Six weeks of wage talks between South African gold producers and unions have failed to bridge the chasm between their positions, increasing the prospect of crippling strikes in a declining industry battling low prices and soaring costs.
The two opposing sides in the gold sector remain poles apart after weeks of talks, with virtually no narrowing of the gap between employers, whose latest offer was a 5.5 percent hike in basic wages, and unions.
The National Union of Mineworkers (NUM), which represents 64 percent of the country’s roughly 140 000 gold miners, is seeking a basic wage for entry-level underground workers of R8 000 a month, a 60 percent increase. Its more hardline rival the Association of Mineworkers and Construction Union (Amcu), with about 17 percent of the gold labour force, has submitted demands as high as 150 percent.
“The prospects for a strike remain big,” NUM spokesman Lesiba Seshoka said yesterday. More talks were due yesterday and Monday next week, and workers could down tools after that if the impasse remained.
Gold and platinum producers are still recovering from a wave of wildcat strikes in 2012 rooted in a turf war between NUM and Amcu. This cost billions of dollars in lost output and triggered damaging sovereign credit downgrades.
But in contrast with last year, when illegal strikes spun out of control into violence, the wage talks process this year has followed standard legal procedures and has been peaceful, although there have been sporadic murders at mines.
The gold companies, which have slightly raised their starting offers, say the unions have shown no compromise.
“In past years there has been a narrowing of the gap by this stage in the negotiations and we have not seen that yet,” said Charmane Russell, the spokeswoman for gold producers represented by the Chamber of Mines, which include AngloGold Ashanti, Gold Fields, Harmony Gold and Sibanye Gold.
Aside from a 5.5 percent increase, producers have also offered a “gain share” which, depending on the company, could be linked to the gold price, production, profits or cost objectives. The outlook is gloomy too for talks in the platinum sector, which also faces massive union pay hike demands. – Reuters