MEIBC SETTLEMENT AGREEMENT
Dear Members
The MEIBC Settlement Agreement: 1 July 2014 - 30 June 2017 was signed by all six party trade unions at a Main Agreement Negotiating Plenary meeting yesterday.
SEIFSA signed on behalf of the 24 federated Associations and confirmed that two Associations were still involved in internal mandating processes.
The Border Industries Employers Association (BIEA) representative was not present at the meeting. NEASA did not sign the Settlement Agreement.
The Bargaining Council will, in the next two weeks, convene a Management Committee Meeting to ratify the Settlement Agreement, confirm the position of the two outstanding SEIFSA Associations and adopt a resolution to have the Agreement extended to all non-party employers and employees in the industry.
SEIFSA recommends that the increases be implemented from 1 July 2014 for all scheduled employees who worked during the strike and, in the case of those employees who participated in the strike, from the date of signature of the Settlement Agreement, namely 29 July and/or from the date of their return to work.
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MA Negs 2014 MEIBC Signed Settlement Agreement.pdf | |
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MA Negs 2014 All Wage Tables 2014.pdf | |
Press Release - 2014/07/28: SEIFSA WELCOMES END OF METAL AND ENGINEERING INDUSTRIES STRIKE
Speaking after the end of a special meeting of the Federation’s Council – which is made up of the chairpersons of Associations affiliated to SEIFSA, Mr Nyatsumba expressed relief that employers and labour finally reached an agreement on outstanding matters, particularly on Section 37 which was the major point of difference in the past few weeks.
“We are immensely relieved that the strike is finally over. It is now incumbent on all stakeholders in the metals and engineering sector to work cooperatively together to grow the sector and to ensure that it is internationally competitive. The sector has a very important role to play in the delivery of the Government’s ambitious infrastructure development programme over the next few years, and that can happen only when a strong partnership exists between business and labour,” Mr Nyatsumba said.
He explained that although SEIFSA’s preferred wording on Section 37 was not accepted by the union, the Federation’s Council was satisfied that a compromise wording reached over the weekend would protect companies from two-tier bargaining.
The wording agreed upon reads as follows: “The parties agree that, subject to the full and final settlement clause, Section 37 remains unchanged.
“The 1 July 2014 to 30 June 2017 MEIBC Settlement Agreement amends existing terms and conditions of employment of all employees covered by the Main Agreement and is in full and final settlement of wages and conditions of employment for the period of the agreement.”
Mr Nyatsumba expressed appreciation to Labour Minister Mildred Oliphant and her team for the major role that they had played in brokering the agreement. He said that the Minister and her team had engaged in shuttle diplomacy between the parties, but especially SEIFSA and the National Union of Metalworkers of South Africa.
“We are grateful to Minister Oliphant for the leadership that she showed in this matter. It is no exaggeration to say that, had she and her team not been involved in the process, the strike may well be continuing,” Mr Nyatsumba said.
PRESS RELEASE - 2014/07/23: CONSUMER DATA CONFIRMS SOUTH AFRICAN RESERVE BANK’s FEARS OF INFLATION
Speaking after the release of consumer price index (CPI) figures by Statistics South Africa, Mr Langenhoven said that fiscal policy was either contributing to inflation or, at worse, neutral in containing it, while monetary policy was clearly trying to hold the fort. However, the institutional or administrative leverage over price levels was contributing to inflationary pressures due to the wide impact of electricity and fuel price increases on general inflationary pressures in the economy.
Mr Langenhoven said today’s CPI numbers were a confirmation of the South African Reserve Bank’s motivation to increase interest rates recently. He said the conflicting signals for the optimum policy response with low economic growth, rising inflation, a potential fiscal deficit as well as the precarious shortfall on the balance of payments were not making the options any easier.
“The June figure of 6,6% is high, and may fuel expectations of more to come. This is the key problem facing the Governor of the Reserve Bank – managing inflationary expectations with interest rate increases without stunting domestic growth, all the while keeping an eye on what other central banks are doing. She is, in a sense, trying to engineer a soft take-off of growth rather than a soft landing,” Mr Langenhoven said.
He added that the next producer price inflation numbers will indicate whether or not cost pressures are sustained. He said that the two biggest risks contributing to upward pressure on costs would be the exchange rate weakening (mainly driven by domestic uncertainties) and continued oil price increases driven by events in oil- producing countries.
