The company is in consultations with unions and employees on the reduction plans, which are aimed at protecting its employees against persistent low platinum group metal (PGM) prices.

Lonmin CEO Ben Magara said: "The mining industry is going through another challenging economic cycle and we need to make difficult decisions to maintain the resilience of our business and protect employment.

"Our cost controls so far have been encouraging but the price of our metals is beyond our control and we need to make further savings, including seeking voluntary reductions in our labour force which represents around 60% of our total costs.

Magara added: "These are tough conversations but I am encouraged by our employees’ appreciation of the situation. That is a reflection of the huge effort all parties have made to understand one another better in recent months and we are all seeing the benefit of that now."

The company said the efficiencies and savings required are being undertaken from top to bottom such that the executive committee headcount has been reduced by 22%.