Volume 10, No.2 - March 2001

We're part of the union

Labour law amendments

COSATU Seeks A Mandate on a Tentative Agreement with Business and Government on Labour law amendments

COSATU's Central Executive Committee (CEC) has endorsed a package of amendments to the labour laws, agreed in the Millennium Labour Council (MLC) - the bilateral forum we have set up with big business. Government has also participated in these informal discussions and has also indicated that it is happy with the package.

COSATU regions held regional shop steward councils between 24 February and 4 March 2001 and affiliates have convened their national constitutional meetings to debate this package. Reports from these meetings have been fed to the COSATU head office. Based on the reports received the National Office Bearers may call a special executive committee meeting or refer the matter to the CEC scheduled for 24-26 April.

The employers have also been consulting their affiliates and negotiations are continuing at the MLC. It is hoped to resolve any outstanding issued by its next meeting on 5-6 April. It will then be necessary to continue discussions at Nedlac to reduce these agreements into legal language capable of being drafted into law.

Why amend the labour laws?

Since 1994, the government has passed a range of laws to transform apartheid labour practices into modern labour relations that protect workers' rights. These laws have faced a massive backlash from some sectors of business, which want to put the clock back. Even before these laws were implemented, some sections of business have been running a vicious campaign both in the home front and abroad.

During his address to open a parliament in 1999, the President for the first time raised the matter indicating that the government was keen to amend our labour laws in order to deal with what he called "unintended consequences".

Last year, the Minister of Labour announced a set of proposals to amend the labour laws. At the time, COSATU correctly pointed out that these proposals represented a worse form of direct attack on workers gains.

At its 7th National Congress held in September 2000, COSATU adopted a programme of action and vowed to fight these proposals. In October the executive committee decided that the strike the national congress decided upon should be held on the 28-30 March 2001 followed by a general strike in each quarter of the year until the amendments have been withdrawn.

Since then, there have been discussions between business and labour as well as with the government. These discussions between labour and business have so far been conducted at the MLC with further bilateral discussions with government. As part of these discussions a fact finding mission led by the co chairpersons of the MLC as well as the Director General of the Department of Labour went to International Labour Organisation in Geneva to study how other countries dealt with retrenchments and the strike and or negotiations. Hours of negotiations have been placed to produce the tentative agreement.

What the proposals mean

The agreements at the MLC are a huge improvement on the original proposals by government. As in any negotiations labour and business made concessions with the view of reaching an amicable solution on this matter.

We have gained the right to strike over retrenchment, a much better deal for workers who are transferred or whose company goes bankrupt, and a range of other improvements. In our view, the package does not undermine any fundamental rights of workers. It extends rights in all the key areas identified by the National Congress.

For this reason, the CEC has recommended adoption of the package of amendments agreed at the MLC. But we do not yet have agreement. It is not clear whether business will ultimately support their negotiators.

For this reason, we only postponed the general strike planned for the end of March - we have not called it off or suspended as some in the media incorrectly reported. We will keep our members informed should action in defence of our rights be necessary.

In the following table, for each main area of the agreement we give some background on the existing law; the government's proposals; and the MLC proposals.

Retrenchment

Current Situation

Workers do not have a right to strike over retrenchments. In addition the union can be sued for damages if memberts embark on a strike. Employers must consult affected workers and their union. Labour Court does not adjudicate the merits of the disputes arising.

Original Government Proposals

The law would still not allow strikes against retrenchment, but for large-scale retrenchments (over 500 over a year) a conciliator will mediate. A better information disclosure provision was provided.

The draft agreement negotiated by labour and business at the MLC and supported by government

The agreement provides a right to strike to all workers if they are employed by company employing over 50 people and where retrenchments will affect more than 50 people or 10% of the labour force which ever is lesser.

Probation

Current Situation

Employees on probation have the same rights against dismissal as other employees

Original Government Proposal

Would allow the dismissal of employees in their first six months of employment for poor performance or incompatibility, the employer will be only required to go through a fair procedure. This will mean that workers on probation may be dismissed even if it is substantively unfair

The draft agreement negotiated by Labour and business at the MLC and supported by government

We have protected the rights of workers on probation to a hearing at the CCMA, and to fair reasons for any dismissal.

Parties have agreed to a narrower test of compliance with fairness for dismissal for work performance during probation period than applies to permanent workers. This makes clear what is already implied in the LRA.

The CCMA will be able to determine or settle dismissal disputes though conciliation and arbitration. The parties agreed that while probation is a normal and acceptable mechanism to assess performance of new employees, it should not permit the emergence of a "permanent probationers" within the workforce.

This is an important means of protecting workers from an unscrupulous employer, a protection the existing law does not have.

Bargaining Councils

Current Situation

The law favours Bargaining Councils established by the majority parties in every sector. The Minister may extend agreements to non-parties if she or he is satisfied that a bargaining council is representative.

Original Government Proposal

Forcing the Bargaining Councils to consult every employer in an industry before the minister can extend agreements to non-parties. That means any employer can undermine the collective bargaining system by taking legal action on the basis that they were not consulted. This would mean an end to Bargaining Councils system and collective bargaining.

The draft agreement negotiated by Labour and business at the MLC and supported by government

The agreement on bargaining councils removes the problems created by the government amendment. The agreement recognise that Bargaining Councils are an integral part of the collective bargaining arrangements in South Africa and their functioning needs to be strengthened. It is desirable to promote membership by small business into employers associations that take part in bargaining councils.

To achieve participation by small business in the system of Bargaining Councils, every year each Council will submit an annual report to the Registrar on their involvement of small businesses, and NEDLAC will propose policies to help.

