The rapid rise in mining wages represents a turning point – by Sikonathi Mantshantsha (The Rand Daily Mail – April 21, 2015)

Has the mining industry finally come to the party by paying sufficient wages to its employees? It looks like it. Last week Gold Fields agreed to raise the average wage of its employees by 10%/year for the next three years, a rate that is almost four hundred basis points higher than last year’s 6.1% consumer price inflation rate.

The wage agreement that the gold company reached with organised labour in SA is a significant development on the path to normalising labour relations in SA.

It is also a clear indicator that important lessons were learnt from the Marikana tragedy almost three years ago, and the enormous value destruction on the platinum belt during the five-month strike last year.

The most important part of the deal is that it was reached without any loss in productivity for the company or income for the workers through strike action.

In some ways the Gold Fields settlement for its 3 500 South Deep — its only asset in SA — employees validates the sacrifices made by workers on the platinum belt in 2014.

The approximately 100 000 workers across three major platinum miners lost about R10-bn in income last year after they embarked on a protracted strike, demanding a minimum wage of R12 500/month.

Impala Platinum, Anglo American Platinum and Lonmin lost estimated revenue of R20bn before coming to an agreement in May last year.

The National Union of Mineworkers represented the South Deep workers in the recent talks. It says the increase will amount to 21% over three years. The lowest-paid employee will receive over R7 000 per month during the first year, rising to just below R9 000 in 2017.

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