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Telkom SA makes headway in union negotiations

August 6, 2013 • Mobile and Telecoms, Southern Africa

Telkom SA Group CEO Sipho Maseko. (Image source: File)

Telkom SA Group CEO Sipho Maseko. (Image source: File)

Telkom South Africa yesterday announced the conclusion of its substantive negotiations with trade unions the Communications Workers Union (CWU), the South African Communications Union (SACU) and Solidarity.

The Company met with SACU to sign the three year labour agreement effectively launching Telkom into the implementation phase of the agreement. SACUs support of the agreement is indicative that the majority of employees are in favour of the agreement.

Telkom believes that the labour agreement signed on with the unions is a means to address and eradicate salary disparities based on race and gender.

“It is encouraging that our employees are willing to support the Company’s initiatives to ensure cost effectiveness and the sustainability of our business. Our determination to close the wage disparities has not gone unnoticed,” says Telkom Group CEO, Mr Sipho Maseko.

The agreement, effective for a three-year period from 1 April 2013 to 31 March 2016, will assist the company on its journey to restoring financial health and ensuring long-term sustainability by eliminating uncertainties over labour costs for the next three years. It will also allow the company to focus on managing its costs and vigorously attend to productivity challenges.

“We appreciate the role that labour has played in facilitating this agreement and note the willingness to work together for the good of our employees and the organisation. We look forward to ongoing engagement with labour to address productivity initiatives and interventions,” he added.

The Company has received written confirmation from Solidarity to proceed with the implementation of the agreement and an official signing ceremony was held recently with CWU.

The company has initiated the implementation process which will entail a special payroll run and the payment of part of the back pay effective from 1 April 2013 by Wednesday, the 7th of August 2013 with the rest being paid out on Friday, the 23rd of August 2013.

The following principles of the agreement will now come into effect over the next three years:

•             The general salary increase will be based on 6% of the market’s 50th percentile as per employee functional area

•             Those employees below the 50th percentile of the market will receive an additional amount added to their total package

•             All employees below the 75th percentile of the market will receive an increase on their total package

•             All employees above the 75th percentile of the market on 31 March 2013 will receive a monthly pensionable once-off amount (no increase in their total package)

•             The standby allowance will increase by 6%

Telkom has undertaken to further engage organised labour if the Consumer Price Index (CPI) moves above 7,5% and remains at that level for a minimum period of six consecutive months during the effective period of this agreement.

Telkom has also undertaken to conduct external salary benchmarking and share the results with the trade unions prior to implementing salary increases in the second and third year. Depending on whether the market 50th percentile reduces or increases, the status quo will either remain or revised values will be applied.

Staff Writer

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