Diamond giant De Beers and the National Union for Mineworkers (NUM) have resolved the wage dispute which threatened the company's operations.

According to the diamond miner's spokesman Tom Tweedy "The company and NUM have settled the dispute and the parties will meet next week to formalize the agreement."

The deal states that employees at the A-level – the lowest salary level – and B-level would receive a 10% increase and C-level employees would be granted a 9.5% raise.

A rotational shift allowance would be paid to qualifying employees, to be increased to eight percent of an employee's basic wage.

The settlement would be back-dated from May 1.

"De Beers appreciates the mediation role carried out by the CCMA," said Wayne Smerdon, industrial relations head at De Beers.

"We sought to find common ground with the NUM negotiating team and we have reached that point," he said.

The settlement affected 1587 employees in the bargaining unit on De Beers' five mines in South Africa. The company had a total of 5500 employees in the country.