SA's largest trade union, the National Union of Metalworkers of SA (Numsa) will ask its members in the automotive sector for a new mandate on a 4.5% wage increase offer from manufacturers this week.  

This is a far cry from the one-year 20% wage increase across the board the Numsa is demanding from the Automobile Manufacturers Employers Organisation (AMEO), after its three-year wage agreement came to an end in June.

However, Numsa said it was willing to tone down on the call for 20%, provided AMEO acceded to some of its wide-ranging demands.

Should the parties fail to common ground, any potential disruptions to the sector will have a severe effect on the economy. The automotive sector  contributes more than 7% to the GDP, which contracted by 3.2% in the first quarter of 2019. The National Association of Automobile Manufacturers of SA (Naamsa) said it expected a “flat year” for the sector. 

In June aggregate domestic-vehicle sales fell to 45,939 units from the 46,663 units sold in June 2018, a decline of 724 units or 1.6%, according to Naamsa. 

Numsa's demands include morning, afternoon and night allowances of 10%, 20% and 30%, respectively. It is also demanding an annual bonus increase from 8.33% to 12%, six months’ paid maternity leave and 10 days paid paternity leave, as well as a transport allowance of R5,000 per month.

Numsa also wants clerks, welders, spray painters and metal-finish workers to be paid a 20% allowance. 

On Thursday, Numsa auto and tyre co-ordinator Vusumuzi Mkhungo told Business Day that the talks got under way this week.

“We have laid out the roadmap for these negotiations. The employers are saying their opening position is 4.5% wage increase,” he said.

“We are now reporting back to our members as to what is the attitude of employers and we shall get a fresh mandate from them on the way forward.”

Mkhungo said other meetings between Numsa and AMEO will be scheduled from July 17 to 19.

“That will be the real engagement that will take the wage talks process forward. We hope it will produce outcomes which we can share with the public.”

AMEO could not immediately be reached for comment.  

In 2016, Numsa with 450,000 members — emerged from protracted wage talks with a three-year agreement of a 10% increase for the first year, and 8% for each subsequent year.