
The production cuts were approved by the Debswana board last Thursday. The board also approved the company's business plan and budget for 2009 which included aligning operational activities with the current recession.
"We are still in negotiations with the unions over the fate of the workers that have been affected by the closure of the two operations and are hoping to reach an agreement this week," said group public and corporate affairs manager, Esther Kanaimba.
"We are going to look at many strategies so that damage to workers is minimal.
Retrenchments will only be used as a last resort after all other strategies have been exhausted."
After the Thursday meeting, the board directed management to submit an application to the Minister of Minerals, Energy and Water Resources for suspension of production at Damtshaa Mine and Orapa's No. 2 plant for 2009.
It also approved stay-in-business projects, among them Cut 8 in Jwaneng and the continuation of the operations review which is intended to improve organisational efficiency.
It is understood management was engaged in marathon meetings with staff and the union last week about how best to survive the crisis.
Two options are available to Debswana: either shareholders inject fresh capital into the mines or workers are retrenched an unpalatable alternative in an election year.
On the demand side, buyers' appetite for rough stones has sunk rapidly with senior management sources at the Diamond Trading Company Botswana, the selling arm of De Beers, saying the first sight of the year was almost a flop.
It is reported some of the sightholders did not even show up and the company is now in consultation with management and the union.
"We have two options available: either we cut working hours, or we cut part of workers' bonuses," a source said. "But as things stand, we are going to have to take a few weeks' break in March because the mines are closed right now."
Kanaimba said the Managing Director, Blackie Marole, has told employees that "this is going to be an uncertain and challenging year and that management is committed to finding ways and means of minimising the impact of the recession on employees".