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Take it or leave it, warn mine firms

Johannesburg - South Africa's top three platinum companies issued a take it or leave it wage ultimatum to striking Association of Mineworkers and Construction (Amcu) workers on Wednesday, hoping to break a month-long stoppage that has crippled production.

In a joint statement, Anglo Platinum (Amplats) [JSE:AMS], Impala Platinum (Implats) [JSE:IMP] and Lonmin [JSE:LON] said they would not raise an already rejected wage offer and warned of impending job losses.

The three platinum companies reduced their workforce from a combined 145 000 in December 2011 to less than 134 000 in December last year. 

Wage demands

Workers are demanding a minimum monthly wage of R12 500 and rejected a deal in January that would guarantee a minimum 7% increase in each of the next three years.

Mining firms said this offer was reasonable, adding "we cannot and do not contemplate anything above this".
"It remains imperative that an affordable, achievable and sustainable resolution is reached," they said.

"Prolonged strike action will result in more losses, in further fundamental restructuring and, inevitably, this will have a negative impact on jobs and indeed the economy."

Hardball tactic

It is unclear if the hardball tactic will work with Amcu, whose militant stance has made it the sector's largest union in just a few years.

An estimated 80 000 platinum workers have been off work for almost a month, theoretically costing the firms $400m (about R4.4bn).

The companies accused the union of negotiating in bad faith.

"It is simply not possible to negotiate if only one party ever moves and the other party maintains its position."

Give and take

Also on Wednesday at a media briefing Amplats CEO Chris Griffith said negotiations required a give and take from all parties.

"Amcu refuse to accept the economic circumstances facing this industry," he said in Johannesburg. "Amcu clearly have no, or little, interest in preserving jobs." 

Lonmin CEO Ben Magara said the offered increases are significantly higher than the inflation rate of 5.4%. "This is as [far] as we can go without being irresponsible." 

Implats CEO Terence Goodlace said costs of platinum production had grown significantly over the last five years, while productivity continued to slide.

More court action?

He said his company was exploring the option of trying to have the strike declared illegal by the courts amid "extensive reports of both overt and covert intimidation at the various operations, as well as injuries and damage to property".

Griffith said "the pain may be felt" next week when the monthly pay day rolls around. 

The stoppage itself by Amcu members has followed the letter of the law and is therefore considered a "protected" strike, which effectively means it is legal and striking employees cannot be fired for just downing tools.

Last week Amplats filed papers to sue Amcu for a provisional R591m in damages resulting from ongoing strike action.

Undermining confidence

"We cannot afford the strike to continue much longer. It is undermining confidence in South Africa and undermining confidence in narrow reef mining in South Africa," said Griffith.

On miners' living conditions, he said the platinum producers were going "over and above the requirements of the Mining Charter".

Magara said the strikes were not helping these efforts. "Thriving business makes it possible to improve living conditions."

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