A stable labour environment, encompassing a sense of security, fairness and predictability, is a crucial foundation for any successful organisation.
Transnet’s recent conclusion of a three-year wage agreement with the SA Transport & Allied Workers’ Union (Satawu) accentuates a commitment to the organisation’s long-term success and safeguarding the wellbeing of its employees.
The agreement offers a 17.5% cumulative wage increase over three years: 6% in year one (2025), 6% in year two (2026), and 5.5% in year three (2027). The above inflation offer reflects our commitment to fair compensation amid challenging financial circumstances.
Fair offer
Transnet’s offer is not just about numbers; it’s about people. We recognise the rising cost of living and the sacrifices our employees make every day to keep SA’s ports and rail network running. We acknowledge their important contribution during this period of Transnet’s recovery and turnaround.
That is why, despite our constrained balance sheet, we have tabled an offer that includes increases to basic salaries, 13th cheques, pension contributions, medical aid subsidies and housing allowances. This package ensures increases of R1,000 to R3,200 per person, per month over the agreement period.
However, the offer must be seen in the context of our current reality. It is the most we can afford while remaining sustainable. Transnet is navigating a difficult financial reality, compounded by years of underinvestment, operational inefficiencies and the lingering effects of state capture.
Our balance sheet is constrained and our ability to invest in critical infrastructure, which is essential for both service delivery and job security, depends on responsible fiscal management.
Why a three-year agreement matters
After the conclusion of the last wage agreement, which was signed in 2022 and expired on March 31 this year, Transnet has experienced labour stability and continued to build trust with labour and their representatives.
Our rapport with recognised labour unions is crucial in driving our ongoing efforts to revitalise and improve our operations, positioning the organisation as a key driver of SA’s economic development.
The stability also enabled us to pursue the objectives of the shareholder compact, corporate plan and legislative and policy reform strategic imperatives.
Guided by the desire to maintain the prevailing healthy and productive environment, Transnet management adopted a proactive approach during wage negotiations in the first quarter of 2025 and, together with our labour partners, agreed to appoint a credible, independent facilitator to facilitate the wage negotiations from the outset.
A multiyear wage agreement provides predictability, allowing us to focus on urgent operational improvements, such as modernising port and rail infrastructure; advancing private sector partnerships to boost efficiency, operational expertise and funding; and implementing productivity-linked incentive schemes that reward employees for performance.
These incentives have already delivered tangible benefits, with employees earning bonuses when performance targets were exceeded. This model aligns employee success with company success — a win-win approach we are committed to expanding.
Financial sustainability and debt management
With a significant debt burden and operational constraints, we must balance fair compensation with our commitment to remaining financially viable. Our offer is not just about today. It’s about safeguarding the future. By ensuring long-term financial sustainability, we protect jobs, secure growth opportunities and maintain our ability to invest in the infrastructure SA needs.
Our priority is to keep SA’s economy moving. Transnet’s rail and ports facilitate trade, support industries and create jobs. Disruptions from prolonged wage disputes or industrial action would hurt our employees and the nation. That is why we remain invested in speedily resolving labour matters: to focus on what matters most — delivering reliable, efficient logistics services to our customers and ultimately boosting the SA economy.
Job security and long-term sustainability
At the heart of this negotiation is a simple truth: Transnet’s sustainability and our employees’ welfare are deeply entwined. We are committed to job security. But this commitment requires a company that is financially resilient and competitive. Our wage offer reflects this balance: fair increases today to support employees while ensuring sustainability into the future.
One of our recognised trade unions, United National Transport Union (Untu) has not yet signed the agreement. We remain confident that existing collective bargaining processes will lead all of us to a responsible and positive outcome. We urge all parties to consider the nature of our economic landscape. While acknowledging the importance of fair compensation, we also believe that ensuring Transnet’s long-term viability is crucial for sustained employment of the thousands of Transnet employees.
As transport minister Barbara Creecy recently noted, SA’s logistics sector is under severe strain, and state resources are limited. Demands that ignore these realities are simply unaffordable. In the current economic climate, excessive increases could threaten the sustainability of Transnet as it strives to overcome its challenges.
A call for unity and pragmatism
Transnet’s recovery is not just our mission; it is a national imperative. Our ports and railways are the lifeblood of SA’s economy, and their success depends on co-operation. We call on all stakeholders, including Untu, to engage constructively. Industrial action would harm employees, the company and the country at large. We remain optimistic that the parties will resolve the dispute speedily.
Matsheka is group chief of people management & learning at Transnet.
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