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Durban - Durban city bosses may resort to robbing Peter to pay Paul to settle the huge wage bill the municipality owes thousands of employees.
The implications of last week’s Labour Court ruling could cause “an administrative nightmare” and, if the situation were handled badly, the municipality and ratepayers would be the biggest casualties, a well placed source warned on Thursday.
The problem goes back several years to when smaller councils were merged to become the Durban Metro. Pay structures and benefits for employees in the north, south, inner west, outer west, south central and north central municipalities were not on a par with those of their counterparts in Durban.
An agreement was then instituted in 2007 when municipal workers were unified under the newly created eThekwini Municipality.
This meant they were all placed on the highest of the five pay structures applicable at the time.
“Some 5 800 employees received increases in their basic salaries in terms of this agreement. If the previous conditions of services were to be reinstated, any salary adjustments paid to those employees from April 2007 based on the metro pay scales, will have to be repaid by the employees,” the source said.
A city manager’s circular dated March 2011, signed by former city manager Michael Sutcliffe, said that should the city revert to the conditions of service that existed before 2007, payments, including annual leave bonuses, night allowances, standby allowances and pension fund contributions by the employer, would have to be recalculated and repaid by the employees.
“The municipality has a statutory obligation to recover all irregular expenditure and is therefore duty-bound to recover the money… arising from the judgment,” the circular said.
The case, brought by the Independent Municipal and Allied Trade Union (Imatu) and the South African Municipal Workers Union (Samwu), involved a divisional agreement about conditions of service that the unions and the city disputed in 2007.
The unions said that, after they signed the agreement, they asked the municipality not to go ahead with its implementation.
This was because they had concerns about the agreement as it dealt with issues that fell outside their permitted scope in terms of the National Bargaining Levels Collective Agreement and involved the removal of benefits.
But the municipality persisted with the agreement. The unions took the matter to court and won in the Labour Court and the Labour Appeal Court.
Samwu regional chairman Madala Nhleko said the municipality had only looked at implications from the side of the employees.
“The employer only speaks about (sic) 5 800 employees who have to repay the council. But, we say no employee will pay anything back. The money that the city owes the remaining 17 000 employees runs to millions.”
Nhleko said the city was complicating the court ruling by saying employees had to repay money and not addressing the fact that thousands of city employees were owed millions.
eThekwini spokesman Thabo Mofokeng said the city would call a press conference next week to clarify the court ruling.
“This is not a simple matter; it needs to be addressed in a mature manner by the municipality and labour,” he said.