Unions have asked South Africa’s biggest gold and coal producers to raise wages by as much as 61 percent, or 10 times the inflation rate. The country’s gold-stocks index dropped to an almost 12-year low.
The National Union of Mineworkers, or NUM, wants surface-level employees to be paid a minimum basic salary of 7,000 rand ($740) a month, it said in e-mailed statement. That compares with 4,350 rand paid now, Elize Strydom, the chief negotiator for the Chamber of Mines, the body through which wage talks take place, said today. Solidarity wants a raise of 10 percent for all members, General Secretary Gideon du Plessis said.
“The chamber has circulated these demands to all its members and the members will now meet,” Strydom said by phone.
Mining companies in South Africa are reining in spending plans amid rising costs, declining metals prices and labor disruptions that halted output last year. Gold producers in the country, the world’s fifth-biggest producer of the metal, last year raised wages by 7.5 percent to 10 percent. Annual inflation averaged 5.3 percent from 2010 to 2012 and was 5.9 percent in March.
The FTSE/JSE Africa Gold Mining Index declined 3.4 percent to 1,318.49, the lowest intraday level since November 2001. AngloGold Ashanti Ltd., the world’s third-largest producer, dropped 3.6 percent to 156.16 rand, the lowest in 4 1/2 years, while Gold Fields Ltd. (GFI) declined 3.5 percent to 53.62 rand, at 2:30 p.m. in Johannesburg.
The NUM wants opencast employees’ basic salary to be raised to 8,000 rand a month. They are paid 5,000 rand now, Strydom said. The union wants workers in all other categories to get a 15 percent increase and has made other demands on benefits including housing and transport.
The wage demands are “usually high'' but this is more politicking than being realistic, David Davis, a mining analyst at SBG Securities Ltd., said by phone. “They can’t afford it.”
The NUM has lost membership to the Association of Mineworkers and Construction Union in rivalry that contributed to unrest that halted production at gold, coal, and platinum mines last year and cost the continent’s biggest economy .
While the AMCU has been invited to wage talks for gold, the union hasn’t indicated whether it will participate, Strydom said.
“We’ve told the AMCU that we’ve bargained centrally over many many decades in gold and that’s where we will be bargaining and we’re inviting them to be part of central-level negotiations,” she said.
Solidarity’s wage-increase demands include a request that their members be compensated for working during last year’s stoppages, Du Plessis said by phone.
“There was a gentleman’s agreement during the unrest where our members worked under difficult circumstances and they would be rewarded for that,” he said.
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