KCM workers fight back

In May this year Foil Vedanta released a video showing Vedanta boss Anil Agarwal mocking the Zambian parliament and bragging that he makes $500 million per year from Konkola Copper Mines (KCM), having bought the company for $25 million, against a $400 million asking price. The video caused outrage in Zambia, where KCM has failed to pay taxes, and is indebted to contractors. A few days later hundreds protested in the streets in Lusaka

demanding that Vedanta pay taxes and improve the conditions for workers. In light of the profitability of KCM claimed by Agarwal, this article examines the poor treatment of KCM workers by Vedanta, and some of the recent protests by current and former miners.

KCM is Zambia’s biggest employer with 18,000 workers, 11,000 of which are reported to be on short contracts and un-unionised. Vedanta took over KCM from Anglo American in 2004. Since KCM was privatised in 2002, miners claim their conditions have worsened, and protests have become even more regular in recent years.

One active group are the Former KCM Miners Association. They represent more than a thousand retrenched and discharged KCM miners, including the 752 who were made redundant when Vedanta closed the Nkana smelter in 2009. (The Nkana smelter had not long been refurbished with an $81 million loan from the UK’s Department for International Development in 2001). The former miners have produced lengthy documents evidencing in detail how the 752 miners retrenched in 2009 were never paid the terminal benefits owed to them, due to deliberate manipulations by KCM (owned by Vedanta). In January 2013, in a letter to a news blog site, they claimed:

We are more than 700 ex-miners languishing in poverty after KCM breached our contracts. We have all the necessary agreements.

Since 2009, we have been spending sleepless night engaging government officials like Mr Musukwa, Ronald Msisika, Mr. Shamenda, Mr Simuusa, Mr Mikanga, Mr Mbulu. Even the President is aware but it is like KCM is bigger than our leaders. We visited Cabinet office on 12th February, 2012 but to no avail. We spent 180 days at intercity bus terminals in Lusaka surviving on pamelas and cabbages.

According to the Standard Code Book issued by the Industrial Relations Bureau, and not changed since 1996, the terminal benefits owed to miners should be ‘28 months basic pay, plus one month’s basic pay per completed year of service less any monies owed by you by [the mining company]‘. In 2000, the state mining company ZCCM became ZCCM Ltd and ZCCM Smelterco. Employment contracts were re-issued to ‘reaffirm KCM’s responsibility to honour its contractual obligations’, and though some of them contained the original, and legal, terminal benefits, others stated a new redundancy package of just ’2 months basic pay per completed year of service’, removing the 28 months basic pay workers remain entitled to according to the Standard Code Book. Employees noticed the discrepancy and refused to sign the new document, claiming this change was illegal under labour laws.

The pictures below show two versions of ZCCM Smelterco’s new contracts issued in 2000, with the legal, and illegal redundancy packages.

In 2009, around 700 workers were made redundant from the Nkana smelter and, in violation of their contract, were prohibited from re-entering the plant on the day they received their termination letters. A few months later more employees were retrenched at KCM’s Nampundwe mine. An information sheet issued by KCM at the time stated that there would be two different rates of redundancy pay for the workers – those transferring to other IBUs, and those taking voluntary separation. The former would get the legal 28 months plus 2 months (in this case) per year of completed service, which the latter would get only the 2 months per year of completed service. (see below)  in a letter to a news blog site, they claimed:

The former miners give examples of two of the workers retrenched in 2009. Mr Wambizi worked 25 years, but was only paid 28 months plus 5 years service (calculated from 2004 when Vedanta took over ZCCM Smelterco and it became KCM Plc). Mr Chitu worked 5 years, and was paid 2 months basic pay per year of service. The miners have fought this discrepancy ever since, demanding the full payment from Konkola Copper Mines, the Mine Workers Union and government departments.

In January 2011 the Zambia Revenue Authority (ZRA) contacted the retrenched miners to say they had underpaid tax on their redundancy payments, showing a record of payouts of the full amount (28 months plus 1 months pay per completed year of service). The miners claim this suggests that KCM sent termination slips with the correct amount of terminal benefit due to the tax office, while sending the reduced payments and termination slips to the miners.

In December 2013, 76 workers retrenched in a spate of new redundancies by KCM claimed they had also been paid ‘peanuts’ in benefits.
In February this year the former KCM miners protested again, stating that they are owed over two hundred and seventy two thousand kwacha in terminal payments.
But it is not just former KCM miners who are getting a raw deal. On 8th May around 400 KCM contract workers stormed the Zambia National Broadcasting Corporation (ZNBC) offices in Kitwe during a protest over KCM’s refusal to implement the minimum wage. One worker, Mr Chisenga, told the Zambia News and Information Service that the workers were paid as low as K600 when their colleagues on the full time payroll were paid above K3000