Three major platinum producers on Wednesday rejected additional wage demands put forward by the Association of Mineworkers and Construction Company (AMCU).
The producers -- Anglo American Platinum Limited (Amplats), Impala Platinum Holdings Limited (Implats) and Lonmin Plc (Lonmin) -- confirmed that each company has received written feedback from AMCU President Joseph Mathunjwa regarding the latest wage offer by the companies.
This followed an "in principle" agreement reached between the companies and AMCU leadership last week.
AMCU committed to taking this agreement to their members at various mass meetings to receive a mandate from their members to sign an agreement, the companies said in a joint statement.
"The letters received from AMCU confirmed that the union had received a mandate from its members to finalize agreements with the companies that would bring an end to the five-month strike," the statement said.
The letters raised various procedural issues such as the timeframe of proposed agreements, which the companies are willing to discuss with the union leadership.
"Regrettably, however, the letters also contain new and additional demands which, if granted, would mean huge additional costs -- of around 1 billion South African rand (about 94 million U.S. dollars) in aggregate -- to the companies, beyond the increases contained in the 'in principle' agreements," the statement said.
"The companies simply cannot afford the additional wage demands. Engagement with AMCU on their latest demands is ongoing. The goal remains a sustainable solution beneficial to all stakeholders," said the statement.
The companies also confirmed that there has been a return to the platinum belt region of large numbers of employees who have spent the strike period elsewhere.
Last week, the platinum producers offered a new wage proposal, which would increase the salary of the lowest paid workers by 1, 000 rand for two years and 950 rand in the third year, excluding (about 90 U.S. dollars) other benefits.
The salaries of officials, artisans, and miners would increase by eight percent in the first year and by 7.5 percent for the remaining two years.
Living-out allowances would not be increased for the duration of the three-year settlement. Pension fund contributions, overtime, holiday leave, and shift allowances would be increased annually based on the consumer price index (CPI).
The companies also promised to pay workers backpay within seven working days of them returning to work. The backpay was for the period prior to the strike.
AMCU previously demanded a basic monthly salary of 12,500 rand.
To date the companies have forfeited earnings of around 23.1 billion rand, while employees have forfeited earnings of some 10.3 billion rand. (1 U.S. dollar equals 10.76 South African rand)