Bloomberg News

Miners at AngloGold, Gold Fields, Others Reject 4% Pay Offer

June 20, 2011

(Updates with chamber of mines comment starting in fifth paragraph.)

June 20 (Bloomberg) -- South African gold miners seeking 14 percent higher pay rejected a 4 percent “pittance” offered by employers including AngloGold Ashanti Ltd. and Gold Fields Ltd.

The National Union of Mineworkers will meet the Chamber of Mines, which negotiates on behalf of gold mining companies, on July 5, it said in an e-mailed statement.

“The NUM totally reject the pittance with the contempt it deserves,” it said.

Gold prices have surged 40 percent since the beginning of last year, spurring unions to demand wage increases in excess of South Africa’s inflation rate, which was 4.2 percent in April. The United Association of South Africa is supporting the NUM pay demand, while Solidarity, another union, is seeking a 12 percent increase. The nation’s gold mines employ about 160,000 workers.

The Chamber of Mines of South Africa made offers on a broad range of demands, including an opening wage increase offer of 4 percent, the Johannesburg-based chamber said in an e-mailed statement.

It was important to be aware of the economic realities in the industry, with production consistently declining and companies facing high cost pressures, it said.

“It is critical that the parties strike a balance between the different needs, and that they therefore need to think creatively on these matters,” the chamber said.

South Africa’s other gold mining companies include Harmony Gold Mining Co. Wage negotiations in the coal industry will go ahead tomorrow, the NUM said.

--Editors: Gordon Bell, Emily Bowers

To contact the reporter on this story: Mike Cohen in London at mcohen21@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net


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