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AfricaMoney | August 20, 2017

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MSPA offers 13% wage hike over 4 years but sugar unions make counter proposal

MSPA offers 13% wage hike over 4 years but sugar unions make counter proposal

The MSPA, for its part, has stated that 2014 and 2015 are going to be two consecutive years posing tough economic challenges, and implementing a substantial wage increase in these 2 years, as proposed by the JNP, would greatly add to its woes. (Image: Bio Energy Consult)

The members of the Mauritius Sugar Producers’ Association (MSPA) tried today to resolve the ongoing strike in the sugar sector by agreeing to the proposal of the Labour Ministry for a temporary wage increase of 13% for sugar workers, spread over four years, but the labour union has asked for the same increase to be provided over a shorter time frame of 2 years instead.

While MSPA proposed that this 13% increase be applied as follows: 4% in 2014, 4% in 2015, 2.5% in 2016 and 2.5% in 2017, the Joint Negotiating Panel (JNP) rejected the proposal, asking for this increase to be paid in two tranches of 10% in 2014 and 3% in 2015, rather than in four instalments.

The proposed wage hike would amount to a total increase of Rs 460 million over the duration of the agreement, if paid over four years, but if the salary increase is implemented over two years, the same 13% increase would then amount to Rs 640 million, that is a towering Rs 180 million more than the proposal of the MSPA.

Also, except for salary negotiations, the rest of the arguments raised by both parties would then be referred to an arbitrator.

Thus, even if the arbitrator decides that a 13% salary increase is too high, the members of the MSPA would have already made a commitment to pay it, and would be unable to go back on the agreement.

The MSPA, for its part, has stated that 2014 and 2015 are going to be two consecutive years posing tough economic challenges, and implementing a substantial wage increase in these 2 years, as proposed by the JNP, would greatly add to its woes.

It may be recalled that the price of sugar fell to Rs 12,500 per ton this year while last year, sugar was sold at Rs 15,800 per ton.

Spreading the salary increase across merely two years will contribute towards drastically reducing the revenues of the sector, as well as cause production to decline, the MSPA concluded.

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