Over the past few months employers and employees in the coal sector have been negotiating wage increases in the Coal Sector. Employees, represented by the NUM, Solidarity, UASA and NUMSA have reached a deadlock with the represented employers, Exxaro Coal, Anglo American Coal, Glencore, Koornfontein, Kangra, Delmas Coal and Msobo Coal which may well result in a strike occurring across the entire sector.

Says Mr Peter Bailey, NUM Chief Negotiator in the Coal Sector in a press statement: “The Chamber of Mines members are pleading poverty when it comes to black workers yet white managers and executives have the luxury of being overcompensated.”

While the press is reporting that employers are offering increases of between 5% and 7% on basic wages, there are other conditions of employment where employers have also made large increase offers, including fully paid maternity leave, increased medical separation benefits, transport allowances and living out allowances as well as other conditions of employment.

Overall the low coal price and the comparatively high labour costs have made negotiations for the 2017 wage period extremely touchy, with most negotiations within the sector settling on average around a 6.5% total cost increase.

While the NUM’s public claims that it will be embarking on strike action should the employers not up their offer have artificially inflated coal prices, the long term view is that these prices will again normalize given the international decline in fossil fuel usage and a push towards renewable energy.

A sector-wide strike would have a tremendous effect on coal mining and related operations as it directly affects not only the coal producers, but also their contractors and transportation providers, not to mention the immense engineering and related support services that rely on coal producers for income. It remains to be seen what the outcome of the CCMA conciliation on the 8th of November 2017 will be.

The spokesperson for the negotiating committee, Mr Motsamai Motlhamme stated in a press release: “The Chamber believes that the offers made are fair and reasonable. Employees in the coal sector are amongst the highest paid employees in the mining industry.”