Trade unions Association of Mineworkers and Construction Union (AMCU) and the National Union of Mineworkers (NUM) are in dispute with Sibanye-Stillwater’s gold division, noting in a statement that wage talks have deadlocked.

“Despite gold selling at record highs of more than $3 900/oz and management paying themselves salary hikes of up to 39% and multimillion-rand bonuses, Sibanye-Stillwater offers workers a meagre R650 increase,” the union asserts.

AMCU, along with the NUM and two other unions that have organisational rights at Sibanye-Stillwater’s gold operations concentrated on the West Rand and in the Free State of South Africa, started wage negotiations on July 14.

“This happened as an unusually short wage agreement for a single year had already lapsed on June 30," AMCU points out.

The union explains that after a total of five wage negotiation meetings, the parties reached a deadlock and embarked on the company’s internal dispute resolution process.

“We have seen this approach before. Sibanye-Stillwater sends a junior negotiating team with almost no mandate to negotiate – their only mandate is to stay where their bosses told them to. This then leads to a very frustrating and drawn-out process, which inevitably leads to some sort of dispute,” AMCU president Joseph Mathunjwa posits.

The union also highlights the discrepancy between record high gold prices and the wages of mineworkers in the sector.

At an internal dispute resolution meeting held on October 2, the four unions consolidated their demands to a unified position of a monthly increase of R1 300 for the lowest-earning mineworkers, and 6.5% for miners, artisans and officials.

The NUM has said the wage offer is insufficient to meet the rising cost of living and that Sibanye-Stillwater has failed to recognise the value of the employees.

Sibanye-Stillwater confirmed in a statement to Mining Weekly that the unions have declared a deadlock, and that the company would now engage further with them through a process of conciliation under the auspices of the Commission for Conciliation, Mediation and Arbitration (CCMA).

Sibanye-Stillwater investor relations and corporate affairs executive VP James Wellsted informs that the company made several offers.

This included an initial proposal which consisted of a fixed yearly increase in the guaranteed monthly wages, aligned with the country's inflation and a variable component, which linked to the gold price and the achieved level of monthly production relative to plan, which provided considerable earnings upside potential if the gold price or productivity increased, he explains. 

"The benefits for employees would be additional earnings potential from increases in the gold price and an additional incentive based on improvements in productivity and delivery relative to planned levels." 

The first proposed offer was rejected by the unions; therefore, the company tabled a second proposal for a one-year fixed increase of 4.5%, which was higher than average inflation of about 3% for this year, Wellsted pointed out. 

The second proposal was also rejected.

A third proposal for a three-year agreement (based on demands by the unions for a longer period), consisting of fixed yearly increases of 4.5% each year, again, above the average yearly South African Reserve Bank medium-term inflation forecast, was made, he outlines. 

The unions also rejected the third offer and demanded higher yearly increases.

"The company has continually maintained and communicated to the unions that the demands they tabled cannot be met, without placing the viability of the operations at risk and could result in potential job losses, which we should all try to avoid," Wellsted says. 

He highlights the company remains fully committed to constructive engagement with the unions throughout the CCMA process, and will continue to engage in an attempt to agree fair and sustainable yearly wage increases; however, it will need be cognisant of the potential impact on the sustainability of its gold operations.

The NUM said it too remains committed to constructive dialogue and that it will continue to engage with the company through the CCMA process to reach a fair and mutually acceptable agreement.