South African unions sign deal with gold companies

The South African National Union of Mineworkers and two other unions signed Thursday a deal with industry body the Chamber of Mines (CoM), agreeing to a new pay structure for the strike-hit gold mining sector.

CoM representing gold producers AngloGold Ashanti, Gold Fields and Harmony, agreed to an addendum to the gold sector’s 2011 to 2013 previous wage agreement.

Gold miners will see their monthly salaries up about 500 rand ($57), on top of a pay raise of up to 10% that workers got in July, weeks before wildcat strikes hit South Africa’s platinum and gold mines.

The sum, however, still fall short of what most strikers are demanding: 16,000 rand (about $1,800) in monthly pay.

Most miners currently earn about 4,000 rand ($500).

Harmony Gold’s (NYSE:HMY) Kusasalethu workers went back in time for their 6am ultimatum on Thursday to avoid being fired, the company said. The miner will provide an update later on when operations would restart, but in the meantime it said it was doing procedural medicals and safety checks.

AngloGold Ashanti (NYSE:AU) has yet to issue dismissal letters to 12,000 striking workers who ignored an ultimatum to return to their posts or be fired, spokesman Alan Fine told Business Report.

And Gold Fields (NYSE:GFI) said 7,300 people out of 8,100 were sacked at its KDC East mine on Tuesday. Their appeals started on Thursday morning and would take place over the next week.

Although today’s pact promises gold producers to resume normal activities, the platinum sector remains affected by labour unrest with several mines still closed.

Part of the issue is, as BBC News analyst Matthew Davies writes, that platinum mines tend to negotiate with their own workers rather than with unions across the sector. This would explain why Lonmin’s miners obtained a 22% pay increase, while but 12,000 of those at Anglo American Platinum (Amplats) were fired.

Globally South Africa is the fourth largest producer of iron ore, holds the same rank for annual gold production, is number one in platinum output and holds fifth spot for steam coal.

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