Ferrochrome producer Samancor Chrome has formally issued a retrenchment notice in terms of Section 189 of the Labour Relations Act (LRA). This notice potentially affects approximately 2 403 employees across its smelting operations—including Dikwena Chrome, Ferrometals, Middelburg Ferrochrome, TC Smelter, Tubatse Alloy, and Tubatse Ferrochrome—as well as its corporate offices.
Firstly, the company has provisionally determined that restructuring and a reduction in the workforce are necessary to address significant financial and operational challenges. Over the past 12 months, the smelters have accumulated unsustainable standing costs, primarily because the company has not maintained full operational capacity. The most pressing factor is the increased cost of electricity, which has severely strained Samancor’s financial position. Despite implementing rigorous cost-saving initiatives—including natural attrition, termination of contractor agreements, review of fixed-term contracts, suspension of performance bonuses, limitations on overtime, and pausing training programmes—these measures have not secured the long-term viability of the business or achieved the desired financial stability.
Additionally, every position within the smelting operations and corporate offices, from entry-level to executive, may be impacted by the restructuring. At this stage, it is proposed that D- and E-level employees whose positions become redundant be selected for retrenchment, with specific roles to be clarified during the consultation phase.
The consultation process will commence in the coming weeks and will extend for a minimum period of 60 days, as mandated by the LRA. Meetings will be scheduled at regular intervals, with notifications sent in advance to all affected employees and their representative trade unions. Sessions will be held both in-person at key operational sites and virtually, ensuring all stakeholders can participate. Participants will include management representatives, union officials, affected employees, and, where appropriate, an independent retrenchment facilitator appointed by the company.
During these consultations, key topics will be discussed, including the rationale for retrenchments, alternative measures to avoid or minimise job losses, details of the severance packages, selection criteria for retrenchment, the timeframes involved, opportunities for redeployment, and support measures available to affected employees. Minutes of each meeting will be recorded and made accessible to all participants, ensuring transparency throughout the process.
Additionally, the company encourages employees to raise any concerns or propose alternatives during these consultations to ensure a collaborative approach. The final decisions regarding affected positions and the implementation of retrenchments will only be made after this comprehensive engagement process.
Samancor is committed to supporting employees during this time of transition. Affected staff will receive assistance in compiling exit portfolios, which will include support with updating curricula vitae, dedicated time off for job searching, and letters of reference. Employees can access counselling and wellbeing support through the Employee Wellness Programme, available via a confidential hotline or by scheduling on-site appointments with qualified counsellors. Financial counselling will also be provided to help employees navigate the implications of retrenchment.
Furthermore, retrenched employees will be prioritised for any suitable vacancies that arise within Samancor in the six months following their retrenchment. The company will apply for the appointment of a retrenchment facilitator to ensure fairness and adherence to best practices.
Finally, Samancor emphasises that no final decisions have been made regarding the retrenchments at this stage. The company remains committed to conducting the process transparently, engaging in good faith with all stakeholders, and providing comprehensive support to employees throughout. Further updates will be communicated as the consultation process progresses.