The SA Transport and Allied Workers Union (Satawu) is threatening to paralyse Transnet when all its 21,000 members down tools on Monday over a wage dispute at the state-owned transport and logistics group, unless a last-minute deal is struck.
The two major unions, Satawu and the United National Transport Union (Untu), have declared a dispute over salary increases, rejecting an initial 1.5% offer and a revised one of 4% to plunge Transnet into industrial action that could have serious repercussions for the economy.
The operator of the country’s freight rail network and ports is scrambling to avert a full-blown strike and has declared a force majeure at its ports as attempts to avert strike action failed.
It is the second time this year that Transnet is declaring force majeure over operational difficulties.
As a full-blown strike seems unavoidable at this stage, it warned a strike would have a serious affect on the economy, and implored the unions to reconsider. Fruit exporters have pleaded with the government to intervene as a strike would halt exports and put thousands of jobs on the line.
On Monday, the parties will meet at the Commission for Conciliation Mediation and Arbitration (CCMA), which has been brought in to try to broker a solution through meditation.
The unions have rejected Transnet’s revised wage offer, describing it as “ridiculously low and below inflation”. Satawu said though it was still open for discussions, it would not accept anything below two digits.
In an interview with Business Times, the union's secretary-general Jack Mazibuko said Monday's industrial action would see all its 21,000 members down tools, including security personnel, freight train drivers and port operators. Transnet has 52,000 employees.
“We have served Transnet with a 48-hour notice of our intention to strike, and our strike starts Monday. The company requested a meeting with us last Tuesday where they tabled their so-called revised offer of 4%. This offer is divided into two — a 3% across the board increase and one percent in the form of a lump sum equivalent to R7,600. We took this offer to our members for a mandate but it was strongly rejected and that's why we are here now, " said Mazibuko in a telephonic interview.
“All employees at Transnet Freight Rail, including all ports in the country, security, pipelines, train drivers, operations — in fact all our 21,000-strong membership — will be on strike come Monday,” Mazibuko said.
He said Satawu received a letter from the CCMA requesting a meeting to try to find a solution and avert the strike which will also severely disrupt key mineral exports.
“We will be attending that meeting, but we want to remind the CCMA that they don’t have the power to take away workers' rights to embark on a strike. We are asking for 13.5%, but we are prepared to accept from 10% — not anything below double-digit, no,” said Mazibuko emphatically.
All employees at Transnet Freight Rail, including all ports in the country, security, pipelines, train drivers, operations — in fact all our 21,000-strong membership — will be on strike come Monday
Transnet has said the strike is illegal but Satawu disputes this, saying it was protected and all members should join. Mazibuko said they were aware of the importance of Transnet to the country's economy, but current harsh economic times and “employer’s intransigence” have forced them to take a stand.
“Unfortunately, we didn't want to go this route, but we have no choice,” he said.
Cobus van Vuuren, general secretary of Untu, which started its industrial action on Thursday, said Transnet’s 4% offer was far below inflation at 7.6%.
''The company’s offer is not aligned with the mandate that was given to us by our members. The strike is on. Transnet has consistently refused to accept our picketing rules despite our numerous efforts asking them to engage us on the matter. The employer is applying delaying tactics as these wage negotiations started last year in November, and to date nothing has happened.”
Speaking at the Mining Indaba in Johannesburg, group CEO Portia Derby said they were hoping to reach an agreement with the unions “without us having to buckle”.
Transnet's rail and port facilities are crucial for exporting the country's bulk commodity exports such as coal, iron ore, chrome and manganese. Exporters of agricultural products also rely heavily on efficient rail networks and ports, but Transnet has been operating below capacity for years as it grapples with a shortage of locomotives, cable theft, vandalism, poor maintenance, and outdated and slow port infrastructure.
Industry experts said another strike would add to the damage suffered by the economy in April when killer floods hit KwaZulu-Natal, destroying rail infrastructure and disrupting operations at harbours. Current logistical constrains at Transnet are expected to cost the country's mining industry R50bn in lost opportunities this year alone. This week the Mining Council lambasted Transnet for yet another disruption to the economy. Roger Baxter, CEO of the council, said the poor performance of Transnet was as bad as load-shedding in terms of economic impact.
An organisation representing berry producers said with the strike occurring during the peak berry export season, it means “every single day of ports not operating will have a significant knock-on effect on the entire berry value chain, putting 30,000 livelihoods at risk as well as millions of rand in export revenue.
BerriesZA said the industry was already hit by ongoing operational issues at ports because of ageing infrastructure, inefficient systems and staff shortages.
“Compounding this problem is a surge in input costs for farmers, including hikes in fertiliser and fuel prices as well as soaring freight rates. As a result, more than a third of local berry producers are not profitable, which means their survival and the livelihoods they support are under severe threat.
“The latest strike action could be the final nail in the coffin for berry farmers who fill a critical gap in the labour sector, due to their harvest season running from September to November before the early stone fruit and table grape harvest season commence,” said BerriesZA chair Justin Mudge.
The organisation has written to Transnet executives requesting a meeting to discuss contingency plans that can be put in place to ensure the continued movement of berries through the ports, and to ministers in the economics cluster to ask for intervention to end the strike.
Prof Raymond Parsons of the North West University Business School said the Transnet strike and subsequent force majeure declaration were another setback for an economy struggling to maintain momentum.
''Transnet must avoid becoming another Eskom. Before the strike, mining had already lost R50bn in revenue so far this year, so the overall impact of the strike on the economy will now escalate those costs at a time when business is battling to contain cost inflation. And if SA's ports are unable to operate efficiently, it instead strengthens the competitive position of Mozambican ports as providing reliable facilities,” Parsons said.
Transnet said “any strike action taking place presently is illegal and unprotected”.
It believes its revised offer is reasonable and fair, and deserves serious consideration given the company's current operational and financial performance. The company vowed to implement contingency plans to contain the damage.
“In the event of mass industrial action, contingency plans will be implemented, and the company will do all in its power to ensure the safety of personnel and facilities. Staff have also been informed that the principle of no work, no pay shall be enforced,” the entity said in a statement.
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