South Africa Union Seeks 12,500 Rand Minimum for Gold Miners

(Bloomberg) -- South Africa’s Association of Mineworkers and Construction Union plans to demand a 12,500 rand ($950) monthly minimum wage from some of the country’s top gold producers in upcoming negotiations.

The labor group decided on its demands on Sunday at a mass meeting near Carletonville, about 90 kilometers (56 miles) west of Johannesburg. It is the second-largest union at producers including AngloGold Ashanti Ltd., Sibanye Gold Ltd. and Harmony Gold Mining Co. Ltd., according to Minerals Council South Africa, a lobby representing the industry.

“12,500 rand, I think it can put the worker in a better place,” especially considering higher taxes and petrol prices, AMCU President Joseph Mathunjwa said in an interview after the meeting. What workers are currently paid “isn’t fair.”

The labor group is also calling for an increase in benefits ranging from severance pay to transport costs and longer maternity leave. It also wants a five-day work week to replace the shift system. Mathunjwa cautioned that the union can change its demands at any time.

South Africa’s gold mines are among the world’s deepest, oldest and most labor intensive, which means that producers face constant pressure to reduce costs, while a 27 percent national unemployment rate makes job cuts politically difficult.

Negotiations Imminent

The Minerals Council has received AMCU’s demands, spokeswoman Charmane Russell said in an emailed response.

“No date has yet been set for the start of negotiations, but that is imminent,” she said.

The union demand would mean a substantial increase to companies including Harmony, which reached an agreement in 2015 that increased the monthly minimum basic pay to 7,662 rand ($586) in July last year.

The biggest union at the companies, the National Union of Mineworkers, in April submitted a list of demands for a two-year agreement that calls for entry-level underground pay of 10,500 rand a month, according to a copy seen by Bloomberg.

To contact the reporters on this story: Paul Burkhardt in Johannesburg at pburkhardt@bloomberg.net;Ntando Thukwana in Johannesburg at nthukwana@bloomberg.net;Odwa Mjo in Johannesburg at omjo@bloomberg.net

To contact the editors responsible for this story: James Herron at jherron9@bloomberg.net, Kevin Costelloe, Keith Jenkins

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