Swakop Uranium employees falling in the bargaining unit have rejected a proposal by the company to substitute the traditional annual salary increment practice and replace it with a quarterly performance-based bonus payment.
The Patriot has it on good authority that Swakop Uranium workers rejected the offer saying “bonuses are not guaranteed” while others feel the absence of salary increments mean their disposable income will remain stagnant.
The workers in the bargaining unit said they will not consider the proposal as they would rather stick to the current 7% annual salary increase.
A highly-placed Husab source confirmed the development this week. “Management tabled that proposal during bonus discussions with the workers held last month and the workers said they want the company to continue giving them annual salary increments, not quarterly bonuses,” said the source.
“The company is now seized with the matter, but we definitely expect NUNW to stand its ground and convey the wishes of the workers which it represents. If not, we will be forced to take up this matter with the Labour Commissioner because an employer cannot change the conditions of employment of workers without their approval,” the source further said.
Although the company’s management was not immediately available for comment, a senior employee at the mine said failure to move from automatic annual increments could affect the sustainability of the company’s operations.
“As we all know the price of uranium on the global market is not doing well, therefore the annual increment model is a danger to our operations and that of the workers. Let’s say, hypothetically, the company is not making money, where do workers expect the money for increments to come from? In the long run, we could end up like Langer Heinrich that has been forced to cut jobs because of the economic climate,” said the source.
The source further added that there is an impression that workers want to continue getting annual salary increment whether the company performs or not.
“The current system disadvantages the company because, even if the company does not perform well, it is expected to pay its workers annual increments. Is this really sustainable?” added the source.
This could force the country’s biggest uranium mine to go back to the drawing board and work on prudent ways to manage costs as the mine transitions from construction to production phase. Husab Mine is expected to be the second largest uranium mine in the world, after the McArthur River uranium mine in Canada and the largest open-pit mine on the African continent.
A discussion document seen by The Patriot indicates that the company feels there is a need to align the Company’s Short Term Incentive (STI) scheme to business performance Key Performance Indicators (KPI).
This means that the company looks at the KPI’s and depending on how the company performs employee bonuses are then determined on the basis of that.
“The redesign will drive performance improvement at all levels within the company and departmentally as well,” states the document. It further indicates that the company will move away from the traditional fixed rate of annual salary increases for the employees and aligned directly with the Company’s performance and “prevent the salary gap creep between the bargaining and non-bargaining units, where historically the bargaining unit increases have been higher”.
Workers however dispute this assertion, saying: “The salary gap cannot be addressed by this, only through clearly outlining the grading system. Currently is no clear indication of salary grades and there is a lack of proper alignment.”
Salary increases for Swakop Uranium workers in the non-bargaining unit are granted as per the approval of the board.
Considerations for increments for workers in this unit include inflation, company performance, employee salary position and personal performance.
The proposed bonus scheme, if implemented, will apply to all Swakop Uranium employees, except consultants and those on job attachment.
Temporary employees who are contracted for three consecutive months during a quarter under review will also be included.
The Mineworkers Union of Namibia (MUN) regional coordinator George Ampweya said the issue has not formally reached his office, adding “I had an informal discussion with the representatives of Swakop Uranium, however no formal communication has been made”.
He further noted that the proposal cannot be entertained on the basis that there is an existing procedural agreement between the two parties which governs the relationship between them.
“We cannot go against those provisions accorded by the proposal, in a nutshell, I can already detect that the employees have rejected it,” he said.
He further noted that it is not fair for Swakop Uranium to want to change the employment conditions of the workers.
“In as much as it sometimes seems like it is difficult to reach amicable solutions, partners should adopt a nature of wanting to engage collectively in the interest of both parties.
I also think it is quite unfortunate that the company is not of that opinion currently” explained Ampweya.