Tailings retreatment company DRDGOLD said on Thursday that the planned strike action at its Ergo operations had been suspended, following a withdrawal of a previously issued 48 hours’ strike notice by the National Union of Mineworkers (NUM) and the Association of Mineworkers and Construction Union (AMCU).

The strike was scheduled to start with the morning shift on Thursday.

The company had expected its daily throughput rates at Ergo to decline to about 40 000 t/d, compared with the planned 54 000 t/d when the strike was initially reported.  

The previously intended strike notice followed the finalisation of picketing rules under the auspices of the Commission for Conciliation, Mediation and Arbitration (CCMA) on December 3.

Wage negotiations at Ergo began in July, and since then, the company and organised labour have resolved 23 of the 25 demands tabled at the outset of the process.

The two remaining issues relate to wages and profit share.

UASA accepted and signed the wage agreement for its members on December 12, and the current dispute, and any strike action, applies only to the NUM and AMCU.

The NUM and AMCU have maintained a demand for a double-digit wage increase of 12% across the board and additional profit-related benefits.

DRDGOLD says that these demands remain more than three times inflation with consumer price index (CPI) at 3.6% and significantly above agreements recently concluded across the gold sector.

Ergo has tabled an offer that includes guaranteed yearly increases of between 6% to 7.5% for each of the next five years, placing the offer above CPI and aligned with, or higher than, recent sector agreements, the company points out.

The offer also includes the continuation of its profit-share scheme, with 15% of payroll distributed to employees when performance milestones are achieved.

There is also a new and additional 2% performance-based incentive, as well as improvements to the living out allowance and increases to the interest-free housing support scheme.

DDRDGOLD says it believes the offer provides real, multi-year financial benefit to employees while allowing the company to continue reinvesting in long-term projects to extend the operational life of Ergo.

Despite the strike being cancelled, the dispute relating to wages and profit share remains unresolved, DRGGOLD indicates.