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South African Union Lowers Gold-Wage Demands to ‘Single Digit’

One of the four South African unions representing labor at wage talks with gold producers lowered its salary-increase demands to “single-digit” percentage points as negotiations are set to continue tomorrow.

Minority union Solidarity, which along with the Association of Mineworkers and Construction Union today held discussions with seven gold companies through the Chamber of Mines, will accept pay increases of less than the initial 10 percent sought from employers, General Secretary Gideon du Plessis said.

“Solidarity has moved,” Du Plessis said today by phone. “We will listen should the employers adjust their offer.”

Talks stalled on July 24 after Solidarity, UASA and the National Union of Mineworkers, which wants an increase of more than 60 percent for entry-level pay, rejected the initial offer by the chamber, which represents companies including AngloGold Ashanti Ltd. (ANG), the world’s third-largest producer. The chamber raised its proposal to 5.5 percent with additional compensation and to 6 percent in some job categories on Aug. 21. South Africa’s annual inflation rate was 6.3 percent in July. Strikes could cost the gold industry 349 million rand ($34 million) a day in revenue, according to the chamber.

The chamber will again meet Solidarity and the AMCU tomorrow, Charmane Russell, an external spokeswoman for the organization at Russell & Associates, said by phone.

The AMCU, which wants basic wages for entry-level miners to be more than doubled to 12,500 rand a month and represents 17 percent of the miners, hasn’t changed its demands, Russell said.

No Decision

Two other labor unions are also holding out for a revised offer by the companies before deciding on whether to declare a strike.

The NUM, which represents 64 percent of employees at the seven gold companies, and minority union UASA have yet to decide on whether to strike after being given permission to do so by a mediator on Aug. 21.

“I’m going back to see if there’s any offer on the table,” Franz Stehring, head of mining at UASA, said by phone today. The union is “still carrying on with strike ballot,” he said. UASA proposed a raise of 18 percent for miners.

The NUM will give companies until Aug. 31 to increase their wage proposal before deciding whether to strike, spokesman Lesiba Seshoka said yesterday.

The chamber declared a dispute with the AMCU on July 29, and referred the matter to the Commission for Conciliation Mediation and Arbitration for resolution. The commission engages the sides for a period that can last as long as 30 days.

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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