The protracted wage strike at Sibanye-Stillwater’s gold operations that would have entered its third month on Thursday, has just about ended, with parties expected to formalise a pay hike deal early this week.
This comes after 25,000 gold mineworkers affiliated to the Association of Mineworkers and Construction Union (Amcu) and National Union of Mineworkers (NUM) on Friday gave the unions’ leadership a mandate to accept a three-year wage proposal made by the Commission for Conciliation, Mediation and Arbitration (CCMA) to the parties.
Amcu treasurer Jimmy Gama told Business Day on Sunday that the parties will meet this week to sign the deal, adding that the industrial action that started on March 9 is finally over.
Sibanye-Stillwater’s Memory Johnstone said workers are not expected back at their posts on Monday as the wage agreement “first needs to be formalised [and signed]. [We] will provide further details in due course.”
The mandated proposal is in line with inflation over a three-year period (at an average annual increase of 6.3% total increase) and will contribute to the sustainability of the company’s SA gold operations, Sibanye said in a statement.
The CCMA proposal to the parties includes a package wherein category 4-8 [lowest-paid] employees will receive an increase of R1,000 a month in year one (amounting to 7.7%); R900 in year two (6.5%); and R750 in year three (5.2%).
Hardship allowance
Miners, artisans and officials will receive an increase of 5% in year one; 5.5% in year two (or CPI if it is between 5% and 5.5%) and 5% in year three. If CPI is greater than 5.5% then the increase will be 5.5%, if it is less than 5% then the rise will be 5%, and if it is between 5% and 5.5%, the it will be the same as CPI.
In addition, Category 4-8 employees will receive a one-off hardship allowance payment of R3,000, of which R1,200 will be a cash payment and R1,800 will be allocated to a reduction of debt or loans owing to the world’s largest producer of platinum group metals (PGMs). The Reserve Bank forecasts headline inflation rate of 5.9% for 2022.
“For the agreement to be binding and in order for the lockout to be lifted, the agreement must be formally concluded by Sibanye-Stillwater and the leadership of Amcu and NUM,” Sibanye said, adding this is expected to take place early this week.
“The final agreement will be extended to all employees in the bargaining unit including members of Uasa [United Association of SA] and Solidarity.”
In the early days of the industrial action in March, Uasa and Solidarity, the two minority unions at Sibanye, announced they had accepted the company’s offer for a R700 pay rise for underground and surface workers, a R100 increase in the living-out allowance, and a 5% pay increase of artisans, miners and officials over three years.
Afford demands
Amcu and NUM had been steadfast in their demand for an increase of R1,000 a month, which would have amounted to a 9.8% rise in year one, 8.8% in year two and 8.2% in year three for entry-level workers, including surface and underground miners.
The two unions rejected Sibanye’s final settlement offer for increases of 7.8% in basic wages in year one, 7.2% in year two and 6.8% in year three, and a R50 hike in living out allowance. The striking workers — who have lost more than R1.2bn in wages — pointed to Sibanye CEO Neal Froneman's R300m pay package in 2021, saying the company could afford their demands after all.
Sibanye’s chief regional officer for Southern Africa, Richard Stewart, said: “We welcome this positive step towards ending the industrial action at our gold operations and thank our employees for making their voices heard. We also acknowledge the integral mediation role played by the CCMA in facilitating constructive engagements between the parties. We now look forward to returning our SA gold operations to stability and profitability for the benefit of all stakeholders.”
While the company has said it is premature to attribute accurate numbers to production losses, it has published an annual production guidance of between 813,000oz and 873,000oz for 2022, meaning it could have lost at least 203,250oz if the strike went on for three months.
Amcu’s five-month strike from November 2018 at Sibanye’s gold operations cost the company R1.6bn and 110,000oz in production of gold, and claimed nine lives. Workers forfeited R1.5bn in pay, only for Amcu to accept the same terms, following in the footsteps of rival unions.
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