President Cyril Ramaphosa, one of the founding leaders of the National Union of Mineworkers (NUM), told delegates to the union’s national congress that mineworkers must not end up being the losers due to strikes.
While the mining sector has recorded bumper profits due to high global commodity prices, some employers have refused to give in to unions’ demands for above-inflation wage increases.
In his keynote address in Boksburg, east of Johannesburg, on Wednesday, Ramaphosa acknowledged this is a “good time” for the sector due to high commodity prices.
The president told the delegates that tensions between workers and mining companies and strikes should be resolved. “In the end we want an industry that continues to operate. Mineworkers must not end up being losers in all of this,” Ramaphosa said.
Amcu’s five-month strike from November 2018 at Sibanye’s gold operations cost the company R1.6bn and 110,000oz in lost production of gold, while nine people died. Workers forfeited R1.5bn in pay during the industrial action after which Amcu accepted terms that had been accepted by NUM, Solidarity and the United Association of SA (Uasa).
Another long strike could deprive Sibanye of an opportunity to take advantage of a gold price that jumped from a low of $1,782 at the beginning of 2022 to $2,070, the highest since August 2020.
Members of NUM and the Association of Mineworkers and Construction Union (Amcu) downed tools at Sibanye-Stillwater’s gold operations from March 9, demanding higher wages.
Positive contribution
In its congress documents, NUM said the sector, which contributes about 9% to GDP and directly employs about 450,000 people, could afford to pay higher wages.
“The SA mining sector is profitable and its contribution to employment creation and foreign exchange earnings for the country is positive,” the union said in a secretariat report seen by Business Day.
NUM and Amcu, with a combined membership of about 25,000 at Sibanye’s gold operations, are demanding an increase of R1,000 a month for the lowest-paid employees, and 6% for miners, artisans and officials — above the headline inflation rate of 5.8% the Reserve Bank has forecast for 2022.
They are also demanding a R100 increase in the living-out allowance, which takes their pay demand to R1,100 each year for three years.
Sibanye has not moved from its revised offer that has since been accepted by two smaller unions, Solidarity and Uasa, resulting in surface and underground workers receiving a R700 pay rise and a R100 increase in the living-out allowance each year for three years, and a 5% pay increase for artisans, miners and officials over the course of the multiyear agreement.
Face downsizing
NUM said gold production has been declining in the past decades, with the precious metal now hard to mine as the ore is at deep levels.
“Gold production decreased below 100 tonnes in 2020. [A] fall in production has reduced gold’s contribution to the SA economy, resulting in [fewer] jobs and a drop in trade union membership.… Workers in the gold sector might face downsizing by mining houses or reduced benefits,” the union said.
Sibanye spokesperson Memory Johnstone said though it is “premature to attribute accurate numbers to production losses for the past two-and-a-half weeks, Sibanye-Stillwater has published production guidance for the year of between 813,000oz and 873,000oz for 2022”. The company could lose at least 67,750oz if the industrial action continues for a full month.
Meanwhile, Ramaphosa said the government has been working hard on trade and investment promotions, as part of the economic reconstruction and recovery plan that was unveiled in 2020.
“The R332bn in investment pledges [during] last week’s investment conference brings us close to 95% of the target we set in 2018, to raise R1.2-trillion,” Ramaphosa said.
He said these were investments that had been raised amid a global economic downturn.
The Reserve Bank has revised its forecast for global growth in 2022 down to 3.7% from 4.4%.
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