A three-day strike by tens of thousands of South African gold miners wound down today with most strikers agreeing to return to work after accepting the latest wage offer from employers, the National Union of Mineworkers (NUM) said. Gold producers said they had offered entry-level workers pay increases of 8 percent and a 7.5 percent rise for other employees from July this year, slightly above consumer inflation which was 6.3 percent in July. For next year, employees would get inflation-linked increases, the companies said. The pay rise offer is far below the 15 to 60 percent NUM had originally been seeking. The unexpectedly quick end to the strike is a relief to Africa’s largest economy, hit by stoppages across a range of sectors including auto making, which have cost tens of millions of dollars a day in lost output.
South African stocks moved into positive territory in afternoon trade while the rand gained against the dollar. NUM spokesman Lesiba Seshoka told national broadcaster SABC that most of the workers “have committed to going back to work”. Sibanye Gold said on Friday workers at its Beatrix mine in the Free State province had ended the strike and would return to work with tonight’s evening shift. Workers at Sibanye’s Kloof mine near Johannesburg returned to work on Thursday night. In addition to Sibanye, South Africa’s other main gold producers – AngloGold Ashanti and Gold Fields – had also been impacted. AngloGold confirmed late Friday afternoon that its employees who had downed tools were returning to work.
But those at Harmony Gold remained on strike. The company said all of its mines, except for its Kusasalethu operation, continued to be “severely affected” by the strike. Companies, squeezed by soaring costs in the world’s deepest and most dangerous mines, and falling prices, have said they cannot afford big pay rises, and that message appeared to filter down to the rank and file. South Africa has produced a third of the bullion ever pulled out of the earth but its gold industry is now in dire straights and in a state of steep decline.
h3. Basic Pay
NUM, which represents two-thirds of the country’s unionised gold miners, had been seeking a 60 percent raise for entry-level workers to bring their basic pay to 8,000 rand ($780) a month. Its hardline rival AMCU wants increases of up to 150 percent.
But the offer means the entry-level underground workers will only get an additional 400 rand a month compared with the extra 3,000 rand a month they had initially asked for. The Association of Mineworkers and Construction Union (AMCU) has not been on strike in the gold sector but said it would consider the latest industry offers at a meeting on Sunday. Operations where AMCU has the majority, such as AngloGold’s Mponeng – the world’s deepest mine – and Harmony’s Kusasalethu have worked normally throughout the strike.
If the gold dispute is resolved, attention will turn to talks in the platinum sector, where AMCU is the dominant union after poaching tens of thousands of disgruntled members from NUM in a brutal turf war that erupted last year. Dozens of people were killed in 2012 in violence related to the union rivalry, which unleashed a wave of wildcat strikes that rocked South Africa’s gold and platinum sectors, leading to sovereign credit downgrades. But the gold strikes have been peaceful, raising hope that tensions in the platinum belt can also be contained. The gold talks had swayed the platinum price, lifting it about 15 percent over the past two months as markets bet on supply disruptions from South Africa. Its spot price has lost about 2 percent the past two days, in part on perceptions that platinum miners will also reach wage deals without protracted strike action.
South Africa accounts for about 75 percent of global production of the precious metal used for making emissions-capping converters in automobiles. Wage talks are also under way in the country’s coal sector.