Published: 25 July 2013

JOHANNESBURG - Bruising wage negotiations between South African goldminers and workers look to have stalled after unions declared an official wage dispute, which could bring more trouble for beleaguered bullion producers.

Rising worker militancy has coincided with soaring costs and falling prices that have prompted producers such as AngloGold Ashanti to shed a total of 14,000 jobs over the past two years. Wednesday's declaration by the unions means that two-week-old salary talks, labelled as the toughest since the end of apartheid in 1994, will now be held up by a 30-day process of mediation that could end in an industry-wide strike.

 "As far as we are concerned, negotiations have not yet begun," said Frans Baleni, General Secretary of the National Union of Mineworkers (NUM), one of four unions at the bargaining table.

If wage bills rise dramatically, the gold companies could be forced to make further job cuts a prospect that is causing concern in the ruling African National Congress (ANC) as it prepares for an election in the first half of 2014.

Bullion producers are offering a wage increase of 5 percent, up from their initial offer of 4 percent but way off the 60 to 100 percent demanded by workers. South Africa's labour laws allow for wage disputes to be referred to an outside mediator. If that fails, employees are allowed to go on a legal strike.

- Sapa

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