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Transnet Agrees Wage Deal with Majority Labor Union

Maritime Activity Reports, Inc.

October 18, 2022

© petert2 / Adobe Stock

© petert2 / Adobe Stock

South African state-owned logistics firm Transnet said on Monday it had agreed a three-year wage deal with the union representing the majority of its workers, ending a two-week strike that had hit commodities exports and piled up millions in losses.

"Transnet and the company's majority union United Transport and Allied Trade Union (UNTU) reached a three-year wage agreement today," it said in a statement, adding the deal would bring most of its employees back to work.

UNTU members, who represent more than half of the company's workforce, went on strike on Oct.6, demanding an increase linked to South Africa's year-on-year inflation rate, which was 7.6% in August.

Transnet said it had agreed on a 6% wage increase for the current financial year, a 5.5% raise next year and a further 6% boost in 2024. The deal is effective from April 2022, it said.

"The company's priority in the immediate is clearing any backlogs across the port and rail system – prioritizing urgent and time-sensitive cargo," Transnet said.

UNTU officials were not immediately available for comment.

A spokesperson for the South African Transport and Allied Workers Union (SATAWU) told Reuters the minority union had not yet agreed to a deal with Transnet.

The strike has hobbled Transnet's freight rail and port operations including the Durban harbor, one of Africa's busiest, impacting mineral and agricultural commodity exports.

Last week, the Minerals Council of South Africa said mining companies were losing 815 million rand ($45.27 million) per day in export revenue due to the strike, as major mineral export harbors were operating at between 12% and 30% of their daily averages due to the strike.

The strike also affected the horticulture sector as fruit exporters struggled to send produce to overseas markets.

($1 = 18.0020 rand)

(Reuters - Reporting by Nelson Banya; Editing by Promit Mukherjee, Matthew Lewis and David Evans)