S. African Union Seeks Gold Wage Raise After Platinum Unrest

The National Union of Mineworkers, South Africa’s biggest labor union, wants more pay for gold miners after wage discontent in the platinum industry spurred violence in which 44 people died at a mine earlier this month.

The union wants an increase of as much as 2,000 rand ($238) a month for workers including rock drillers, winch and locomotive drivers, General Secretary Frans Baleni said. Talks are taking place with Africa’s gold producers including Gold Fields Ltd., AngloGold Ashanti Ltd. and Harmony Gold Mining Co Ltd., he said.

Workers “must get a slightly higher package,” Baleni said by phone today.

The NUM’s efforts in the gold industry come as it battles to retain members at platinum operations. Rivalry with other unions is stoking labor unrest at the some of the world’s biggest precious metal mines, with police shooting and killing 34 protesters at Lonmin Plc’s Marikana operation on Aug. 16 after 10 people died in fighting during an illegal strike by rock-drill operators. Lonmin miners said the NUM didn’t take their demand to increase wages to 12,500 rand ($1,489) a month to the company’s management.

At Impala Platinum Holdings Ltd., which shut the world’s biggest mine for the metal for six weeks this year in a similar dispute that left four people dead, workers have established interim committees, with management speaking directly with emerging leaders of the workforce, the company said Aug. 22.

Direct Demands

Employees at Anglo American Platinum Ltd., the world’s largest producer of the metal, made demands directly to the company on Aug. 17, spokeswoman Mpumi Sithole said by phone.

The Chamber of Mines, which represents companies including Africa’s three biggest gold producers in talks, won’t re-open a two-year agreement signed in August last year, said Elize Strydom, the chamber’s chief negotiator.

“We feel very strongly about this,” she said by phone from Johannesburg.

Under that agreement, workers got raises ranging from 7.5 percent to 10 percent. South Africa’s annual inflation rate averaged 4.1 percent in the year through August 2011, according to the country’s statistics agency.

Operators of winches and locomotive engines are in the categories that received a 10 percent increase in July 2011 and again last month, Strydom said. Rock drillers got a 9 percent advance in each of the last two years, she said. Operators in gold mines earn an average 11,400 rand a month, according to Loane Sharp, a labor analyst at Adcorp Holdings Ltd.

Jobless Rate

South Africa’s economy, the continent’s biggest, will probably expand 2.6 percent this year, according to the International Monetary Fund, less than the National Treasury’s February estimate of 2.7 percent. The government has said it needs 7 percent annual growth to cut the jobless rate to 14 percent by 2020 from 25 percent currently, the highest of more than 60 nations tracked by Bloomberg.

A group including members from the chamber and unions will meet over the last two days of this month to discuss the request for more pay, said Strydom. Because of this, the chamber may receive demands for the next wage deal in February instead of April, allowing talks to begin as early as in March, she said. The two-year accord ends in June.

Lost Contact

“We did receive demands and referred them to the Chamber of Mines,” Gold Fields spokesman Sven Lunsche said by phone.

The NUM is the largest affiliate of the Congress of South African Trade Unions, which forms part of the political alliance that rules South Africa. Cosatu, as the union body is also known, “got a major hiding” through the violence at Lonmin, Sharp said by mobile phone. The NUM has lost contact with its grassroots members, which allows for more militant splinter unions to emerge, he said.

Violence affecting platinum companies this year could “definitely” spread to the gold industry, as well as the public and manufacturing sectors, said Sharp.

South Africa’s gold industry had 157,019 workers in 2010, while platinum group metals companies had 181,969 employees, according to the Chamber of Mines. The total number of workers on all South African mines fell to 498,141 from 518,729 in 2008, the highest in the decade through 2010, according to the chamber.

Gold was little changed at $1,670.20 an ounce by 4:16 p.m. in London, while platinum rose for an eighth day, advancing 0.1 percent to $1,551.74 an ounce.

Gold Fields dropped 1.2 percent to 108.73 rand by the close in Johannesburg. Harmony added 0.5 percent to 81.50 rand, while AngloGold fell 1.3 percent to 278.46 rand.