There is a growing threat of strike action in South Africa’s gold sector in the next seven days following the Chamber of Mines latest – and final – 6.5% pay increase offer for entry-level workers.
“Employers are holding on tight, especially the big three (AngloGold Ashanti, Sibanye Gold and Harmony Gold). When they say the final offer is final, they really mean final,” a spokesperson for the Chamber of Mines told Finweek.
Hearts have hardened since a chamber workshop in June, which attempted to not only establish economic conditions of the SA gold sector, but ‘rules of the game’ as well during the negotiations.
For its part, the National Union of Mineworkers (NUM) has barely moved in its position in which it asked for a 60% increase for entry-level workers. It recently gave the industry seven days to meet its demands, or it will call for a strike.
Speculation from employers is that gold companies may enforce lock-out rules in the event of a strike as a symbol of resolve.
This would mean that gold mines where industrial action was called would be put under lock and key, barring even nonstriking workers from operating.
The idea is that employers will not settle for only half its employees turning up for work in the event of one union striking but another sending employees to work. The onus would fall upon the unions to work among themselves in order to find a solution to wage negotiation impasse.
Solidarity, however, is thought to be more conciliatory on gold industry offers. It said it would look at a single-digit wage increase and is looking into bonus incentives that offer an additional 1% to 1.5% increase on employees basic salaries.
There’s also a suspicion that NUM is not as strike-hungry as in previous negotiations. In fact, there’s a view that NUM doesn’t want to have the loyalty of its members tested as it may expose weaknesses.
The NUM is still the majority union in SA’s gold industry, but its reputation and self-belief have been dented by the advent of the Association of Mineworkers & Construction Union (AMCU).
This was evident at the Mining Lekgotla, a conference involving Government, unions and the industry, held on 27-29 August, where NUM’s president, Senzeni Zokwana, delivered an uncertain presentation. Gone was the fire of Zokwana’s previous appearances. Instead, it was replaced by an appeal to other unions – to all intents and purposes AMCU – that they play by “the rules of the game”.
“Sometimes when people ask me how I feel, I find it difficult to keep a straight face, especially when our members are being attacked,” said Zokwana. “I don’t know where this industry is going as people are breaking the rules,” he added, referring to attacks on NUM shop stewards.
As a statement, it sounds decidedly on the back foot, but he’s not alone.
The fact is the gold industry can’t afford to pay more to employees notwithstanding the inconvenient recovery in the gold price which sees it improve to R456 000/kg.
Nor can it meet the wage increases that are being discussed in SA’s automotive sector largely owing to the fact that the gold sector is a price taker whereas automotive sector players can increase their prices.
Furthermore, employers are refusing to enter into separate deals with different unions. That’s why its 6.5% offer to entrylevel workers is binding on all unions notwithstanding AMCU’s reluctance to join other unions in a single bargaining process.
There will be no outbidding of one union by another in wage increases; and no political point scoring. Sibanye Gold CEO, Neal Froneman, said the company had sufficient cash reserves to see out a prolonged bout of industrial action. Will the unions have the stomach for the fight?