Municipalities, unions sign three-year wage agreement

PARTIES in municipal sector wage talks have finalised an “amicable” multiyear agreement, which points to improved labour relations and stability in the sector, South African Local Government Association (Salga) chairman Thabo Manyoni said on Friday.

The negotiations between the parties leading up to the agreement averted industrial action, which in recent years has been a characteristic of the talks, resulting in a halt in services and uncollected refuse lining the streets.

The final agreement, signed by Salga, the South African Municipal Workers Union (Samwu) and the Independent Municipal and Allied Trade Union (Imatu) on Friday, included an across the board increase of 6,5%, to take effect from July 1 this year, with an additional 0,5% to take effect from January next year.

The three-year agreement made provision for an increase in the consumer price index (CPI) plus 1,25% in the second year — 2013-14 — and CPI plus 1% in the third year. The agreement also provides that a fall in inflation below 5% would serve as a floor, while 10% will serve as a maximum for inflation adjustment, offering protection to both sides.

Imatu general secretary Johan Koen said on Friday the union was pleased with the outcome given the financial and capacity constraints as argued by Salga, as well as the agreed 18% contribution by employers to defined contribution pension funds.

The acceptance of 6,5% across the board was a result of the “very strong case” made by Salga on what it could afford, he said.

Mr Koen said the lack of strike action during the negotiations was not due to “strike fatigue” by the unions, but rather due to that “the parties sat together and we put the issues on the table clearly”.

Mr Manyoni said constraints that had formed a “backdrop” to the negotiations included a “decreasing revenue base, rising debt owed by consumers and an increasing number of municipalities in financial distress”.

Samwu general secretary, Mthandeki Nhlapo, said while the agreement did not represent the “preferred” outcome for the union — given the effect of economic difficulties faced by its members — it had been deemed acceptable.

The positive “exchange of information” leading up to and during the negotiations had narrowed the gaps between parties, allowing for the compromise, he said.

Mr Nhlapo said while signing multiyear agreements was not a position usually taken by the union, the agreement should offer sufficient protection for its members. Both Mr Nhlapo and Mr Koen welcomed the inclusion in the agreement of a provision to fill vacant posts within municipalities, to be discussed at a local labour level.