Johannesburg’s incoming municipal administration will face the financial and legal implications of a multibillion-rand salary agreement signed by the city and the South African Municipal Workers’ Union (SAMWU) just hours before South Africans went to the polls.

The addendum to the Politically Facilitated Agreement (PFA), signed on Tuesday, 3 November, involves “contemplated payments” of between R1.2-billion and R5-billion to address long-standing salary disparities among municipal employees.

The timing means that the new council, to be elected in Wednesday’s local government elections, could inherit responsibility for approving the budget adjustments and overseeing the implementation of commitments made by the outgoing administration.

The agreement comes as Johannesburg faces intense financial pressures and persistent service delivery failures.

Although the city has confirmed the payment range, it has not disclosed how the commitments will be financed, precisely how much remains outstanding, or what effect the settlement will have on future municipal budgets.

The agreement seeks to end historical salary disparities arising from the amalgamation of various local authorities, which resulted in employees being remunerated according to different municipal grading structures.

Some employees were paid according to Grade 8 municipality scales, while others received remuneration under Grade 10 scales, despite working for the same metropolitan municipality.

The addendum builds on a November 2025 settlement and seeks to accelerate the implementation of outstanding salary parity commitments through a Common Key Salary Scale.

According to the city, the contemplated payment of between R1.2-billion and R5-billion will be used to place affected employees at the appropriate entry level of the salary scale for a Grade 10 municipality.

However, the financial commitment remains subject to the applicable terms of the November 2025 Settlement Agreement.

The new agreement does not necessarily represent an entirely new financial obligation, but seeks to give effect to commitments already made under the earlier settlement.

Johannesburg Executive Mayor Dada Morero said the agreement followed extensive engagements and mediation involving the city, SAMWU, the Gauteng Provincial Government and legal representatives.

He confirmed that all parties had signed the addendum and were satisfied with the outcome.

Morero said the necessary payment processes would be effected through a budget adjustment in January, with implementation expected towards the end of March 2027.

Both dates fall after Wednesday’s elections, meaning that the newly elected council and the administration it appoints could be responsible for managing the financial consequences of the agreement.

Any required budget adjustments would have to comply with the Municipal Finance Management Act (MFMA), which governs municipal spending, budgeting and financial accountability.

While an election does not automatically invalidate a municipality’s agreements, the incoming administration must address the city’s existing commitments and determine how to accommodate them within the applicable budget and legal framework.

Morero described the signing as an important development in resolving the labour dispute and restoring stability within the municipality.

He said the resolution would allow the City to concentrate on improving service delivery, particularly waste removal, which had been affected by operational disruptions.

“Workers are back at work full force and all other issues and constraints that customers witnessed will now be fully addressed, especially as it relates to waste removal. There will be full force to address those,” he said.

Gauteng MEC for Cooperative Governance and Traditional Affairs Jacob Mamabolo said the agreement was a watershed moment in Joburg’s history, adding the salary disparities had affected labour relations, employee morale and the municipality’s overall performance for years.

“This closes a chapter of a two-tier salary scales in which some are paid under Grade 8 municipality, others are paid under Grade 10 municipality. So this duality in the salary scales should come to an end so that all the employees of the city are on a Grade 10 municipality and the salary scales are correct,” he said.

“If the workers are not happy, if the workers are not motivated, if the workers have got issues that are not being attended to, it affects their performance,” he said.

Mamabolo said affordability had been considered in reaching the settlement and that implementation would take place within the framework of the MFMA.

The city said the addendum was negotiated and finalised through extensive engagements, with Advocate Terry Motau SC acting as facilitator and providing legal and professional assistance.

The process also received support from the Gauteng Provincial Government, including the MEC for Infrastructure Development and the Department of Cooperative Governance and Traditional Affairs.

“The signing of the Addendum marks an important step towards addressing historical salary disparities, promoting fairness and advancing equitable remuneration among affected employees of the City of Johannesburg,” the city said.

INSIDE METROS

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