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Industry settlement rewards NUMSA for violence – binds only 18% of employers in Metal Industry. NEASA continues with lock out of striking union members.




The National Employers’ Association of South Africa (NEASA) is extremely dissatisfied with the settlement that SEIFSA, NUMSA and five other unions entered into to bring a partial end to the Metal Industry strike. Today NUMSA and five other unions announced that they accepted SEIFSA’s wage offer of 10% on the lowest grades for three years, as well as a complete capitulation by SEIFSA in respect of Section 37 which talks to the aspect of two tier bargaining. This is once again an illustration of big business’s eagerness to capitulate to the pressure exerted by trade unions.


By giving in to the pressure from trade unions, SEIFSA is once again letting the Industry down, especially small and medium businesses. It has set a very sombre tone for future negotiations,’ says NEASA Chief Executive Gerhard Papenfus.


NEASA reiterates that this settlement will only serve to further destabilise the Industry.


Through this settlement SEIFSA has agreed to a wage increase of 3,4% above inflation (calculated on the current rate of inflation) for three years. SEIFSA has ‘reluctantly’ agreed to this settlement and admitted that it will inevitable result in ‘massive job losses’. Therefore, how can anyone refer to this settlement as one which will bring stability to the Industry? This is nothing else than an arrangement which will speed up the demise of the Metal Industry, causing worsened unemployment and poverty and therefore socio-economic instability,’ Papenfus said


At the beginning of these negotiations the National Union of Metal Workers of South Africa (NUMSA) pointed out that this Industry had lost 250 000 over the last 5 years. The General Secretary of the Bargaining Council (MEIBC) recently on national television said that the industry lost 700 000 employees. The employment levels in manufacturing is now what it was in 1972. The Metal Industry is on average 40% more expensive than other industries covered by bargaining council agreements.


Whilst everybody agrees that manufacturing in South Africa is in decline, that the Metal and Engineering Industry, a potential major provider of employment, is indeed in a crisis, and unemployment is now at national crisis levels, this agreement does nothing to address this very important factor. Instead, as in the case of previous agreements, this agreement will simply exacerbate the problem,’ says Papenfus.


NEASA is not a signatory to this agreement because of the unsustainable level of the wage increase being agreed upon by SEIFSA and NUMSA, which will cause the Industry to decline even further, and also because the Unions refused to address NEASA’s demands for the creation of a new entry level wage, for newcomers, which is an absolute must for purposes of job creation and the creation of a more flexible dispensation without which the Industry will not prosper. The Federation SEIFSA, who signed this agreement, represents at most 2039 employers, or below 18% (in all likelihood as low as 15%) of employers in the Metal Industry, which comprises between at least 12 000 and 14 000 employers.


It needs to be emphasized that any employer, who is not a member of the SEIFSA employers organisations who signed this agreement, is not bound in any way whatsoever by this settlement agreement. This means that at least 10 000 – 12 000 employers, or more than 80% of the Industry, is unaffected by this agreement’, Papenfus said.


The problem here is that NUMSA sees SEIFSA as weak and a negotiating partner out of which anything can be squeezed. The economy and this Industry is paying a hard price for this arrangement. It has resulted in this Industry, which could and should be a major employment creator, to be a major contributor to rising poverty and inequality,’ says Papenfus.




It is expected that the parties who signed this agreement will approach the Minister of Labour to extend this agreement to parties who did not sign the agreement. In such an event NEASA will petition the Minister not to extend the agreement to non-parties. If she, notwithstanding NEASA’s submissions to her, goes ahead and extend the agreement, NEASA will institute review proceedings in the Labour Court to have it set aside, similar to what NEASA has done with the 2011-14 Metal Industry Agreement.




NEASA’s demands in these negotiations were reduced to the following core demands:-


  • a reduced entry level wage;
  • an improved exemptions policy which will allow for improved flexibility, and
  • an 8% across the board increase.


In view of the fact that unions refused to address NEASA’s demands in these negotiations, NEASA employer members may continue to lock out workers who engaged in the strike. This arrangement will continue until NEASA’s demands are met,’ Papenfus said.


As a result of this NEASA members will not be required to take back members of NUMSA, MEWUSA, UASA, CEPPWAWU and SAEWA. This arrangement will apply until the unions have conceded to NEASA’s demands.


For more information:

Sya van der Walt-Potgieter

Media Liaison


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