Johannesburg, South Africa — MININGREVIEW.COM — 21 April 2009 – South Africa’s biggest trade union has asked for wage increases for its members in the gold and coal sectors that are nearly double the national inflation rate, setting the stage for tough talks next month.
Reuters reports that the National Union of Mineworkers (NUM) – which represents some 190 000 workers in the two sectors – wants a 15% wage increase from the companies represented by the Chamber of Mines, and would not take anything less, it said in a statement.
South Africa’s inflation stood at 8.6 p% in February.
The NUM said it wanted to shield its members’ earnings from inflation and still ensure that they kept their jobs in a sector hit by job losses in the wake of the global economic turmoil.
Wage hikes are likely to boost production costs, which are already about half of total costs for gold producers, who sell for dollars and pay costs in the local currency.
The union claimed that the coal and gold producers could "afford with ease" to give the increase. South Africa’s coal producers include mining group Anglo American Plc and rival Xstrata, while AngloGold Ashanti and Gold Fields – the world’s number three and four producers – are the major gold mining companies.
Reuters reports that the negotiations could start in the second week of May, and a wage deal was expected to take effect in July 2009 for two years.
"The mandate is clear and our members say they expect no excuses," NUM general secretary Frans Baleni said.
Chief Chamber of Mines negotiator Elize Strydom said that union demands for a 15% rise as well as increases in various allowances meant the wage talks would be tough. “One shouldn’t look only at the 15% demand, which is already much higher than inflation. There are other demands the union has made that have a significant implication on costs,” she explained.
The union also asked for an improved medical cover, and higher allowances for workers living outside company hostels. “These are very big cost items, and very expensive items. We are doing the number crunching right now to see how they will impact overall costs, and will then give our response," Strydom said.