Johannesburg - South Africa's Association of Mineworkers and Construction Union (Amcu) walked out of gold wage talks on Wednesday, an industry body said.
"They declared a dispute and the next step is mediation," a spokesperson for the Chamber of Mines told Reuters, without providing a reason. Three other unions remain committed to the talks.
On Tuesday the gold producing companies responded to mining unions saying that their wage demands were unaffordable.
“The demands made by the four unions are unaffordable, as high as an additional R16.5bn across the five companies when one of the union’s demands is extrapolated,” the companies said in a joint statement.
The gold companies include AngloGold Ashanti [JSE:ANG], Evander Gold Mines, Harmony [JSE:HAR], Sibanye Gold [JSE:SGL] and Village Main Reef.
According to the companies the industry’s total wage bill was R23.5bn in 2014.
“Acceding to these demands would threaten the sustainability of our industry, and would jeopardise almost all current jobs,” the companies said.
Offer not acceptable
The Association of Mineworkers and Construction Union (Amcu), National Union of Mineworkers (NUM), and UASA (United Association of SA) have all indicated that the initial offer by the producers were not acceptable.
The producers proposed a five-year wage deal with annual wage increases between 7.8% and 13%, plus a share of profits.
According to UASA (representing 7% of gold employees) the gold producers tabled a “good opening offer”, but added that it still needs work.
NUM (representing 52% of gold employees) has rejected the offer outright, asking for an increase to basic pay for underground workers to R10 500 per month from R5 700.
Amcu (representing 30% of gold employees) said gold producing companies need to improve their pay offers and have threatened to declare a deadlock if the union is not happy with the offer.