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Biggest Platinum Producers Consider Union’s Wage Proposal

Feb. 3 (Bloomberg) -- The world’s largest platinum producers are reviewing a proposal on wages as negotiators seek to resolve the companies’ dispute with a South African union that has been on strike since Jan. 23.

“The management is still looking at a proposal,” Jeff Mphahlele, general secretary of the Association of Mineworkers and Construction Union, said by phone today. The union is updating its more than 70,000 members on the platinum belt, where the AMCU is the dominant labor group, on discussions with employers, he said.

Anglo American Platinum Ltd., Impala Platinum Holdings Ltd. and Lonmin Plc met the union Feb. 1 for negotiations that are due to resume tomorrow. About 45 percent of platinum operations in South Africa don’t break even and the walkout is costing the three producers about $18 million a day in lost sales, the companies said in a statement after their latest talks.

“Prolonged strike action will result in more losses, and further fundamental restructuring and, inevitably, this will have an impact on jobs and indeed the economy,” they said.

Anglo American Platinum, known as Amplats, Impala, and Lonmin, are losing about 200 million rand ($18 million) a day in revenue because of the strike, while workers are forgoing about 88 million rand in wages, the three companies said.

Worker Attendance

Impala’s operations are “all quiet today” after a crowd blocking workers from reporting for duty was broken up by police on Jan. 31, company spokesman Johan Theron said in an e-mail. As much as 20 percent have turned up during the strike, not enough to resume underground operations.

Non-striking Impala workers will be given paid leave for seven days, Franz Stehring, head of mining at the UASA union, said by phone after a meeting with Impala today. “We’re sitting with a situation: a safety risk with people coming to work with the intimidation and violence.”

Some Impala workers will continue to carry out roles deemed essential at the company, Stehring said.

Amplats has averaged attendance of about 10 percent since the start of the strike, CEO Chris Griffith said on a conference call. Sue Vey, a spokeswoman for Lonmin, didn’t immediately respond to a text message seeking comment.

The Commission for Conciliation, Mediation and Arbitration, a consultant to the talks, put forward a proposal to the parties for their consideration, it said in a Feb. 1 statement. The mediated proposal could form the basis of a final settlement, the CCMA said.

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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