Address by the Honourable Minister of Labour: Ms Mildred N Oliphant, MP at the Annual Nedlac Organised Labour Conference, Roodevallei Conference and Meetings Hotel
Programme Director,
Leaders of Organised Labour,
Colleagues.
Thank you for inviting me again to address the National Economic, Development and Labour Council (NEDLAC) Organised Labour Conference. It is always a pleasure to meet the leaders of organised labour so early in the year as it generally sets the tone for the rest of the year. But this year is also particularly significant in that we celebrate two decades of freedom as well as it being an election year.
Already it promises to be an interesting and exciting year. Recent developments in the labour front signify a turbulent period ahead but I still believe that it is incumbent upon to extend best wishes to you all for 2014.
As you are well aware, we have ended another year in which the labour arena has been highly contested and it has been marked by conflict and controversy. It can only get better from here and that will be possible if we make a commitment to work together in addressing the many challenges that face us.
The improvement that we hope for this year was given an impetus when news broke late last year that employment levels reached 14 million in the third quarter. The labour market is back to the employment peak of 2008 before the recession started to bite. You will recall that South Africa lost 1 million during the recession of 2009 and it has taken us since that time to recover and for jobs to be recovered. The official unemployment rate declined to 24.7 percent in 2013.
The most important challenge for the year ahead must surely be to do everything possible to ensure that the number of jobs continues to grow, decent jobs. We also hope that this year will buck the trend of 2013 that saw a higher number of new contract jobs or short-duration jobs than permanent jobs.
The National Development Plan (NDP) target is for 2.8 million new jobs to be created by 2015, or total employment at 15.8 million. This target comes against the background of ongoing criticism of South Africa’s labour legislation and attacks on our labour dispensation, especially by some international organisations, business and the media.
There are also some who are clearly of the view that our labour legislation is too restrictive and that the South African labour market is over-regulated. We certainly don’t think so. As government we are committed to a policy and legislative approach that is captured by the concept of regulated flexibility.
Regulated flexibility accepts the necessity of regulation, and the need for flexibility. The key issue is finding the right balance. As Benjamin, Bhorat and Cheadle have argued and I quote:
“South Africa’s labour market is neither exceptionally over-regulated nor, indeed, under-regulated. This holds true globally and in relation to the sample of middle-income economies. This result reinforces our view that labour market policy debates in South Africa should be about nuance, rather than substance.”
So, let us make progress by focusing on the details and on striking the right balance in our labour legislation. The National Development Plan refers to a “responsive labour market.”
It says that the labour market should create opportunities and work for all, while ensuring human rights, labour standards and democratic representation. A lot of what the NDP says about the labour market is consistent with our policy and legislative framework.
One of the challenges that the NDP does pose is the need for a link between wage growth and productivity growth. This is an area that the department has not addressed directly but it is one that will require attention.
To create greater certainty in the labour market and to answer our critics, a policy priority for the department will be the promulgation and implementation of the Bills that have been in the Parliamentary process for quite some time. The sooner that we are able to implement amendments to the LRA, BCEA, the Employment Equity Act (EEA) and the Employment Services Act, the sooner will we be able to deal with abuses in the labour market and problems of non-compliance with our labour legislation.
The African National Congress (ANC) Election Manifesto is also very clear in this regard. It says: “Enforce measures to eliminate abusive work practices in atypical work and labour broking.”
An area that will remain a priority and a challenge for us is employment equity. It is quite evident that remnants of Apartheid still persist in a number of areas in the private sector particularly, with the public sector managing to make huge strides in transformation. Many private sector employers are still found wanting in implementing employment equity. It seems it is ‘business as usual’ for many of them.
There is a need for collaboration with all stakeholders involved, in particular organised labour, to address issues of transformation in our country. The slow pace of transformation or a lack of it, in a number of workplaces, necessitated the department to introduce amendments to the EEA to expedite transformation and strengthen compliance and enforcement mechanisms.
Therefore, there is a need for trade unions to engage and entrench themselves on employment equity matters in the workplace where the labour inspectorate, Commission for Conciliation, Mediation and Arbitration (CCMA) and the Labour Courts can play a technical and supportive role in order to ensure compliance.
The amendments will assist in:
- Clearly defining who are the beneficiaries of employment equity
- Eliminating unfair discrimination in terms of pay equity on the basis of race, gender & disability; or on any other arbitrary ground
- Providing better dispute resolution mechanisms by facilitating access to the CCMA and Labour Court for unfair discrimination cases. This will mean the CCMA will not only conciliate, but also arbitrate on unfair discrimination matters for the benefit of low paid workers in particular
- Increasing compliance levels by shortening the enforcement processes and increasing penalties for non-compliance.
