The trio of unions in wage talks with Eskom have rejected the troubled utility’s offer of a 3.75% wage hike and have demanded the removal of the “toxic” HR boss in the negotiations.

Eskom also stands accused of approaching the talks in a shambolic and unprofessional manner.

The first round of wage talks took place from 19 to 21 April. They will recommence on 8 May, and already things seem to be going pear-shaped. This bodes ill as autumn descends and the power crisis, which has shattered any prospects of economic growth this year, looks set to worsen.

The three unions involved – Solidarity, the National Union of Mineworkers (NUM) and the National Union of Metalworkers of South Africa (Numsa) – said on Friday, 21 April, that they had all rejected Eskom’s offer of a 3.75% wage hike at a time when consumer inflation is 7.1% and interest rates have been rising. 

As we reported earlier this month, NUM has tabled demands for a wage hike of 15% across the board. Solidarity, which mostly represents more highly skilled workers, wants CPI plus 3%.

Potholes on a long road

The yawning gap in the offer and the demands – which is often par for the course in such negotiations – is just one of many potholes on what will likely be a long and winding road to an agreement. 

“Eskom has rejected our demands and further said that the conditions of services must remain unchanged,” the three unions said in a statement. 

Beyond the 15% wage hike, NUM’s list includes increased paternity leave, a once-off R15,000 essential worker allowance, and 10 days of “African Renaissance Leave” – demands that have raised eyebrows among some commentators, including our own Tim Cohen. 

Although the demands may seem unreasonable against the backdrop of Eskom’s precarious finances – which the unions dispute – and perceptions that the SOE’s staff are well off by South African standards,the utility’s management has long been stoking the coals of resentment. 

One thing the unions agree with former group chief executive André de Ruyter is that corruption is rife at Eskom. Based on conversations this correspondent has had with NUM and Solidarity members, it is clear the unions blame this state of affairs on management.

‘Toxic management’

Thulane Ngele, general manager of people relations at Eskom, has clearly pressed some buttons. The unions have demanded he be removed from the bargaining process, describing him as “toxic”. 

“He has no idea what meaningful engagement is, and he is rude, and obnoxious in the manner that he communicates with labour in this forum… Mr Ngele was the reason that workers embarked on protests at Eskom power stations last year, which exacerbated the load shedding crisis,” the unions said. 

This is the first admission by labour that the protests and wildcat strikes at Eskom during wage talks last year worsened the power crisis at that time.

Eskom employees cannot legally strike because their work is deemed essential. But the message is gin clear: management and its actions, according to the unions, are a red rag that is goading workers to cross the line. 

In union eyes, Eskom’s management has not covered itself in glory on other fronts in this year’s negotiations. 

Gideon du Plessis, the head of Solidarity, told Business Maverick that Eskom’s management “is out of its depth… They are completely disorganised and have no idea how to conduct wage negotiations.” 

Du Plessis said that whenever Solidarity enters wage talks with mining companies, they provide a detailed breakdown of their finances and expected earnings to motivate their initial offers. Eskom’s management, however, made its offer with no such explanation and said it would only provide insight into the state of its finances on 8 May when talks resume. 

“The mining industry is one of the industries bearing the brunt of load shedding and I would suggest it offer its expertise to guide Eskom in these talks,” Du Plessis said. 

No attention to detail

Eskom’s internal communications to its workforce regarding the talks have also come under withering union scrutiny. One such message that Business Maverick has seen said Solidarity’s demand was: “CPI plus 3% increase on the average CPI for April 2022 to March 2023 of 7.1%. This means a 10.5% increase…”

No, it actually means a 10.1% increase. That may just be a typo and not appalling maths, but attention to detail is critical in such an important process.

It should come as no surprise that Eskom, which can hardly keep the lights on, may still suffer from poor management

The wage talks at Eskom stand in contrast with what has taken place in the mining sector in the past couple of years, which – with a few notable exceptions such as the strike at Sibanye-Stillwater’s gold operations last year – have gone smoothly by the standards of recent history. Across the platinum belt, five-year wage deals are in place and no tool was downed to reach those agreements. 

Read more in Daily Maverick: 

Eskom Intelligence Files

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The Eskom talks, on the other hand, are similar to what has been taking place in the mining sector in one striking way: unions, even if their demands vary, have presented a united front. Solidarity, NUM and Numsa are three very different unions. Solidarity is far more moderate and is hardly anticapitalist. Numsa is stridently socialist and has left the Coastu grouping that NUM, which also retains a militant edge, still falls under.

That this trio is working together strongly suggests Eskom’s management is not reading the room. Critics may say that the unions are not reading the wider room that is the South African economy. Regardless, the situation is not promising as winter approaches and the lights dim. DM/BM