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The needs of a small group of public sector workers, who have comfortable jobs with stable incomes, do not exceed the needs of millions of South Africans who may be vulnerable in difficult economic times, the Labor Court said in rejecting an application. by the unions to force the government to pay their 2020 wage increases.
Unions expressed shock and anger at Tuesday’s ruling.
Public sector unions lost their attempt to force the government to implement the third round of the 2018 wage deal, which the government said it could not afford.
The ruling is a victory for the government and the National Treasury, who have argued that the salary increase would cost the state an additional R3.2 billion. The wage bill is the single most important item in the budget and one of the reasons Moody’s and Fitch downgraded SA’s credit rating even further to junk last month.
In a harsh ruling against public sector unions, the court ruled that the agreed increase for the third year of the agreement was illegal and dismissed the request for manpower to force the government to implement it.
Finance Minister Tito Mboweni had argued in a cross-application in the case that the salary agreement was “illegal, invalid and unenforceable.”
The court weighed whether “there is a legal justification for paying such a large sum of public money to a relatively small cohort of the South African population,” he said. The court determined that it was common cause that state finances were “in an even more sorry state than before the arrival of Covid 19”.
“In the current circumstances, it does not appear to be fair and equitable to order the government to spend significant and scarce financial resources on employees whose jobs are already secured and salaries have been paid in full, particularly in circumstances where there is an imperative of recovery of the economy for the benefit of millions of vulnerable people.
“For example, the provision of social grants to other South Africans living on the periphery could very well be threatened by such a decision, as well as the need to pay additional significant and critical medical costs caused by the pandemic,” the court said. .
The ruling marks a major setback for the unions, which were locked in meetings Tuesday afternoon about the way forward. The FM understands that they are considering appealing the ruling and is ready to rule on the matter later on Tuesday.
The general secretary of the Democratic Union of Teachers of South Africa, Mugwena Maluleke, who speaks on behalf of the Cosatu unions, said the unions were studying the ruling and had already noticed constitutional problems in the ruling. He said union members were “shocked and angry.”
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