HomeGoldUnions reject new wage offer

Unions reject new wage offer

Doornkop mine – one of
many South African
mining operations
facing the threat
of a strike
Johannesburg, South Africa — MININGREVIEW.COM — 04 June 2009 – South Africa’s gold producers improved their wage offer to workers to 6% as pay talks entered the second of five rounds, but the trade unions have rejected the proposed increase and threatened to strike. Mine workers have demanded a 15% pay rise.

Reuters reports that the unions say their wage demands can be met because the price of gold has risen despite the global economic downturn. South African gold producers, who negotiate as one under the Chamber of Mines, made an opening offer of a 5% increase to unions two weeks ago, which unions rejected.

“We have increased our offer to 6% and could go higher if the unions respond positively to this offer,” said Chamber gold negotiator Elize Strydom. She pointed out that other than the 6% wage offer, the Chamber had proposed to increase other allowances demanded by workers, including maternity, meal and medical allowances.

Strydom says the unions’ wage demands plus their request for additions to other allowances represent a total demand of 28%, which the gold producers point out is well above inflation at 8.4%. Such an increase would dramatically jerk up production costs and jeopardise the long-term survival of their industry.

Strydom revealed that further wage talks were due on 11 June. She was negotiating on behalf of AngloGold Ashanti, Gold Fields and Harmony, the world’s third, fourth and fifth biggest gold producers respectively.

The 300 000-strong National Union of Mineworkers (NUM) and the smaller Solidarity union both said the new offer was still poor.

“As from tomorrow the union will start consultations with its members to map a way forward, as negotiations seem to have reached a deadlock,” said NUM spokesman Lesiba Seshoka. “Members will then have to give direction on whether a strike action is necessary or what,” he added.

“The offer of 6% does not even come close to the current inflation rate of 8.4%,” Said Solidarity spokesman Reint Dykema.

A new wage deal is due to start in July 2009 and last for a period two years.