Engineering sector faces union strike as wage talks deadlock

BATTLE LINES are drawn taut between the National Union of Metalworkers of South Africa (Numsa) and employer organisations after the union resolved to embark on a strike in a fortnight to press for demands in the metals and engineering sector for an 8 percent increase across the board for the first year, and a Consumer Price Index (CPI) + 2 percent improvement factor for the second and third years.

Numsa’s national executive committee is meeting on Sunday to discuss the deadlock with all employer associations in engineering, namely the National Employers Association of South Africa, the Steel and Engineering Industries Federation of South Africa (Seifsa), the SA Engineers and Founders Association and the chief executive of the Metal and Engineering Industries Bargaining Council.

This after talks at the Commission for Conciliation, Mediation and Arbitration deadlocked.

Numsa, which is the largest trade union in the engineering sector, has further warned that if CPI + 2 percent falls below 6 percent, employers must offer 6 percent or reopen negotiations.

Employers have offered a three-year agreement of a 4.4 percent increase for this year, which is based on minimums, and not on the actual rates of pay. They have also offered CPI + 0.5 percent for the second year and CPI + 1 percent for the third year.

The strike will take place on October 5 and will be launched with a national march, Numsa spokesperson Phakamile Hlubi-Majola said in a statement yesterday.

Numsa’s bone of contention is that members sacrificed their wage increases in order to save the engineering sector in light of the Covid-19 pandemic by signing a standstill agreement in 2020.

The agreement meant that workers did not get an increase, but it ensured that their conditions remained the same.

“Employers have benefited from this, but they do not want to give anything back to workers. Instead, their position of refusing to give workers a meaningful increase can only be interpreted as one thing – that they want to give workers a zero increase this year, which is a position that Numsa rejects,” Hlubi-Majola said.

Seifsa acting chief executive Lucio Trentini said employers did not wish to revoke the instinctive response of locking out striking workers without pay, but had limited options as they hoped for a better resolution in the next two weeks.

“The industry is not in good shape. It has been hard for employers to merely keep the doors open and keep employees in employment. This is the last thing we need,” Trentini said.

Of concern to the employers, Trentini said, was that Numsa had declared a dispute with all metal and engineering employers, which would bog down the sector in the event of industrial action.

“The prospect of a looming industrial action does not sell confidence. When foreign direct investment see the possibility of strike action, which can mirror the 2014 action when we had four weeks of close-downs, everyone suffers,” Trentini said.

The wage battle also comes at a time when the steel sector faces a sharp decline in the iron ore price, which has fallen from a record high of $235.55 (R3 485) a ton in May to less than half of that figure – about $90 on Monday – as China has increased stringent new production curbs on steel production to curb pollution.