South African Trade Unions sign three year wage deal with power utility Eskom

In June, Eskom had said that it would offer a ‘0% wage increase’, which was overwhelmingly rejected by the workers and trade unions.

September 01, 2018 by Peoples Dispatch
(Photo: NUMSA)

South Africa’s two major trade unions – the National Union of Metalworkers of South Africa (NUMSA) and the National Union of Mineworkers (NUM) –  have reached a three-year wage agreement with the state-owned power utility company, Eskom. The victory comes after months of long struggle during which the unions demanded an increase in the workers’ salaries. Solidarity, another Eskom-recognised trade union, also signed the agreement.

According to a statement by NUMSA, the agreement reached with the Eskom Central Bargaining Forum is applicable from July 1, 2018 to June 30, 2021. The agreement raises the workers’ salaries by 7.5% in the first year, and by 7% in the following two years. A one-time cash payment of R 10,000 after taxes will also be made to all the employees in the bargaining forum within 48 hours of the signing of the agreement.

Eskom had earlier decided to take the matter to the Commission of Conciliation, Mediation and Arbitration (CCMA) by declaring a dispute of mutual interest after the trade unions demanded that Eskom drop the disciplinary charges it had filed against protesting employees before the agreement was signed. In negotiations between the unions and the management, it was agreed that in instances where there was evidence of misconduct, Eskom may embark on a disciplinary process. Phakamile Hlubi- Majola, NUMSA spokesperson told Peoples Dispatch that “workers will be represented by trade union representatives during that process. But no dismissals will be initiated by the company.”

Eskom had earlier said it would take action against the employees who had participated in what it termed ‘illegal strikes’ in June and July, which it claimed had caused power outages after the company was forced to implement load shedding. The company also claimed that workers vandalized its properties to disrupt the power grid.

The agreement reached on Thursday also stated that Eskom would be increasing the housing allowance for workers according to the consumer price index each year. The conditions of service for workers will also remain unchanged for the period from July 1 to June 2021. The agreement further stated that the review of the current short-term incentive scheme would be referred for further engagement at the Central Consultative Forum (CCF) negotiations.

Irvin Jim, general secretary of NUMSA, thanked the union’s members for “demonstrating militant discipline in the face of extreme provocation by the employer.” He also thanked the negotiating team for managing to break the deadlock that lasted three months and the workers who succeeded in forcing the management of the company to increase their offer from 0% to what was finally agreed upon.

In June, Eskom had said that it would offer a ‘0% wage increase’, which was overwhelmingly rejected by the workers and trade unions. After a strong worker’s movement subsequently raised the offer to 4.7% for 2018 and an inflation-based increment for the next four years. Unions at the time had sought a flat 15% salary hike for all employees and an R  2,000 (South African Rand) housing allowance, among other demands.

In July, the power utility increased its offer to a 6.2% wage hike for workers for the first year. The three trade unions representing the workers at the negotiations took this offer to their members for debate. Subsequently, the workers rejected this offer and demanded a living wage instead.

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