Telkom won't retrench

By Staff Writer for Telkom

Johannesburg, 20 Aug 2009

Telkom's agreement with the Communication Workers Union (CWU) will include a two-year “moratorium on forced retrenchments”.

The company officially signed an agreement with the union yesterday, after protracted wage negotiations and industrial action by the CWU. According to a statement released by the company, the parties agreed to a general salary increase of 7.5%.

The agreement also ensures the company will implement an accelerated process to address salary disparities and that all future increases will be performance-based. “On average, this translates to an 11.22% increase for bargaining unit staff and all adjustments are effective from 1 August 2009,” says Telkom Group CEO Reuben September.

The parties have been at loggerheads over wage negotiations in a year-long dispute. While a settlement was reached last year, the union reignited the discussions a few months ago, unhappy with the implementation of a substantive agreement signed three years ago.

The union has staged various levels of industrial action over the last few weeks, forcing Telkom to agree to the 7.5% demand. “With the support and approval of our board, Telkom has systematically and proactively addressed the matter of salary disparities,” says September.

Telkom's agreement to hold onto staff for at least two years will be a boon to the CWU, which has expressed concerns over retrenchments following Telkom's possible decision to outsource non-core operations.