Unions reject gold producers’ wage offer

Production of gold bars at the Rand Refinery, the largest and most modern gold refinery in the world, Germiston, South Africa. Here, each bar is stamped with an individual number. Photographer: Henner Frankenfeld / Bloomberg News

Production of gold bars at the Rand Refinery, the largest and most modern gold refinery in the world, Germiston, South Africa. Here, each bar is stamped with an individual number. Photographer: Henner Frankenfeld / Bloomberg News

Published Jul 7, 2015

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Dineo Faku

UNIONS in the gold sector yesterday rejected the Chamber of Mines’ opening offer comprising a five-year wage deal retaining their demands in line with expectations as the stage has been set for tough talks.

The two biggest unions – the National Union of Minewokers (NUM) and the Association of Minworkers and Construction Union (Amcu) – held on to their demands for increases for their lowest paid members of between 80 percent and 100 percent in the third round of talks in Johannesburg.

The talks, which include AngloGold Ashanti, Sibanye Gold, Harmony Gold, Pan African Resources’s Evander Gold Mines and Village Main Reef, are against the backdrop of declining production, marginal shafts and rising costs, including Eskom’s tarriff hikes.

Gold producers last week tabled a five-year deal focused on sustainability of the industry.

Livhuwani Mammburu, acting NUM spokesman, said members had rejected the offer as it was not even close to their demand of R9 500 a month for the lowest paid surface worker and R10 500 for underground employees.

Asked whether a strike was on the cards, Mammburu said: “I cannot pre-empt our next decision.”

The union represents 52 percent of the 95 000 gold mining sector employees.

Dumisani Nkalitshana, Amcu’s national organiser, which represents about 20 percent of the gold mineworkers, said the five-year wage deal was too long of a term for its members.

“Our members have said no to the five-year wage term because it’s too long. We will continue negotiating for R12 500 a month for entry level underground mineworkers.”

Too long

Amcu led the crippling five-month wage strike in the platinum belt last year, which saw shafts at Lonmin, Anglo American Platinum and Impala Platinum ground to a halt.

Franz Stehring, head of mining at the United Association of SA, which represents 7 percent of the gold employees, said the producers had offered wage increases of as much as 13 percent, plus a share of profits.

The proposed five-year deal was “too long”, said Stehring, adding that virtually unchanged housing allowances and increases not linked to inflation were also issues.

“The answer to the chamber from our side will be ‘go back and redo your figures,’” said Stehring.

The chamber said yesterday that the producers heard from all four unions, which are NUM, Amcu, Uasa and Solidarity, in large part, all four unions retained their demands without any movement.

Speaking on behalf of the gold producers, Elize Strydom said: “As producers we remain committed to reaching an agreement based on the sustainability of the industry, and the retention of jobs.

“The companies’ offers were made in good faith, and are substantial. We will continue to engage to reach outcomes that are sustainable.”

The chamber had previously said the gold sector was in dire straits.

The sector is grappling with challenges as a result of falling dollar gold prices, aging infrastructure and depleting ore bodies, rapidly rising costs, electricity-related constraints and disruptions and greater distances to working faces which affect productivity.

As a result, company margins are under severe pressure, placing the sustainability of many mines and shafts under threat. – Additional reporting by Bloomberg

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