The new incoming president of the Steel and Engineering Industries Federation of Southern Africa (Seifsa), Michael Pimstein, has appealed to employers affiliated to the organisation to adopt proactive actions towards the upcoming wage negotiations in 2017.
Pimstein is returning back to a Seifsa position he held in 2006 and 2007, after Angela Dick, of Transman, who was elected as the association’s first woman president in October 2015 resigned. Previously, he led Macsteel Service Centres South Africa and is currently joint CEO of Capital Appreciation Limited, which invests in businesses across various sectors.
In a recent address to Seifsa members, Pimstein called for urgent discussions with the labour unions in the metals and engineering sector. He also appealed to employers to “embrace dialogue”, as opposed to regarding the upcoming negotiations as a “war”.
During the previous round of wage negotiations that took place in 2014, a three-year settlement was secured after a month-long strike that sometimes turned violent. That agreement signed will expire at the end of June 2017.
The 2014 to 2017 agreement was also strongly opposed by rivals of Seifsa, the National Employers’ Association of South Africa (Neasa), which termed the settlement as “unaffordable” for smaller firms in the metals sector. Some Neasa members even locked out union members in an effort to secure an alternative deal. It also moved the matter to the Labour Court with an appeal to set aside a decision by the Labour Minister to extend the 2014 to 2017 Seifsa agreement to the rest of the metals industry.
The 2017 talks are scheduled to start in earnest in March, with some discussion already ongoing about the prospect of pursuing bargaining in a way that conditions at a sub-sectoral level could be taken into account.
Pimstein admitted that working conditions in the metals and engineering industry had declined markedly since his last stint as president, when companies were still enjoying the tailwinds of sustained economic growth and the investment windfall that came with preparations for the 2010 FIFA World Cup.
In contrary however the current context was one of an industry struggling in the face of harsh domestic and global economic conditions, overcapacity, even greater importation threats, imposed by particularly China, and weak steel consumption. There were also worries about the possible negative implications on downstream industry of recent moves by government to protect South Africa’s primary steel producers.
“These conditions are likely to prevail for some time . . . as there are no signs that the world market is rapidly moving out of its weakness,” he said, adding that unless the global economy was growing above 2.5% steel consumption would remain under pressure.
“So I think we need to prepare ourselves in South Africa – which has particularly challenging social and political issues and a no-growth environment – to do the best we can in a [steel] market next year that is not likely to exceed 4.5-million tons.”