The National Union of Mineworkers (NUM) of South Africa has threatened to take legal action against Glencore over its proposed plan to close mine operations of Optimum Coal.

Last week, Glencore announced its decision to shut the open-cut thermal coal operations of its subsidiary Optimum Coal Mines in South Africa, which is expected to result in 600 to 700 job losses.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

NUM deputy general secretary William Mabapa was quoted by Reuters as saying: "We are consulting with our lawyers as to what recourse we will take against DMR if they fail and Glencore succeeds with retrenchment."

The company announced in January its plans to place the open cut operations on care and maintenance.

"We are consulting with our lawyers as to what recourse we will take against DMR if they fail and Glencore succeeds with retrenchment."

The decision was estimated to eliminate five million tonnes of production a year in addition to 1,070 jobs at the time.

During that time, Optimum consulted with organised labour and the South African Department of Mineral Resources over the past few months in a bid to evaluate whether any measures could be put in place to avoid the closure.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Following these sessions, the company realised that the operations could not continue in the prevailing market conditions and no measures are available to avoid the retrenchments.

According to Glencore, Optimum proposes to retain sufficient mining operations and processing capacity at present to ensure the continued supply of coal to the Hendrina Power Station.

The company said it will provide funding to its subsidiary to enable it pay the full retrenchment costs.

Glencore also agreed to offer assistance to affected employees by conducting re-training programmes to enable them to plan for the future.

Training programmes were planned in areas such as portable skills and financial management.

Under the plans, some of the employees would be redeployed to other parts of the business in case of any available vacancies.

In 2014, the Optimum coal mining complex had an estimated workforce of 3,700 employees.