* Wage demands come as costs soar, prices fall
* Labour unrest continuing amid union turf war
* NUM is seeking hikes of up to 60 pct for entry-level
(Adds chamber response)
By Ed Stoddard
JOHANNESBURG, May 19 South Africa's National
Union of Mineworkers said it would seek pay rises of up to 60
percent from gold and coal producers, raising the prospect of
fresh strikes as firms battle higher costs and falling prices in
an already heated labour climate.
Africa's biggest economy is hoping to avoid the 2012 wildcat
strike action at platinum and gold mines that cost billions in
lost revenue and production and killed over 50 people.
Mineworkers are mobilizing to assert themselves, with the
NUM fighting a challenge to its once near monopoly in the shafts
from the Association of Mineworkers and Construction Union
(AMCU), which has poached tens of thousands of platinum miners
from it in a violent struggle for members.
NUM said it was seeking an entry-level minimum monthly wage
of 7,000 rand ($750) for gold and coal surface workers and 8,000
rand for those underground in a submission to the country's
Chamber of Mines, a copy of which was seen by Reuters.
Elize Strydom, the industrial relations adviser at the
Chamber of Mines, said the minimum wage for surface workers is
currently 4,700 rand and for underground miners it is 5,000
rand, so the demands for the latter are a 60 percent increase.
NUM also said it wanted 15 percent increases for "all other
wage categories," or more experienced and skilled workers.
The chamber of mines said in a statement it had received the
"proposals" from NUM and urged all parties to compromise in the
talks which will begin around the middle of June.
"We appeal to all parties to explore every option in trying
to reach settlement without resorting to damaging industrial
action, and to reach agreements that will strike a balance
between what is affordable to the companies and meets the
expectations of the employees," the chamber said in a statement.
It gave no further details.
Sliding precious metals prices have raised the pressure on
miners as they ready for pay talks. Spot platinum on
Friday closed at $1,450 an ounce, down around 35 percent from a
record high of $2,240 hit in March 2008, and most South African
shafts are losing money at this price.
Gold is down about 19 percent this year, losing its
safe haven allure on concern the U.S. central bank will end its
extensive stimulus for the U.S. economy.
Mining companies have been awarding above-inflation wage
rises over the past decade but with labour now accounting for
over half their costs in South Africa, they are reaching a point
where this is no longer sustainable for their income statements,
especially as power and other costs climb steeply.
But even increases above inflation do not go far for workers
at the bottom end of the pay scale who on average have eight
dependants and are mostly drawn from poor rural areas.
South African inflation is currently running at just under 6
percent and looks set to accelerate given recent weakness in the
rand currency, which investors have sold off because of concerns
about labour unrest in the mining sector. Rising inflation
especially for food will harden the resolve of workers.
The NUM still represents most workers in the gold and coal
sectors, and to head off any challenge from AMCU in those shafts
it will need to be seen taking a hard line with management.
The rivalry between the two unions triggered violence that
killed over 50 people last year and tensions are running high.
An AMCU organiser was murdered last weekend, prompting a 2-day
strike at platinum producer Lonmin.
AMCU has not yet submitted its wage demands to platinum
producers, who negotiate with unions on a company-by-company
basis. But they can ill afford to be generous given current
prices for the precious metal.
Anglo American Platinum, the world's top producer,
now plans to cut 6,000 jobs from an initial target of 14,000 as
it seeks to restore profits after falling into a loss last year.
It is hardly in a position to give big pay rises after scaling
back its original plan under government pressure.
Gold and coal producers negotiate through the country's
chamber of mines. South African gold companies include AngloGold
Ashanti, Africa's top bullion producer, Gold Fields
, Harmony and Sibanye. Coal producers
include Anglo American and Exxaro.
($1 = 9.2816 South African rand)
(Additional reporting by Agnieszka Flak; editing by Keiron
Henderson and Cynthia Osterman)