Members of the National Education, Health and Allied Workers Union (Nehawu) have downed tools at Productivity SA since November 13.
This comes after Productivity SA Management stated that the protest was taking place at all the Productivity SA Offices, namely Midrand, Durban and Cape Town.
The decision by Nehawu to embark on strike action follows a series of salary negotiations with the union for the 2023/24 financial year.
The parties reached a deadlock and Nehawu declared a dispute regarding the salary increases for 2023/24.
Nehawu demands 9.5%, which includes a 2% salary increase linked to financial performance in the 2022/23 financial year.
“It should be stated the financial performance of the entity in the 2022/23 financial year resulted in a deficit, therefore the 2% was unaffordable and could not be granted.
“Productivity SA can only afford a 4% salary increase for employees falling within the bargaining unit (salary levels 12 and below), and any salary increase above the 4% will result in the entity incurring a financial deficit (projected at R8m for the financial year ending March 31, 2024) and a negative going-concern status, which may render the board to be trading recklessly and in breach of the Public Finance Management Act (PFMA),” Productivity SA stated.
Despite efforts to find common ground, a deadlock occurred, and the matter was referred to the Commission for Conciliation, Mediation and Arbitration (CCMA) for arbitration, which was not successful.
Productivity SA said that management considered the demand for cost-of-living adjustment salary increase by staff.
“The entity cannot afford the demand of 9.5%, given its funding shortfall. The board had approved a 3.5% salary increase for the 2023/24 financial year for staff on level 13 and above, even though this will increase the budget deficit. The offer of a salary increase is 4% to staff on level 12 and below including gap closure to the qualifying employees.
“Management was negotiating in good faith taking into consideration that the entity could be faced with the going-concern challenges due to the budget deficit,” said Productivity SA in a statement on Wednesday.
The company further stated that it cannot offer salary increases beyond 4% as this may result in it incurring a deficit (projected at R6.1 million) in the 2023/24 financial year, which will impact its going-concern position and render it technically insolvent.
The company said: “Management also respects the right of the staff to protest and is actively engaging in strategies to protect our collective business interests and ensure that operations continue seamlessly, in accordance with Section 64 of the Labour Relations Act.
“To ensure the safety and security of staff, a comprehensive contingency plan is in place. This plan aims to safeguard access to the building for those not participating in the strike.
“It is to be mentioned that, the picketing rules that outline the guidelines and regulations regarding any picketing activities that may occur during the strike have been agreed to and have to be respected by all parties.”
Productivity SA went on to say that is committed to doing everything humanly possible to avoid disruptions in service delivery and also give assurance that there will be a continuation of provision of support services to companies participating in its Business Turnaround and Recovery and Competitiveness Improvement services programmes.