/ 17 October 2022

Transnet, majority union come to agreement on wage hike

Earlier in May
Photo: (Karel Prinsloo/Bloomberg)

After just over a week of striking, the United Transport & Allied Trade Union (Untu) has signed a three-year wage deal with Transnet.

Untu — which represents 53.9% of the Transnet workforce and is the majority union at the state logistics company — went on strike on 6 October following an impasse in wage talks. A few days later, Untu workers were joined by the South African Transport and Allied Workers Union (Satawu), which has not yet struck a deal with Transnet.

According to a statement issued by Transnet, Untu’s industrial action will end with immediate effect after the union’s members accepted a 6% wage increase in the first year. Untu workers will get a 5.5% increase in the second year and another 6% increase in the third.

Transnet initially offered a 1.5% hike but labour was unwilling to budge from its bold demand for a wage increase of between 12% and 13.5%.

The wage deal accepted by Untu is below what inflation is expected to average in 2022 — about 6.6%. The future increases are, however, above inflation expectations. This will put pressure on the South African Reserve Bank, which aims to keep inflation expectations anchored at 4.5%.

Transnet said its priorities were the immediate clearing of backlogs across its port and rail system, prioritising urgent and time-sensitive cargo and implementing recovery plans, along with industry and its customers.

A number of commentators have warned that protracted industrial action at the state-owned entity would further dent South Africa’s economy.

Satawu deputy general secretary Anele Kiet said the union and Transnet had not yet reached an agreement. Satawu would remain on strike until it received a mandate from its members to accept an offer by Transnet, he said.

“It is unfortunate that members of Untu mandated their union to sign the agreement. Where we are standing, as Satawu, our members are rejecting the offer and, therefore, we will remain on the picketing line.”

Kiet said Satawu was disappointed that Untu had accepted Transnet’s offer, saying members of his union had thought labour was speaking with one voice on the matter.