Labour Watch

Labour agenda threatens administration and the economy

Will there be a repeat of SAMWU actions?
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The wage negotiations already underway in the public sector, are but one of four that could pose threats to effective public administration and service delivery and the fragile economy over the coming several months.

 Probably before the negotiations between government and central and provincial public service unions, which opened in September last year, are completed, negotiations in the local government sector will start. Negotiations in the gold and coal mining sectors will also follow over the next six to eight months, with bargaining traditionally always starting a few months before existing agreements run out.

 Multi-year agreements in all four sectors are expiring between now and the end of September of this year:

 ·       The current Public Service Coordinating Bargaining Council wage deal expires at the end of March;

 ·       The gold sector wage deal expires in June;

 ·       The municipal sector’s existing 3-year wage deal expires in July; and

 ·       The coal sector’s new wage deal becomes due at the end of September.

 As the negotiations between government and public sector unions have already proven, there is a high possibility of deadlock in all of these sectors – although the risk is probably higher in the two sectors than in the case of mining.

 The unions rejected government’s latest offer just as negotiations were temporarily suspended for the holiday season in December. The only agreement reached at the time was on employees’ right to select the payment date of an annual 13th cheque.

 On four other union demands, the government responded as follows:

 ·       Demand for a 15% salary increase was met with a initial 5.8% offer with subsequent years’ increases to based on the average projected CPI-rate;

 ·       Demand that employer contribution to medical aid scheme to be increased by 26.5% was met with an 17.6% offer;

 ·       Demand for an extra 10 days family responsibility leave for parents was met with an offer of two additional days; and

 ·       Government insists on a multi-year wage deal while the unions demand a single year deal.

 On demands for an increase of the housing allowance from R900 to R3 000 per month, that salary levels 1 to 3 be compressed into one and level 4 be made an entry level, and for paid maternity leave to increase from four to six months plus two weeks paid paternity leave, the government did not respond.

 Besides the wide gap between the demands of the 16 unions involved claiming to represent 1.3 million civil servants and government’s offers, the power struggles inside the broader trade union movement at the end of last year, could also complicate the process. There is no guarantee that the political alliance of these unions via COSATU will ensure smooth negotiations.

 The new Minister of Finance, Nhlanhla Nene, is on record that he has allowed for a 6.6% increase in the annual wage bill of government over the next three years, representing a huge gap with the 15% demanded.

 The stage seems set for confrontation and strike action that could not only threaten effective public administration, but also cause serious disruption to services like education and health care.

 Local government

 Before the end of January the South African Municipal Workers Union (SAMWU) will be holding its “bargaining conference” to formulate demands for the successor agreement to its existing three year deal ending in July.

 Not only does SAMWU have a reputation of militancy and disruptive or even violent action but it also is in dispute with government over the enactment in December by President Jacob Zuma of the Public Administration Management Act. The act is rejected by the union as unconstitutional and anti-worker.

 Despite being in the ANC-led governing alliance via its affiliation to COSATU, it can be expected that SAMWU will use to the utmost the leverage it has, stemming from the upcoming local government elections of next year.

 It can be expected to drive a hard bargain. In the process there is a strong possibility of the disruption of municipal services in the second half of this year.

 Mining sectors

 But it is especially in the two mining sub-sectors of gold and coal that the tensions and keen competition for members amongst those unions still inside COSATU and those outside it can bedevil negotiations. It might also place new pressure on existing majority union dominance under the present labour relations legislation.

The National Unions of Metal Workers of South Africa (NUMSA), expelled from COSATU last year, is increasingly recruiting and organising in the mining sector where it competes with rivals National Union of Mineworkers (NUM) and the Association of Mineworkers and Construction Union (AMCU).

 Planned restructuring in the mining sector by major mining houses and the anticipated job losses to go with it, will likely also play into the negotiation processes.

 Both the NUM and its rival AMCU, have indicated they will strongly oppose restructuring that leads to job losses.

To this overall scene regarding the four sectors subjected to wage negotiations and the turf wars unleashed by the apparent breakup of COSATU can be added NUMSA’s plans for a new political formation/party to the left of the ANC alliance and the release of the report of the Farlam Commission of enquiry into unrest at the Marikana mine. So too, can the global economic uncertainties and shaky commodities markets.

 It all adds up to a likely very volatile and disruptive labour scene for most of 2016. As illustrated by last year’s five-month-long strike in the platinum sector it has the potential to cause havoc for the economy as a whole.

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by Stef Terblanche

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