Eskom wins 17-yr legal battle against Solidarity | Fin24
In partnership with
  • Deloitte

    The accounting firm has denied allegations of corruption related to Eskom contracts.

  • SAA Uncertainty

    What you need to know if you have a ticket or intend to buy one.

  • Michael Jordaan

    Forget Matric results - here's how to prepare your kids for jobs that don't yet exist.


Eskom wins 17-yr legal battle against Solidarity

May 27 2015 06:41

Cape Town - Eskom is set to recover legal costs from Solidarity after the trade union lost a 17-year legal battle against the power utility.

This follows the Constitutional Court's dismissal of Solidarity's application for leave to appeal a case which aimed to force Eskom to honour a verbal agreement of 17 years ago.

Solidarity wanted Eskom to pay 34 retired licensed nuclear power operators at the Koeberg Power Station a yearly once-off non-pensionable payment equal to double the basic salaries.

Eskom said the union also alleged that the agreement included a system of early retirement to these employees in terms of which they would be credited with condoned service of six months for each year served as a licensed operator, or pro rata for part thereof in addition to the 12 months ordinarily credited.

Solidarity told Fin24 this week that it had “resigned itself” to the Constitutional Court ruling, but should the opportunity arise “we would fight another 17 years for these members”.

Deon Reyneke, head of Solidarity’s Energy Industry, said “sometimes you don’t get the result you deserve, but it doesn’t mean the battle wasn’t worth it".

The court stated that “the application should be dismissed as it bears no prospect of success”.

Eskom said  its response throughout the years had always been that no agreement had been entered into, and that only proposals had been discussed between the parties.

Reyneke said Solidarity was disappointed by the ruling, and it was “still convinced that the manager of the power station acted within his mandate in 1998 and that the agreement was thus valid".

The case dates back to 1998 when Solidarity and Eskom reached an agreement that the Koeberg nuclear power operators, in accordance with generally accepted international practice, were allowed to go on early retirement due to the hazardous nature of their work, explained Reyneke.

“In addition, Eskom would continue to contribute to the employees’ pension to avoid penalties due to early retirement. This would have been calculated according to a fixed formula based on years of service.

“The formal agreement was ratified on 2 November 1998, and an Eskom directive (written policy) was issued by the manager of the Koeberg Power Station. Soon, a group of employees, who also wanted to benefit from the agreement but didn’t qualify for it, threatened with strike action.

“Suddenly, Eskom argued that the manager of the power station acted outside his powers and mandate and that the agreement was not valid. According to Solidarity’s information, the decision to withdraw the agreement came directly from the former CEO in a bid to avert the impending strike.

“Solidarity declared a dispute and the matter was referred to the Labour Court. After a drawn-out legal process which went backwards and forwards, the case finally went to court in 2010 and 2011.

“The court found for Solidarity, ordering Eskom to honour the agreement. Eskom approached the Labour Appeal Court and in 2013 this court found for Eskom. Solidarity then applied to the Constitutional Court for leave to appeal against the Labour Appeal Court ruling. In May this year, the Constitutional Court rejected the application," Reyneke said.

Legal costs

Eskom said its legal team will now proceed to recover its legal costs from Solidarity.

“The process for recovering legal costs entails a bill of costs being drawn up by attorneys, which is then submitted to the taxing master at the court for taxation,” said Eskom spokesperson Khulu Phasiwe.

“The taxing master allows certain costs and may disallow others in accordance with a specific tariff. The process will therefore take some time to finalise.” 

solidarity  |  eskom  |  pensions


Read Fin24’s Comments Policy publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Company Snapshot

Voting Booth

How concerned are you about ransomware attacks?

Previous results · Suggest a vote