South African miners agree wage deal to end strike

South African miners Image copyright Getty Images

Union leaders have signed a wage deal with South Africa's biggest platinum mining companies, ending the nation's longest-running strike.

The Association of Mineworkers and Construction Union (AMCU) has agreed deals with Lonmin, Impala Platinum and Anglo American Platinum.

It means the lowest paid workers' salaries will rise by around 1,000 rand (£55) a month each year until 2017.

The AMCU's striking members will return to work on Wednesday.

The chief executives of the three mining firms said in a joint statement: "The road ahead remains a challenging one and it will take some time for our operations to resume full production."

The settlements differ slightly by company and staff category.

However the basic salaries of the lowest-paid workers will broadly rise by 1,000 rand a month over three years and staff will also receive additional benefits such as pension, housing and health insurance.

Workers will also receive back pay within seven days of returning to their jobs.


Milton Nkosi, BBC South Africa correspondent

The fact that South Africa's currency gained 1% against the US dollar is a demonstration of a sigh of relief by the market.

The workers must be the most relieved, given that they haven't been able to earn for nearly half a year, with no bread on the table for their destitute family dependents out in the hinterland.

President Jacob Zuma's new second term administration will also be breathing a sigh of relief because the last thing they want, as they begin a new five year term, is a recession. The economy contracted by 0.6% in the first quarter partly as a result of the strike.

The governing ANC often point out that South Africa's problems of inequality, poverty and high unemployment will only be solved if the economy is growing at about 5% per annum.

So the sooner the miners return underground to dig out that shiny metal from deep in the belly of the earth the better for all of us.

'Living wage' demands

The strike began on 23 January, when more than 70,000 workers downed their tools to demand a "living wage".

Unions sought an almost doubling of the basic pay for entry level workers from 5,000 rand (£264) to 12,500 rand per month as well as better benefits.

AMCU announced that it had accepted a wage settlement and declared that the strike was officially over at a mass rally on Monday.

Joseph Mathunjwa, AMCU's president, addressed approximately 20,000 members at a sports stadium in Phokeng near Rustenberg.

When asked whether the union should accept the offer, members chanted "sign, sign".

Image copyright Getty Images

Platinum shock

The stoppage has affected 45% of the global supply of platinum and played a part in the contraction of South Africa's economy in the first quarter.

Platinum is used in jewellery and for emissions-capping catalytic converters in automobiles, and South Africa holds around 80% of the world's known platinum reserves.

It is also the world's largest exporter of the precious metal, but five months of stoppages have crippled the country's platinum output, and severely impacted the economy.

According to a website set up by the companies, the strike has so far cost the industry more than 24bn rand (£1.3bn) while employees have lost around 10.6bn (£590m) in wages.

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