More than 220 000 National Union of Metalworkers of South Africa (Numsa) members would embark on indefinite industrial action in the metals and engineering sector from July 1, while the union has also warned of a possible strike at power utility Eskom.

Numsa was demanding a one-year bargaining agreement with a wage increase of 12% in the metals and engineering sector.

Negotiations under the auspices of the Metal and Engineering Industries Bargaining Council (MEIBC) started three months ago and, upon reaching a deadlock during the last round of the negotiations, an independent facilitator was appointed to mediate, to assist the parties in reaching a settlement, Numsa explained in a statement.

However, the negotiations had reached a deadlock on Wednesday.

The employers’ latest three-year wage settlement offer comprised a 7% all-inclusive, cost-of-employment increase in 2014 and a consumer price index- (CPI-) aligned increase in 2015 and 2016 for Rate A employees and an 8% all-inclusive, cost-of-employment increase in 2014 and a CPI + 1% increase in 2015 and 2016 for Rate H employees.

“It has never been in our agenda to call a strike; this strike has been imposed on us. Our [agenda] is to use the strike as part of a tactic to exert organisational pressure [on] the bosses to return to the table and present an offer acceptable to our members,” the Numsa national executive committee said.

Meanwhile, Reuters quoted Communications Minister Faith Muthambi as saying that government would "talk to all sides" to prevent a strike in this sector, which would further weaken the country’s economy.

The Minister made this statement during a post-Cabinet briefing on Thursday, only days after a wage agreement had been signed between platinum producers Anglo American Platinum, Impala Platinum and Lonmin and the Association of Mineworkers and Construction Union, ending a five-month-long strike that had taken a toll on South Africa’s economy.

"We are going to support all the affected parties to make sure this strike doesn’t take place," Muthambi said.

Steel and Engineering Industries Federation of Southern Africa (Seifsa) CEO Kaizer Nyatsumba said in a statement on Thursday that the organisation welcomed government’s concerns about the possible strike in the metals and engineering sector.

He added that employers remained very concerned about the strike threats and hoped that, even at this late stage, Numsa would reconsider its decision.

“We have done everything reasonably possible to ensure that negotiations are concluded successfully in our sector, without the need for anybody to resort to industrial action.

“We have twice made good wage offers to the unions, with our last offer being a very good one. Regrettably, we are left with no option but to conclude reluctantly that the unions were always intent on embarking on a strike at the end of the negotiations process as a show of force,” Nyatsumba commented.

Business Unity South Africa (Busa) also noted that it was extremely concerned about the possibility of another strike, adding that it believed more innovate ways had to be developed to deal with employer–employee relations, given weak economic growth and high unemployment.

"Our country is at a T-Junction and ongoing disruptions to the economy will take us to a precipice. We urge all stakeholders to look for new tools to address the real issues we have as a nation. We, thus, urge employer and worker representatives to meet and reach a workable compromise that will avoid further jolts to the economy," Busa said.

South African Chamber of Commerce and Industry CEO Neren Rau called on Numsa to delay the industrial action.

"If Numsa is truly committed to cooperation with government and gusiness to work towards a more prosperous South Africa, then it should return to the negotiating table and not put South Africa’s economic stability at risk. This is especially pertinent given the severe economic impact of the prolonged platinum strike. A review of the industrial relations framework is also necessary to find ways to balance the rights of workers and the broader economy," he commented.

Rau further pointed out that the country had less than six months to convince credit rating agencies of its stability as an investment destination. "The strike by the metalworkers will effectively erase the opportunity for South Africa to redeem itself and government bonds will most certainly be downgraded. This will, in turn, lead to higher cost of credit for the entire economy, from large corporate bonds to consumer credit," he warned.

However, Numsa argued that it had not taken the decision to strike lightly as the “no work – no pay” principle would apply.

In addition to the wage increase, Numsa also demanded the scrapping of the use of labour brokers, that wage negotiations had to benefit all workers irrespective of whether they were salaried or wage earners, the extension of the scope of the main agreement and the removal of the short-time and layoff clauses from the main agreement.

The union had scheduled various marches and plant-based protests for July 1, and was calling on all workers, the unemployed in working class communities and “other progressive organisations” to stand in solidarity with the metals and engineering workers in the “common struggle for a living wage and decent life”.

Nyatsumba stressed that Seifsa remained available to engage with the unions at any time in an effort to avert a strike or to bring it to a speedy end.

“I plead that we work together to preserve jobs and to grow the metals and engineering sector in South Africa. Let us give those companies that continue to operate in the metals and engineering sector an opportunity to survive and fight another day in this ultra-competitive, low-margin environment. Let us preserve our cherished jobs. Let us give our economy a fighting chance,” he said.

Busa also urged Numsa to participate in stakeholder engagements on the critical issues facing the country to find sustainable growth-promoting solutions to employer–employee relationships.

Meanwhile, trade union Solidarity also called on the MEIBC and other trade unions in the bargaining unit to extend the dispute round of the negotiations by 21 days.

The union’s request to the MEIBC to extend the dispute round is based on Section 64(1)(a) of the amended Labour Relations Act, which provides that a trade union and a bargaining council may agree to extend negotiations to avoid a strike.

“With this request, Solidarity wants to prevent its members from being subjected to a lockout by the employer if other trade unions should go on strike,” said Solidarity general secretary Gideon du Plessis. 

He further pointed out that the unions opposed the employers’ current offer, as the impact of a clause on existing employees needed further investigation.

This clause, which proposes that the minimum salary payable to new entry-level employees be halved, could lead to instability within the industry and give radical unions an opportunity to sow unrest, Solidarity warned.

“The trade unions have unanimously agreed to reject the employers’ offer, pending reconsideration of the provisions on the minimum salary payable to entry-level employees,” said Du Plessis.