South African gold producers on Wednesday urged unions to narrow their demands after a third round of wage negotiations saw unions rejecting offers of annual wage increases of up to 6.5 percent for miners and up to 4.5 percent for skilled workers.
Four companies are negotiating – Sibanye-Stillwater , Harmony Gold, AngloGold Ashanti and a smaller producer, Village Main Reef- under the auspices of the Minerals Council South Africa industry group.
Although marginally above inflation for most workers, their offers fell well short of the hikes, some in excess of 30 percent, demanded by the four unions.
Four companies are negotiating — Sibanye-Stillwater , Harmony Gold, AngloGold Ashanti and a smaller producer, Village Main Reef.
South Africa’s gold mines are the deepest in the world, reaching as far as 4 kms (2-1/2 miles) underground, and margins and grades have shrunk at such depths after over a century of mining.
Gold producers have been giving above-inflation wage hikes for years, adding to the cost burden of an industry that has been battling depressed prices, labour unrest and soaring power bills.
The chief negotiator on behalf of the gold producers, Motsamai Motlhamme, said all four unions rejected the offers.
“The companies urge the unions to narrow their demands, particularly non-wage demands, so that the companies in turn can focus on improving wages within the context of affordability,” said Motlhamme.
Producers also urged the unions to consider the “gold industry’s precarious position and economic realities.”
The four unions are the National Union of Mineworkers (NUM), the Association of Mineworkers and Construction Union (AMCU), Solidarity and UASA.
Solidarity General Secretary Gideon du Plessis said in a separate statement the union doesn’t deny that the mines are under pressure.
However he added that wage increases granted to mine chief executives have been extremely favourable and showed no sign of a “sector that is under pressure.”
The NUM said in a statement it rejects the offers in their current form and reiterated its initial demands.
The NUM wants the basic monthly pay for entry-level underground workers to rise to 10,500 rand ($785) over the next two years, which translates into annual increases of between 15 and 18.5 percent, depending on the company.
AMCU has put in demands of over 30 percent. ($1 = 13.1720 rand) (Reporting by Nqobile Dludla Editing by Alexandra Hudson)