“We all hope that, on balance, these factors will contribute to a positive outcome of the already-precarious choices the country needs to make, and not worsen it,” Mr Langenhoven said.
PRESS RELEASE - 2014/07/23: EMPLOYERS’ ORGANISATIONS WARN AGAINST DOUBLE DIPPING AND DENOUNCE VIOLENCE ACCOMPANYING THE CURRENT STRIKE
In an unprecedented move, Steel and Engineering Industries Federation of Southern Africa (SEIFSA) Chief Executive Officer Kaizer Nyatsumba and his counterpart at the National Employers Association of South Africa (NEASA), Gerhard Papenfus, expressed grave concerns about recent Labour Court judgments regarding Section 37. They demanded that the section be amended to confirm its original intention, when the clause was introduced into the Main Agreement in 1992, that all matters which could materially add to the cost of employment would be negotiated collectively in the Bargaining Council.
Section 37 protects employers from having to engage in substantive negotiations at plant level, once a deal has been concluded on wages and related conditions of employment at national level.
The two CEOs said that the words that they wanted added into the clause were the ones in bold: "…The Council is the sole forum for negotiating matters contained in the Main Agreement and those related to the cost of employment. During the currency of the agreement, no matter contained in the agreement or which may impact on the cost of employment may be an issue in dispute for the purposes of a strike or lock-out or any conduct in contemplation of a strike or lock-out.”
“SEIFSA and its member Associations are proponents of collective bargaining and remain implacably opposed to double dipping through two-tier bargaining. We believe that the challenge posed by the Van Niekerk judgments require all of us to reconfirm our commitment to collective bargaining by strengthening the original intentions of Section 37,” Mr Nyatsumba said.
NEASA and SEIFSA also strongly condemned the violence that has been perpetrated by some of the employees currently on strike. Mr Papenfus said that while workers’ rights to go on strike were respected, there was absolutely no room for violence.
“We condemn the current violence in the strongest possible terms and call on the police to arrest those perpetrating it and protect those on whom it is visited. We also call on the leadership of the unions to call on their members to desist from violence,” Mr Papenfus said.
“All rights go with responsibilities, and the same applies to the right to strike. Violence and other reprehensible, criminal acts during a strike action cannot be condoned and should be punishable by law,” Mr Nyatsumba said.
PRESS RELEASE - 2014/07/22: SEIFSA ACCEPTS MINISTER'S PROPOSAL ON WAGES BUT NOT ON SECTION 37
At a SEIFSA Special Council meeting yesterday afternoon to discuss a Ministerial Proposal which, was shared with all employers' organisations and trade unions on Saturday, a slim majority of employer Associations affiliated to the Federation agreed to a 10% wage increase for low-level employees over the next three years, on condition that the offer is accepted by the unions not later than Friday, 25 July. An overriding condition for the proposal's acceptance was that the unions agreed to an inclusion of a clause in the Main Agreement which indicated that matters that would materially impact on the cost of employment would not be raised for negotiation at company level.
The conditionally-approved wage offer is 10% for rates F, G and H in 2014, for rates G and H in 2015 and for rate H in 2016, and 8% in 2014, 7,5% in 2015 and 7% in 2016 respectively for rate A.
SEIFSA Chief Executive Officer Kaizer Nyatsumba said that members of the Federation overwhelmingly reiterated their position that they would not sign any settlement agreement until their concerns about recent Labour Court judgments regarding Section 37 were addressed. He said that they wanted the section amended to confirm its original intention, when the clause was introduced into the Main Agreement in 1992, that all matters which could materially add to the cost of employment would be negotiated collectively in the Bargaining Council.
"Our members are bitterly disappointed about the fact that they have made numerous concessions, including offering unaffordable increases that are considerably above inflation and threaten their businesses, but have got absolutely nothing in return. Not only will they not go beyond the wage offer brokered by the Minister and her team, but they will also simply not budge on Section 37," Mr Nyatsumba said.
He said that the high wage increases proposed by the Minister in order to end the current strike in the sector would inevitably lead to “massive job losses” as companies sought to reduce their costs since they could not pass the increases on to their customers.
Mr Nyatsumba said that all that SEIFSA and its members wanted was for the retention of the dispensation that had existed in the past 22 years, since the inclusion of Section 37 into the Main Agreement in 1992 when increases started being offered on the actual wages earned by employees and not on the minimums. Following Judge van Niekerk’s ruling a few months ago that Section 37 covered only those matters that were contained in the Main agreement, SEIFSA wanted the relevant clause amended to make plain its original intention.
