The National Union of Metalworkers of South Africa (Numsa) is calling for a 10% wage increase in the motor sector along with a number of other benefits.
The motor sector comprises more than 300,000 employees across various industries that are represented by the Motor Industries Bargaining Council, including the Fuel Retailers Association, Motor Industry Staff Association, and the Retail Motor Industry Organization.
A sudden 10% wage could thus increase operating costs involved with fuel distribution and vehicle manufacturing, raising questions as to whether these expenses will ultimately be passed on to the consumer.
Cost of living crisis
The industries covered by the motor sector include all aspects of the supply chain, from component manufacturing companies to fuel stations, car dealerships, tyre shops, aftermarket sales, glass-fitment centres, car cleaning, car parts assembly and panel-beating workshops.
Altogether, these industries represent an estimated 306,000 workers, 90,000 of whom are Numsa members.
Numsa spokesperson Phakamile Hlubi-Majola said that the union presented its wage demands during the first round of negotiations with the Motor Industries Bargaining Council, which took place on 10 and 11 April last week, according to BusinessLive.
The renewed push for a wage increase is being done in preparation for the end of a previous agreement signed in November 2022.
That agreement concluded with a three-year plan that saw a 7.5% boost for workers in the first year, with an additional 6% during the second and third years, which is set to end on 31 August.
On top of the new 10% wage hike, the union is also demanding medical aid and insurance for its workers, night shift allowances, transport allowances, and a narrowing of the wage gap.
Hlubi-Majola argued that the demands are a response to the low earnings of its members.
“Our demands are informed by the reality of the negative impact of the cost of living,” she said.
“Research by Stats SA found that about half of the 13 million workers in SA earn below R5,400 a month, meaning most of the earnings are concentrated at the top.”
She stated that many of Numsa’s members struggle to survive on their current income, which barely covers food, rent, electricity, and transport.
Hlubi-Majola cited a study by the Pietermaritzburg Economic Justice and Dignity Group, which found that workers spent as much as 57% of their income on transport and electricity, leading to underspending on necessities like food.
Numsa claims that its demands are reasonable amidst the ongoing cost of living crisis as wages have failed to keep up with the escalating costs of goods and services, pushing many below the breadline.
“While we accept that the CPI is currently at around 3%, an inflation-based increase is unrealistic because our members simply cannot afford to survive on it,” said Hlubi-Majola.
The Motor Industry Staff Association has yet to publicly respond to Numsa’s demands, stating it is still busy with the first round of negotiations.
Where this leaves petrol attendants
A few weeks ago, Minister of Mineral and Petroleum Resources, Gwede Mantashe, indicated that fuel station employee wages may be in the crosshairs of a plan to reduce petrol prices.
“Over the past five years, this component of worker wages has increased cumulatively by 29%,” he said.
“The critical question confronting all of us is maintaining a delicate balancing act between workers’ wages, industry margins, and the impact on the consumer.”
This suggests that attendant wages and station profit margins could be the target of an effort to cut prices, rather than reducing taxes such as the General Fuel Levy.
It’s worth noting that forecourt employee salaries only account for around 3.1% of the retail price of fuel, whereas government taxes and levies contribute up to 30% of the final cost.
Last year, the retail price of petrol went up 5.3c/litre from 285.70c/l to 291.00c/l to reflect the changes in attendant salaries, which means the new hike is likely to raise costs by between 5c and 10c.
It therefore remains to be seen how the government’s Fuel Price Intervention Plan will lower rates for motorists, and if this will negatively impact pump attendants.
If so, it will likely lead to further negotiations from trade unions that could raise margins for station owners, mitigating the efforts to reduce prices.
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