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Shopsteward Volume 27: Special Bulletin

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Congress  |  Declarations

Declaration on Labour Market Flexibility

Adopted by COSATU Special Congress, 19 August 1999

This Special COSATU Congress notes with anger the calls by sections of business, both white and black, for greater labour market flexibility. This call is an attempt to roll back all the social gains introduced since 1994, and to take us back to the apartheid labour market.

We note that the old apartheid labour market was both very flexible, and in the words of the presidential Commission of Enquiry set up by then president Mandela in 1996

" Labour market policy was, arguably, the centrepiece of apartheid`s mechanism of social control and its economic growth strategy. Poverty, discrimination and inequality were the hallmarks of its workings and consequences".

We note the vast inequalities in wealth and income between top and bottom in our labour market:

  • with wages in organised workplaces in the bulk of manufacturing at less than R500 a week, and in fact some factory wages as low even as R70 per week,

  • in mining R230 per week,

  • in the public sector the lowest wage is about R400 per week,

  • in the commercial service sector Rx per week,

  • on farms Rx per week,

  • in domestic employment Rx per week.

We note too that some CEO`s are earning R135 000 per week.

It is precisely because a democracy cannot accept such destitution amidst plenty, that we introduced new policies and new laws.

The reforms of the labour market were started with the democratic transformation of 1994. This embraced new laws such as the Labour Relations Act, the Basic Conditions of Employment Act, the Employment Equity Act and the National Skills Act.

Now sections of business want to take us back to the past. They want a flexibility that means no standards.

They want the right to hire and fire as they please, in the passage, without due process or a fair reason, and to casualise labour contracts, so that they can have a `rent a black` employment relationship: rent workers by the hour, the day or the period you need them, then discard them.

They want the right to pay bitterly low wages, so that those at the bottom in society, after a hard day`s work, still starve.

They want to promote small business not because they want job creation, but because this will be a convenient way to cut their costs through subcontracting work from companies where we are starting to gain reasonable standards, to the new sweatshop economy.

They want to reduce the powers and coverage of central bargaining agreements to force negotiations back to plant levels in order to frustrate the negotiation of decent industry standards.

What is noteworthy is not the attitudes of the traditional employers of labour, but that sections of black business has been co-opted so quickly.

They too are happy to promote policies that will require that the poverty of workers is the means of their enrichment. Instead of joining workers in calling for wealth redistribution from the historically privileged, they now want simply to let workers pay the price, through lower wages and no regulation, to make them wealthy businessmen.

COSATU will not accept this.

We will defend the gains made in the transformation of the labour market.

We will not let Bargaining Councils be weakened through tampering with the provisions to extend agreements to non-parties.

We will not give up the protection which workers have against unfair dismissal.

We will not let working conditions in the small business sector drop to sweatshop levels.

We will defend the rights of workers, won through hard battle.

We call for labour market policy consistent with the vision adopted by the COSATU Central Committee in 1998.

We call for the strengthening of the Labour Relations Act in the following areas:

  1. The prohibition of scab labour;

  2. Exclude the right to lockouts;

  3. Improve disclosure of information requirements, including a provision that entitles unions to information on the package of CEO`s as part of collective bargaining;

  4. Prevent the loophole of `independent contractors` being used by unscrupulous employers to by-pass the employment relationship;

  5. Improve the severance pay provisions to four weeks per year of service;

  6. Require sub-contracting arrangements with an employment impact to be negotiated with representative trade unions;

  7. Change section 189 to require retrenchments to be a matter for negotiation;

  8. Ensure that `dismissals` for operational requirements explicitly refer only to instances where a company has no alternative, rather than for any `objective reason`;

  9. Protection for secondary strikes should be improved;

  10. Protection for workers whose companies are sold should be improved.

We call for a change in the Insolvency Act in the following areas:

  1. To ensure that the Act does not exclusively protect the position of `creditors`, but that it makes provision for companies to be saved on social and public interest grounds;

  2. To require the liquidator to use the period of judicial management to maximise job retention;

  3. To amend the section of the Act which terminates all employment contracts during the provisional liquidation phase;

  4. To give proper and adequate preference to worker claims during insolvency, by making it the most preferred level of claims;

  5. To consider the setting up an independent and compulsory guarantee fund to make provision for payment of all workers claims, including outstanding wages, when a company goes into liquidation, and the insolvent estate is unable to pay out these claims;

  6. Directors and shareholders of an insolvent company/close corporation should be liable to prosecution and if guilty, to imprisonment should worker statutory contributions not be met out of the proceeds of the liquidation.

We call for a change in the BCEA in the following areas:

  1. A legislated 40 hour working week;

  2. No downward variation of the standards in the Act;

  3. Implement the other package of proposals agreed within the alliance to strengthen the BCEA and address the problems of workers.

Programme of Action on Jobs and worker rights

As COSATU we commit to the following program of action in defence of our rights:

Rolling mass action

  1. A campaign at the shopfloor: industry by industry: every week we focus on a new sector, with action in defence of jobs and labour rights:

    Gold mining
    Public sector
    Paper and print
    Coal, platinum and diamond mining


  2. Provincial action

    (Details to be added)


  3. General strike if demands of Federation are not achieved

    (Timing to be agreed)