UPDATE 2-South Africa's NUM union seeks 15% wage hike from gold miners and Eskom

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UPDATE 2-South Africa's NUM union seeks 15% wage hike from gold miners and Eskom
Credit: © Reuters.

(Recasts with Eskom)

By Tanisha Heiberg

JOHANNESBURG, March 31 (Reuters) - South Africa's National Union of Mineworkers (NUM) said on Wednesday it planned to seek a hike of at least 15% in a three-year wage deal at upcoming negotiations with gold miners and state utility Eskom.

NUM said it would consolidate the wage demands from all sectors it operates in, and would seek increases of between 15% to 20%, or 15,000 rand ($1,016) minimum, alongside other demands including medical aid contributions and COVID-19 health and safety leave.

Higher gold prices XAU= , which reached a record in August last year, boosted 2020 earnings and offered mining companies a lifeline following production disruptions because of the COVID-19 pandemic.

"Given the good dividend performances by mining companies NUM enters this season of negotiations in high spirit for a good settlement," NUM said.

Gold producers have in the past argued that above-inflation wage hikes cannot be sustained unless prices also rise.

They say higher wages could also add to already high costs in an industry the has the world's deepest mines.

Unions argue wages remain too low, a legacy of the apartheid era when the Black mining labour force was ruthlessly exploited.

The demands far exceed the current inflation rate of 2.9%, raising the prospect of tough negotiations with companies, including Sibanye Stillwater SSWJ.J , Harmony Gold HARJ.J , and smaller producer Village Main Reef. double-digit wage increase is likely to pile further pressure on Eskom, which is choking under a mountain of debt, and regularly implements scheduled power cuts because of repeated faults at its ailing coal-fired power station fleet.

Eskom's spokesman declined to comment on the demands.

Sibanye Stillwater's spokesman said they would address demands during the wage talks.

Harmony Gold and Village Main Reef could not immediately be reached for comment.

Negotiations with Eskom are expected to begin on April 20, while an exact date has not yet been set for the start of talks with gold miners.

($1 = 14.7700 rand)

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