JOHANNESBURG (miningweekly.com) – South Africa’s gold mining companies on Monday tabled a five-year offer that would see their employees benefit from an upside in the industry, with some fringe benefits to alleviate employee indebtedness and improve housing.

Gold companies AngloGold Ashanti, Evander Gold Mines, Harmony Gold, Sibanye Gold and Village Main Reef developed company-specific economic models to enable employees to “clearly” evaluate the ongoing economic and social performance and sustainability of their employers and their respective business units.

The employees, represented by Association of Mineworkers and Construction Union, the National Union of Mineworkers, Solidarity and Uasa, would, from July 1, gain from automatic profit sharing during a lift in the industry.

During an improved performance, the companies would equally share between 3% and 5% of profits earned on average over the preceding six months with all of its employees.

This would be in addition to any production or safety allowances or bonuses earned and paid to employees quarterly in arrears.
However, should the profit margin at a business unit fall below 6%, this would trigger an automatic review of the operating unit.

A consultation process would then begin to jointly find measures to restore the viability of the business unit and avoid job losses, which, if unsuccessful, could lead to voluntary and statutory consultation for potential shedding of the workforce.

Meanwhile, the companies were also offering social and employment guarantees, including guaranteed employment – provided that the profit margin at operating unit level did not fall below a margin of 6% - and guaranteed yearly increases, starting July 1, of between 7.8% and 13% a year in basic wages for entry-level underground workers and 4.5% to 6% for miners, artisans and officials.

To address housing and living conditions of employees, a special purpose vehicle (SPV) funded by the companies would be implemented to ensure that employees and their families had “a choice of where and how to live”.

“The SPV would aim to benefit from economies of scale to reduce the cost of housing and speed up delivery. The living-out allowance would continue at its current level until the SPV is able to deliver affordable and desirable outcomes for all employees,” the gold miners said in a joint statement.

Additional measures would be introduced to enable employees to retire “with dignity” and reduce employee indebtedness to no more than 25% of net pay.

Personal financial management training and reasonable access to on-site debt counselling services would also be provided to all employees.

Further, a review of training expenditure, in consultation with the unions, would also be undertaken to ensure that maximum educational and skills enhancements were realised from the industry’s training budgets.

"The companies party to these negotiations currently spend some R1.5-billion on education and skills development each year,” the parties concluded.