Moder­ate wage deal marks union’s set­tling in at the ta­ble, but ri­val NUM says ‘the en­tire wage agree­ment is a big loss to poor mine work­ers’

CityPress - - Business - DEWALD VAN RENS­BURG dewald.vrens­burg@city­

It was smiles and hand­shakes all round at the sign­ing of the As­so­ci­a­tion of Minework­ers and Con­struc­tion Union (Amcu) wage deals with the ma­jor plat­inum mines this week. The three-year deals are moder­ate by the sec­tor’s stan­dards and mark Amcu’s first wage round in the sec­tor with­out a strike of his­toric pro­por­tions tak­ing place.

Lon­min CEO Ben Magara joined Amcu’s lead­er­ship to an­nounce the deals and was trad­ing jokes with Amcu of­fi­cials af­ter the pa­per­work was done. He even pumped his fist and shouted “Viva Lon­min!” once or twice.

Like the deal that ended the five-month plat­inum strike in 2014, it gives work­ers a rel­a­tively high ba­sic wage in­crease – at the cost of their other ben­e­fits (see box).

Af­ter the Marikana mas­sacre, the ba­sic cash wage of an en­try-level worker at Lon­min was 58% of re­mu­ner­a­tion.

By the end of the new deal in 2018, this will stand at 67% of to­tal re­mu­ner­a­tion.

Amcu pres­i­dent Joseph Mathun­jwa said the in­creases were “way above in­fla­tion”.

“I don’t think any union in South Africa can com­pare them­selves to us,” he said at the me­dia brief­ing.

In re­al­ity, how­ever, the wage deal rep­re­sents a rel­a­tively small pre­mium over in­fla­tion if the low ben­e­fit in­creases and 7% in­crease for higher-level em­ploy­ees are fac­tored in.

At An­glo Amer­i­can Plat­inum (An­glo­plat), the deal trans­lated into a cost-to-com­pany in­crease in the wage bill of, on av­er­age, 6.74% over the next three years, the com­pany said. This is barely above in­fla­tion. Lon­min did not re­veal the to­tal cost-to-com­pany ef­fect, but for just the lower-paid bar­gain­ing units, the av­er­age ef­fect is 7.4% a year – well within what is nor­mal for wage in­creases be­fore the events of 2012.

“For us, what mat­ters is the to­tal cost to com­pany,” said Im­pala spokesper­son Jo­han Theron.

Magara told City Press the cash-first struc­ture of the wage deals was not all that big a de­par­ture.

Man­agers at Lon­min had long had the op­tion of hav­ing their in­creases go to cash pay­ments rather than re­tire­ment con­tri­bu­tions, and this had now sim­ply been ex­tended to the whole work­force, he said.

“You can­not in­def­i­nitely con­tinue mov­ing re­mu­ner­a­tion into the ba­sic wage,” he ad­mit­ted.

In the long run, this would erode mine work­ers’ re­tire­ment sav­ings rel­a­tive to their wages, set­ting them up for a poor re­tire­ment.

A min­ing com­pany of­fi­cial told City Press that the Na­tional Union of Minework­ers (NUM) had not re­ceived the credit it de­served for the mas­sive gains in non-cash ben­e­fits it won for mine work­ers in the years be­fore it was dis­placed by Amcu.

In push­ing the NUM out of the sec­tor, Amcu has also re­versed this em­pha­sis by push­ing for more cash in hand.

The NUM pointed this out in a state­ment, say­ing that “the en­tire wage agree­ment is a big loss to poor mine Source: Lon­min work­ers, who are be­ing made to be­lieve they have achieved a lot”.

“The ben­e­fits are cal­cu­lated from a lower base be­low their ba­sic salaries, and that is where the prob­lem is. Work­ers are highly ripped off in this agree­ment,” said the NUM.

It is, how­ever, pow­er­less to do much about it.

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