We are switching shifts

2014 CASE STUDY:

Switching shifts for greater benefit

“The time is near when planning alternative working arrangements must give way to their practical application, at least on the basis of pilot schemes.”

That is the view of Robert van Niekerk, Senior Vice President: Organisational Effectiveness at Sibanye. The introduction of new working arrangements should have benefits for employees (creating additional employment and possibly allowing employees to use extra off time to see their families more often) and the Group in terms of improved productivity. However, Robert acknowledges that implementation is complex and the model still needs to be refined. Nevertheless, a start has been made at Cooke 4 following agreements reached with the unions in December 2014.

Sibanye’s strategy regarding alternative working arrangements is consistent with the Sindisa Project, initiated during the 2011 wage negotiations between the Chamber of Mines and the unions, as a result of a collective stakeholder agreement to address productivity issues in the industry.

While initial conversations have been held with several of Sibanye’s union structures at the other operations, an agreement was finally reached with the unions at Cooke 4 shaft on 12 December 2014 as an outcome of the Section 189 restructuring process. “It is a key element in the package of measures agreed to by shaft stakeholders to secure a profitable future for the shaft,” Owen O’Brien, Vice President: Cooke Mining Operations, points out. “The impact, in terms of production results, will be revealed in time but the practical implementation is going remarkably smoothly. Financial projections indicate that the arrangements will increase the shaft’s profitability, resulting from the higher gold production enabled by working the face six days a week to increase production shifts.” The introduction of alternative work arrangements at Cooke has resulted in an additional 22 working shifts per annum with corresponding productivity benefits.

Vusi Sampula, Vice President: Employee Relations at Sibanye, notes the potential benefits to employees of alternative working arrangements: “More than 30% of Sibanye’s employees are migrants, hailing largely from the Eastern Cape, Lesotho and Mozambique. Flexibility of working arrangements may allow migrant employees to return to their homes and families more frequently.” This calls for the testing of different work rosters and regular assessment of the implementation thereof. Instead of the current 11-shift fortnight arrangement that gives employees a two-day break every other weekend, the alternative working arrangement will periodically allow individuals four-day breaks from work. This may allow mine employees to return home more often and spend more quality time with their families in the labour-sending areas.

Overall, even though the face is worked more often, each employee will work fewer shifts in order to remain compliant with the maximum 45 weekly work hours enshrined in the Basic Conditions of Employment Act. This allows for a modest increase in shift length within the standard weekly working hours, and will offset the effect of long travelling times while increasing the face time available for productive work.

Owen points out: “With operating mines as complex as those run by Sibanye, it is not simply a question of ensuring sufficient numbers of people in each work crew in a specific workplace. It also involves ensuring that each work crew has an adequate mix of skills on every production shift.” The preferred alternative is to hire more appropriately skilled employees to staff the rosters, thereby creating additional employment opportunities.

Ahead of any pilot implementation, Sibanye’s planners projected that employee numbers would need to rise by 7%, which would result in a corresponding increase in the wage bill. George Ashworth, Sibanye’s Manager: Organisational Effectiveness, says: “The cost increase should be offset by higher production volumes and resultant revenue improvements, conservatively, in excess of 6% due to the additional shifts that the faces are worked. On this basis, R/kg operating costs would decline by at least 2% in spite of absolute increases in operating costs. Fixed costs would also be spread over increased gold production, further reducing the unit (R/kg) operating costs and expanding the operating margin.”

Sibanye’s management anticipates benefits to employees having adequate leisure time for a number of reasons: safety, productivity and health, among others. Vusi points out that a four-day break is the right length to meet employee needs without disrupting the work rhythm. With modern transport systems, four days could allow employees to travel and spend meaningful lengths of time with their families – this is still subject to assessment and refinement. A longer period away from work may require the introduction of re-induction and acclimatisation procedures. Owen and his colleagues are convinced that the practical challenges can be overcome or resolved, shaft by shaft. As part of introducing the new work arrangements, consultation with and agreement among stakeholders is critical to ensuring the efficacy of the new arrangements.

In addition to Cooke 4, discussions are in progress at a number of shafts at Sibanye’s other operations in order to initiate trial implementation of alternative working arrangements during the first half of 2015.

“The fact remains that, without new working arrangements to enhance productivity, the lives of our mines will be shorter than they have to be,” says Robert. “The potential to increase the resources that can be mined economically through reductions in the paylimit, thereby extending mine life, is enormous.”

The squeeze is also not solely on mines’ or shafts’ lives but also on the profitability that allows them to deliver superior value to all stakeholders served by Sibanye.