Constitutional Court strikes down public sector wage deal

The unanimous judgment was released on Monday, a hefty blow for labour unions who approached the court to overturn a labour court ruling. 

The unions were arguing that despite economic challenges faced by the country's pockets, government had an obligation to the agreement.

The state was able to honour the agreement for two years, but for 2020, it said the agreement would cost the fiscus R38 billion which it couldn't afford due to lack of funding. 

If government obliged with the agreement, it would have cost R75 billion in back payments to civil servants. 

The apex court ruled in favour government on the basis that the Department of Public Works and the Minister of Finance did not act within in law when coming to this agreement. 

"The court noted that regulations 78(2) and 79(c) created jurisdictional facts which must exist prior to the Minister’s exercise of power to negotiate and conclude collective agreements on behalf of the State, absent which the Minister acts without legal authority,” it said in the ruling.

"The court found that the jurisdictional facts were not present and that non-compliance with the requirements of regulations 78 and 79 rendered the resultant collective agreement between the State and the trade unions invalid and unlawful, and thus unenforceable.”

The applications by unions were dismissed with no cost order.