The country’s approximately 295,000 municipal workers are expected to receive a 4.75% increase across salaries, homeowners’ allowance, and employer medical aid contributions, reflecting an effort to support workers amid rising living costs.
New Minimum Wage and Allowance Adjustments
Starting from July, the minimum wage across all 257 municipalities will rise from R10,600 to R11,100 per month. The homeowners’ allowance will increase from R1,170 to R1,225, while employer contributions to medical aid will move up from R5,971 to just under R6,100.
Agreement Background and Implementation
These adjustments are part of a wage agreement signed in September 2024 after extended negotiations at the South African Local Government Bargaining Council (SALGBC). SALGBC General Secretary Bill Govender has urged all municipal managers to ensure full implementation of the agreed increases.
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Provision for Municipal Exemptions
The agreement allows municipalities to apply for exemption from implementing certain provisions. This must be done within 30 days after the approval of their 2026/27 budget or by June 30, whichever comes first.
Tshwane Wage Dispute and Back Pay Plan
The 2026/27 phase of the agreement comes amid ongoing wage-related developments in the City of Tshwane. A previously unimplemented 3.5% salary increase from July 2021 became a point of dispute after the municipality initially secured an exemption.
Following a review at SALGBC, the exemption was overturned, and the municipality was directed to implement the increase along with back pay within six months. However, due to financial constraints—estimated at nearly R1.1 billion—the city sought a more manageable approach.
Back Pay to Be Distributed Until 2029
According to the Independent Municipal and Allied Trade Union (Imatu), a settlement was reached allowing the 3.5% back pay to be distributed gradually from June this year through March 2026. Payments will begin with lower-level employees and progress toward higher-level staff.
Ongoing Legal Dispute Over 5.4% Increase
City of Tshwane workers are also involved in another dispute regarding a 5.4% salary increase for the 2023/24 financial year. The matter is currently before Labour and Labour Appeal Court Judge President Mogomotsi Edwin Molahlehi after unions challenged a prior exemption granted to the city.
Future Wage Structure Negotiations Underway
Meanwhile, SALGBC parties, including the South African Local Government Association and the South African Municipal Workers’ Union, are negotiating a new wage curve agreement. This could lead to standardized pay scales across all municipalities.
Consultancy Assigned for Pay Scale Development
Johannesburg-based consultancy 21st Century has been appointed to assist in developing these pay scales by collecting and analysing payroll data from municipalities nationwide. The bargaining council has warned that delays in submitting required data could slow down the process and affect the accuracy of the sector-wide analysis.