Unions have fought hard in the past to bring more small businesses into bargaining councils. This agreement helps. In addition, the LRA should permit bargaining councils to develop industrial support services and to provide services and coverage for workers in informal and home-based activities.

The last proposal would strengthen centralised bargaining by reaching workers who are now mostly left out of Council agreements and services.

Variation

Current Situation

The Minister or collective agreement may not vary the core rights in the BCEA. These are regulation of working hours, ordinary hours of work including the 45 hour week, prohibition of child labour, prohibition of forced labour and requirement that employers follow in the case of night work.

Original Government Proposal

The Minister may vary the BCEA whenever she or he wants.

The draft agreement negotiated by Labour and business at the MLC and supported by government

The Minister is limited to vary only with the agreement of the majority union, and only in cases like workers on ships, and only on hours of work: where the nature of work organisation make any other option impracticable such as wok maritime work. A key objection to the amendments has therefore been resolved.

Transfer of employees under Section 197 of the LRA

Current Situation

An employee may be transferred without negotiations, and only retains her or his conditions as a part of pre-existing contracts - which the new employer may renegotiate once employers are outside the bargaining unit. Sometimes employers transfer workers to avoid giving them a package - and the new employer then goes broke

Original Government Proposal

Proposals would effectively permit an employer to transfer workers, and then retrench them for 'operational requirements'.

The draft agreement negotiated by Labour and business at the MLC and supported by government

The provisional agreement will give workers stronger protections when a company is transferred. An employer who transfer a business or part of a business as a going concern will have to make sure that the new employer has made adequate provision to meet his obligation to pay wages, leave pay and bonuses accrued at the time of transfer to the transferred employees. Failure to do so will make the old the employer jointly liable - this applies for a period of 12 months after the transfer has taken place.

No transfer may be designed to avoid collective bargaining commitments Unions and the employer may agree through collective bargaining, to let employees opt to take a retrenchment package rather than a transfer.

Labour Court

Current Situation

Labour Court judges have a lower status than High Court judges do, which makes it hard to retain and attract skilled judges to the Labour Court. Nedlac is currently excluded from the appointment of acting judges to the Labour Court.

Original Government Proposal

Labour Court judges should have the same status as High Court judges. Nedlac would still be excluded from the appointment of acting judges.

The draft agreement negotiated by Labour and business at the MLC and supported by government

Agree with the government's proposals. Nedlac will recommend a list of judges from which the Minister should appoint acting judges.

CCMA and unfair dismissals

Current Situation

Cases at the CCMA often take a long time, and procedures are not always clear cut - for instance, when a party does not show or on when to grant postponements.

Original Government Proposal

Government proposed various limitations on complaints to the CCMA, to reduce the workload, wanted to require workers to be union members before a dismissal if the union can represent them, and wanted to introduce fees for the CCMA's services and fines for certain cases that may be imposed also on workers or unions.

Cosatu officials will not be able to represent workers; only affiliate can, even where there is no affiliate rep present.

The draft agreement negotiated by Labour and business at the MLC and supported by government

The parties agreed to simplify and shorten the process of considering the fairness of dismissals. To give effect to this the CCMA will combine conciliation and arbitration into a single conarb process for certain kinds of cases. Many other ways will be introduced to let workers receive a finding from the CCMA without the delays we have at present.

NEDLAC should set timeframes for CCMA cases The proposal to introduce new fees that may be charged by the CCMA to unions/workers will be deleted. Workers can be represented by a union without having to prove they were members before their dismissal. Cosatu officials will be able to represent affiliate members where the affiliate does not have a representative.

Insolvency Act

Current Situation

If a company decides to go bankrupt, workers cannot challenge the decision in order to save jobs; and if the company owes them wages or holds their provident or medical funds, the bankrupt company does not have to pay them first.

Original Government Proposal

Workers' wages should be paid before the company's other debtors

The draft agreement negotiated by Labour and business at the MLC and supported by government

The draft agreement has significant changes to the Insolvency Act to assist workers in cases of liquidations. The parties agree to the following principles:

Premium for Sunday

Current Situation

COSATU needs worker payments to be higher than the 'preferred creditors' proposed by government. The document provides for business to come back with a mandate to make certain workers claims equal to the highest claims possible in law, that of 'secured creditors'. Premium for Sunday work Workers who occasionally work on Sunday are paid double time. Workers who normally work on Sundays are paid 1,5 times their normal pay. These rules aimed to encourage employers to avoid Sunday work, in order to set up a common day of rest.

Original Government Proposal

The premium for Sunday work would be scrapped and any worker who works on a Sunday will simply receive normal pay. This will mean the permanent removal of all 'Sunday pay' provisions in the law.

The draft agreement negotiated by Labour and business at the MLC and supported by government

The agreement provides all workers who work in companies with 20 - 30 workers a premium of 1,5 time instead of double time if they work on Sunday. All other workers will still receive the current premium. Workers who receive double pay in terms of a collective bargaining agreement will continue to receive it. A Wage Determination currently defines Sunday pay in the retail and hospitality sectors. It would remain until revised by the Employment Conditions Commission, irrespective of amendments to the BCEA.

Work Workplace Forums

Current Situation

Only representative trade unions may set up Workplace Forums

Original Government Proposal

Minority unions and even non- unionised workers can set up Workplace Forums

The draft agreement negotiated by Labour and business at the MLC and supported by government

The agreement is that these amendments will need to be withdrawn, so that only a majority union can launch a Workplace Forum.