Numsa won’t budge on 20% demand in auto wage talks | Fin24

• The National Union of Metalworkers of South Africa is demanding a 20% increase in a one-year deal at the auto sector wage talks.
• The Automobile Manufacturers Association is offering a three-year CPI based deal with increases ranging between 4.7% and 6.2%.
• Numsa secretary general Irvin Jim said the 20% across the board increase demand warranted serious consideration, given the rising cost of living.
• Get the biggest business stories emailed to you every weekday or go to the Fin24 front page.

National Union of Metalworkers of South Africa (Numsa) general secretary Irvin Jim said the union will not budge from its 20% wage increase demand in the ongoing auto sector wage negotiations, as workers in the sector have had little protection from rising costs.

The broader automotive sector is under pressure, after its contribution to South Africa’s GDP fell from 6.4% in 2019 to 4.9% in 2020, with 2.8% coming from manufacturing and 2.1% coming from retail. That said, it is still the largest manufacturing sector of the South African economy, contributing 18.7% in value addition to domestic manufacturing output.

The auto sector wage talks – which include vehicle manufacturers – have run at the same time as motor components wage negotiations. Separate wage negotiations are also underway in the motor sector.

In the auto sector the Automobile Manufacturers Association (AMEO) represents car companies like Mercedez Benz, BMW, Nissan, Toyota and Volkswagen.

In the motor sector dealerships, petrol stations and and panel beaters are represented by the Fuel Retail Association (FRA) and the Retail Motor Industry Organisation (RMI). Numsa is a prominent union at both wage negotiations.

Numsa is demanding a one-year agreement including a 20% wage increase across the board, 100% payment during short-time and layoff, and the movement of workers at level 4 of the wage scale to level 5. The union is negotiating with AMEO under the auspices of the National Bargaining Forum (NBF).

READ | Numsa wants double-digit increase in auto wage talks – even if it means a strike

Jim said workers in the sector were resigning early in order to claim from their pension packages, warning this was a sign that workers in the sector are in serious financial distress.

“After reaping massive profits, AMEO is proposing a three-year agreement based on CPI. They are proposing 6.2% in year one, 5.6% in year two, and 4.7% in year three of the agreement,” said Jim.

Jim cited the Household Affordability Index by the Pietermaritzburg Economic Justice and Dignity, which showed that food prices in April 2022 are about 8.2% more costly than they were in 2021. 

“Our members made sacrifices and supported the sector during the worst period in recent human history. It is outrageous that employers are giving inflation-based increases when workers are responsible for making executives extremely wealthy,” he said.

AMEO told Fin24 that it was not commenting on negotiations at this stage. 

READ | Tensions mount in motor sector as wage battle looms

Numsa spokesperson Phakamile Hlubi-Majola told Fin24 that the union’s next meetings with AMEO would take place from Monday to Wednesday next week. She said there had been no new developments in the talks since late July.

Meanwhile, in separate wage negotiations, Numsa continues to demand a 12% across the board, an overtime rate in line with the Basic Conditions of Employment Act, alignment of the wage negotiations calendar with the auto sector, amongst other things.

At these talks FRA made a 4% wage increase offer while RMI said it “tabled a wage offer to NUMSA which is aligned to inflation forecasts for the intended three-year period of the collective agreement”.