Eskom power lines. Photo: Henk Kruger/African News Agency (ANA)

Johannesburg - South Africa's National Union of Mineworkers said on Thursday it had signed a three-year wage agreement with state-owned power utility Eskom, applicable from July this year to June 2021.

It said the provisions of the deal, signed in the early hours of the morning, included a 7.5 percent wage increase in year one, 7 percent the following year, and 7 percent in the third.

"The 2018 Eskom wage negotiations have been the most difficult ever in the history of the NUM," the union said in a statement.

"This was caused by the Eskom approach to the wage negotiations when they (initially) tabled a zero percent wage offer in the beginning of this wage negotiations."

Eskom caved in on its initial stance after workers downed tools.

NUM said the electricity company would increase the housing allowance for workers by the consumer price index (CPI) gauge for each year of the wage agreement.

A once-off cash payment of R10,000 after tax for all employees in the Bargaining Forum at Eskom would be made within 48 hours of the signing.

Unions and Eskom agreed that the review of the company's current short-term incentive scheme would be referred for further engagement at the Central Consultative Forum.

 NUM said it was worried that relations between Eskom and unions were not healthy under the company's current Eskom leadership.

"We hope that the industrial relations between the parties will improve and bring stability that is necessary at the power utility," it added.

African News Agency/ANA