Several months of wage talks at Telkom were brought to an end this afternoon with the signing of a three-year wage deal with Telkom's second-largest union, the South African Communications Union (SACU).
The agreement follows the one reached with the Communication Workers Union (CWU) a few weeks ago and gives Telkom a clear majority, allowing it to implement the offer across the board.
Telkom's group executive for employee relations, Meshack Dlamini, said - when CWU signed the deal - that it would be implemented across the board and benefit 16 800 staff, while only 1 719 employees will not receive an increase for the next three years, but rather once-off payments every month.
Solidarity has not signed the three-year deal, but indicated to Telkom CEO Sipho Maseko that the deal can be implemented although it has reservations. The deal will see Telkom's wage bill grow 6.8% a year.
Maseko says the group hopes to cover the increase in its wage bill through other cost-cutting measures and increased productivity. He could not indicate whether retrenchments would take place in the future. "Anyone who can predict the future takes a big chance."
Telkom has offered voluntary severance and early retirement packages to its staff, a process that is ongoing until August.
The increase will result in some staff gaining a pay rise of more than 6%, and others less than that. Telkom has agreed to engage with unions if inflation moves above 7.5% and remains there for six consecutive months. Inflation is currently at 5.5%.
No mandate
Solidarity and SACU were unhappy with the offer, which they argued, amounts to a wage freeze. The two smaller unions say that, while the disparity should be resolved, this should not come out of the wage hike budget.
SACU president Michael Hare says the wage negotiations had been a rollercoaster, but finally wage disparities had been dealt with, an issue previous CEOs had not tackled. He says the union took a week to test trust in Telkom and is confident the deal will be implemented.
Solidarity spokesman Marius Croucamp has said the offer is a freeze, which amounts to wage cut in real terms, as people will be held to the same level for three years. In year one, 60% of staff will get a real increase, which drops to 40% and then 30% in the final year, he explained.
Hare previously said the effective wage freeze, which will see members losing out in terms of wages in real terms, has angered staff. Some 13 998 of Telkom's bargaining unit employees were unionised as at 30 September 2012.
In a statement, Hare explained, however, that the union did not reach a majority when mandating members on whether to sign the deal or embark on full-blown strike action. As it works on a majority when balloting, it is "obliged to conclude an agreement with Telkom".
Hare adds that Telkom sorted out all its concerns and has unofficially agreed to relook those workers who will have moved up to the 75th percentile and will not qualify for an increase in year three. It is also looking at functional duties of service staff. These were SACU's main concerns.
The company has initiated the implementation process, which will entail a special payroll run and the payment of part of the back pay by Wednesday, with the rest being paid out on 23 August.
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