COSATU Submission on the Basic Conditions of Employment Bill
Parliamentary Portfolio Committee on Labour, 28 October 1997
by Mbhazima Shilowa, General Secretary

Twenty Months ago, the Minister of Labour, Comrade Tito Mboweni, released a Green Paper on the Basic Conditions of Employment. From April 1996, government labour and business engaged in negotiations in NEDLAC, first over the Green Paper and later various drafts of the Basic Conditions of Employment Bill (the Bill). The primary aim of these negotiations was to agree on the purpose and content of the Bill.

COSATU views this piece of legislation as very important as it replaces the current Basic Conditions of Employment Act and Wage Act and provides a floor of basic conditions of employment for all workers - organised and unorganised- including the most vulnerable, such as domestic and farmworkers.

Business on the other hand want to preserve apartheid cheap labour practices in the workplace by protecting the current BCEA passed by the apartheid regime at the time when employers had a cosy relationship with government, and the majority of workers were disenfranchised. Employers, using globalisation and international competition as their cover, want to remove obstacles to further oppression and exploitation of workers. If employers have their way, South African workers, who, as the Green Paper points out, already work long hours by international standards, would work even longer hours, with very little or no protection.

The challenge facing you as the elected representatives of the people is to send out a signal to workers, through this Bill, as to what you consider to be the minimum employment standards to which every worker should be entitled, concerning basic things like hours of work, periods of sick and maternity leave and rates of over-time pay.

Parliament's choice is stark: to lead the process of eradicating apartheid's legacy from South African work places by improving and securing employment standards for ordinary working people or, to give in to those forces who want to turn back the clock and retain the patterns of apartheid cheap labour and worker insecurity.

From the beginning of the negotiations COSATU indicated that it supported the need to change the South African legislation taking into account the minister's five year plan and the RDP, the demands of workers during many years of apartheid rule as well as the need for social justice at the workplace. In this regard we indicated that while we support the broad thrust of major parts of the Green Paper and subsequent draft Bills to the extent that they seek to set a basic floor, and to improve, and regulate working conditions, there remain certain core areas that we would want addressed. These issues have since become the subject of public debates during our marches and strikes as well as during the ill conceived court case by BSA. Indeed, while the Bill is only now before you, Parliamentarians have already referred to it in their various interventions during the parliamentary debates.

While government and labour generally, COSATU in particular, have revised their positions in search of a settlement, business have refused to change their positions. COSATU attempted to encourage a resolution through offering a number of major compromises. For example, during the course of negotiations last year COSATU proposed:
that a 40 hour working week need not be implemented immediately but that it could be phased-in over a 5 year period;
that the demand for 6 months paid maternity leave be reduced to 4 months paid with the right of an additional two months of unpaid leave;
that the minimum age of child labour be reduced from 18 to 16 years.

Despite these compromises by COSATU, business refused to compromise on its positions. Obviously, business is in no rush to see the implementation of new basic conditions legislation as the present Act was drafted by the apartheid regime at a time when the majority of workers were disenfranchised and when employers had a close alliance with that regime. The resulting intransigence of business led to a deepening of the conflict over the Bill, and endless attempts to delay the process.

In the process, business, supported by their representatives in parliament (especially the NP& DP) have exposed their true intentions:
under the guise of "labour market flexibility" (ie undermining the rights of workers) they are determined to stop progressive labour legislation and to reverse existing legislation which limits the unfettered power which they have enjoyed in the past.

In attacking the labour legislation business has attacked the legislative programme of Tito Mboweni's Five-Year Programme for the Department of Labour. This can be interpreted as nothing less than a rejection of the ANC government's programme to transform employment relations and promote equity and productivity in the work place. They do it under the guise of promoting employment creation and small business promotion, yet the same business is engaged in mass retrenchments and continues to resist anti-monopoly legislation.

Our submission will focus on the core issues that we want the committee to address as well as hand over proposed draft changes for your consideration (contained in the accompanying document). The core issues that we seek to address are the following:

Hours of Work
The Bill improves working hours in respect of those workers whose hours of work are currently above 45 hours. While we welcome this reduction in working hours, particularly in respect of domestic, security, transportation, farm and mineworkers, we remain of the view that the bill should be strengthened to ensure that the proposed schedule, and process, aimed at achieving a 40-hour week, leads to an effective, and systematic reduction in hours. We therefore propose that the bill be amended to include the following:
entrench all sectoral minima which are below 45 hours, as a step to the goal contained in the Bill of achieving a 40-hour week. This needs to be explicitly captured in the schedule.

