Tendele Coal Mining, a subsidiary of JSE-listed multi-commodity mining company Petmin, has successfully concluded wage negotiations with the majority unions at its Somkhele anthracite mine in Kwa-Zulu Natal.

A two-year wage agreement, effective from 1 July 2015, has been concluded with both AMCU and NUM and a three year agreement has been concluded with Solidarity.

Under the terms of the AMCU and NUM, a two year agreement has been reached, with a basic wage increase of 7.5% for 2015/2016 with a further increase of 7.5% for 2016/2017. This agreement also improves medical benefits, housing allowance and other benefits for eligible employees from 1 July 2015, which together with the basic wage increase, results in an increase in Total Cost to Company (TCTC) of 8.6% for 2015/16 and 6.5% for 2016/17.

The parties previously reached a deadlock at the CCMA and both Unions and Management opted for private mediation to break the deadlock.

“The wage agreement provides much needed stability and certainty during very volatile times in the “commodities’ world”, and we thank both AMCU and NUM and the independent mediator, Fred Arendse (CEO of SSC Group) for the manner in which the negotiations were concluded”, says Jan du Preez (Petmin’s CEO).

“The conclusion of this agreement is a witness that if both management and organised labor negotiate in good faith there will always be a solution. We believe that this culture of prioritising with our employees and respecting each other’s responsibility will continue”, says NUM’s Lucky Mkhwanazi.

“Although it was really a tough process, we are happy with what we have accomplished in the wage negotiations process , and a special thanks to the shop stewards, management and the independent facilitator and the employees for the faith they have in their trade unions”, comments AMCU’ Glehn Mkhabela.

In addition to the agreement reached with both AMCU and NUM, a three-year wage agreement was agreed for miners, artisans and officials, represented by Solidarity. Under the terms of the three-year agreement, employees will receive a 6% increase in TCTC for 2015/2016, a 6.5% increase in TCTC for 2016/2017 and a 7% increase in TCTC for 2017/2018.

“We thank Solidarity, and look forward to working together with all employees to continue to improve productivity and contain costs in an extremely challenging environment”, continued Du Preez.

Petmin recently announced a R350 million Black Economic Empowerment (BEE) ownership scheme that will benefit the children of the approximately 175 000 people working for, and living around its Somkhele anthracite mine.

The deal gives workers and communities around Somkhele a 20% stake in Tendele. The mine produces about 1.2 Mtpa of premium priced anthracite for ferroalloy smelting, and about 350 000 t of low-volatile energy coal from discards for export.

The BEE deal requires shareholder approval and a Category 1 Circular to shareholders are in the process of being finalized.

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