Recommendation of 3.5% increase in municipal wage could take talks 'to next level'

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It has been recommended that employees be given an increase of 3.5% effective from July and a once-off non-pensionable allowance for some categories of employees.
It has been recommended that employees be given an increase of 3.5% effective from July and a once-off non-pensionable allowance for some categories of employees.
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  • A conciliator's recommendation of a 3.5% wage increase for municipal workers has been hailed a significant step forward towards a deal.
  • The turn in local government wage talks come as local government audit outcomes by the Auditor-General continue to suffer.
  • Salga said it would advocate for a multiyear agreement and "inflation-linked increases" that take cost containment into consideration.

A conciliator's recommendation of a 3.5% wage increase for municipal workers has been hailed a significant step forward towards a deal by the South African Local Government Association (Salga). 

The conciliator last week recommended at the South African Local Government Bargaining Council that employees be given the increase effective from July and a once-off non-pensionable allowance for some categories of employees.

The turn in local government wage talks come as local government audit outcomes by the Auditor-General continue to suffer, and international sovereign credit rating agency Moody's downgraded several metropolitan municipalities last month.

In July, when the local government wage talks were expected to be concluded with a deal, negotiations took an adversarial turn, with unions rejecting a 2.8% wage increase as "peanuts", which triggered a dispute.

The wage talks went into arbitration that month with closed virtual hearings being held in Durban. At the time, the South African Municipal Workers' Union (Samwu) demanded a R4 000 salary increase across the board and a sectoral minimum wage of R15 000.

The bargaining council had proposed a three-year wage agreement, with a 4% salary increase in the first year and with projected CPI minus 1% in the outer years.  

Salga said in a statement on Monday that regardless of whether parties accept the new recommendations, this would now take the process to the next level.

"The conciliator's proposal in the main calls for all employees to receive an increase of 3.5% with effect from 1 July 2021, and for different categories of employees, to receive an additional once-off non-pensionable cash allowance," said the statement.

Salga said it would advocate for a multiyear agreement and "inflation-linked increases" which take into consideration cost containment measures in areas around employee costs in municipalities.

"Parties are expected to make submissions to the bargaining council not later than 23 August 2021 and the conciliation process has now been extended until 31 August 2021. Pursuant to the recommendations, Salga has commenced with the process of consultations and will in due course submit its final position," the statement said.

Samwu spokesperson Papikie Mohale told Fin24 that the union's national executive committee (NEC) met to discuss the latest developments at the bargaining council and would determine a way forward soon.

"We have also received the report, we held a special NEC last week which resolved that we should go back to members with the report. We are meeting again on the 25 to consolidate the mandate from workers," said Mohale.

Salga said it expected the recommendation to "cement labour relations", allow municipalities to continue the fight against the Covid-19 pandemic, achieve financial the financial recovery and improve service delivery.

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