S. Africa’s Numsa to Meet on Strike Pay Offer Over Next Two Days

The National Union of Metalworkers of South Africa, the country’s biggest labor group, will over the next two days consider a wage proposal to end a three-week strike in the metals and engineering industry.

The Steel and Engineering Industries Federation of Southern Africa, a Johannesburg-based group whose members employ the most workers in the sector, said yesterday it had accepted a Labor Ministry-backed proposal for a 10 percent pay increase a year to low-level earners over three years. The strike by more than 220,000 workers since July 1, which has affected companies including carmakers Toyota Motor Corp. (7203) and General Motors Co. (GM) and beverage-can maker Nampak Ltd. (NPK), has cost the industry 4.8 billion rand ($454 million), Seifsa says.

Seifsa prematurely publicized the announcement of a wage offer before union members had the chance to consider the proposal, Numsa said in an e-mailed statement today.

The union’s executive “condemned the hasty decision taken by Seifsa to publicly communicate the offer to all newsroom wires, without affording the union an opportunity and a right to report back to members,” according to the statement. “We call on Seifsa to hold back and allow members to reflect on the proposed settlement offer.”

Numsa’s executive is discussing the offer and the group will convene a number of “general” meetings in the next two days to seek a mandate from members, according to the statement. The country’s inflation rate was 6.6 percent in May, the highest in five years.

The labor organizations have until the close of business on July 25 to accept the offer, which would see them return to work July 28. The deal requires that future employment issues be negotiated at national rather than company or plant level.

The walkout may lead to a slowdown in economic growth if it isn’t resolved, Reserve Bank Governor Gill Marcus said last week. It comes after a five-month strike by more than 70,000 platinum miners that ended in June, which pushed Africa’s second-largest economy into contraction in the first quarter as mining output plunged.

To contact the reporter on this story: Kamlesh Bhuckory in Johannesburg at kbhuckory@bloomberg.net

To contact the editors responsible for this story: Nasreen Seria at nseria@bloomberg.net Sarah McGregor, Ben Holland

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