Johannesburg owes its workers R10.3bn and Samwu says the next mayor must pay

Johannesburg’s next political leadership is being told to pay a R10.3 billion wage settlement it inherits, with the union that signed it warning that a change of mayors does not change who owes the money.

The South African Municipal Workers’ Union (Samwu) says the agreement was concluded with the City of Johannesburg as an institution, not with any individual politician, and that the incoming administration must honour it. Outgoing mayor Dada Morero signed the deal on the eve of the local government elections.

“We hope when the time comes for them to pay, they will not renege,” Samwu Johannesburg regional chairperson Lebogang Ndawo said. “They must honour the agreement and ensure that workers continue providing the services the city deserves.”

As Sunday World reported on 4 November, National Treasury has opposed the agreement, arguing it was signed unlawfully and is unaffordable for a metro already under severe financial strain. Finance Minister Enoch Godongwana has pointed to mounting debt and to the settlement not being adequately funded in line with the Municipal Finance Management Act. Treasury has also warned that the deal adds billions of rand to an already constrained budget.

The dispute turns on what the R10.3 billion actually is. Ndawo rejected Treasury’s description of it as a conventional wage increase. “National Treasury was of the view that this is a wage agreement, whereas it is a parity issue,” he said. He said the settlement addresses past disparities in which white employees in the city earned more than their Black counterparts, and that the principle of equal pay for work of equal value was not respected.

Samwu also argues that Johannesburg’s pay scales sit below those of other metros carrying the same grading. Ndawo cited waste collection workers, saying similar staff in Gqeberha and Tshwane earn about R15,000 a month while their Johannesburg counterparts earn around R11,000. He said the gap widens higher up, with the city manager and senior executives paid at grade 10 since 2018 while councillors are paid at the highest applicable level.

The money is being paid in phases, and one phase has already slipped. Ndawo said the city paid a first instalment of about R1.2 billion in March. “The second payment was supposed to be R5.2 billion in July. However, the city reneged and did not include it in the budget,” he said. The balance is scheduled for 2027.

Rather than reopening the agreement, Samwu wants the city to cut what it spends on outside contractors for work it says can be done in-house, naming fleet management contractors and debt collection agencies among the providers that weigh on municipal expenditure. The union’s position is that removing duplicated outsourced functions would contain costs while leaving the settlement intact.

Cosatu has backed the deal. Its parliamentary coordinator, Matthew Parks, called it “a major victory for municipal workers, improving their wages and their ability to take care of their families”, and said it would improve workplace productivity and the municipal services working-class communities and businesses depend on. He said the incoming council should honour the agreement as part of rebuilding the city.

For residents, the practical question is what the standoff does to the services the city is already struggling to deliver, from waste collection to the billing and debt systems Samwu wants brought back in-house. The workers who clean streets and collect refuse are the ones whose pay is at stake, and the union’s case is that the city has been paying them less than their peers in other metros for the same grade of work.

What remains unresolved is how a metro under Treasury’s funding pressure funds a settlement Treasury says was never budgeted for, and whether the incoming administration treats the missed July instalment as a debt to be cleared or a commitment to be renegotiated. Samwu has made its position clear. The city’s next leadership has not yet said how it will pay.