JOHANNESBURG (miningweekly.com) – Talks facilitated by the Commission for Conciliation, Mediation and Arbitration (CCMA) between platinum producers Anglo American Platinum (Amplats), Impala Platinum (Implats), Lonmin and the Association of Mineworkers and Construction Union (AMCU) were adjourned on Wednesday as the parties remained far apart.

The CCMA said in a statement that it had decided to adjourn the process to give all parties an opportunity to reflect on their respective positions.

Amplats CEO Chris Griffith said the miner was discouraged by the turn of events at the CCMA.

“We have been diligent and transparent in engaging all our stakeholders on the financial position of the company, a position which led to the restructuring of the business in 2013. At the CCMA, my team of specialists has been ensuring that AMCU is apprised of what is achievable and sustainable to preserve jobs,” he said.

AMCU on Tuesday morning announced that it had revised its demands and was now seeking staggered increases that would take the basic entry-level wage to R12 500 over a period of three years, as opposed to its original demand of a R12 500 basic wage from the first year.

However, the platinum producers said this demand was still unaffordable as it translated into an average increase of between 30% and 40% year-on-year.

Lonmin, Amplats and Implats were proposing a three-year wage agreement on a guaranteed package with increases ranging from 7.5% to 9%, with the lowest paid employees receiving a 9% increase in year one.

The miners said this offer was well above the current South African inflation rate of 5.4% and was more favourable compared with increases in other industries.

The increase proposed by the producers would take the current monthly minimum wage of between R5 000 and R5 700 to between R6 300 and R7 200 by 2015 excluding benefits and bonuses.

“Importantly, the proposed increases will take the minimum guaranteed pay of entry-level underground employees to between R9 390 and R10 250 in the first year to between R10 900 and R11 900 in the third year,” the miners stated, noting that most other labour-intensive parts of the economy paid a basic minimum wage only.

“The industry’s proposed increase in wages and benefits, of some R2-billion in the first year alone for the three companies combined, remains fair considering [that] the industry has reported a cash loss of about R4.3-billion in 2013,” Implats CEO Terence Goodlace said, adding that the company was calling on its employees to seriously consider the offer in the interests of the sustainability of the platinum industry and to secure their jobs.

“A return to work is critical before permanent structural changes become inevitable,” Implats said.

Goodlace further stated that the platinum producers remained committed to finding an affordable and sustainable solution for all stakeholders, specifically the employees, but also the companies’ suppliers and other close associates in the Rustenburg area.

Lonmin CEO Ben Magara also reiterated the platinum producers’ commitment to finding a positive and sustainable resolution to the dispute in the interest of all stakeholders. 

“We are particularly concerned about the plight of our employees who have lost six weeks of wages to date. The longer the strike continues, the greater the impact on our higher cost shafts, our ability to return to a normal operating environment and obviously on jobs,” he said. 

CCMA director Nerine Kahn said the mediation process could be expected to resume once the parties had considered their positions and indicated a willingness to return to the negotiating table.

LOSSES
Since the start of the strike on January 23 the three platinum producers had collectively lost more than R6.8-billion in revenue and employees more than R3-billion in wages.

Amplats on Wednesday reported that it was losing about 4 000 oz of platinum a day, which translated into a loss of R100-million of revenue value a day.

Implats said it had lost about 90 000 oz of platinum since the start of the strike, which translated into around R2-billion in revenue, while Lonmin also confirmed having lost around 90 000 oz of saleable platinum.

Lonmin said, as a consequence of the strike action, which had caused activity at its mining and processing divisions to be minimal, it would not achieve its sales guidance of in excess of 750 000 oz of platinum and now expected sales for the year ending September 30, 2014, to fall further the longer the protected strike continued.