Ashanti Goldfields and union reach agreement on cuts

Ashanti Goldfields (AG) said on Wednesday it had reached an agreement over proposed job cuts with the Ghana Mineworkers Union (GMU), the company's Obuasi workforce and the Ministry of Employment, Reuters reported. The cuts, at the firms's main Obuasi mine, will affect over 2,000 employees or over 20 percent of the workforce and will be implemented on 1 September, Reuters reported the company as saying. The agreement will mean that 2,000 out of 8,152 shift workers will lose their jobs, as well as 150 of the 942 Ghanaian senior staff and five of the 42 expatriate senior staff. The redundancy compensation for junior staff has been agreed at 20 percent of current annual basic pay for each year of service. The total cost of the redundancy plan is estimated at US $10million. The plan is expected to reduce Obuasi operating costs by about US $7million, the company said. According to Reuters the union said AG had already made some 500 casual workers redundant. The cuts are a result of the fall in world gold prices aggravated by the announcement by the Bank of England in May that it would auction its gold reserves. A Ghanaian associate professor at Northeastern University in the United States, Kwamina Panford, told IRIN on Tuesday that as long as employees received "decent severance packages" and the agreement was reached in a "mutually respectful manner" then it should all pass off peacefully.