In South Africa Unions declare wage dispute with gold producers

Any strike action could further damage an industry that is already reeling from falling production and the precious metal's recent price decline to 5-1/2 year lows.

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The sun sets behind a shaft outside the mining town of Carletonville, west of Johannesburg, July 7 2015. REUTERS/Siphiwe Sibeko play The sun sets behind a shaft outside the mining town of Carletonville, west of Johannesburg, July 7 2015. REUTERS/Siphiwe Sibeko
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The largest unions in South Africa's gold mining sector declared disputes with producers on Thursday after wage talks deadlocked, sending the negotiations to a government mediator, a necessary regulatory step before their members can go on strike.

The two sides have been poles apart: the industry squeezed by falling prices and rising costs versus labour demands for big wage hikes to close what it says is the "apartheid wage gap" - the disparities that persist between the black workforce and white management two decades after white rule ended.

A spokesman for the National Union of Mineworkers, the biggest union in the gold sector, said it did not hold out much hope that the parties could reach a deal under mediation and that a strike against AngloGold Ashanti, Harmony Gold and Sibanye was "unavoidable."

"The talks have completely collapsed, it as if we had never negotiated at all," spokesman Livhuwani Mammburu told Reuters.

Any strike action could further damage an industry that is already reeling from falling production and the precious metal's recent price decline to 5-1/2 year lows.

A spokesman for the rival Association of Mineworkers and Construction Union said the employers had reverted to their previous offer, a move the union viewed as "unacceptable."

A spokeswoman for the producers said the unions had not yet formally informed the employers of their intention to declare a dispute, but said that this had been expected.

She also confirmed that the companies had reverted to their previous offer.

Unions have been seeking pay hikes of up to over 100 percent for the lowest-paid miners against the companies' latest offers of increases ranging from 9 to 18 percent.

The previous offer by the gold firms - which is the one now on the table - was for pay hikes of 7.8 to 13 percent for entry-level workers.

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