Miners In Negotiated Empowerment A Comprehensive, Self-Sustaining Solution to the

South African Mining Sector Crisis November 10, 2012 November 10, 2012

Team 12 Joyce Cheng Young-hee Kim Kim Miller-Tolbert Jay Patel Annie Tsay Jacob Weatherly

Miners In Negotiated Empowerment

A Comprehensive Bottom-Up Approach to Addressing the Challenges Facing the South African Mining Sector

November 10, 2012

The Problem

STRIKE

Lack of Agency

Low Wages

Unsafe Working

Conditions

Poor Health

Outcome: Striking to Death

Source: “Scene of South African Mine Shooting May Have Been Altered, Inquiry Is Told” New York Times November 6, 2012

What did the strikes accomplish?

• Pay raise for a minority

• But at what cost? – Deaths – Lost trust – Diplomatic and economic repercussions for

South Africa – Decreased productivity and economic loss

A Gross Power Imbalance

South African miners

What solutions have been previously presented?

• Top-down approaches

• Many well-intentioned existing policies lack effective implementation.

• 1973: Occupational Diseases in Mines and Works Act (ODMWA )

Landmark Ruling: Mankayi v. AngloGold Ashanti (2004)

1973: ODMWA 2004: Mankayi Settlement

Future: Potential Insolvency of SA Mining Sector?

Policy Recommendations: Empower, Negotiate, and Collaborate

• Sustainably empower South African miners.

• Facilitate their engagement in equitable negotiation and collaboration.

• Enable miners to bring about positive changes in their own lives.

Action Plan:

1. Provide a Strike Safety Net

• Establishment of a fund that covers workers’ basic needs while on strike

• Provides food and healthcare security • Allows execution of protective measures

to uphold collective bargaining agreements

• Unused funds miner-driven proposals for standard of living improvement

Empower Negotiate Collaborate

2. Promote Union Educational Initiatives

Health

Legal

Labor

•Infectious disease & occupational safety

education

•Basic skills training, labor pool shifting

•Representation & protection by union

• ~$30/mo/member to fund miner training programs

• Foster competition among unions to attract larger membership

• Larger membership Increased collective bargaining power

Per-Miner Incentive Program

Empower Negotiate Collaborate

3. Support for Home Loan Initiative

• Establish an insurance program to back home loans

• Ensures miners a basic housing and living standard (TB, HIV rates)

• Community-building, familial settlement • Job creation: promotes development of

general services within the local economy

Empower Negotiate Collaborate

4. Facilitate Quality Legal Representation

• Put legal representation in the hands of workers – Protects human rights – Spillover benefit: prevents vigilantism – Non-violent means of effecting change

• Promotes equitable negotiation of employment contracts with mining houses

• Provide workers a strong voice in government

Empower Negotiate Collaborate

Subsidies to NUM and AMCU-$105 million Strike Fund-$870 million

Intermediate Health Insurance-$516 million Home Loan Insurance-$20 million Quality Legal Representation-$1.5 million Public Relations-$300,000

Strike Security Force-$300,000 Environmental Fund-$515 million

24%

Budget Allocation ($2B/year)

5%

42%

25%

Budget

Education cost per miner per year

Number of miners enrolled in education program

TOTAL COST

$350 300,000 $105 million

Income to be supplemented during strike

Number of miners

Unemployment rate

TOTAL COST OF STRIKE FUND

$10,000 500,000 25% $870 million

Per capita annual health expenditures

Number of miners

Number of dependents per miner

Unemployment rate

TOTAL HEALTHCARE COST

$650 500,000 6 25% $516 million

Budget, Continued

American foreclosure rate

Average house price

Number of miners

% of South Africans owning homes

TOTAL HOUSING COST

0.0013 $56,000 500,000 56% $20,384,000

Legal representation Public relations Strike security force

Environmental fund

$1.5 million $300,000 $300,000 $515,016,000

Challenges and Limitations

• Embezzlement of per-miner training funds – Lack of benefits defection of members

• Splintering of unions – Administrative consolidation more benefits

per miner • Inter-union violence

– Punitive withholding of union funds

Miner Enfranchisement More Equitable Negotiations

Empower Negotiate Collaborate

Impact of MINE: Stability, Sustainability, and Growth

• Growth in mining sector (currently ~9% GDP)

• Improved standard of living • International confidence,

attract foreign investment

Empower Negotiate Collaborate

References

• Stuckler D, Basu S, McKee M, Lurie M. Mining and Risk of Tuberculosis in Sub-Saharan Africa. Am J Pub Health. March 2011. Vol 11 No 3: 524-30.

• Stuckler D et al. Governance of Mining, HIV and Tuberculosis in Southern Africa. Global Health Governance IV.1 2010.

• Mogotsi L. Challenges Facing the South African Gold Mining Industry. Alchemist 38: 15-17.

• Serrano M et al. Trade unions and the global crisis: Labour’s visions, strategies and responses. Geneva: International Labor Office, 2011.

• CIA World Factbook, https://www.cia.gov/library/publications/the-world-factbook/

• Lakmidas S, Lonmin miners strike again in South Africa. 18 Oct 2012. Reuters.