July 15 (Bloomberg) -- The National Union of Mineworkers, once dominant at shafts in South Africa, is raising efforts to regain ground from a powerful rival whose five-month strike won platinum employees gains in basic pay of as much as 20 percent.
The NUM today takes its case to the national mediator for recognition at a gold mine where the Association of Mineworkers and Construction Union holds the majority. It’s also in a battle at platinum mines where it still has more members than the AMCU to maintain that status and to negotiate pay agreements comparable to those gained by its competitor.
“Bottom line is that we can expect labor relations to remain sensitive and potentially volatile,” said Michael Kavanagh, a metals and mining analyst at Noah Capital Markets in Cape Town.
The strike called by the AMCU ended last month after paralyzing most mined platinum production in the country that accounts for about 70 percent of global output. Anglo American Platinum Ltd. said yesterday the strike may have cut first-half profit by more than 90 percent. Now, NUM members at operations owned by Aquarius Platinum Ltd. and Impala Holdings Ltd. not affected by South Africa’s longest mining stoppage are pushing for better deals.
An unauthorized walkout by employees at Impala’s Marula mine, where the NUM represents most workers, was motivated partly by miners seeking the same increase the AMCU extracted from the three largest platinum producers. Some of the Marula workforce are thinking of leaving the NUM, according to the company.
Marula workers “are thinking of resigning from the NUM and either not joining a union or perhaps joining AMCU,” Johan Theron, an Impala spokesman, said last week. “General unhappiness there is manifesting in some potential realignment. Only time will tell.”
Impala and the NUM settled a two-year wage deal at Marula in the northern Limpopo province and at a refinery east of Johannesburg in last year for increases of as much as 8.5 percent. South African inflation was 6.6 percent in May.
“If our members are below, then we want to settle that,” Solomon Digoro, NUM’s branch chairperson at Marula, said by phone. “The unprotected strike has interrupted the whole process, so we’re now at a stage that we must settle a date to go and negotiate about it.”
Anglo American Platinum Ltd., Impala and Lonmin Plc agreed with the AMCU to increases in basic wages for the lowest-paid workers of as much as 1,000 rand a month. A strike started July 1 by the National Union of Metalworkers of South Africa has halted production at plants run by Toyota Motor Corp., Ford Motor Co. and General Motors Co.
The NUM is negotiating on wages at Aquarius and Royal Bafokeng Platinum Ltd., Piet Matosa, acting president for the union, said in a July 8 interview. “I know we are very close to signing a deal,” he said.
The NUM also represents the majority of workers -- 87 percent -- at African Rainbow Minerals Ltd.’ Modikwa mine, where it concluded wage negotiations in March, according to the company.
The NUM, which remains the biggest union in gold, is seeking the right to be recognized at Harmony Gold Mining Co.’s largest mine, Kusasalethu, where the AMCU is the majority labor group. The union fell to 15 percent of employees, half of the threshold for recognition, according to spokeswoman Marian van der Walt. “We continue to engage with them, and they still enjoy the basic organizational rights at the mine.”
The claim for recognition is due to be heard today by the Commission for Conciliation, Mediation and Arbitration, Van der Walt said.
Founded 32 years ago and once South Africa’s biggest labor union, the NUM has watched its influence decline as the AMCU gained a grip on the platinum belt northwest of Johannesburg. The shift in power since 2012 has been accompanied at times by violence as the groups battled for membership. Five people were killed during the recent AMCU strike.
The AMCU’s support swelled as it aggressively recruited in the wake of a strike at Lonmin, where 34 miners were killed by police in a single day in August 2012 as they protested over pay.
In a rare reversal for the AMCU since its emergence as a force, the union has lost its recognition status at the Western Chrome Mines run by Samancor Ltd. after a slump in support.
The AMCU gained recognition rights in February 2013, and has since fallen below the threshold, the company said. The union lost the right to have shop stewards and an office as of July 1.
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