South Africa's AMCU wants gold sector to double minimum pay

May 13, 2015 8:33 AM

By Zandi Shabalala and Tendai Dube

The Association of Mineworkers and Construction Union (AMCU) President Joseph Mathunjwa speaks to striking mine workers at the Royal Bafokeng Stadium in Rustenburg, June 23, 2014. REUTERS/Skyler Reid

JOHANNESBURG (Reuters) - South Africa's Association of Mineworkers and Construction Union (AMCU) wants the basic pay for entry level workers in the gold mining sector to be more than doubled, setting the stage for tough pay talks in an industry battling dwindling profits.

Joseph Mathunjwa told reporters on Wednesday his union, which led a record five-month long strike in the platinum industry last year, would seek a monthly wage of 12,500 rand ($1,045) for workers who currently earn around 6,000 rand.

"The mineworkers are enslaved across the country. Whatever we put forward is to liberate the mining workers from this oppression," Mathunjwa said.

With dwindling profits and increasing costs, Africa's top bullion producers AngloGold Ashanti, Sibanye Gold and Harmony Gold warn that high pay increases and strikes would lead to the decline of the struggling industry.

Mine owners had no immediate comment on the AMCU demand.

AMCU had also called for a doubling of wages in the platinum sector last year, sparking the costly industry stoppage. In the end, it settled for raises of around 20 percent annually.

Platinum companies found the increases and the long strike hard to swallow. Lonmin said last week it would cut 3,500 jobs at its South African mines.

Mathunjwa told Reuters the union was talking to Lonmin over the retrenchment plans.

"Lonmin has been engaging with our members and we have been talking about it. They won't just start cutting jobs, we will talk," he said on the sidelines of a press conference.

Mathunjwa said the union would hold a mass meeting to get the workers' response to the planned job cuts.

South Africa's mostly black mining labour force is increasingly restive two decades after the end of apartheid, with perceptions prevalent that the earnings which have been made in the industry have not flowed fairly to workers.

AMCU swept to popularity in the platinum sector by poaching thousands of members in a bloody turf war with arch-rival the National Union of Mineworkers (NUM) and has since spread its influence into the gold and diamond sectors.

The AMCU union represents 29 percent of workers in the gold sector, according to an industry website, with NUM claiming 54 percent of the workforce. Other workers belong to smaller unions, while some are not members of any labour groups.

The NUM secured a wage deal with Gold Fields in April, and will seek up to 75 percent wage hikes from the rest of the sector, a source familiar with the matter said.

($1 = 11.9620 rand)