File picture: Denis Farrell

If the imminent settlement in the metals and engineering sector was extended to non-parties by Labour Minister Mildred Oliphant, the National Employers’ Association of SA (Neasa) would challenge it in the Labour Court as it had done successfully in the past, the employer body said yesterday.

Court judgment was reserved on July 2 on a similar matter. The court had previously found the extension by Oliphant of the three-year agreement that expired on July 1, thereby giving rise to the current strike, was invalid.

In December 2012, Judge Andre van Niekerk set aside the agreement and gave Oliphant four months to apply her mind to extending it to non-parties, namely Neasa. Within that period, she again gazetted and extended the deal to non-parties.

Gerhard Papenfus, the chief executive of Neasa, described the imminent deal as “suicide”. He said: “We will not be party to the settlement.”

Neasa has offered 8 percent annual increases, subject to an agreement on reducing the entry-level wage.

The Steel and Engineering Industries Federation of Southern Africa (Seifsa) said yesterday it had “reluctantly”, but conditionally, accepted a wage proposal by Oliphant. It insisted that the main agreement be tightened up at the metals and engineering industries bargaining council in order to protect employers from “double dipping”.

This is also known as section 37 of the main agreement and was introduced in 1992 when increases started being offered on actual wages earned and not on the minimums.

A condition for the proposal to be accepted by Seifsa was that the unions agree to an inclusion in the agreement which indicated that matters which would materially affect the cost of employment would not be raised for negotiation at plant or company level.

Kaizer Nyatsumba, the chief executive, said: “Seifsa and its member associations are proponents of collective bargaining and remain implacably opposed to double dipping through two-tier bargaining.”

Another overriding condition by Seifsa is that the offer be accepted by the unions by no later than Friday.

The proposal by Oliphant’s ministerial task team is a three-year agreement. In year one workers on wage rate A will get an 8 percent increase and those on wage rates F, G and H a 10 percent increase. In year two wage rates G and H will get 10 percent and wage rate H will get a 10 percent increase in year three. Wage rate A will receive a 7.5 percent increase in year two and 7 percent in year three.

The talks were facilitated by the ministerial task team and the Commission for Conciliation, Mediation and Arbitration after an earlier deadlock.

The wage proposal was put to the employers and unions on Saturday.

Nyatsumba said Seifsa had held a special council meeting on Monday afternoon and a slim majority agreed to the 10 percent increase subject to the mentioned conditions.

“Our members are bitterly disappointed that they have made numerous concessions, including unaffordable increases that are considerably above inflation and threaten their businesses, but have got nothing in return. Not only will they not go beyond the wage offer brokered by the minister and her team, but they will not budge on section 37.”

He said Seifsa, the majority of whose members were small companies employing fewer than 50 people, was deeply concerned about the damage done to the economy by the current industrial action, and found the unions’ reluctance to compromise very disappointing.

The National Union of Metalworkers of SA has taken the new proposed settlement to its members for a mandate.