Amplats and labour clinch historic wage deal

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AMCU and other unions have sealed a five-year wage deal with Amplats.
AMCU and other unions have sealed a five-year wage deal with Amplats.
Lisa Steyn
  • Unions and the platinum miner have penned a historic wage deal spanning five years.
  • Workers will receive a pay hike of an average 6.6% from July onwards.
  • The deal includes a profit-share agreement, a housing scheme, and a clause to reopen talks in certain circumstances.

Anglo American Platinum and labour have signed a wage deal which could set the bar for the rest of the industry, where talks are ongoing.

In a signing ceremony on Thursday, Anglo American Platinum penned a five-year wage deal with three unions. These include the Association of Mineworkers and Construction Union (AMCU), the National Union of Mineworkers (NUM), and UASA.

The wage agreement increases salary and salary-related allowances, which will increase the total labour cost-to-company, on average by 6.6% per annum over the five-year period.

Amplats' lowest-paid employees will receive an annual increase in basic salary of 7.5% or R1150 in year one, increasing to 7.5% or R1500 by year five.

Supervisor-level employees will see basic salary increases of 6% in years one to three and 6.5% in years four and five.

The medical aid contribution will increase by 7% per year. With the increase in the basic pay, all other salary-related allowances and bonuses for employees will also increase as a result, including pension contributions. Housing allowances will also increase.

Unions said the agreement can be revisited if inflation rises beyond a certain level.

It’s the first wage deal that spans five years. It is also the first time an agreement was reached after just five meetings.

Sitting alongside the unions, Natascha Viljoen, Amplats CEO, said a new paradigm in the mining industry had been created by this collective "breakthrough in how we look at wage negotiations".

The deal has been reached in a "collaborative and constructive" way, she said, indicating that the wage deal will be implemented from July.

The agreement is likely to set the tone for wage talks with the other platinum mining companies in South Africa.

Wage talks at Impala Platinum are ongoing, while talks at Sibanye-Stillwater’s platinum business will commence next week.

Relations between Sibanye and unions are tense as a strike at the company’s gold mines has been ongoing since 10 March with no sign yet of any settlement.

AMCU and NUM are demanding an increase of R1 000 in every year of a three-year wage deal – an agreement labour has secured at Harmony and other gold mines. Sibanye has argued that giving in to such a demand is unsustainable for its marginal gold operations and will hasten the closure of these mines.

Meanwhile, the platinum operations have been highly profitable thanks to exceptionally strong metal prices. It’s also boosted the company share price, resulting in a controversial remuneration of over R300 million for Sibanye CEO Neal Froneman.

At Thursday’s signing ceremony, AMCU president Joseph Mathunjwa said the mining industry was a complex space to negotiate within as a price-taker subject to global trends.

Added to that, he said collective bargaining had failed in South Africa. "We find ourselves as unions negotiating the social wage – which is what the government should be doing," he said, noting that medical and travel expenses formed part of labour’s wage demands.

Given that labour has first demanded a pay hike of 13%, NUM president Daniel Baipile said the union was not entirely pleased with the wage deal with Amplats but had agreed to compromise.

"It’s a give and take," said UASA’s Franz Sterhing. "This agreement is not just about an increase – this is the building block that will ensure each and every one of our members and the company’s employees can live a decent life."

* Change made to second-last paragraph to reflect labour's initial demand of 13%. 

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