South African Platinum Wage Negotiations Reach Standstill

Mineweb reported that negotiations between South Africa’s Association of Mineworkers and Construction Union (AMCU) and Lonmin plc (LSE:LMI), Impala Platinum Holdings Ltd. (OTCMKTS:IMPUY) and Anglo American Platinum Ltd. (OTCMKTS:AGPPY) are essentially at a standstill.

The AMCU has refused the miners’ offer of a 9-percent wage increase, while the miners have said they cannot accommodate the AMCU’s demand of a minimum salary of 12,500 rand.

As quoted in the market news:

The reality for AMCU is that the platinum companies have dug in their heels and will not offer more than 9%. Furthermore, the 5-week strike has so far cost AMCU members 10% of their annual wages.

If the platinum companies rescind and agree to increase wages to a minimum of R12,500, it will put mine workers in the top 25% of what workers earn in South Africa. They would earn more than teachers, nurses and police officers.

The average national minimum wage is R3000, while the minimum wage in the platinum sector is around R5,000.

Click here to read the full Mineweb report.