South Africa coal companies, unions agree wage deal

JOHANNESBURG Wed Nov 7, 2012 7:17am EST

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JOHANNESBURG (Reuters) - Coal firms in South Africa, including Anglo American (AAL.L), have signed a deal to raise certain entry-level worker wages by up to 5 percent, the Chamber of Mines said on Wednesday, to prevent labor unrest in the sector from spreading to coal.

More than 80,000 miners, or 15 percent of the industry's workforce, have downed tools in recent weeks in the gold and platinum sectors in often violent, illegal strikes, undermining already shaky growth in Africa's biggest economy.

If the unrest spread to coal mines it would have an impact reaching far beyond the industry, with some 85 percent of South Africa's electricity generated by coal-fired plants.

Phillemon Motlhamme, deputy head for industrial relations at the chamber, said the body which represents the industry was approached by unions in September to ensure that illegal strikes, with a death toll of more than 50 this year, would not spread to coal.

"The National Union of Mineworkers (NUM) and the other two unions asked how we can strengthen our collective bargaining framework and ensure continuous stability in the coal sector," he said.

Salaries will be raised by 5 percent for entry-level employees at Anglo, Kangra Coal, Xstrata Coal XTA.L, and Exxaro's (EXXJ.J) Mpumalanga operations, effective November 1.

Exxaro will give smaller wage increases to workers in other categories, while Anglo, Kangra, Optimum Coal and Xstrata have offered once-off payment of 2,000 rand ($230) to workers in higher levels.

While there were some disruptions to operations at smaller coal mines due to legal strikes recently, most companies in the sector have not been affected. ($1 = 8.6523 South African rand) (Reporting by Agnieszka Flak; Editing by Ed Stoddard)

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