Unions score wage goals

2010-07-03 11:57

Trade unions appear to be scoring goals for their members as the

current wage agreements are higher than inflation, which reached 4.6% in May.

Business is concerned about the ­precedent being set by the higher

wage settlements.

But Professor Sakhela Buhlungu from the University of

Johannesburg’s Sociology of Work department, says ­labour is not holding

employers to ransom by ­striking during this period.

“When the workers start striking, they are wrongly described as

immoral and unpatriotic. But when the ­employers come up with excuses to give

labourers lower increases when the economy is down, not many people ­criticise


Buhlungu says this year’s negotiations are ­happening against a

­background of companies splashing out millions on World Cup tickets.

“Eskom, for instance, spent R12 million on World Cup tickets, yet

it is failing to give the workers the increase they want. This raises suspicions

that there is money stashed away but it is not for the benefit of the

employees,” he says.

The Bureau for Economic Research at the ­University of Stellenbosch

forecasts that wage ­settlements will average 9% this year.

The bureau ­believes inflation will be about 6.3% by the end of the


Buhlungu says the wage increases granted so far are lower than the

20% increases company ­executives have been ­giving themselves in recent


Andrew Levy, chief executive of ­Andrew Levy Employment, says

strikes occurring now could turn public opinion against labour.

“But it seems the unions are benefiting by pulling the World Cup

card to ­negotiate for higher increases as some unions have managed to get away

with a double-digit increase,” says Levy.

He says the workers are right to ­demand above-inflation increases

as failure to do so would see their spending power being eroded.

He says it is unfair to compare the fat salaries of directors to

the meagre pay of foot soldiers.

“Directors get paid on performance, scarce skills, supply and

demand of the product or services being offered by their companies,” he


Michael Spicer of Business Leadership SA condemned the current wage

agreements as unsustainable.

“If the public sector continues giving out these high wage

increases, it will lead to budget deficits.”

He says labour and employers have to ­exercise a high level of

responsibility in wage ­negotiations.

“Management should be careful when adjusting their pay so that they

don’t give perceptions that they are offering themselves excessive salary

­increases,” says Spicer.

Rudi Dicks, the chief executive of ­Naledi, the ­research arm of

labour ­federation Cosatu, says ­unions’ right to strike cannot be overridden by

the ­hosting of the World Cup.

Naledi’s figures show that unions ­accepted ­average increases of

7.7% in 2008 while inflation set at 11.5%. Last year, inflation averaged 7.1%

while the workers took a 9.3% salary increase.

Last year’s settlements exclude ­sectors that were in the last year

of their three-year agreement.

An attempt by new union, the South African ­Aviation and Allied

Workers’ Union, to link their industrial action to the World Cup failed this

week. The police oversaw a group of 100 people ­dispersing as the strike failed

to take hold.

The union’s spokesperson, Levy Mhlaba, claimed that Fifa gave

Airports Company South Africa (Acsa) and airport retailers money to pay workers

a bonus for ensuring an incident-free World Cup.

It claimed that not all workers were receiving the bonus.

Acsa spokesperson Solomon Makgale denied any Fifa payment.

“They are talking about an incentive scheme Acsa put in place for

its own ­employees at the airport.”

He said the company had decided to pay a bonus of R800 a week to

people it employed during the World Cup and who were at work during that


Jaco Kleynhans, the spokesperson for trade ­union Solidarity, said

they had avoided industrial action ­during the World Cup as they ­believed their

members would not benefit.

“Strikes ­during the tournament would result in our country getting

bad publicity.”

Kleynhans said the union would ­embark on wage negotiations after

the tournament.

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