Wage Negotiations 2015 (Update 4/2015)

salaryThis is an update on the status of the current wage negotiations.

The parties have been locked in three days of intense discussions and today completed the second round of wage negotiations. At the end of this round, both SALGA and the trade unions revised their positions as follows:

Trade Union Position:

Salary increase:

• A one year agreement;

• 11% across the board salary increase or R2 000.00, whichever is the greater;

• The minimum wage to increase to R7 625.00.

Housing Allowance:

The housing allowance to increase to R1 100.00 and be extended to all employees who are renting, owning houses or paying loans towards a housing bond.

Employees who do not own or rent houses to receive R600.00 per month and the remaining R500.00 is to be deposited into a saving scheme for a maximum of ten years after which, the employer is to withdraw the funds and utilise it to assist the employee to purchase a house.

SALGA’s Position:

Salary increase:

A three year salary and wage agreement which is to be structured as follows:

• Year one: 5, 4 % across the board increase;

• Year two: CPI + 0.25%;

• Year three: CPI + 0.25%.

The minimum wage is to increase to R5 925.00 in year one and thereafter by the same increase as the across the board salary increase.

Medical Aid Benefits:

The current maximum employer contribution (cap) is to be retained, meaning no increase to the maximum medical aid contribution for the next three years.

The parties to the SALGBC must also develop a “special purpose medical aid instrument” to give low income earners access to medical aid benefits.

Pension Fund Benefits:

All new employees will only be allowed into defined contribution pension funds. All employer contributions for such new employees will be capped at a maximum of 18% of basic salary.

Housing Allowance:

SALGA wants to encourage home ownership. However, this must be affordable to municipalities and based on the agreed criteria to qualify for allowances.

SALGA wants parties to investigate and develop a mechanism to assist “Gap Market employees” (employees who do not qualify for RDP housing and are also unable to get approval for a housing bond from a banking institution) to obtain financing to purchase a home.

Service Charter:

SALGA wants the parties to sign a service charter in order to address productivity and corruption in the sector. The service charter must be based on Constitutional values, improving service delivery, promoting good governance and fighting corruption.

Conclusion/Way Forward:

The above represents the position of the negotiating parties at the end of round 2 of the wage negotiations. Another round of negotiations is planned for 26, 27 and 28 May 2015 in Cape Town. It is expected that further concessions may be made at this next round of negotiations.

In the meantime, IMATU will embark on an extensive consultation process with all our members to determine the way forward for the next round of negotiations.

Please note that a more comprehensive report will be circulated in due course to give more detailed feedback on what transpired during this 3 day round of negotiations.

Regions will be updated on a regular basis as this matter progresses.