The National Union of Metalworkers of South Africa (Numsa) says it has served steelmaker ArcelorMittal South Africa (AMSA) with a 48-hour notice to strike after the union rejected AMSA’s wage increase offer.

Numsa intends to start the strike at AMSA’s Vanderbijlpark, Pretoria and Newcastle operations at 08:00 on May 11.

Numsa’s core demands are a 10% increase in wages across the board, a housing allowance, for AMSA to contribute 80% towards employees’ medical aid premiums and the scrapping of labour brokers and the insourcing of temporary employees.

AMSA is offering an increase of 5% across the board and 2% of employees’ salaries in cash as a monthly amount.

AMSA CEO Kobus Verster says the timing of the strike notice suggests that Numsa did not share AMSA’s revised offer with its members, which is “disappointing”.

He says the AMSA offer is fair and takes into account both the current economic conditions and the future sustainability of the business.

AMSA states that its offer is higher than what has been implemented in the steel sector (5.5% on average) and elsewhere in the recent past – indicative of AMSA’s substantially higher salary scales, compared with the rest of the industry and other sectors.

Although Numsa disputes this fact, AMSA states that the union has, to date, not presented any factual evidence to the contrary.

The union has been engaging in wage talks under the auspices of the Metals and Engineering Industries Bargaining Council since March and has since “deadlocked with the employer”, it says.

Although Numsa stated that the lowest paid AMSA worker receives R7 000 a month, AMSA says the current average total remuneration of its lowest grade employees is R21 423 a month, excluding overtime.

AMSA’s 7% increase offer will result in an average positive adjustment of R2 246 a month for bargaining unit employees.

Numsa says AMSA employees have not had “meaningful increases” in two years, receiving increases of only 2% in 2020 and 2021.

AMSA is concerned that unsustainable increases in base pay will lead to cost pressures which will weaken its competitiveness. “Our industry remains very cost sensitive, challenging and volatile. To survive and be sustainable, we need to ensure that our cost base remains competitive so that we can manage through the downturns,” says Verster.

AMSA notes that communication channels between the parties remain open in the interest of speedily reaching an agreement in the negotiation process.

“We encourage all parties to behave responsibly in finding agreement so that the business can move forward,” he concludes.