The power utility is currently in talks with the National Union of Metalworkers of South Africa (NUMSA), National Union of Mineworkers (NUM), and Solidarity regarding a wage deal. The two biggest unions – NUMSA and NUM – are seeking a 15% wage increase while Solidarity wants a 9.5% increase for its members. Eskom said these salary increases are unaffordable and asked the unions to revise their demands downwards. Eskom spokesperson Sikonathi Mantshantsha highlighted that their employee benefit expenses currently cost the company R33 billion.

With 44,772 employees, it means that Eskom employees receive an average salary package of R737,000 per year. This is significantly higher than most workers in South Africa. Mantshantsha added that unions are also demanding medical aid contributions to 80%, doubling housing and vehicle allowances, and an expansion of the leave system. “Employees are demanding all sorts of things, like increasing previously agreed maternity leave,” he said. Mantshantsha said the unions’ current demands will add an additional 30% to their annual R33 billion employee benefit expenses, which is “clearly unaffordable”.

NUMSA and NUM, however, are sticking to their guns and argue that their pay demands are reasonable and affordable. NUM’s energy sector co-ordinator, Khangela Baloyi said Eskom can afford that amount of money. “This 15% increase is very reasonable, and it is achievable. We have done our calculations, we know how much money Eskom is making, where they are spending the most money and they need to cut their wasteful spending and pay workers a decent wage,” said Baloyi. Commenting on Eskom’s financial woes, NUM’s acting general secretary William Mabapa said the problems were “manufactured” by a management that was failing to do its job. He argued that Eskom is wasting money on things which do not generate money for the company and could be cut. He pointed to Independent Power Producers (IPPs) which he said are paid more for electricity than what Eskom sells it for.

NUMSA, in turn, attacked the ANC government, saying it is “quite disgusting that we have a black government which is a shareholder at Eskom, but African workers at Eskom earn less than white workers for the same job”. Eskom has rejected the unions’ demands and said it was not in a position to table an offer in terms of a percentage increase to basic salary. The Eskom wage negotiations have now reached an impasse and are teetering on the brink of collapse. Mabapa said he was disappointed by the breakdown as he did not expect “a chairman of a company to be controlled by the management of a company”.

Commenting on the current situation, Eskom’s Mantshantsha told MyBroadband the demands placed on the table by the three unions remain totally unaffordable. This, he said, is especially so for a company which is not able to generate enough cashflow to operate independently and is forced to rely on the cash bailouts from the state to maintain its going concern status. “Eskom has requested the unions to revise down their demands ahead of it tabling an offer,” he said.