South Africa’s main gold union snubs final pay offer
South Africa’s major gold-mining union, the National Union of Mineworkers (NUM), rejected Friday a final pay offer presented by the country’s top producers, becoming the last of all the labour groups involved in the negotiations to brush off the wage increase proposal.
“We are extremely disappointed that our offers have not been accepted,” the Chamber of Mines’ lead negotiator, Elize Strydom, said in a statement.
The lobby group, which negotiates on behalf of the country's gold producers, had offered a wage raise of up to 17% last week. But the two biggest unions are demanding increases of roughly 70% to more than 100% from employers including AngloGold Ashanti (NYSE:AU), (JSE:ANG), Harmony Gold (NYSE:HMY), (JSE:HAR) and Sibanye Gold (NYSE:SBGL), (JSE:SGL).
The Association of Mineworkers and Construction Union (AMCU), which is the second-biggest representative and also rejected the offer earlier this week, will be present at the talks set to resume on Wednesday, Aug. 12, Strydom noted.
Gold prices have fallen over 9% since wage negotiations began June 22, touching a five-year low and hurting companies already struggling due to higher output costs. In the proposal that was rejected, producers cut the wage-deal term to three years from five and said they would increase basic pay by more than before.
Lack of progress in next week's round of negotiations would raise the prospect of major industrial action in the beleaguered sector.