Johannesburg - The outcome of a wage dispute at Northam Platinum, where a South African strike is in its third week, will set a precedent for the industry’s largest producers, Investec and Stanlib Asset Management said.
Northam workers remain off the job even after the company raised a salary-increase offer to as much as 9 percent.
The National Union of Mineworkers, or NUM, has demanded an average increase of 61 percent.
“If Northam settles at 9 percent it does lower the chance of other miners getting single-digit settlements,” Albert Minassian, an analyst at Investec in Cape Town, said by telephone.
“Unions need to be seen to be strong and fighting for their members.”
The three largest producers -- Anglo American Platinum, Impala Platinum and Lonmin -- also have been locked in talks with unions as workers push for higher pay and managers seek to keep a lid on spiralling costs.
While the NUM used to be the biggest union at the companies, it’s recently been usurped by the Association of Mineworkers and Construction Union, which has demanded an even greater jump in wages.
“AMCU definitely would want to show at least a percentage point or so more than what NUM bargained for,” said Kobus Nell, an analyst at Stanlib, which manages about $50 billion in assets in Johannesburg.
“I just don’t think the companies have room” to give more.
Topping Inflation
The AMCU is demanding some salaries be more than doubled to 12,500 rand ($1,236) a month.
The rate of inflation in South Africa, where the platinum companies mine most of their metal, was 6 percent in September.
South Africa’s Commission for Conciliation, Mediation and Arbitration on November 13 gave the AMCU the right to call a strike at Amplats, as the largest producer is known, after the union refused to accept a wage-increase offer of 7 percent.
The union is yet to decide whether it will strike.
At Lonmin, the CCMA will facilitate talks with the AMCU after pay negotiations broke down on November 14, the union’s National Treasurer Jimmy Gama said yesterday by phone.
At Impala, the AMCU on October 28 decided to strike, without setting a date.
The union has lowered its demand for basic wages at the company to 8,668 rand a month, which compares with a company offer of about 6,000 rand, an increase of 8.5 percent.
Johan Theron, a spokesman for Impala, declined to comment today when contacted by e-mail.
Amplats spokeswoman Mpumi Sithole wasn’t immediately able to comment when contacted by phone.
Lonmin spokeswoman Sue Vey didn’t respond to an e-mail. - Bloomberg News