SALGA and Organised Labour conclude historic Five-Year Salary and Wage Collective Agreement at the SA Local Government Bargaining Council

Posted: 06 September 2024

The South African Local Government Association (SALGA) and Organised Labour represented at the South African Local Government Bargaining Council (SALGBC) have reached a landmark agreement, finalizing salary and wage negotiations with a 6% increase for the current financial year. This Consumer Price Inflation (CPI)-linked agreement spans five years, marking a first in South Africa's public service history.

This unprecedented five-year salary and wage agreement is a historic achievement in both the local government sector and the broader public service. SALGA, representing 257 municipalities nationwide, along with the South African Municipal Workers Union (SAMWU) and the Independent Municipal and Allied Trade Union (IMATU), are committed to ensuring the successful implementation of this agreement.

Key Provisions of the Agreement:

• 2024/25 Financial Year: Employees will receive a 6% salary increase, structured as follows:
  - 4.5% effective from 1 July 2024
  - An additional 1.5% from 1 March 2025
  
• 2025/26 and 2026/27 Financial Years: Salary increases will be set at CPI plus 0.75%.
• 2027/28 and 2028/29 Financial Years: Salary increases will be pegged at CPI plus 1.25%.

This agreement follows intense negotiations, held on 15-19 July 2024, 23-26 July 2024, and 12-15 August 2024 at the SALGBC. The final breakthrough came on 15 August 2024, when the facilitators issued a proposal that all parties accepted as a fair compromise.

The agreement takes into account the challenging economic environment, characterized by high inflation and constrained fiscal resources. It will come into effect on 1 July 2024 and remain in force until 30 June 2029. This deal is expected to provide much-needed stability in the local government sector.

SALGA was mandated by municipalities to negotiate a balanced salary and wage agreement that reflects current economic pressures, particularly in light of several municipalities facing financial distress. As part of the agreement, SALGA also introduced a revamped exemption process, using a set of financial distress indicators from the National Treasury to assist struggling municipalities.

While the agreement has received overwhelming support, all parties now have the responsibility to ensure its implementation and defend its provisions.
SALGA extends its gratitude to member municipalities for entrusting it with the responsibility to negotiate on their behalf, and to the SALGBC and organized labour for their cooperation in prioritizing the interests of local government.

The new salary and wage collective agreement follows the expiration of a three-year wage deal signed in 2021, which provided increases of 3.5% (2021/22), 4.9% (2022/23), and 5.4% (2023/24).