“While we submitted our acceptance of the Facilitator’s Proposal today, our acceptance is in principle, and subject to all parties accepting the Proposal. In addition, our acceptance is subject to parties convening a technical working group to craft a mutually acceptable salary and wage collective agreement. If the Facilitator’s Proposal is not accepted by all the parties, IMATU will withdraw its acceptance and revert to its position prior to the Proposal,” explained IMATU General Secretary, Johan Koen.
The Facilitator’s Proposal makes provision for a three year agreement with an initial across the board wage increase of 7% effective from 01 July 2015. Local government employees will receive the average annual Consumer Price Index (CPI) plus 1% in both year two (2016/17) and in year three (2017/18). The 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%. This effectively means that workers are guaranteed a minimum salary increase of 6% in years two and three.
All new employees will become members of defined contribution pension funds with an employer contribution of 18% of basic salary. Parties agreed to increase the maximum employer contribution rate to an employee’s medical aid to R3 871, with this maximum contribution being increased by 50% of the percentage increase in year two and 25% of the percentage increase in year three.
IMATU has, for a number of years, pushed aggressively for improvements to the local government housing allowance which has proved dismally inadequate in promoting home ownership amongst our members. IMATU is therefore pleased to see that a way forward in this regard has been included in the Facilitator’s Proposal.
“With effect from 1 July 2015, the home owner allowance will increase to R700 per month. This amount will increase annually, for the duration of the agreement, by the average CPI percentage,” said Koen.
The Facilitator’s Proposal recognises that extending the home owners allowance to as many employees as possible, is a long term process. Some employees do not qualify for government housing assistance yet earn ‘too little’ to qualify for bond approval through commercial institutions, thus creating a ‘gap market’. A working group shall be established to determine an appropriate allowance for ‘gap market’ employees. In the interim, such employees will be paid a R350 monthly allowance.
“IMATU’s acceptance of the Proposal represents the collective mandate received from all our Regions following extensive consultations with our members. IMATU and the South African Local Government Association (SALGA) have accepted the Facilitator’s Proposal. The response from the other trade union in this bargaining process is still outstanding,” concluded Koen.
This Proposal is not yet binding until all parties have formally accepted. Members will be kept updated once responses from all the parties have been submitted to the Bargaining Council.