Transnet has reached a three-year wage agreement with the SA Transport and Allied Workers Union (Satawu), offering above-inflation salary increases despite its ongoing financial struggles. The deal, signed late on Wednesday following tense negotiations, will see workers receive a 6% increase in the first and second years, followed by a 5.5% increase in the final year. This amounts to a total wage hike of 17.5% over three years. The agreement includes adjustments to basic salaries, pension contributions, 13th cheque payments, as well as medical aid and housing allowances. Transnet, which reported a R2.2bn loss in its latest financial results, stated that the offer balances employee well-being with the company’s financial stability.
While Satawu welcomed the agreement as a victory for its members, the United National Transport Union (Untu) rejected the deal. Untu had previously demanded a 10% wage increase and sought a one-year agreement rather than the proposed three years. Additional demands from Untu included R2,500 allowances for both housing and medical aid, along with the removal of overtime capping. Untu warned it was prepared to mobilise its members for strike action if its demands were not met. The union expressed concerns that the accepted deal was merely an extension of the previous 2022 agreement and would harm workers financially.
The potential for industrial action poses a risk to Transnet’s recovery, which has already been hindered by financial losses and heavy debt burdens. The company’s monthly interest payments on its R100bn debt amount to R1bn, adding further pressure on its operational stability. With Transnet’s key role in supporting the national economy, analysts have warned that government intervention may be necessary to sustain the company’s financial health. Despite these challenges, Satawu maintains that the agreement represents a crucial step in ensuring job security and stability for Transnet employees.