Mine Workers Union has rejected Goldfields company's claim that "scary" salary levels of its staff is behind imminent job cuts expected to affect some 1,500 staff.

General Secretary of the Union Prince Ankrah questioned why Goldfields Vice-President who he claims takes home $66,000 a month should blame the job cuts on the salary levels of other staff. Myjoyonline.com cannot independently confirm the salary claim.

Goldfields Ghana’s Vice President and Head of Corporate Affairs, Mr. David Johnson was on Top Story on Joy FM to justify the re-current theme of job losses in the mining industry.

Photo: David Johnson

He first blamed the 10% drop in gold prices on the world market amidst increasing cost of materials it uses for mining.

But "the big one", he said is the "unrealistic" wage demands of its unionised staff strength of about 2,500.

He said over the past four years, staff wages has increased by at least 60% in dollar terms.

If staff are asked for double digit increase in wages on a dollar basis, you can imagine what will happen to your margins' he told host Evans Mensah.

He said for every percentage increase of staff wages shortens the life span of the mine by three months. The Tarkwa mine in the Western region, Goldfields claim has a remaining lifespan of not more than six years.

These three factors, he said, has worked together to put the mining company under pressure to cut its losses or "our shareholders will lose out".

He was not comfortable to call the expected 1,500 lay-off as retrenchment. The Goldfields Vice-President said a contractor has been engaged to mine the Tarkwa concession who will re-hire at least 85% of the affected staff.

The job losses will therefore affect some 370 staff and not 1,500, he suggested.

The severance package he said is 25% of annual salary multiplied by the number of worker years.

Those who receive the severance package "with one hand" and get a new job offer "with the other hand" cannot be truly described to be worse off, he explained.

Listen to Goldfields Vice-President explain job cuts

But in a rebuttal, the General Secretary of the Mine Workers Union Prince William Ankrah has expressed reservations at the comments by the Vice-President whom they claim earns $66,000 dollars a month.

"It is indeed astonishing. I  would want to cool my tempers" he fumed and pointed out that issues about staff wages was never part of the reasons given in its discussion with the Union.

Prince Ankrah claimed there is a report that  shows 47.2% of the company's wage bill pays top management and that consumes a chunk of the wage bill.

He said Goldfields company has worked together with the staff to scale down cost pressures which has saved the company $165million over the past three years.

"He earns $3.5million a year. This excludes benefits", he claimed and expressed disappointment in the Vice-President's comments.

"I am indeed surprised. I thought I could trust him", he lamented.

He dismissed the severance package as inadequate a compensation for the affected workers.

"If they are going to get that juicy pay that the Vice-President has would be exciting. Unfortunately that is not the case" he said.

The General Secretary called for an honest discussion on the retrenchments.

The Mine Workers Union has petitioned Parliament to intervene in the planned retrenchment.

Photo: Prince Ankrah

Listen to General Secretary of Ghana Mine Workers Union