Union activity is a major problem in South Africa where labour legislation is skewed heavily in favour of employees and against employers. Strikes are common place in all of our labour-intensive industries – like the mining industry or the metals industry – and, of course, in the public sector. Union action generally makes the economy less productive. It is important to establish the extent to which a listed company is exposed to union activity before buying its shares. Union action has been so successful in South Africa that in certain sectors an annual increase, which is usually above the inflation rate, has been accepted as the norm. Thus the announcement from the new CEO of Escom (Hadebe) that in June 2018 there would be a zero percent increase for all staff members, has caused consternation among unions. It could signal a general show-down between the union movement and government.

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