Pan African Resources PLC (AIM:PAF, OTCQX:PAFRY, JSE:PAN, FRA:RTZ, OTCQX:PAFRF) (AIM:PAF) said it agreed a multi-year wage deal with two unions at its Barberton gold mines in South Africa.
The AIM-listed miner reached a three-year wage agreement with the National Union of Mineworkers and a five-year wage agreement with the United Association of South Africa. The two unions represent the majority of employees at the Barberton mines.
The NUM agreement provides for an average annual wage increase of about 5.6%, compound annually, over a three-year term starting from 1 July 2021.
The UASA agreement, effective from the same date, provides an average annual increase of 5.0% in the first two years and an average annual increase of 5.0% or the annual South African consumer price inflation (CPI) rate, whichever is higher, capped at 6.0% in the third year. In the last two years, UASA members will get an average annual increase of 5.0% or CPI, whichever is higher, capped at 6%, with the ability to re-negotiate these increases if the CPI rate falls below 4% or rises above 7.5%, for each of these two years.
Assuming a CPI rate of 5.0% for the initial three-year period, the wage increases will result in an average annual increase of about 5.4%, compound annually, over the period, said the gold producer.
“We are pleased with the outcome of the negotiations and commend the constructive spirit in which they were conducted,” said Pan African chief executive Cobus Loots.
The three underground mines at Barberton produced almost 85,000 ounces of gold in the year to end June 2021, or 42% of the company’s total gold output of 201,608 ounces.
In June, Pan African renewed the mining rights to its Barberton mines for another 30 years.
READ: Pan African renews mining rights at Barberton for next 30 years