(The Municipality budgeted for increases to its municipal councillors but not for its employees.)

29 September 2023

The Independent Municipal and Allied Trade Union (IMATU) has secured an exemption outcome dismissing the Enoch Mgijima Local Municipality’s Exemption Application.

IMATU welcomes the order that was issued today by the arbitrator appointed by the South African Local Government Bargaining Council (SALGBC). In terms of this order, the Enoch Mgijima Municipality’s application for exemption was dismissed. The municipality was however granted a temporary reprieve until the end of February 2024 to pay the increases for the July 2023 – February 2024 period. Thereafter, the municipality must pay the 5.4% salary increase to its employees on a monthly basis as required by the salary and wage collective agreement.

The Enoch Mgijima Municipality’s submitted an application for exemption from the salary and wage agreement concluded between IMATU and SALGA in 2021. The matter was heard on 22 August 2023 and 12 September 2023 by Adv. Marion Fouche, an arbitrator appointed by the SALGBC together with a financial expert, Mr Krish Kumar, appointed to advise the arbitrator.

IMATU put up a strong case in opposition to the municipality’s exemption application. IMATU demonstrated that, although the municipality was struggling financially, it was able to pay the 5.4% increase to its employees as it had adopted a financial recovery plan and it would receive substantial relief from the Municipal Debt Relief programme. Moreover, the municipality was the author of its financial difficulties by way of mismanagement, inefficient leadership, illegal council resolutions, irregular and reckless spending, paying acting allowances and more. In addition, the rate of debt collection had deteriorated, grants had been overspent, other expenditure increased, and considerable amounts had been spent on a multi-purpose hall, refuse bags, advertising, stationery and fuel.

Bizarrely, the municipality budgeted for 1% increase of councillors salaries and a decrease in staff salaries!!!

The arbitrator agreed with IMATU and found that although the municipality had financial difficulties, a financial recovery plan was adopted and was in the process of being implemented. The municipality should therefore rely on its recovery plan and apply for debt relief from the Municipal Debt Relief Programme. The arbitrator also found it unfair that the municipality in fact budgeted for increases to municipal councillors, but not for its employees.

The arbitrator was further of the view that the payment of salary increases to its employees will not have a critical or undue impact on the municipality’s financial situation, given that assistance can and, if properly managed, come from the financial recovery plan and the municipal debt relief programme. The municipality should therefore review and adjust its budget to prioritise salary, wage and benefits increases to employees in accordance with the Salary and Wage Collective Agreement.

Accordingly, the municipality’s exemption application was dismissed.

This is the third of three exemption applications IMATU has opposed for the 2023/2024 financial year. The exemption application of the City of Tshwane was dismissed on 11 September 2023 and the exemption application of the Newcastly Municipality was dismissed on 22 September 2023.

We include the following quote from Ms Ntsiki Ntlanjeni IMATU’s Regional Chairperson  for the Eastern Cape Province:

“As IMATU, we are very glad that the arbitrator in the Enoch Mgijima Municipality exemption application has ruled in our favour. The municipality was certainly in the wrong when it decided to budget for salary increases to its councillors but not its employees.

We are therefore pleased that the arbitrator has sanctioned the municipality for its unfair conduct towards its employees by dismissing the exemption application. We therefore call upon the municipality to pay the 5.4% increase to our members by the end of February 2024 as per the terms of the exemption outcome.”

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IMATU is the most progressive trade union representing our members in the local government sector. IMATU is a registered trade union striving for social transformation through sustainable local government.  See for more information.