Namibia mining sector accused of using subcontractors to cut wages and benefits

A parliament committee has found that the mining sector is using subcontractors to hire workers for lower wages.

Committee on poverty eradication and labour chairperson Justina Jonas presented the findings of the report to the mining industry in Windhoek on Monday.

“Across all mining corporations, the committee has observed a pattern where permanent employees are retrenched and then re-hired through subcontracting under less favourable terms,” Jonas said.

The committee visited 11 mines in five regions to assess compliance with labour laws and examine the impact of outsourcing and subcontracting on employment in the mining sector.

They found that employees hired by subcontractors perform the same work, but receive inferior benefits, including reduced wages, absence of pensions, and job insecurity.

“Then there’s the new kid on the block: voluntary separation. Voluntary separation packages are used to bypass compliance with Section 34 of the Labour Act,” Jonas said.

Voluntary separation allows termination of employment by mutual agreement, but has been scrutinised as a form of retrenchment that is less regulated than the retrenchment processes governed by the Labour Act.

Jonas did not name the companies using these practices, but she said it was happening across the sector and the official report would make explicit their findings.

The report also looked at the effects of short-term contracts on the relationship between trade unions and companies, corporate social responsibility, and skills transfer. Occupational health and safety was also raised as a concern.

“The responsibility for safety of workers in the mining sector cannot be delegated away through subcontracting arrangements,” Jonas said.

During the same event, International Labour Organisation country director Philile Masuku cautioned that the mining sector is one of the most dangerous working environments.

“There is a concerning rise in safety incidents,” she said, citing a 2024 Chamber of Mines report.

Monday’s event was organised by parliament under the theme: ‘Public Dialogue: Promotion of Decent Work Within the Namibian Mining Sector’, and aimed to bring together industry players to find workable solutions to the issues identified by the parliamentary committee.

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