PRESENTATION TO SELECT COMMITTEE ON LABOUR AND PUBLIC ENTERPRISES 25 August 2010 DEPARTMENT OF LABOUR REPUBLIC OF SOUTH AFRICA

CONTENT OF PRESENTATION Purpose Background Discussion  Investigation on unpaid wages  UIF Update as at 18 August 2010 Conclusion

PURPOSE To inform the Select Committee of the background and progress of the case of non payment of wages and salaries to workers of the AURORA Grootvlei Mine in Springs.

BACKGROUND Aurora Gold previously traded as Pamodzi Grootvlei Mine, who went into liquidation. An arrangement with the Liquidators resulted in AURORA taking over the operations of Pamodzi. The Minister visited the Pamodzi Grootvlei Mine in August 2008 because serious problems relating to the employment of illegal immigrants were raised by the community, as well as non compliance with the BCEA, UIA and OHS as raised by the NUM. In February 2010 various newspaper articles reported on the non payment of wages and salaries at the Aurora Mine in Springs, Gauteng, which the Gauteng Province noted and acted upon.

BACKGROUND The Springs Labour Centre immediately made contact with the NUM Regional Chairperson Mr. Frazey Namanyane to discuss the matter and determine what the true position was. We also later made met with Mr. Gideon Du Plessis the Deputy General Secretary of Solidarity. Together with NUM and Solidarity we determined that the following wages and salaries were outstanding as at 23 March  40% Unpaid wages and salaries for December 2009  75% production bonuses for February 2010  Wages for February were paid in full (2191 employees)  100% outstanding salaries for February 2010 (354 employees)  100% outstanding wages for March 2010 (2191 employees)  100% outstanding salaries for March 2010 (354 employees)

DISCUSSION When no firm agreement on the payment of wages and salaries could be reached with the AURORA Mine Management, the Inspectorate issued a Compliance Order to Mr. Louis Bezuidenhout the General Manager of Aurora Gold East Mine on 31 March 2010 On 8 April a meeting was held between NUM and the Aurora Management in which a Memorandum of Understanding was signed on the payment of outstanding wages and salaries.

DISCUSSION INVESTIGATION INTO UNPAID WAGES In the MOU it is agreed on the following  That all arrear salaries for February 2010 due to the employees of Aurora Gold East Rand will be paid by 9 April 2010  All arrear March salaries and wages will be paid by 29 April 2010  On signing the memo all industrial action by NUM members will cease  Num and Aurora in consultation with workers will discuss the resumption of operations at the Marievale shaft on the East Rand.

DISCUSSION INVESTIGATION INTO UNPAID WAGES On 19 April we met with NUM and established that the Aurora Management did not meet their commitments in terms of the MOU and that the following payments were still outstanding February salaries:Some employees were paid 20% and others only 5% their February salaries and not 100% Outstanding salaries amounted to R March salaries:Nothing paid as promised and R is outstanding March wages:Nothing paid as promised and R is outstanding December bonuses:40% still outstanding. Amount still being determined

DISCUSSION INVESTIGATION INTO UNPAID WAGES As a result of this the Department took a decision to proceed with referring the case for prosecution. On 12 May 2010 a “Notice of Motion” was served on Kuanda Global Mining Resources 2 (pty) LTD t/a Aurora Gold East Rand In the “Notice of Motion” we are claiming R plus interest on behalf of the workers. Aurora responded to Legal Services indicating their intention to oppose the motion. Advocate Zekhaya Bastile of our Legal Services is dealing with the Labour Court Case, and he arranged to meet with the Legal representatives and Management of Aurora on 21 July 2010 to discuss the matter.

DISCUSSION INVESTIGATION INTO UNPAID WAGES The purpose of the meeting was to discuss the outstanding payments and to determine the intentions and plans by Aurora to pay these outstanding salaries and wages. Both the Aurora management and their Legal representatives did not turn up for the meeting without any notification of their non attendance. The meeting continued with a discussion between NUM, Solidarity, a representative of the non aligned workers and the DoL. During the meeting it was determined that payments were made to some workers, but that details as to who these workers are and how much was paid could not be established.

DISCUSSION INVESTIGATION INTO UNPAID WAGES Under the guidance of Advocate Bastile the meeting agreed as follows  That we will proceed with the Labour Court Case  Because some payments were made we would have to review our original court documents and correct the outstanding amounts. (Amend Compliance order)  In order to determine the correct outstanding amounts and ensure that our case is strengthened it was agreed that all the workers must complete affidavits and lodge a formal complaint (LPS 1) for unpaid wages and salaries.  Up to now we have been working on total outstanding amounts only and the concern was that the Aurora lawyers will request us to explain how we arrived at these amounts, which could delay the case.  It was also agreed that all workers who are earning above the threshold will be excluded from the claim. (Section 6 of the BCEA)

DISCUSSION INVESTIGATION INTO UNPAID WAGES Both the Unions as well as the representative of the non aligned workers agreed to get this information from the workers and submit to DoL. We have made our inspectors available to assist workers with the preparation and calculation of the outstanding amounts Unfortunately many of the workers have left the mine and cannot be traced. We are processing and checking the documents received and hope that more will be received. We arranged with NUM and Solidarity to have all workers at the Mine on Wednesday 18 August where we will complete formal complaints (LPS 1) and submit to Legal Services.

DISCUSSION UIF We also determined that Aurora was not registered with the UIF, and we managed to get them registered on 9 April with registration number /3. All information has been forwarded to the UIC for the recovery of arrear contributions as well as any penalties. None of the workers could claim UIF benefits because they have not been formally retrenched, and the mine management is not providing any clarity regarding termination of service.

OUTSTANDING MONIES AS AT 18 AUGUST 2010 December’09 40% outstanding bonus; R (2180 employees) March’10 100% owed salaries and wages; R (2413 employees) April’10 100% owed salaries and wages; R (105 employees) May’10 61% owed salaries and wages; R (101employees) June’10 100% owed salaries and wages; R (102 employees) Jul’10 100% owed salaries and wages; R (139 employees)

LATEST UPDATE CONTINUED…. A team of inspectors and other officials were set up to take individual complaints and calculate amounts outstanding including other benefits like leave due. UI officials will check if each worker is declared on the system and obtain relevant information for UI applications All documentation will be checked for correctness and accuracy after which an amended Compliance Order will be issued

CONCLUSSION A meeting is scheduled between the Department and the Liquidators in order to establish liability and ensure correct citation in the court documents The Department has received wide criticism of dragging its feet in dealing with the case but we must take cognisance of the fact that we require cooperation of all the parties involved, otherwise we have to take the long route of ensuring compliance to law through the courts I wish to assure honorable members that we will do everything in our power and within the law to force those who violate the law and undermine the rights of workers, to comply with the law We will continue to pursue this case in order to alleviate the suffering of these vulnerable workers

THANK YOU.