S. Africa Unions Threaten Strikes as Platinum Pay Offer Rejected

South Africa’s National Union of Mineworkers said it would strike at Northam Platinum Ltd. (NHM) Nov. 3 and Solidarity rejected an offer by Lonmin Plc (LMI) as labor and platinum producers hold wage talks.

“We gave it all,” exhausting every option, Ecliff Tantsi, chief NUM negotiator at Northam, said by phone. The union will wait to strike until the evening shift at the end of the weekend to allow more time for dialogue, he said, adding “there is no indication of when we are meeting.”

The NUM’s deadline adds to the potential for labor action at other platinum operations in South Africa. Members of the Association of Mineworkers and Construction Union, the largest labor group at Impala Platinum Holdings Ltd. (IMP)’s operations, voted on Oct. 28 to strike at the world’s biggest platinum mine.

Platinum has fallen 5.9 percent this year, tracking a slump in gold as some investors lost faith in precious metals as a store of value and amid concern about slowing demand in Europe and China. Today’s 2 percent drop narrowed this month’s gain to 2.7 percent.

Northam’s Zondereinde division was served with a strike notice after its latest wage offer of 7 percent to 8 percent was rejected, the company said in a statement. The NUM demands an average increase of 61 percent, Northam said.

The AMCU wants basic monthly wages for underground workers of 12,500 rand ($1,275) from the three largest South African platinum producers.

Lonmin Talks

Solidarity rejected Lonmin’s four-year offer of a 6 percent increase annually for skilled employees and 7 percent for entry-level workers, the union said in a statement.

The company won’t be commenting “on the progress of the negotiations as we believe it would be counterproductive,” Sue Vey, a spokeswoman for Lonmin, said in an e-mailed response to questions.

The AMCU is the biggest representative of workers at Lonmin, Impala and Anglo American Platinum Ltd. (AAL), or Amplats, the world’s three largest producers of the metal.

“It might happen that a strike could happen jointly” with other platinum companies, Jimmy Gama, AMCU’s treasurer, said yesterday.

The union is also in wage negotiations with Amplats. Mpumi Sithole, a spokeswoman for the company, didn’t respond to an e-mail seeking comment.

Johan Theron, an Impala spokesman, confirmed the company had received notice of the AMCU’s vote. “They gave as formal notice of the outcome of the ballot and notice that they seek further engagement,” he said by e-mail.

To contact the reporter on this story: Paul Burkhardt in Johannesburg at pburkhardt@bloomberg.net

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

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