13.2 C
Johannesburg
Wednesday, November 23, 2022
HomeBusinessEskom’s financial tsunami as it loses wage bill battle

Eskom’s financial tsunami as it loses wage bill battle

Eskom’s financial tsunami as it loses wage bill battle

- Advertisement -

Eskom’s financial troubles have just gotten worse and its wage bill could increase to unsustainable levels.

The struggling power utility has been ordered to pay thousands of its workers more than a year’s worth of backdated salary increases.

The Commission for Conciliation, Mediation and Arbitration (CCMA) yesterday awarded Eskom workers an extra 1.5% wage increment on top of the 1.5% that the utility unilaterally implemented in July 2021.

Last year, Eskom “exercised its right and made a decision” to implement its final 1.5% basic wage increase and changes to the conditions of service offer, ignoring the unions’ wage demand increases well above the annual inflation of between 9.5% and 15%.

However, the three unions referred the 2020/2021 wage dispute to the CCMA for arbitration and the arbitrator ruled in their favour, saying the payment of the 1.5% must be backdated from 1 July 2021.

Eskom yesterday could not be immediately drawn to comment whether it would implement or challenge this order and how much this wage settlement would cost or where would the money come from.

The National Union of Mineworkers (NUM) general secretary Wiliam Mabapa welcomed the arbitration award, saying their full time shop stewards (FTSS) had demonstrated the understanding of the country's labour laws.

“The award for this dispute that took more than a year in the arbitration process was received today,” Mabapa said.

“We have dealt with this arbitration using our own FTSS who worked day and night in the preparation, planning and dealing with leading of evidence during the actual arbitration process.”

Spokesperson for the National Union of Metalworkers of South Africa (Numsa) Phakamile Hlubi-Majola also said they welcomed the decision.

“Ultimately we would have obviously liked more, but this is arbitration, this is how it works, and we are satisfied that at least we managed to secure an increase for our members after that increase was unfairly taken away from them by Eskom management,” Hlubi-Majola said.

Trade union Solidarity, one of the three unions that took Eskom to the CCMA for arbitration, was not immediately available for comment.

This comes as the anticipated restatements to Eskom’s annual financial results for the year ended March 31, 2022, are expected to have an impact on the group’s financial position.

Eskom yesterday confirmed that it would not meet the deadline to publish its audited annual financial statements, and has pushed this to the end of November, two months late.

According to the Public Finance Management Act, State-owned enterprises Eskom should table in Parliament the finalised accounts six months after the close of the financial year which usually is by September 30.

However, Eskom said it was resolving anticipated restatements to its previously issued audited financial statements for the prior year ended March 31, 2021, “which will have an impact on the group’s statements of financial position and income statement”.

Last year, Eskom reported a net loss after tax of R18.9 billion for the financial year ended March 31, 2021.

The utility was expecting to cut its full-year loss from R18.9bn to R9.1bn in the 2021/22 financial year, but had warned that its debt position remained unsustainable at more than R400bn.

Eskom yesterday said that some of the anticipated restatements included the reclassification of coal stocks from current assets to non-current assets, reclassification of certain electricity debtors from current to non-current, various adjustments to property, plant and equipment, and others.

“As the audit is still underway, other matters may be identified,” it said.

“The audit process has been impacted by broader control issues ranging from stock counts, procurement compliance and financial reporting matters referred above.”

BUSINESS REPORT

Original Article

- Advertisement -
RELATED ARTICLES
- Advertisment -

Most Popular

- Advertisment -