Power plays: Eskom employees demonstrate outside the power utility’s head office at Megawatt Park in Sunninghill, Johannesburg, in June. Picture: GREG ROXBURGH
Power plays: Eskom employees demonstrate outside the power utility’s head office at Megawatt Park in Sunninghill, Johannesburg, in June. Picture: GREG ROXBURGH

Eskom and trade unions edged closer on Tuesday to a wage increase agreement after the power utility reviewed the offer it tabled a week ago.

Eskom offered its workers two options which were constructed from its last offer as its final proposal.

Labour unions said they would take the two options back to members for consideration after yet another round of tense wage negotiations.

Solidarity, however, told Business Day it was "happy" with the offer and that it was "within their mandate" from their members.

The union’s spokesman, Deon Reyneke, said its 7,500 members would now choose one of the two options Eskom had tabled.

In the first option, Eskom proposed 7% wage increases for three years, with housing allowance hikes dependent on the inflation rate.

In the second, it offered workers 7.5% in 2018 and 7% in 2019 and 2020. This option does not include the housing allowance offered in the first.

In a statement late on Tuesday, the National Union of Mineworkers (NUM) confirmed the offers had been made.

Although the power utility has made strides towards organised labour’s demands since it first tabled its 0% wage increases a month ago, NUM and the National Union of Metalworkers of SA (Numsa) were not won over on Tuesday.

Deal-breaker

Insiders told Business Day that the deal-breaker was the 12% once-off bonus demand.

A central consultative forum would be convened on Friday to discuss the bonus issue, while talks would reconvene next Friday, they said.

On Tuesday it seemed that the unions had retreated from their 8% wage increase demand and R500 housing allowance. Unlike Solidarity, which has been leaning towards a settlement for the past two weeks, NUM and Numsa seemed ready to stick it out until Eskom caved in on the bonus demand.

The unions are in a bitter rivalry for members at the power utility, with NUM — which has been shedding members in the past eight years — seeking to cement its presence in all the sectors it organises.

NUM is the biggest union at Eskom, followed by Numsa, and it is unlikely either one would agree to a settlement first.

The unions were also under pressure to conclude the talks, with their public pleas to meet Public Enterprises Minister Pravin Gordhan and Finance Minister Nhlanhla Nene failing to gain traction.

Organised labour leaders wanted government leaders to intervene in the difficult talks, which have dragged on for over a month.

Although Nene suggested last week that the unionists would need to show the country how the money for the increases could be sourced from the fiscus, it remained unclear how Eskom would finance the wage increases.

Eskom is due to present its financial results on Monday. Gloomy predictions by energy experts already abound.

Eskom has been in financial disarray for years, following large-scale corrupt activities at the power utility with funds being pillaged as state capture ravaged balance sheets of state-owned enterprises.

The company has debt amounting to R367bn and has been flagged as a risk to the country’s economy.

During the early stages of negotiations, Eskom spokesman Khulu Phasiwe said the company would have to dip into its operations budget to finance the wage increases.

CEO Phakamani Hadebe said Eskom also planned to reduce capital expenditure to meet a savings target of R50bn in the next five years.

However, the company has since stopped commenting on the wage negotiations, with the exception of a brief statement on Tuesday saying the talks were nearing an end.

mahlakoanat@businesslive.co.za