Business Maverick has seen a copy of the presentation of the three-year offer. For entry-level/category four to eight workers, the offer is an additional R1,000 a month for the next three years. In the first year, that works out to a pay hike of about 10% at a time when inflation is running at 4.6%. For more-skilled workers, the offer is 6% per year.

“We are taking the offer back to our members but this was the mandate they gave the negotiators, so we expect them to accept it,” a National Union of Mineworkers (NUM) source told Business Maverick. The deal is likely to be signed next Thursday.

For Harmony, the imminent wage agreement means it will not have to engage in protracted talks that could have potentially ended in a strike. It’s not clear if Amcu, which has far fewer members, will accept the deal, but the union will have little choice in the matter since it is not the majority union at Harmony.

The gold price is off its historic highs of more than $2,000 an ounce breached in August 2020, but is still elevated by historic standards and just under $1,800. Harmony’s headline earnings for the year to the end of June roared back into positive territory, surging to 923 South African cents per share from a headline loss per share of 154 US cents. Other gold miners are doing better but it’s making decent money, so it would have been hard-pressed to offer something closer to inflation.

Labour relations in South Africa’s mining industry have come a long way from a decade ago when class conflict and inter-union warfare raged on the platinum belt and on some gold mines. It will be interesting to see what unfolds when the platinum sector, which is making oodles of cash, gets around to wage talks. DM/BM