Pay disparity blamed for mine unrest

The salaries of chief executives in the mining sector have quadrupled over the past few years despite the global economic crisis and are 150 times higher than the pay of an ­average mineworker. (AFP)

The salaries of chief executives in the mining sector have quadrupled over the past few years despite the global economic crisis and are 150 times higher than the pay of an ­average mineworker. (AFP)

Company reports show that former Lonmin chief executive Ian Farmer earned R24-million, Gold Fields  chief executive Nick Holland got R32.6-million and Anglo Platinum chief executive Neville Nicolau's pay was R21.5-million. An ordinary mine worker earns less than R70 000 a year.

Cosatu general secretary Zwelinzima Vavi has criticised mining bosses for paying themselves millions while refusing to improve the wages of ordinary workers.

The salaries of chief executives in the mining sector have quadrupled over the past few years despite the global economic crisis and are 150 times higher than the pay of an ­average mineworker.

Political and labour analysts have blamed the bloated pay packages for executives for the growing income gap, which has reached levels unseen since the demise of apartheid. It has been cited as one of the key reasons for the wave of illegal strike action on the mines.

Labour unrest has spread to several mines across South Africa in the past four weeks owing to demands for better pay.
Thousands of mineworkers are demanding R12 500 a month. The mine bosses have accused them of making "unreasonable wage demands".

During a speech last week Vavi criticised the mining industry for generating billions in profit while keeping the wages of workers low. He said mine workers, the vast majority of whom are black, were aware that South Africa was the most unequal society in the world.

"Black people are asking about the promised redistribution of wealth. They are asking: 'Where is the promise that the wealth of the country shall be shared when redistribution of income has worsened?' Today, there is effectively distribution from the poor to the rich, represented by the reality that the top 10% of the rich accounted for 33 times the income earned by the bottom 10% in 2000. This gap is likely to have worsened when you consider that we lost 1.17-million jobs due to the global economic crisis of 2008."

Vavi said in 2008 the top 20 highest-paid directors, who are still overwhelmingly white males, of JSE-listed companies earned an average of R59-million a year each, whereas the average employee earned R34 000 in 2009.  

"The rock-drill operators at the centre of the dispute perform a more dangerous, unhealthy and difficult job than anyone else in the world. They face death every time they go down the shafts. Yet their monthly earnings are just R5 600. Just compare that to the earnings of Lonmin's financial officer, Alan Ferguson – R10 254 972 a year or R854 581 a month – 152 times higher than a rock-drill operator," Vavi said.

"In the mining industry a handful of multinational monopolies make billions of rands of profit extracted from the labour of workers, who toil in the most wretched, unhealthy and dangerous conditions kilometres underground for wages that come nowhere close to the value that their labour creates for their employers."

Irvin Jim, general secretary of the National Union of Metalworkers of South Africa (Numsa), echoed Vavi's comments. Jim said that over the past five years these companies had registered operating profits of more than R160-billion, which could have built more than three million RDP houses.

"The mining bosses are not fit to control the mineral wealth of our country. Numsa is convinced that unless the mineral wealth of our country is returned to the people as a whole, mining will continue to be characterised by violence against the working class, either through dangerous working conditions or from the bullets of police in defence of the profits of mining bosses," said Jim.

"We see no solution to the violence against workers on the mines apart from nationalisation in defence of the lives of all South Africans."

Social ferment
Writing in Business Day this week, political analyst and deputy vice-chancellor at the University of Johannesburg Adam Habib said social science over the past 40 years had convincingly demonstrated it was inequality, not poverty, that created the social ferment required for revolution.

This was in response to economist Mike Schussler's comment that the workers at Lonmin's mine at Marikana did not represent the poor and they were actually "privileged".

"Workers and the poor in South Africa are experiencing what sociologists have come to refer to as relative deprivation. This means [they] are angry because they believe that the benefits of the country's transition to democracy have not been equally shared," wrote Habib.

The debate about inequality coincided with the release of a report by the Commission of Employment Equity this week.

The report painted a disturbing picture of the deepening inequality in South African society and the lack of transformation in the workplace, particularly in the private sector. It said white males still dominated most opportunities pertaining to recruitment and promotion.

Commission chairperson Mpho Nkeli said: "Whites and males will continue to dominate the middle-to-upper levels for the next 127 years as long as employers continue to employ people with mainly the same race and gender profile of those who have just exited the organisation."



Matuma Letsoalo is a senior politics reporter at the Mail & Guardian. He joined the newspaper in 2003, focussing on politics and labour, and collaborated with the M&G's centre for investigations, amaBhungane, from time to time.In 2011, Matuma won the South African Journalist of the Year Award and was also the winner in the investigative journalism category in the same year.In 2004, he won the CNN African Journalist of the Year prize – the MKO Abiola Print Journalism Award. Matuma was also a joint category winner of the Mondi Shanduka SA Story of the year Award in 2008. In 2013, he was a finalist for Wits University's Taco Kuiper Award.
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    • Charles Molele

      Charles Molele

      Charles Molele is a senior politics reporter at the Mail & Guardian. Charles joined the paper in 2011. He has covered general news, court and politics for the past 19 years, and also worked as a senior reporter for the Saturday Star, Sunday World, ThisDay, Sunday Times and is former politics editor of the New Age. Charles's other career highlights include covering Kenya's violent general elections (2007/08), Zimbabwe’s sham general elections (2008), Mozambique's food riots (2010) and the historic re-election of US President Barack Obama (2012).
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