S.Africa's NUM union wants 84 pct pay increase for gold workers

by Reuters 0

Harmony Gold narrows quarterly loss Mining companies have opposed the proposed rules published last Friday by the mining ministry. Photo: Pixabay.

South Africa’s National Union of Mineworkers (NUM) will push for an 84 percent rise in basic pay for entry-level gold mining workers, a near 10 percentage-point increase on previous demands, according to documents obtained by Reuters on Thursday.

They show that the NUM, which represents 57 percent of the workforce in the goldmining industry, want employers to pay entry-level workers a basic 10,500 rand ($888) a month.

(READ MORE: S.Africa’s AMCU wants gold sector to double minimum pay)

Entry-level gold diggers currently earn around 5,700 rand per month, not including various allowances structured into their pay packages.

Last month NUM sources had said it would ask for 10,000 rand for entry-level workers.

The latest demands have been seen by Reuters in official union documents dated April 30 and sent to mining companies body the South African Chamber of Mines.

The demands, which come as the central bank worries about the economic impact of pay rises above the current 4.8 percent rate of inflation, will set the stage for tough negotiations and a potentially protracted dispute with the gold mining companies.

Profit margins in the industry are under pressure, with global commodity prices hit by a strengthening dollar and demand weakened by an economic slowdown in China.

The spot gold price is currently at just over $1,204 an ounce, over 30 percent down from its historic peak of $1,920 in September 2011.

Rising electricity costs and falling output linked to labour stoppages, have added to the gold industry’s woes.

Meanwhile rival union AMCU, which led a five-month strike last year in the platinum sector, said last week it would seek a monthly wage of 12,500 rand ($1,045) for entry-level workers in the gold sector.

Demands by the NUM union also include a 15 percent increase in pay for miners, artisans and officials across the board, as well as rises in living, medical and meal allowances.