It should be noted that the Facilitator’s Proposal is not binding, all parties to the negations must formally accept the Proposal in order for the Agreement to be recognised. The Facilitator, Mr Moe Ally, presented the following:
- The Salary and Wage Collective Agreement shall begin 1 July 2018 and remain in force until 30 June 2021.
- The Agreement makes provision for an initial across the board wage increase of 7%, effective from 01 July 2018. Local government employees will receive the projected annual Consumer Price Index (CPI) plus 1.5% in the second year of the agreement (2019/20) and a further CPI plus 1.25 % in year three (2020/21). The Salary and Wage Agreement also contains an acceleration clause which stipulates that if the CPI falls below 5%, inflation will be deemed 5% and similarly if the CPI increases beyond 10% then it will be deemed to be 10%.
- Employees who earn a basic salary of R 9 000 or less shall receive a further 0,5% increase with effect from 1 January 2019.
- From 1 July 2018, the minimum wage shall increase to R 7 324.24 per month. With effect from 1 July 2019, the minimum wage will increase by a further 0.5% in addition to the CPI linked increase.
- The housing allowance shall increase by the same percentage as the annual salary and wage increases each year. GAP market employees who earn a basic salary of R 9 000 per month or less, shall receive a non-pensionable allowance of R350 as of 1 July 2018. This non-pensionable allowance will thereafter increase by the same percentage as the annual wage increase for the duration of the agreement.
- The maximum medical aid employer contribution rate shall increase by the same percentage as the annual salary and wage increase.
The parties have agreed to continue negotiations regarding the Retirement Fund Restructuring procedure in a parallel process under the auspices of the bargaining council.
Similarly, the Facilitator’s Proposal acknowledges the commitment of all parties to completing the housing investigation in order to determine an appropriate home owners allowance and improve access to housing for local government employees.
“The negotiators were mindful of the growing financial pressure our members face given the recently introduced VAT and fuel levy increases. While the requirements of our members remain at the forefront of all negotiations, we believe that the parties did make an attempt to balance individual priorities and the sustainable growth and development of the sector,” commented IMATU General Secretary, Johan Koen
Members will be engaged through their respective regional structures in order to establish a mandate going forward. IMATU will need to communicate its acceptance or non-acceptance of the Facilitator’s Proposal by 16 May 2018.