Eskom wage negotiations set to continue next month after unions reject final offer

It’s back to the drawing board again after unions rejected Eskom’s latest offer in wage negotiations.

There will be yet around round of talks between Eskom and its trade unions next month as the parties look to come to an agreement on a suitable pay increase for the 2023/2024 financial year.

‘Progressed relatively well’

Eskom met with National Union of Mineworkers (NUM), National Union of Metalworkers of South Africa (Numsa) and Solidarity at the Centralised Bargaining Forum this week to continue discussions on salary hike for the power utility’s employees.

The negotiations have “progressed relatively well with some significant movements made” since the beginning of the wage talks last month, according to Eskom.

But the unions have refused to accept the utility’s revised and final offer of 5.25%.

“However, all parties reached a settlement on the amendment of the grievance and disciplinary procedures,” the power utility said in a statement on Friday.

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NUM and Numsa are demanding to 11% and 12% wage increase respectively, whilst Solidarity seeks an 9.5% hike.

Although the negotiations are currently deadlocked, Eskom confirmed that the talks will continue in June.

“As a custom, the negotiations take place over three sessions of three-days each, however, this year all parties agreed to hold a fourth round of negotiations on 13 and 14 June with the view that there are prospects of reaching a settlement at the Central Bargaining Forum.

“Eskom is hopeful that it and the labour unions will find each other for the benefit of the company and in the best interest of the country,” the embattled utility added.

‘Struggle to make ends meet’

NUM and Numsa had opened the negotiations with a request for a 15% salary increase, while Solidarity requested for 10.1% when the first round took place from 19 to 21 April.

Eskom initially presented a 3.75% offer at the time, which was later increased to 4.5% during the second round on 8 to 10 May.

Meanwhile, Numsa has indicated that it rejected the latest wage offer “because we feel that Eskom can do better”.

READ MORE: Numsa accuses Eskom of coming to wage talks unprepared

“Food inflation is extremely high, and the cost of fuel and basic goods has skyrocketed. And to make matters worse, the South African Reserve Bank [SARB] has hiked interest rates, which means our members are going to struggle even more to make ends meet,” Numsa general-secretary Irvin Jim said in a statement.

Jim said the union was of the view that workers at Eskom have been subjected to austerity measures for the last three years as the allowances have not changed since 2016/2017.

“Eskom management says that Treasury has promised to fund them, but the funding comes with conditions and that these monies cannot be used to improve wages and benefits of workers at Eskom,” he said.

“What National Treasury should do is to make sure that it allocates enough money so workers can at least have decent wage increase.”

Eskom debt

Eskom, which relies on government bailouts to power the economy, has debt of more than of R420 billion.

The government has since committed to provide the utility with debt relief of R254 billion over three years.

This arrangement includes providing Eskom with advances of R78 billion in 2023/24, R66 billion in 2024/25 and R40 billion in 2025/26.

However, one of the conditions set by National Treasury was that Eskom may not implement remuneration adjustments that “negatively affect its overall financial position and sustainability” over the debt relief period.

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