Sierra Rutile Limited, currently owned by Leone Oil Company, has announced plans to implement a workforce reduction as part of efforts to realign its operations with prevailing economic realities. The proposed redundancy exercise, which may significantly affect the company’s workforce, forms part of broader measures aimed at reducing operational costs and stabilizing the company amid declining returns on investment and mounting global economic pressures.

The announcement was made on Tuesday, 19th May 2026, as concerns continue to grow over the sustainability of operations at one of Sierra Leone’s leading mining companies.

It could be recalled that Leone Oil Company acquired 100 percent ownership of Sierra Rutile from former owner, Iluka Resources, in 2024, making the company fully Sierra Leonean-owned for the first time in its history.

In response to the proposed layoffs, a delegation from the Ministry of Employment, Labour and Social Security, led by Deputy Minister Lansana Dumbuya, visited Sierra Rutile on Tuesday, 19th May 2026, to engage Management and workers on the planned exercise and ensure compliance with labour laws governing redundancy.

Speaking during the engagement, Deputy Minister Lansana Dumbuya clarified that Government’s intervention was intended to safeguard the interests of both workers and Management while fostering dialogue to ensure a peaceful and lawful process.

“Our purpose here is to engage directly with workers and prepare minds for the eventuality. We are not part of the company’s finances but we must ensure that any redundancy process is fair, lawful and conducted amicably,” he stated.

The Deputy Minister noted that global economic uncertainties have negatively impacted commodity prices and investment returns, forcing many companies around the world to undertake restructuring and cost-cutting measures to remain viable.

According to information submitted to the Ministry, Sierra Rutile had anticipated the need for cost reduction over an extended period. The company had previously planned to reduce its workforce from over 2,000 employees to approximately 1,000 workers.

Records indicate that in 2024, about 468 staff members were laid off, while the current redundancy exercise is expected to affect 213 general staff, 80 senior staff and 46 Management personnel.

Deputy Minister Lansana Dumbuya emphasized that while Government remains committed to creating employment opportunities, prevailing economic realities sometimes necessitate difficult decisions to preserve business continuity.

“These companies are not charitable institutions. Investors expect returns and when losses persist, realigning and restructuring become inevitable,” he noted.

He assured workers that the proposed redundancy process would strictly comply with the provisions of Section 82 of the Employment Act 2023 and the Mining Collective Bargaining Agreement Gazette governing redundancy and labour relations within the mining sector.

Deputy Director of Labour and Employment, Abdulai Conteh, explained that Section 82 of the Employment Act, 2023, alongside Article 27 of the Mining Collective Bargaining Agreement Gazette, 2025, clearly outlines the legal framework guiding redundancy procedures.

According to him, Sierra Rutile Management had formally notified the Ministry in line with legal requirements, thereby triggering mandatory consultations with workers and relevant stakeholders to ensure transparency and adherence to labour standards.

“Redundancy is a recognized labour process under the law. Our role as a Ministry is to ensure that all procedures are properly followed and that the rights and welfare of workers are adequately safeguarded,” Abdulai Conteh stated.

He further appealed to workers to remain calm and embrace constructive dialogue as consultations continue between Management, labour authorities and employees.

Meanwhile, Secretary General of the Workers’ Union, Ahmed MK Josiah, welcomed the Ministry’s intervention but expressed disappointment over what he described as delayed communication regarding the proposed layoffs.

“Redundancy has happened before in 2017 and 2024. While we understand the situation, earlier communication would have helped workers prepare better,” he said, while also questioning whether improved conditions of service would accompany the restructuring process.

Several workers also voiced concerns over reductions in staff benefits and operational changes reportedly introduced after Leone Oil Company assumed ownership and management of Sierra Rutile.

Responding to concerns raised by employees, Chief Executive Officer of Sierra Rutile, Lima Suffian Kargbo, disclosed that the redundancy decision was driven solely by financial sustainability concerns.

He revealed that the company currently spends approximately US$2.5 million monthly on fuel and nearly US$1.8 million on logistics, including transportation and staff provisions, despite experiencing limited returns on investment.

“We are not happy about this decision but if we do not cut down costs, the company risks collapse,” Lima Suffian Kargbo explained.

The Chief Executive Officer further disclosed that the workforce reduction would affect approximately 24 percent of general staff, 35 percent of senior staff and 46 percent of management personnel, with implementation expected before the end of May 2026 to enable the company resume operations on a restructured scale in June.

The meeting concluded with assurances from the Ministry of Employment, Labour and Social Security that all affected workers would receive their full redundancy benefits in accordance with the law.

While some employees reportedly expressed willingness to voluntarily exit the company, labour officials clarified that the final determination of affected staff remains solely within the mandate of Management.

Deputy Minister Lansana Dumbuya reassured workers that Government would continue to serve as an impartial mediator to ensure the redundancy process is conducted peacefully, lawfully and respectfully. https://thecalabashnewspaper.com/sierra-rutile-to-cut-workforce-amid-rising-administrative-costs-and-declining-returns/