Mr Nyatsumba said that the words that SEIFSA wanted added into the clause were the ones in bold: " The Council is the sole forum for negotiating matters contained in the Main Agreement and those related to the cost of employment. During the currency of the agreement, no matter contained in the agreement or which may impact on the cost of employment may be an issue in dispute for the purposes of a strike or lock-out or any conduct in contemplation of a strike or lock-out.”
“SEIFSA and its member Associations are proponents of collective bargaining and remain implacably opposed to double dipping through two-tier bargaining. We believe that the challenge posed by the Van Niekerk judgments require all of us to reconfirm our commitment to collective bargaining by strengthening the original intentions of Section 37,” Mr Nyatsumba said.
He added that SEIFSA members were very disappointed with the violence that accompanied the strike and called on the police to apprehend all those involved in violence and vandalism.
Mr Nyatsumba said SEIFSA, the majority of whose members were small companies employing fewer than 50 people, was deeply concerned about the damage done on the economy by the current industrial action, and found the unions’ reluctance to compromise very disappointing.
PRESS RELEASE - 2014/07/22: SEIFSA CLARIFIES ITS ACCEPTANCE OF THE MINISTER'S PROPOSAL
JOHANNESBURG, 22 JULY 2014 – The Steel and Engineering Industries Federation of Southern Africa (SEIFSA) wishes to clarify that the employers’ acceptance of the Minister’s proposal is conditional upon a resolution of Section 37, and its acceptance by the unions no later than Friday (25 July).
Several social media reports have stated that SEIFSA has accepted the Minister’s proposal unconditionally – this is not true and it is clearly articulated in the press release (issued this morning) that employers have accepted the Minister’s proposal on wages but not on Section 37.
Press Release - 2014/07/18:STUBBORN INFLATION EXPECTATIONS FORCE DIFFICULT DECISION ON INTEREST RATES
Speaking after Reserve Bank Governor Gill Marcus announced that interest rates will increase by 25 basis points to 5.75% , SEIFSA Chief Economist Henk Langenhoven said the Federation concurred with the Governor on the weakness of the economy, but this was no longer enough reason to keep interest rates unchanged.
“The Governor found it very difficult to report positive trends amongst the abundance of data that became available since the last MPC meeting. The domestic economy is deteriorating and international markets for South African exports are recovering at a very slow pace. Metals and engineering production growth fell from 3,5% in April (on a twelve-month basis) to 2% in May,” said Mr Langenhoven.
SEIFSA has previously stated that the sector cannot afford the continuation of the downward spiral in production and profitability. This is made worse by strong upward pressures on costs.
Ms Marcus said that recorded inflation rates in the economy have accelerated and expectations about future price increases have deteriorated. Simultaneously, recent wage settlements in the economy have been spiralling upward and specific settlements in the mining and possibly the metals and engineering sector will worsen this trend.
Mr Langenhoven said that the metals and engineering sector’s experience of these unfavourable economic trends and the impact of the difficult policy decisions is a microcosm of the pain felt in different degrees in the wider economy. However, he remained hopeful that “the self-
PRESS RELEASE - 2014/07/15: SEIFSA HAS EXHAUSTED ITS MANDATE IN THE NEGOTIATIONS
“We have not promised NUMSA to get back to it with a new offer. Instead, we made it clear that we have exhausted our mandate. We also explained, during our meeting with the NUMSA leadership yesterday morning, that the final offer made last week – which was intended to end the strike and to see employees back at work this week – failed to accomplish its goal and has since been withdrawn,” Mr Nyatsumba said.
The conditional final offer, which was rejected publicly by NUMSA on Sunday, was 10% in 2014, 9,5% in 2015 and 9% in 2016. It was made on condition that it would lead to a quick settlement that would see the current damaging industrial action, which has been accompanied by violence in some parts of the country, ended.
Mr Nyatsumba said that SEIFSA has reverted to its previous offer of 10% in 2014 and 9% in 2015 and 2016 respectively, and that no follow-up meetings were scheduled with NUMSA.
For higher-earning artisans on level A, the offer remains 8% in 2014, 7,5% in 2015 and 7% in 2016.
Mr Nyatsumba said that it was not true, therefore, that NUMSA was waiting for SEIFSA to get back to it with a new offer or on any matter.
