OPEN LETTER TO SATAWU and UTATU

At our meeting on Tuesday (11 May 2010), when your unions rejected the settlement proposal of Transnet, we indicated a willingness to continue engaging and discussing ways of resolving the current wage dispute.

As you know the 11% increase to pensionable earnings, backdated to 1 April 2010, together with a new medical aid dispensation took Transnet beyond its mandate. This offer was made in a genuine attempt to resolve the wage deadlock and prevent a strike. As explained, this increase to Transnet's cost base comes at the expense of other projects.

Acceding to your demands of an across the board increase of 15%, which is three times the inflation rate, would not only fuel wage inflation, it will drive up our operating costs as a company and force Transnet to either raise the prices it charges its customers and/or even consider cutting jobs. As a responsible publicly owned company, we are reluctant to go down this path: it is not in the interest of our employees, customers or the country.

Ultimately, all disputes are resolved, the question that matters is the timing of their resolution. We remain open and willing to open up discussions again in an endeavour to resolve the industrial action currently underway. The wilful destruction of Transnet property, assets and the targeted attacks against our employees who are exercising their democratic right to work is unacceptable. We are concerned that the longer the strike persists, the harder it becomes for you to restore calm and the greater the damage to Transnet and the broader economy.

Whilst we are conscious of the fact that our offer takes us to the outer limit of our mandate, we do recognise that we may need to explore other elements that may not be limited to the wage offer, in order to resolve the dispute. In the spirit of resolution of the dispute, we urge you to enter the discussions with an open mind.

Kind Regards

Pradeep Maharaj
Group Executive: Human Resources

TRANSNET

Issued by Transnet, May 12 2010

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