Jan. 31 (Bloomberg) -- A South African strike that has crippled output at the biggest platinum mines will spread at Anglo American Platinum Ltd. after a second union told the company its members will stop work at refineries and smelters.
The National Union of Metalworkers of South Africa late yesterday notified the Anglo American Plc unit that its members plan to walk out from Feb. 3 at the world’s largest platinum producer, Numsa organizer Stephen Nhlapo said. The union demands pay increases of as much as 10 percent for higher-skilled employees and a raise of at least 2,500 rand ($223) monthly for the lowest-paid employees, he said.
“If we want to close the wage gap we have to talk about rand and cents,” Nhlapo, who is Numsa’s head of basic metals and energy, said today by phone. “Percentages won’t get us anywhere.” The lowest-paid workers currently earn 5,000 rand to 6,000 rand, excluding other benefits, he said.
Platinum mining in South Africa, which accounts for 70 percent of global supplies of the metal, has been curbed since the Association of Mineworkers and Construction Union called its members on strike on Jan. 23 at Anglo American Platinum, Impala Platinum Holdings Ltd. and Lonmin Plc. The AMCU is dominant in platinum, with more than 70,000 members, and is demanding that basic wages be more than doubled to 12,500 rand a month. Talks aimed at resolving the dispute resume tomorrow, in Pretoria.
While the negotiations have failed to achieve “tangible progress,” the companies and the union were pursuing a settlement, AMCU treasurer Jimmy Gama said.
“Maybe tomorrow there might be some progress,” Gama told reporters after the talks broke up for the day. “If not tomorrow, then on Sunday.” The union is still sticking to its demand on entry level wages, he said, while negotiating “different options” with employers.
South Africa’s inflation rate was 5.4 percent in December. The nation’s platinum industry is losing an estimated $18 million daily from the strike, while employees are forgoing about $8 million in wages, the three companies said this week.
Numsa is the largest union at Anglo Platinum’s refineries and smelters, with 1,800 members, Nhlapo said. The facilities haven’t been affected by the AMCU’s strike, the company said in a statement on Jan. 23.
Mpumi Sithole, a spokeswoman for Amplats, as Anglo Platinum is known, confirmed receipt of Numsa’s strike notice when contacted by phone.
The AMCU rejected a pay-increase offer of as much as 9 percent and will continue to strike, union President Joseph Mathunjwa said by phone yesterday.
“The employer hasn’t demonstrated it is serious about our demands,” Mathunjwa said.
Non-striking workers were barred from reporting for duty at some Impala shafts today as demonstrators blocked roads, Franz Stehring, head of mining at UASA, a minority union, said today by phone. The operations are in Rustenburg, about 120 kilometers (75 miles) northwest of Johannesburg.
Police dispersed the crowd, which was armed with fighting sticks and put rocks on the road, said Johan Theron, an Impala spokesman. Attendance has increased from 8 percent, on the first day of the strike, to as much as 20 percent, he said. “We’ve seen more people returning to work.”
Numsa has no scheduled talks with Amplats for the next few days, Nhlapo said.
“AMCU’s members rejected 9 percent; the chances are 99 percent that our members will reject it as well,” he said.
Amplats declined for the first time in four days, losing 3.8 percent to 442.71 rand by the close in Johannesburg. Platinum for immediate delivery fell 0.4 percent to $1,377.50 an ounce.
The AMCU last year displaced the National Union of Mineworkers as the largest representative of employees at the three biggest platinum producers. The NUM is part of the Congress of South African Trade Unions, an ally of the ruling African National Congress, while the AMCU says it’s apolitical.
Numsa, which is a Cosatu affiliate and the country’s biggest labor group with about 338,000 members, said last month it won’t back the ANC in general elections that have to be held by July. The organization has criticized the ANC’s economic policies, which it says favor the wealthy and black elite and haven’t done enough to reduce poverty and create jobs for the one in four South Africans without work.
“The will is strong” among AMCU strikers, Gama said earlier today. “They can last six months, eight months, forever if the management is not listening.”
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