Gold producers on Tuesday tabled a conditional wage offer to unions in the sector and said due to the stagnant gold price; rising costs; and falling profitability of the sector, the initial wage demands from unions would “severely impact the sustainability of old and marginal mines”.
“Without wishing to repeat the economic reality of the industry in this forum again, it is important that all parties take into account that ours is a mature industry,” chief negotiator on behalf of the gold producers, Motsamai Motlhamme said during a plenary session with unions.
“As employers, we cannot accede to all the demands tabled by the unions – they are unaffordable and will severely impact the sustainability of old and marginal mines, in particular, and the industry’s ability to continue to provide employment and benefits to employees.”
The gold producers – AngloGold Ashanti; Harmony; Sibanye-Stillwater; and Village Main Reef – met with the unions, the Association of Mineworkers and Construction Union (Amcu); the National Union of Mineworkers (NUM); Solidarity; and Uasa on Tuesday.
The wage negotiations started on July 11.
In a statement, the producers said that in an effort to “reach common ground” they tabled a conditional offer for a period of three years.
“The conditional offer is aimed at improving employee wages and benefits and is conditional on the removal of a number of high-cost demands,” the statement read.
For the first year, the conditional offers range between a 6.2% and 8.2% increase for Category 4 underground employees; and a 4% and 5% increase for miners, and artisans, and officials.
The producers said the key benefits on which concessions have been made on non-wage demands include the extension of the medical contribution for Category 4 to 8 employees to 60% companies and 40% employees for the duration of the agreement; an increase of the minimum medical incapacity benefit to R60 000 over a three-year period, an increase of the minimum severance pay to R36 000 over a three-year period; an agreement to engage at company level with the Igula Provident Fund, or any other fund, as an additional retirement fund option; and an agreement to introduce a 0.5% service increment per year for Officials from July 1, 2019 at some companies.
According to the statement, the NUM rejected the offer and advised that it would formally declare a dispute.
Negotiations between the gold producers and other labour unions would resume on Wednesday.
“The producers welcome the commitment by Amcu, Solidarity and Uasa to continue to engage.”
The unions were not immediately available for comment.