De Beers, a subsidiary of Anglo American Plc, has inked a significant five-year wage agreement with the National Union of Mineworkers (NUM), representing the dedicated workforce at its South African diamond operations.

Under the terms of this agreement, employees will enjoy a 7% wage increase in 2023, followed by 6% increments in the subsequent years until April 30, 2028. This translates into a minimum entry-level basic wage of 17,630 rand ($954.30) per month, exclusive of allowances, as outlined by De Beers.

Furthermore, this historic agreement also paves the way for participation in Anglo American's employee share ownership plans. The negotiations leading to this deal were no walk in the park, according to Moses Madondo, the Managing Director of De Beers Group Managed Operations, who described the talks as "very tough." These deliberations took place against the backdrop of a challenging global diamond industry, plagued by market uncertainties.

For De Beers, this deal not only provides a sense of stability for its employees over the next half-decade but also coincides with the company's focus on expanding operations at the Venetia underground mine. This is a crucial step for De Beers, which commenced production in July from its new $2.3 billion underground mine, marking the end of a 30-year chapter of open-pit mining in December 2022.

Negotiations between De Beers and NUM, representing over 1,500 workers at the South African operations, have been ongoing since March, culminating in this favourable wage agreement. NUM's Chief Negotiator with De Beers, Masibulele Naki, expressed satisfaction with the outcome, noting that "NUM members are very happy with the deal."

Notably, in September, NUM had threatened a strike at Venetia due to breakdowns in wage talks, which could have disrupted production at this crucial site. The diamond industry as a whole is grappling with challenging market dynamics, primarily driven by weak demand amidst ongoing global economic uncertainties.