South Africa's AMCU union disappointed by Lonmin wage offer

South Africa's Association of Mineworkers and Construction Union (AMCU) is disappointed by a wage offer for workers at Lonmin, which was acquired by Sibanye-Stillwater this year.

"We are utterly disappointed with the offer at Sibanye-Stillwater Lonmin," Joseph Mathunjwa told a news conference, describing the offer as a "slap in the face". Mathunjwa said that workers at Lonmin had been offered annual wage increases of 300 rands ($19.55) for the first year, 350 rands for the second year and 400 rands for the third year, lower than other miners in South Africa.

"We feel that Sibanye is trying to provoke us into a strike," Mathunjwa said. "We haven't declared a strike yet ...we are still negotiating." Sibanye-Stillwater spokesman James Wellsted said the company was continuing negotiations with the union but said the Lonmin operations were not able to sustain AMCU's wage demands.

"With Lonmin, the offer made is more reflective of the particular financial and operational position that Lonmin is in and obviously AMCU has taken offense to that but we need to be cognizant of the realities the operations are facing," Wellsted said. The AMCU demanded a monthly basic wage of 17,000 rands ($1,145), a rise of about 48%, for its members in the platinum sector pay talks.

Higher prices for palladium and rhodium and a weaker rand currency have boosted profits at miners such as Anglo American Platinum (Amplats), Sibanye-Stillwater and Impala Platinum after several years of losses. This has emboldened AMCU, which in April ended a five-month strike at Sibanye's gold operations.

Mathunjwa said that although he was not happy with higher offers from other miners such as Amplats and Impala Platinum, they were closer to meeting the union's demands. "There is a light at the end of the tunnel," he said.

($1 = 15.3416 rand) ($1 = 0.8277 pounds)