Thursday, 23 May 2013

Ask The Big Shots Who They're Kidding?

Cyril Ramaphosa
Mail & Guardian Photo - Mike Goldwater

I was outraged by the article by Felicity Duncan in Money Web entitled “Are These Guys Kidding?!” She is referring to the request by NUM for a 47% increase in the entry-level wage for surface mine workers and a 60% increase for underground mine workers.

My reaction would probably be the same if I based my reaction only on the quoted percentage increases of 47% and 60% requested by NUM. However consider for a moment that, if these increases were granted, it would only place entry-level miners monthly income, in Felicity Duncan's words, at about R7,000.

Can one even begin to imagine caring for a whole family each month with just R7,000, before tax and other deductions? Do you think you could ever afford to send your child to university on a salary of just R7,000 per month?

Felicity Duncan goes into a very intricate explanation to justify why she believes that the miner’s current incomes – and these are her words – are a “respectable amount compared to other South Africans”.

She explains how the mining industry is not in great shape. She explains the various factors that impact the mining industry, such as how the cost of electricity has shot up – unless of course you are BHP Billiton who pays less than it costs Eskom to generate the electricity. She explains how these wage demands run the risk of retrenchments and even mine closures.

Felicity Duncan is probably quite right in her analysis of the situation and what these wage demands will mean for the future of the mines and the miners employment prospects. However it seems that all attention is always directed at the ordinary miners at the bottom levels of the mines.

The focus is always on how these ordinary miners, earning these tiny little incomes, will impact on the future of these massive mining companies. 

I do however wonder when Felicity Duncan and other journalists like her will take the time and find the courage to produce an analytical report, which reveals what board members, directors and other senior personnel in the mines are really sucking out of the mining companies coffers each month? What impact are they having on the sustainability of the mines?

When will journalists critically reveal what will undoubtedly be the not so “respectable amounts” that the big shots in the mines are earning every month, while the ordinary miners are told to suck it up and be grateful that they have work and receive the pittance they are paid?


  1. Gemma I have an excellent first hand understanding of what senior personnel in a corporate do. I was not always disabled and was fortunate to have personally carried that huge responsibility in my career.

    The level of responsibility still does not justify the obscene incomes senior personnel earn or the fact that on average, year on year, their salary increases have been much greater than that of their employees.

    Maybe senior personnel need to begin pricing their product differently and factoring in real costs so they can pay their employees fairly. That way the senior personnel are really earning their keep.

    Why should an ordinary worker be satisfied with a below inflation increases, yet senior personnel are not satisfied and they on average always receive above inflation increases.

    Even if we assume that all employees today are earning a fair income, just because of the unfair policy of awarding annual increases in such a discriminatory way, this will be skewed within a few years. This is why there is such unhappiness today. Salaries may have seemed fair many years ago but this ridiculous practice of always giving employees smaller increases has eroded that.

  2. The problem is that no one ever takes into account the benefits given to those employees in the form of pensions, medical aid, food and housing subsidies etc etc. Then they take the rest of their salaries and drink it away.

    Why should we absolve them from their own mistakes by placing companies in such a position that they are forced to alienate consumers by increasing prices? The company will ultimately go under. Those workers have 7, 8, 9, 10 children without thought to how they will support them. And then expect the company to carry the burden.

    Not to mention the fact that they are UNSKILLED labour. How much do they really expect to receive? If your job can be done by any person off the street how much are you really worth to the company? Whereas senior management is the sector of the company that drives the business going forward. Without that level there is NO business. Incentives have to be made to keep the top people from finding other jobs because their skills are actually in demand.

    And the wages being earned by those miners is often higher than those of teachers! Why blame the companies? The real problem is the government and their inadequacy. Increases in electricity, fuel, food and the list goes on. Why should they not be held accountable?

    And the real issue here is that those miners are violent and a liability. They will destroy mine property. And the mine should simply take it and pay up? Someone has to pay for that damage and these days there is no insurance for mine property that doesn't already cost a small fortune.

    The reason people at the top earn more is an incentive program. There is NO excuse anymore. School is free (for what its worth with the educational standard of today), government subsidies tertiary education for black students, there are pupillages, apprenticeships and a million and one other opportunities. But with the unions in place people are being told that its ok to be unskilled and that you do not have to increase your production - the mines will cough up (farmers too) because if they don't we'll go on strike violently, attack people and destroy property.

    And management is left with the clean up and being held out to be horrible beasts because they earn more. There is no such thing as fairness but there is a need to provide jobs. If they are so unhappy with their jobs they should find others. And just to point out the obvious, miners receive HIGHER than inflation increases annually - mostly in the double figures. The problem is people supporting these strikes never check out all the facts and only look at the net take home pay after deductions from their 5 or 6 different loans for which they have emolluments attachment orders against them.

    Management may be paid exorbitantly, but the miners are not paid "slave wages" - and I know. Our firm has worked on the employment agreements and bargaining documents.

    Miners should not be praised for demanding without producing extra. And should not be rewarded for being violent and violating their own agreements. And a final observation - Union fees are also massively inflated on the salaries. Yet that is never questioned?