JOHANNESBURG -(Dow Jones)- Harmony Gold Mining Co . Ltd. (HGMCY), South Africa's third largest gold producer, said Thursday that a demand by the National Union of Mineworkers, or NUM, to raise workers' living allowances by 327% is a waste of money.
"By increasing the living-out allowance paid to less than a quarter of our employees who are neither home owners nor hostel residents, is wasting money," Bernard Swanepoel, Harmony's chief executive, said in a statement.
Swanepoel was responding to demands by the NUM that the company raise workers' living out allowance to 1,500 rand ($1=ZAR10.1300) from ZAR350.
"We believe that the type of housing project at our Free State operations is a sustainable solution to the hostel problem in the industry and the housing shortage nationally," Swanepoel said.
In protest over the company's reluctance to raise its living-out allowance, the NUM has called on around 5,000 workers at Harmony's Randfontein operation to the west of Johannesburg to down tools at 1800 local time.
Harmony said that negotiations are continuing at its Randfontein mine in an attempt to prevent the pending strike.
At around 1400 GMT on the JSE Securities Exchange, Harmony was trading up 80 cents, or 0.4%, at ZAR158.70.