“The current situation that we find ourselves in is very unfortunate and deeply regrettable. We are deeply concerned about the enormous damage wreaked on the economy by the strike, hence our determination last week to bring it to a speedy end. It is regrettable that our final offer intended to end the strike was not accepted, with the current industrial action continuing to damage our economy,” Mr Nyatsumba said.
He also dismissed as untrue a report in Business Report today that SEIFSA “had said that it would return for a mandate” on plant-level negotiations and labour broking. He said that SEIFSA would have explained this to the reporter if he had bothered to check with the Federation.
“We have made a number of important concessions in these negotiations, but our positions on both matters have never once changed. We have indicated all along that we would not be able to sign any agreement that did not protect employers from the threat of double dipping, with matters which impact on the total cost of employment negotiated both at national level through collective bargaining and subsequently at plant level. It remains critically important for us that we reach a mutually-acceptable agreement on Section 37 of the Main Agreement.
“Secondly, we have indicated throughout the negotiations that labour brokers were a matter for labour to raise with the Government, and not with employers,” Mr Nyatsumba said.
Press Release - 2014/07/16: SEIFSA TURNS ITS FOCUS TO OFFICIAL DISCUSSIONS WITH ALL STAKEHOLDERS WITHIN THE BARGAINING COUNCIL
Mr Nyatsumba said that at its meeting in Johannesburg yesterday afternoon, the SEIFSA Council resolved that SEIFSA should continue to seek for a settlement to the current impasse through formal MEIBC structures in discussion with all trade unions active in the sector. The Federation will also continue to work with the other employer bodies.
The Council – which represents the leadership of the various employer Associations affiliated to SEIFSA – expressed great disappointment at the fact that a very good offer made to the National Union of Metalworkers of South Africa (NUMSA) last week, in an attempt to end the current strike as soon as possible, was rejected. The Council felt that the Federation had spent a considerable amount of time in talks with the leadership of NUMSA and had absolutely nothing to show for it.
That offer has since been withdrawn. Instead, SEIFSA’s current offer on the table is 10% in 2014, 9% in 2015 and 8% in 2016 respectively for Rate H workers, and 8% in 2014, 7,5% in 2015 and 7% in 2016 respectively for Rate A workers.
While it remains very concerned about the damage wreaked on the economy by the current industrial action, the SEIFSA Council has now accepted reluctantly that NUMSA appeared determined to continue with the strike indefinitely. The Council stressed the need for a reasonable, three-year wage settlement that would give the sector an opportunity to focus on business during this period, without worrying about the possibility of wage-related strikes each year.
“Regrettably, our genuine efforts to bring the strike to an end as soon as possible were not successful. We have now decided to work with all stakeholders within the Bargaining Council in the hope of securing an agreement. We welcome the fact that the MEIBC has scheduled a facilitated plenary session to take place this week,” Mr Nyatsumba said.
He said that the strike, which cost the country more than R300 million per day in the metals and engineering sector alone, now inflicted even more damage to the economy because it has since affected other related sectors like auto manufacturing.
Press Release - 2014/07/13:SEIFSA DEEPLY DISAPPOINTED AT NUMSA'S REJECTION OF ITS VERY GOOD FINAL OFFER
Mr Nyatsumba said that it was deeply regrettable that the union had rejected a "very good final offer" that was intended to end the strike, and which was made following a meeting with the leadership of NUMSA, which had indicated that it believed the offer could end the strike.
"We have now done everything that we could possibly have done to end the strike and we deeply regret the fact that all our efforts have been in vain. It is very unfortunate that a strike which has already caused much damage to our economy appears set to continue indefinitely," Mr Nyatsumba said.
He said that NUMSA had scheduled a meeting with the SEIFSA leadership for tomorrow morning, where it would officially communicate its response to the Federation's offer. Mr Nyatsumba said that it was unfortunate that SEIFSA first heard about NUMSA's response to its final offer through the media.
Mr Nyatsumba thanked the SEIFSA Council for the clear mandate that it had given him and the SEIFSA negotiating team, but expressed regret that the final offer approved by the vast majority of employer Associations affiliated to SEIFSA had been rejected by NUMSA.
Mr Nyatsumba also expressed SEIFSA's thanks and appreciation to Labour Minister Mildred Oliphant and her team for their efforts in brokering a settlement between the Federation and NUMSA.
He said that the SEIFSA leadership had made the best possible offer that it could have made to end the strike and had now exhausted its mandate.