Johannesburg - The threat of disruption in South Africa’s automotive manufacturing industry by a strike in the retail motor industry, including the automotive component manufacturing sector, has been averted.
Jakkie Olivier, the chief executive of the Retail Motor Industry Organisation (RMI), confirmed yesterday that an agreement had been signed for the entire industry with the National Union of Metalworkers of SA (Numsa) on Friday.
Olivier said despite all the demands made by Numsa, the agreement signed was effectively a wage deal in terms of which wages would increase by 7 percent in each year of the three-year agreement.
Numsa’s previous final demand was for a wage increase of 9 percent in the first year of a three-year agreement, with wage hikes of 8 percent in each of the following two years.
Mark Roberts, the convener of Chapter 111 sector, which is the automotive component manufacturers, said wages would increase in this sector by 8.5 percent in the first year, by 8 percent in the second year and by 7.5 percent in the third year of a three-year agreement.
Numsa was not immediately available for comment.
Olivier said the conditions that were part of previous three-year agreements were part of this deal, meaning the industry would have stability for the next three years.
He said the Motor Industry Bargaining Council (Mibco) would submit the agreement to the Minister of Labour to publish in the Government Gazette and extend it to the entire industry.
Effective next year
Olivier said the labour minister had indicated that they needed up to 10 weeks to publish and extend the agreement to the entire industry, which meant it was likely it would become effective early next year.
“It has taken a long time to negotiate the agreement and I’m pleased it has happened without any major disruption or industrial action. The industry can now plan for the next three years,” he said.
Roberts said Numsa had always wanted a mega bargaining council, but the RMI was opposed to it.
Roberts and Olivier confirmed that they had agreed to undertake a research process over the three-year period of the agreement to see if there was a way to align the wage negotiation cycles of the automotive manufacturers and the automotive component sector.
Olivier said the wage agreement for the vehicle original equipment manufacturers (OEMs) was effective from July 1, while the automotive component manufacturers were on a September 1 cycle.
He said if agreement was reached on the alignment of the negotiating cycles, it would prevent the disruptive effect of back-to-back strikes in the automotive industry. In 2013, almost nine weeks of back-to-back strikes resulted in the loss of production of 58 000 vehicles worth about R11.6 billion.
However, Olivier stressed that RMI had not agreed to anything yet but to participate in research to see if it was feasible to align the cycles.
Roberts said automotive component manufacturers could not be faced with a demand for a mega bargaining council each time a new agreement was negotiated but had agreed without any predetermined outcomes to do more comprehensive research on the feasibility of the alignment of the negotiation cycle.
He said if the automotive component manufacturing sector became part of the OEM bargaining forum it would only be a matter of time because the terms and conditions of the agreement reached with the OEMs was forced down on automotive component manufacturers.
“Because of the diversity of the (automotive component manufacturing) industry, we have to decide how to align the bigger one’s without selling out the smaller manufacturers. For the bigger auto component manufacturers it’s a no brainer but not for the smaller guys.”
Roberts said in general the automotive component manufacturers believed it was also important to try and find a way to shorten the bargaining process.
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