Platinum Strike Union Says Companies Made Proposals in Pay Talks

Jan 28, 2014 5:00 pm ET

Jan. 29 (Bloomberg) -- The South African union leading a strike over pay at the world’s largest platinum producers said the three companies have made proposals to resolve the dispute, with negotiations to continue today.

The Association of Mineworkers and Construction Union won’t disclose details of the offers, put forward at talks in Pretoria, Jimmy Gama, the union’s treasurer, said yesterday. The walkout by AMCU members at Anglo American Platinum Ltd., Impala Platinum Holdings Ltd. and Lonmin Plc started Jan. 23.

“There are offers on the table; we are still exchanging some discussions around those offers, but we are not going to divulge” details, Gama told reporters in the South African capital after negotiations that stretched beyond 7 p.m. ended for the day.

The country accounts for about 70 percent of global production of the precious metal, and the strike is costing the companies 9,900 ounces a day in lost output, valued at about $14.2 million at current prices. The AMCU’s demands include a call for entry level wages to be more than doubled to 12,500 rand ($1,130) a month.

The union will report whatever happens in the final scheduled day of negotiations to members “and take it from there,” Gama said. Members out on strike should “keep the struggle” in the meantime, he said.

The platinum companies have called the union’s demands “unaffordable and unrealistic.” Union President Joseph Mathunjwa last week warned of “marathon negotiations” to resolve the dispute. This week’s talks, facilitated by the government through the Commission for Conciliation, Mediation and Arbitration, are scheduled to wrap up today.

Difficult Talks

The AMCU has replaced the National Union of Mineworkers as the biggest at the country’s biggest platinum mines through arguing for larger pay increases. It has gained in membership and influence since the deaths of at least 44 people, including 34 killed by police in a single day, during labor protests at Lonmin’s Marikana operations in August 2012.

“Negotiations are always difficult, but you need to focus, take them as they come,” Gama said yesterday. “We are positive” about the outcome, he said.

--With assistance from Kevin Crowley and Andre Janse van Vuuren in Johannesburg. Editors: John Viljoen, Alex Devine