NUMSA commemorates the 100 year anniversary of the Russian Revolution

NUMSA to declare a dispute with engineering and steel employers.

18 May 2005, Posted in Press Releases

The National Union of Metalworkers of South Africa [NUMSA] will now declare a dispute with the Steel Engineering Industry Federation of South Africa [SEIFSA] in the second round of wage bargaining round tomorrow 10/05/2005 .

This comes after the employer federation rejected all the union demands and failed to give a wage increase last week. The wage talks determine wages and working conditions of 310 000 workers employed in the engineering and steel industry.

The wage talks hit a snag because employers were not prepared at all to negotiate in good faith, as a result the failure to kick into operation and address wage issues. They started the fight and it is not in the union interest to be defensive. To declare a dispute as early as possible will almost give us a space to mobilise workers for a fight. There is far greater appetite for low wages and negative talks on deregulating the industry. Employers are ultraconservative; they propagate an over-flexible market regime, where they will have the right to weaken the safeguards in the collective agreement.

The wages in the industry are in a sad state of affairs since the increase in petrol price and lower inflation rate. Better wages would lead to better life because workers would be able to purchase local goods and grow the economy. Everyone should know by now that a social wage is essential for long term development in the midst of high poverty and unemployment.

The industry is battling to close the wage gaps between workers and directors. According to research conducted by P-E Corporate Services, South African executives enjoyed higher salary increases than lower-level employees over the past 12 months, stretching the wage gap to its widest in 15 years. They postulate that the trend is likely to increase this year. It is clear that there is no equal distribution of income. Sadly, workers are losing out. Employers continue to be fixated about low wages. They have not realised that low wages is a serious impediment to faster growth and enhanced productivity.

It is unfortunate that SEIFSA blames the strength of the rand for not meeting the wage union demands. It is time that employers must stop whining about the rand and start clawing its way up to contribute more to growth and development of workers. The problem with South African business is that too much time is spent on planning currency scenarios rather than increase the output and growing the local demand. If they cannot get all currency scenarios correct, they retrench workers or reduce wages as means to recover. Workers become sacrificial lambs for wrong planning by business.

It is always questionable as to whether a weak currency can lead stronger sustainable growth and creation of jobs. In 2001, the rand was weak and employers failed to create jobs. They also failed to pay workers better. The truth is all major sectors showed positive export growth in 2004, suggesting that producers have started to adjust to the strong rand. Therefore, to date, historical facts do not compelling evidence that a weaker currency supports stronger growth. We cannot place enormous dependence on a weak currency for survival.

1. Wages and Duration of the agreement:

That the wages increases shall be 12% for the lowest paid and 11% for the highest paid.

The wage parameters shall be set at 6 to 10% for the second year.

Demand a two year wage agreements in the engineering and motor.

2. Employment Security

Notice pay shall be four weeks.

The severance pay shall be 4 weeks for every completed year of service per worker. Furthermore, the benefits pertaining to this severance pay shall be extended to limited duration contract (LDC) workers. With respect to LDCs, staggered termination should be treated as unbroken service for the purposes of severance pay.

Bargaining representatives are tasked with exploring the issue of the viability of Work Security Funds in more detail.

3. Labor Brokers

To close some of the existing gaps in the Main Agreement in particular pertaining to the issue of labor brokers, Section 20 shall be amended as follows:

Section 20 (c) (ad) – in the event of a dispute over the use of labor brokers, each party reserves the right to embark on industrial action.

We further insist that the use of labor brokers in direct production processes must be unequivocally outlawed.

Most importantly we declare that in the long-term, NUMSA’s position that the practice of labor brokering be completely outlawed should be deliberated upon at NEDLAC.

4. Training Demands

Training Conference Resolutions must be endorsed.

The work group consisting of NUMSA, MERSETA and Bargaining Council should be revived.

5. Grading

Grades should be linked to NQF levels

6. Leave pay

Gradually increase leave pay to 20 days after completing one year service.


Employers must adhere and remain committed to the HIV/AIDS Code of Good Practice.

8. Shift Allowance

Increase in afternoon allowance to 10%

10. Integration of house agreement

All house agreement companies must be integrated into the main agreement as a separate schedule.

[For further information please contact Dumisa Ntuli @ 011 689 1700 or 0829737282]