A clawback refers to the recovery of money paid to an employee, typically because that payment should not have been made for legal (or occasionally moral) reasons. Clawback provisions relating to inflation in a wage agreement may entitle an employer to claw back (= deduct) excessive wages already paid in terms of a wage agreement.
Thanks to a report in SA Labour News ‘Government not obliged to draw unions’ attention to implications of what they sign’ attention has been drawn to the report by Wiseman Khuzwayo in Business Report which records that Acting Public Service and Administration Minister Nathi Mthethwa said yesterday that the government was under no obligation to draw the attention of unions to what they should be aware of when they signed wage agreements.
‘He was reacting to the furore relating to the putative public sector wage agreement signed last month. Public sector unions have claimed they were “hoodwinked” into signing what was presented as a 7% wage rise only to realise later that it was only for 6.4%. Seven Cosatu-affiliated unions are threatening to go on strike to scrape back the 0.6% difference, small as it may seem. But Brent Simons, a spokesman for Mthethwa, said: “It is not for us to remind unions of previous agreements they have signed.”
The three-year agreement provides for a wage rise of 7% in the first year, and inflation plus 1% in each of the subsequent years. However, it also states that if there is an underpayment or overpayment in the previous financial year, this will be adjusted in the first year of the new agreement’.