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Platinum producer Lonmin plc (LSE:LMI) confirmed it has reached an agreement with the representatives of the disgruntled miners at its Marikana mine in Rustenburg, putting an end to the six-week strike that claimed 45 lives and cost multi-million pound losses for the world’s third largest supplier of the precious metal.
“Following an all-inclusive negotiation process involving trade unions and delegates of striking employees, Lonmin is pleased to announce that it has reached a settlement and a return to work has been agreed for Thursday,” Lonmin’s officlal statement read, corroborating reports yesterday that miners will have today as a day off to prepare for the resumption of work.
Lonmin said there will be between 11% and 22% increase for all employees falling under categories 3-8 effective 1st October 2012, including the 9-10% rise previously agreed, and a signing bonus of 2,000 South African Rands.
Allowances as well as promotion were also addressed, according to the company, but details of which were not revealed and the FTSE 250 miner said it will update the market on the “implications of the agreement, including its financial impact in due course.”
Shares were 4.1% higher at 10:30 AM GMT, gaining 26.50 pence to £6.765, following the confirmation.
Yesterday, it was reported the protesters cheered at a football pitch after their representatives informed them of the said pay increase.
Precedent
Protesters’ triumph after a violent and deadly strike that disrupted operations in the Rustenburg mining district, however, is viewed by some analysts as basis for other employees in the mining sector to follow suit and demand as much from their employers.
The labour unrest 120 kilometres north of the capital, Johannesburg, has spread to other platinum miners as well as gold producers, who also launched similar calls from their employers.
Number 2 platinum producer, Impala Platinum Holdings, is in the middle of a negotiation with its employees, who also demanded a 10% wage hike five months after it received as much.
Anglo American Platinum, the world’s largest producer of metal used in reducing carbon emission, is also facing several demands from its own employees, who joined other strikers weeks ago.
Impala Chief Executive Terence Goodlance had already warned the labour unrest sweeping the mining sector is an issue for the entire industry.
Lonmin’s acting Chief Executive, Simon Scott, however, stated the signing of the agreement and the conclusion of the strikes “is only one step in a long and difficult process which lies ahead for everyone who has been affected by the events at Marikana.”
