/ 15 July 2013

Gold mining companies offer workers a 4% increase

Gold Mining Companies Offer Workers A 4% Increase

South African gold-mining companies offered workers a 4% increase in wages, less than inflation, because of spiraling costs amid a decline in the price of the metal, the Chamber of Mines said.

“It is clear that the gold-mining industry is facing significant challenges,” Elize Strydom, the chamber’s chief negotiator, said in an e-mailed statement from Johannesburg. “How will we overcome this? It is going to require good faith negotiations and a preparedness to give and take.”

Gold operators in South Africa, the world’s sixth-biggest producer of the metal, had faced demands from some unions to at least double pay of entry-level workers after the precious metal’s steepest quarterly price slump on record.

The Association of Mineworkers and Construction Union (Amcu) asked companies to more than double pay for entry-level workers, while the National Union of Mineworkers (NUM), which represents about 64% of employees in the industry, asked for wages to be raised by as much as 61%. The annual inflation rate was 5.6% in May.

Solidarity, speaking on behalf of 2.4% of miners, asked for a 10% average gain in pay, according to the chamber, which represents gold companies including AngloGold Ashanti, the world’s third- biggest producer of the metal, in wage talks.

“The chamber would have to raise its offer dramatically to create the atmosphere for a settlement,” Solidarity General Secretary Gideon du Plessis said in an e-mailed statement. “Union members will also have to accept a lower-than-expected increase.”

Amcu, which speaks for 17% of gold miners, today refused to sign a document outlining the rules of engagement for the wage talks, Du Plessis said.

Talks will resume on July 24, the chamber said. – Bloomberg