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Gold producers table final three-year wage offers

30th July 2015

By: Megan van Wyngaardt

Creamer Media Contributing Editor Online

  

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JOHANNESBURG (miningweekly.com) – Gold producers AngloGold Ashanti, Evander Gold Mines, Harmony Gold and Sibanye Gold have tabled their final three-year offers for wage and benefit increases to representative unions, the Association of Mining and Construction Union (AMCU), the National Union of Mineworkers (NUM), Solidarity and UASA for the period July 1, 2015 to June 30, 2018.

The companies guaranteed that the pay of entry-level employees would reach R12 800 a month and R13 200 a month in the third year of the agreement.

“We believe this is a generous offer, which is above inflation and at the limit of what this industry can bear while remaining sustainable. It is our final offer and we hope our employees will accept it so we can move forward together to confront the challenges the industry faces,” Chamber of Mines (CoM) negotiator Dr Elize Strydom said on behalf of the gold producers.

The producers asked the unions to commit to the shared goal of maintaining a sustainable industry capable of securing employment and delivering returns to all stakeholders for the longest time possible. The offer was made on the basis that it be accepted by all unions.

The producers also asked all parties to commit to building a culture of sustainable mining and developing measures to improve performance and efficiencies at their operations.

In line with the companies’ differing economic circumstances, offers in respect of wages were differentiated. AngloGold Ashanti and Sibanye, which together employed around 70% of employees, offered to pay Category 4 to 8 employees and B-lower officials R1 000 a month more in the three years, as well as a R100 a month increase in living-out allowance in the first year.

This payment did not attract the normal company contributions to benefits as the focus of the unions had been on improving disposable income.

Miners, artisans and officials would receive a 6% increase on standard rate of pay in the first year, as well as a 6% increase or consumer price index, whichever was greater, in the subsequent years.

Evander Gold Mines would pay Category 4 to 8 employees and B-lower officials an additional payment of R750 a month, as well as a R100 a month increase in living-out allowance in the first year, while miners, artisans and officials would get a 6% increase on standard rate of pay in the first year and 6% increase in the following two years.

Harmony offered a gain share of 5% from the first rand of profit on a quarterly basis, while offering an additional R500 a month to Category 4 to 8 employees and B-lower officials, as well as an increase in living-out allowance of R100 a month for the first year.

Miners, artisans and officials would see a 4.6% increase on standard rate of pay in the first year, followed by a 4.6% increase in the two years thereafter.

The gold producers also made a number of nonwage concessions in response to union demands, including an increase in medical incapacity benefit from R40 000 to R55 000 over three years, extension of the 2011 to 2013 concession of the medical aid contribution rates to 60% for employers and 40% for Category 4 to 8 employees for three years from the date of the wage agreement and an increase in the current guaranteed minimum severance pay of R20 000 to R30 000 over three years.

Further, the retirement age of surface workers had been extended to 63 years, with employees wishing to retire at 63 or before 63 entitled to do so.

The companies proposed that a task team be established to investigate the extension of the retirement age for underground employees to 63 years of age. The task team must complete a written report on its findings and recommendations within six months.

UNION RESPONSE
Trade union Solidarity expressed its disappointment over the final offer tabled by the producers, stating that the proposed wage increases for skilled workers was lower than the mandate for settlement that Solidarity had obtained from its members.

However, the union was satisfied with the concessions regarding the retirement age for both surface and underground workers.

Solidarity general-secretary Gideon du Plessis said the union would present the final offer to its members for consideration and would provide feedback to the CoM by August 7.

“If the offer is rejected, the alternative would be to strike. However, the advantages for members of a strike will have to be weighed against its impact on the sustainability of the mining industry.

“If no strikes take place in the gold sector, this sector will be able to return to normal and it will be able to focus on the optimisation of production in this sector,” he noted.

He further pointed out that workers would be able to supplement their income through production bonuses and profit sharing, which were already in place at certain mines.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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