In a historic wage agreement that guarantees mining labour stability, JSE-listed miner Harmony Gold signed a multiyear, above-inflation pay deal giving mineworkers raises of as much as R1,500 in 2029.
Harmony Gold and the National Union of Mineworkers (NUM), the Association of Mineworkers and Construction Union (Amcu), the National Union of Metalworkers of SA (Numsa), Solidarity and the United Association of SA (Uasa) signed the agreement in Johannesburg on Thursday after months of talks.
Mineworkers will get raises of R1,200 in the first year, R1,250 in the second, R1,300 in the third, R1,450 in the fourth and R1,500 in the final year. Inflation rose to an annualised 5.6% in February. The Reserve Bank expects it to fall to 4.5% only in the fourth quarter of 2025.
Harmony Gold said the deal would result in an increase of about 6% a year over the five years, “which is within our planning parameters”.
“For the first time in our 73-year history, we have concluded a five-year wage agreement with all of our labour unions,” said CEO Peter Steenkamp. “This is testimony to the strength of our labour relations and ensures stability and continued certainty on our fixed labour costs for the next five years.”
He said the deal was reached three months before the existing agreement expired. “It is fair and balanced, considering the impact that cost of living increases are likely to have on employees over the next five years. We are pleased the ... negotiations were carried out in good faith and commend all parties for demonstrating good leadership by engaging constructively.”
In addition to the basic wage increases, the monthly housing allowance will increase to R3,360 in the first year, rising to R4,020 in the final year, while the living-out allowance will increase to R2,800 in the first year, rising to R3,350 in the final year of the wage deal.
Victory
Solidarity general secretary Gideon du Plessis said the agreement was a victory for collective bargaining. It was reached without deadlocks or a dispute process. “It has also been the first time that a five-year agreement has been reached in the gold sector.” The focus would shift to Sibanye-Stillwater’s gold mining operations due soon. Du Plessis said: “Sibanye will have to take a lesson from Harmony on how to follow a progressive approach to salary negotiations.”
Uasa spokesperson Abigail Moyo said the union was pleased to be a part of “rewarding negotiations given the current economic challenges many companies face, especially in mining. The cost of living has workers on edge.”
The pay deal comes as mining groups, including Anglo American Platinum (Amplats), Kumba Iron Ore, Sibanye-Stillwater, Glencore, Seriti and Impala Platinum (Implats), issued retrenchment notices. They want to cut costs with commodity prices falling, load-shedding and Transnet Freight Rail infrastructure deteriorating and hampering exports. Though mining output fell in recent years, the sector employs about 455,000 people and accounts for about 9% of GDP.
Mining houses have been signing multiyear wage deals without workers downing tools in a move said to be bringing labour stability. In May 2022, Amplats signed a five-year pay agreement with Amcu, NUM, and Uasa for raises of R1,100 in the first year, rising to R1,500, or 7.5%, in year five. Implats followed in June that year with a five-year deal for R1,150 raises in year one and up to R1,500 in the last year of the deal.
In November 2023, De Beers, the world’s top diamond producer, signed a five-year wage deal with NUM that saw employees at Venetia Mine and De Beers Sightholder Sales SA get a 7% raise in 2023 and 6% in the years up to April 30 2028. Sibanye-Stillwater did an inflation-linked, five-year wage deal with unions at its Kroondal platinum mine in November 2023 giving its lowest-paid workers 6% raises in each of the years.
SA’s gold mining groups are flush with cash now on rand weakness and record bullion prices. On Thursday, the spot gold price hit a record high for the eighth day running, touching $2,304.89/oz. It gained more than 26% in the past six months.
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