Programme Director,
Strengthening enforcement mechanisms alone, including increasing fines, will not be sufficient to address issues of equality and affirmative action in the workplace. The best place to address workplace issues is at the workplace, which requires proactive action and persistence by workers and their representatives.
Unfortunately, the 2013 strike season was again a difficult one with a number of instances of violence. Violence during strikes remains an issue of concern to government and to the general public. We cannot afford to see the scenes of hawkers being deprived of their livelihood as workers go about their right of protesting what they regard as unfair labour practices.
Every right must be juxtaposed against a responsibility. The right to strike and protest should not infringe on other people’s rights to make a living or their right to refuse to be part of the protest action. The incidents of violence against those who chose to work in the petroleum sector and other incidents cannot and should not be left unchecked.
There are unlikely to be specific legal amendments to address this issue, for example, the requirement to ballot, but we will have to find ways of addressing violence during industrial action.
We all have to exercise leadership and show leadership. This leadership should also manifest in ensuring that the negotiating season starts as early as possible. It seems a self-defeating move to wait until the very last moment before negotiations get underway and this does not leave enough room for proper talks.
Comrades,
We also need to relook the wisdom of prolonged strikes and whether it is in the interests of workers or not. I am of the view that after a certain period of sustained action, the strike ceases to be a weapon for workers interests but an arrow that inflicts pain and wounds in the workers themselves. These are some of the challenges that you have to grapple with as labour leadership and it is up to you how you work around it. This is challenge to you to put your collective wisdom together.
In the High Level Dialogue on the Economy chaired by President Zuma in October 2012, the constituencies recognised the importance of defending the value of the Constitution and the Bill of Rights. Constituencies also undertook to support systems of orderly collective bargaining and combating violence in public protests and industrial action.
Concrete steps will be necessary during the 2014 bargaining season to give effect to these commitments. While the NDP recognises the need to stabilise the labour environment, its proposal is to strengthen the CCMA and dispute resolution. Perhaps it is time to go a bit further and to consider new dispute resolution mechanisms such as compulsory or interest arbitration.
Interest arbitration is widely and successfully used in countries such as Canada. Research internationally has also shown that settlements reached after strikes are not very far from the settlement awarded through interest arbitration.
Clearly, interest arbitration cannot be viewed as an alternative to the strike in South Africa, but it may have potential as a part of the collective bargaining process that can lead to speedy and less costly dispute resolution.
There are two other issues that are important for us and that will require investigation and policy development over the next few years. These are minimum wages and provision for retirement savings. Both are issues that are raised in the NDP and in the ANC’s Election manifesto.
The department is of the view that minimum wages should increase to a level that addresses the challenge of poverty and that supports economic expansion. The ANC Election manifesto says that the ANC will investigate the modality for the introduction of a national minimum wage as a mechanism to reduce income inequality. The ANC has given itself five years to do so.
We also acknowledge COSATU’s input to the debate over a national minimum wage in the concept paper that was circulated in 2012. Our legislative framework for minimum wage regulation is the Basic Conditions of Employment Act. The Basic Conditions of Employment Act (BCEA) adopts a sectoral approach to minimum wage regulation through the mechanism of sectoral determinations.
An amendment to section 55 of the BCEA does make provision for the issuing of an “umbrella” sectoral determination covering employees not covered by other sectoral determination or by a bargaining council collective agreement. So, there may be ways in which a new minimum wage that has wide application could be introduced.
The more difficult challenge will, of course, be to determine the level of a new minimum wage. We look forward to a very lively engagement on this issue.
Finally, the department is of the view that all sectoral determinations should include provision for retirement savings. There are many issues to do with compliance and enforcement in this area as well as difficult issues relating to the benefits that can be provided and the governance and administration of retirement funds for low income workers.
To deal with this, we hope to initiate an investigation to explore the appropriate mechanisms and practical implementation of measures to give many more low income workers access to retirement savings.
In summary, key challenges for the department are:
- to implement the amendments to labour legislation to give certainty to the policy environment and to expand protection for vulnerable workers
- to ensure faster change in employment equity in workplaces
- to find ways of dealing with violence during strikes, including those factors that give rise to violent action and protracted strike action
- to review the possibility to increase minimum wages so as to address poverty and inequality
- to expand provision for retirement savings for low income workers.
Programme Director,
There are many other challenges facing us in the labour market. Some relate to collective bargaining, to the public employment services, to workmen’s’ compensation and to health and safety in the workplace. I have chosen to highlight a few strategic challenges that in our view respond to the National Development Plan and its vision for the future.
They are also challenges where we invite you to engage with us to find ways of improving the South African labour market, improving living standards and ensuring decent work and a more dignified life for workers.
I wish you a successful conference and a good year ahead.
Thank you!
