[This is a perfect example of what I have said many times about these strikes. They come along DEMANDING wage increases, even when business is not good. While the Gold price is high in dollar terms, the Rand is very firm, and the Rand price of Gold is not that great. So these mines are limited in what they can give, and as they say, they will now be forced, in the long term to later fire more workers. In my book, I mentioned that this is how it has been going for years – the few get work, but in the long term, the many suffer and, the industries go backwards. This is what these socialists achieve. Jan]

SA’s gold-mining houses yesterday began counting the cost of a crippling four-day strike after the unions formally accepted Wednesday’s revised offer of 6%-7% wage increases.

The industry-wide strike, which began at midnight on Sunday, was reportedly costing the sector R130m in revenue, or 40000oz of gold, a day.

SA accounts for 15% of global gold output and the sector contributes 2% to the country’s gross domestic product.

Sparked by the Chamber of Mines’ insistence on a 5% wage increase instead of the 12% demanded by the workers, the strike quickly grew to be one the biggest in 18 years — sucking in members of the key unions, the National Union of Mineworkers (NUM) and Solidarity.

Yesterday the chamber, which represents all mining houses in wage negotiations, said the mineworkers were expected to resume work last night.

The unions and the chamber also agreed that wage increases next year would be one point above inflation.

According to the agreement, the companies would, in addition to the pay increases, offer a “living out” allowance of R1000 and a transformed provident fund catering for a secured retirement portion and a 1% employer contribution to the risk portion. The parties also agreed on R10 000 funeral cover.

NUM general secretary Gwede Mantashe said yesterday: “We are also pleased that we were able to settle the strike in such a short space of time.”

Solidarity spokesman Dirk Hermann said last night that his union would still call for the establishment of a mining industry bargaining council to prevent companies from making offers to individual unions.

During the course of the strike, AngloGold Ashanti and Harmony gave the unions separate offers which were higher than what the chamber had proposed.

The other party to the dispute, United Association of SA (Uasa) — which represents about 16000 members in supervisory positions — said last night that it would respond to the companies’ offer today. Uasa members were not on strike.

Although the chamber’s chief negotiator, Frans Barker, said last night that the deal was a “win-win” situation, gold analysts said yesterday that the offer would cripple marginal mines, already under stress from the strong rand and reduced reserves.

They said that unless the price of gold increases, the various mining companies would feel the pinch of the pay increases.

Many of them were already on cost-cutting measures before the onset of the strike.

Analyst Nick Goodwin said yesterday the effect of the offer on individual companies would largely depend on what happens to the gold price.

He said there would have to be an increase of about 25% for the industry to absorb the increases in labour costs. The gold price yesterday closed at $445,85/oz.

“They may have to cut costs further. But there is always a limit to the extent to which a company can cut costs. Sometimes cutting costs too much can have an effect on operations,” Goodwin said.

The increases were likely to reduce mining companies’ revenue by 3% on average.

“That may also force companies to retrench more employees than they had planned to,” he said. Another gold analyst, Leon Esterhuizen, said the increase would further squeeze gold-mining companies’ profits.

Source: AllAfrica.Com
URL: http://allafrica.com/stories/200508120001.htm…/p>