S. African Coal Unions Declare Dispute After Snubbing Pay Offer

South African labor unions declared a dispute over wages after coal producers increased their offer by only 0.5 percentage point in the final round of pay talks.

The Chamber of Mines, representing companies including Anglo American Plc (AAL) and Exxaro Resources Ltd. (EXX), raised its wage offer to 7 percent, Gideon du Plessis, general secretary of the Solidarity union, said today in an e-mailed statement. That also includes a 7 percent increase in housing allowance, he said.

Opening a dispute pushes the matter into arbitration. Should talks at the Commission for Conciliation, Mediation and Arbitration fail to break the impasse, the coal companies may face the prospect of renewed strikes. Walkouts over pay disrupted South Africa’s coal, platinum, gold and iron-ore industries last year.

Wage talks between unions and gold producers started last month with a proposed 4 percent increase in basic pay that was rejected by the unions. Solidarity today called for a new pay proposal and said an additional increase must be offered to compensate for unspecified “housing inequalities.”

The National Union of Mineworkers, the biggest union, has also joined the dispute, Du Plessis said in a text message. The NUM’s General Secretary Frans Baleni didn’t answer calls or respond to text messages seeking comment.

The UASA union is supporting the dispute, Franz Stehring, its head of mining, said by phone.

BHP Billiton Energy Coal, Coal of Africa Ltd. (CZA) and Optimum Coal are also represented by the Johannesburg-based Chamber of Mines in the coal pay talks.

To contact the reporters on this story: Paul Burkhardt in Johannesburg at pburkhardt@bloomberg.net; Andre Janse van Vuuren in Johannesburg at ajansevanvuu@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

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