Biggest South Africa Gold Union Lowers Wage Demand by 9.5%

The biggest labor group at South Africa’s gold mines reduced its pay demands for underground employees and is willing to negotiate further with producers.

The National Union of Mineworkers made “a huge move” by asking that wages be increased to 9,500 rand ($749) a month from the original request for 10,500 rand, General Secretary David Sipunzi said in an interview on Johannesburg-based SABC TV. That’s still 67 percent more than current wages of about 5,700 rand monthly. The inflation rate was 4.7 percent in June.

“What would help these negotiations to progress faster would be for the employers to table a good offer,” he said. “Then we are prepared to negotiate and meet them halfway.”

Companies including world No. 3 producer AngloGold Ashanti Ltd. and Harmony Gold Mining Co. have proposed a five-year wage deal with annual increases of as much as 13 percent, plus a share of profits and improved job security and living conditions. The NUM speaks for about 52 percent of employees at the producers.

While keen to avoid a repeat of last year’s five-month platinum strike, the companies’ ability to raise salaries is limited by spiraling costs and plunging prices that have left much of the industry unprofitable.

The Chamber of Mines, which represents the companies, will make its final offer to unions this week, Livhuwani Mammburu, a spokesman for the NUM, said by phone. This will be the lobby group’s final proposal since talks started last month, he said.