Tshwane mayor Nasiphi Moya has announced the resolution of a 3.5% wage dispute dating back to 2021.
“In September 2021, the South African Local Government Association (Salga), South African Municipal Workers’ Union (Samwu) and Independent Municipal and Allied Trade Union (Imatu) entered into a three-year salary agreement with Tshwane,” she said.
Dispute rooted in exemption battle
“At the time, the city was under severe financial pressure. The previous administration applied for exemption from implementing the 3.5% increase for 2021 and the 5.4% increase for 2023. Those exemption applications were not granted at arbitration.
“The matter proceeded to the Labour Court. The court granted an exemption for 2023 but referred the 2021 increase back to Salga.
“When the 2021 application was reheard, the arbitrator issued a final ruling on 31 October, 2025. That ruling created a binding legal obligation to implement the 3.5% increase backdated to 1 July 2021,” she said.
Phased payment plan agreed
Moya said the immediate lump sum payment would have amounted to nearly R1.6 billion, which would have placed severe pressure on the city’s finances.
“It would have affected commitments to Eskom and other creditors and would have placed our fully funded budget from 1 July, 2026 at risk. This administration inherited both the legal obligation and the financial consequences.
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“We had a choice. We could continue litigation and prolong uncertainty. Or we could accept the ruling in good faith and work with organised labour to structure a responsible solution. We chose resolution,” she said.
Moya said the agreement covers 21 089 employees. It will be paid over three years and calculated from 1 July 2021 on basic salary only, with payments to be staggered from 1 March.
Officials warn of financial trade-offs
Deputy mayor and MMC of finance Eugene Modise said while they deal with the historical debt, workers can still expect their next increases.
“Yes, this was unnecessarily standing costs, we were supposed to pay something like R500 million, now we need to pay between R1.2 and R.5 billion. If we delay it even further, it would amount to R2 billion. Yes, it was a waste, it hurts the purse of the city,” he said.
Modise said the extra interest could have gone to services in the communities, buying equipment, fixing pipes or building a reservoir or substation.
Imatu regional chair Melita Baloyi said it was a milestone to get the confirmation from the mayor that the 3.5% increases across the board will be implemented in March.
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