Is the platinum strike?over?

2014-04-20 15:00

After two weeks of meeting with labour minister, platinum companies move closer to offering the magical R12?500 a month wage within five years

The three strike-hit platinum companies have come out to offer workers a new “settlement offer” that seems to meet the symbolic R12?500 demand halfway.

Although it is a significant move after having resolutely clung to the 9% offer they had made at the beginning of the strike, the mines are still not offering anything close to the R12?500 basic salary that has been the central demand of the Association of Mining and Construction Union (Amcu) from the onset.

Anglo American Platinum (Amplats), Lonmin and Impala Platinum made the new offer after a meeting between their CEOs, Amcu leaders and the labour minister on Thursday.

This followed about two weeks of separate meetings between Labour Minister Mildred Oliphant and the warring parties.

Last Wednesday, Oliphant left an indaba about employment equity in a rush, with her personnel explaining she had to attend to something related to the platinum mining strike.

The CEOs and Amcu leaders will meet again on Tuesday and probably on Wednesday “to iron out some issues”, according to Amcu treasurer Jimmy Gama.

The mines’ spokesperson, Charmane Russell, confirmed Oliphant had been involved, but said Thursday was the first time everybody sat together in the same room.

The broad strokes of the new offer were made public by Amplats and Impala on Thursday evening.

Lonmin is making the exact offer, but will only make its announcement after markets reopen, according to Russell.

This shows the other two mining companies were keen to put the word out before the Easter weekend.

The new offer involves achieving the symbolic R12?500 a month by 2017, but on the basis of all cash elements of remuneration, including a living-out allowance and a monthly contribution to a 13th cheque.

The offer also seems to involve a five-year-long deal – a bid for a long period without further wage talks, which would be unprecedented.

Amcu has thus far unambiguously demanded the basic wage alone reach R12?500 in four years.

The offer still falls far short of that and in practice represents a relatively marginal improvement on the standing offer, depending on which mining company you look at.

The difference between a basic salary and total cash remuneration is currently anything between R2?000 and R2?700.

According to Amplats and Impala, their new offer increases the cost to company of entry level workers to R17?500 by 2017.

At present, this number is R8?604 at Amplats and R9?297 at Impala, while Lonmin already pays R9?790.

According to Amplats and Impala’s identical statements, the offer will involve raising the combined cash part of remuneration by 10% a year for the lowest paid while other elements will increase “in line with inflation”.

The 10% has to be weighed against the roughly 8.5% these cash elements would have increased in the next few years anyway in terms of the old offer.

It is unclear what the net effect is if the percentage increase on the noncash elements end up being less than in the standing offer – a possibility hinted at in the new announcements.

The combined cash elements currently amount to R7?174 at Amplats and R7?808 at Impala, while at Lonmin this already amounts to R8?139.

For Lonmin, the new offer by the other two companies is not a particularly huge move as it involves hitting the same target from a significantly higher base.

Amplats recently claimed it would only be realistic to reach the R12?500 on the basis of all cash items by 2020.

This claim was made as Amplats’ response to a memorandum handed to it by Amcu during a march on its offices in central Joburg.

If Anglo gave a 10% increase on the cash portion of remuneration, it would add about R717 as opposed to the R570 implied by the standing offer in the first immediate adjustment.

In the second year, it would add R789 against the R578 implied by the old offer.

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