Africa’s Biggest Utility Reaches Wage Deal Ending Strike

  • Strike by members of largest union didn’t affect Eskom plants
  • Increases agreed range from 8.5% to 10% in first year

Eskom Holdings Ltd. said it reached a wage pact with unions, ending a strike by members of the largest organization representing workers at the South African state-owned electricity utility that threatened national power cuts.

After negotiations starting in May, the National Union of Mineworkers and Solidarity have agreed to wage increases of 8.5 percent to 10 percent in each year of the two-year agreement, Eskom spokesman Khulu Phasiwe said Friday. The deal, brokered with the assistance of the Commission for Conciliation, Mediation and Arbitration, was reached in the early hours of the morning, he said. Inflation is 6.3 percent.

Eskom, which employs about 42,000 people directly and supplies about 90 percent of power to Africa’s biggest economy, didn’t see any effects on operations from the strike by about 1,500 NUM members this week, Phasiwe said. The law states that work at the utility is an essential service, which means that such actions aren’t allowed. The Labor Court also granted the utility an order against the strike on Aug. 9, a day after the stoppage started.

The deal is “one of the best offers Eskom has made to date, and our members are more than satisfied,” Deon Reyneke, Solidarity’s deputy general secretary for the energy sector, said in an e-mailed statement. “Our members will now be able to get on with their work as usual.”

Agreements Signed

The NUM, which represents about 15,000 members at the utility, and Solidarity unions have signed the agreement. The National Union of Metalworkers of South Africa is still considering the offer, according to Eskom. The increases apply from July, the NUM said in a statement.

Under the agreement reached with the unions, the lowest-paid workers will receive annual increases of 10 percent. A housing allowance will also be increased to 3,000 rand ($224) a month over the next two years, Eskom said.

“It’s a key victory not only for us as a company but also as a nation,” Phasiwe said. “All credit to the unions for making sure that we resolve our differences.”

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