This, as the mine faces possible closure. The mine, which is still in talks with the union, says it has become economically unsustainable and unviable as a result of the world market price reduction for rough diamonds and confirms it has requested employees to take 25% salary cuts for the next three months. 

The CEO for Ekapa Minerals, Jahn Hohne, has highlighted that there is a high need for an alternative business model that can be implemented immediately or the company could soon close its doors.

The Union’s Regional Secretary, Cornelius Manhe, on the other hand, told OFM News the proposed 25% salary cut across all positions is under question as according to the union it will have a huge negative impact on employees at low-level positions earning peanuts, as opposed to those in managerial positions. 

He says they are still in talks with the mine, studying the documents they furnished them with, and will soon chart a way forward…

Hohne has in a statement said the world market price reduction equates to an approximately 20% year-on-year price decrease in dollar terms for Ekapa’s mining operations in Kimberley. This is coupled with about R3 million per month spent on security and infrastructure costs.

He said the chances of a complete shutdown of the business are very high if urgent steps are not taken.

“We have been doing everything in our power to protect the jobs of our approximately 1 400 employees and another 600 people working on contract for the company. We have been working around the clock to find alternatives, including additional finance options, without success,” said Hohne.

He added that they are working closely with their staff members and representing trade unions to find sustainable solutions.

“The options we have left are to increase underground tonnage for increased revenue and significant cost reduction measures. Management, therefore, proposed that, apart from other reasonable steps to reduce costs, all employees across the board consider a voluntary 25% reduction of their salary for a fixed-term period of three months. The proposal was not arrived at easily. However, the situation is critical and management believes that every reasonable step needs to be taken in order to avoid a situation in which the business may have to close,” explained Hohne.

Monhe says they understand that the company says they have been running at a loss, but are disappointed that none of this was ever communicated to the union as their stakeholder.

 OFM News