In addition to the 18 months investigation proposed in the Bill, we recommend that the report be tabled in NEDLAC whereafter negotiations on the systematic reduction of working hours should take place. This should be implemented within two years.

The reporting to parliament on progress in achieving the reduction of working hours should take place once every two years.

The phasing in of a 40-hour week, combined with a curb on overtime, can assist in increasing employment levels if there is a commitment by employers to invest in employment creation. This will be preferable to the situation where, through entrenching a longer working week, the law pushes the economy onto a path where fewer workers, work longer hours, for less.

Child labour
While we welcome the definition of a child in the Bill (below 18 years) in line with the Constitution, the Bill is too lenient in its approach to child labour. COSATU remains of the view that the threshold below which child labour would be prohibited should be set at 16 years instead of 15 as provided in the Bill. Further, COSATU wants to see the beefing up of provisions regulating employment of children between 16 and 18 years. In a country where there is a low skills base, high illiteracy, and youth unemployment, it makes no sense to discourage their parents from keeping their children at school.

Variation
The Bill provides for downward variation of basic conditions of employment through individual agreements, collective bargaining, bargaining councils and by ministerial and sectoral determinations. We remain opposed to the variation model in the Bill particularly in relation to the potential for downward variation under the guise of 'flexibility" which would be an erosion of workers basic rights, without a corresponding benefit to workers. We propose a model that will ensure that where variation takes place, a test of 'on balance more favourable' is applied. This allows for a degree of flexibility to parties in collective bargaining, while not undermining the floor of basic rights.

The variation of basic standards has been introduced as a result of business's battle cry for the introduction of greater 'labour market flexibility'. Decoded, this usually aims to remove workers protection and lower their wages. It reflects business's yearning for a return to the days of apartheid's system of cheap black labour.

The ILO study on the South African labour market (1996) has in fact argued that the South African labour market is too flexible, particularly for the majority of black workers who are faced with harsh conditions and great insecurities as to wage levels, conditions of employment and access to benefits. Rigidities tend to be concentrated in the upper echelons of the labour market, especially in the managerial and professional strata, who use their access to scarce skills and historically accumulated privileges to entrench their positions in a way which has led to huge disparities.

To the extent that flexibility is about a genuine desire to mould patterns of production to meet peculiar needs, the Bill, as well as collective bargaining arrangements, provide for a number of mechanisms which respect the minimum standards provided in the Bill. This kind of flexibility is in our view adequate to deal with the circumstances facing different sectors.

To the extent that the committee agrees to the variation model in the Bill, the following amendments should be made, to protect a number of core rights from downward variation:
working hours should be included as part of the core rights that cannot be varied;
the Ministerial power to vary through sectoral determinations, as well as that of bargaining councils, should be limited to areas stipulated by the Act (as contained in the sections on individual and collective agreements).

Paid maternity leave
Women in South Africa, particularly, black women workers have suffered enormously under apartheid. Many of them have been dismissed for falling pregnant while employed. Some have had to resort to abortions to save their jobs. The current BCEA provides for three months maternity leave with no job guarantee. Unless they are covered by collective agreements, the only payment women receive is 45% of their UIF depending on period of contribution. It is important to note however, that this 'maternity benefit' under the UIF, provides for six months, under certain circumstances.

Guaranteed maternity leave without guaranteed income is wholly inadequate. Lack of social security in South Africa also makes women, and many female headed households, completely dependent on this payment.

We welcome the fact that the Bill increases the period of maternity leave from three to four months seemingly with job guarantee. We however remain of the view that this does not go far enough particularly with respect to the leave period and payment. We therefore recommend that the Bill be amended to provide for six months maternity leave of which at least four months should be paid. The Bill should expressly make it clear that this will be paid maternity leave. Further, that the provision dealing with job security be strengthened to make it clear that women are not only entitled to leave, but to their jobs when they return from confinement.

The common claim, including before yourselves yesterday, that payment of maternity leave will cripple employers who employ women, is either a result of deliberate misrepresentation, ignorance, or sexism. We have consistently argued for a social fund, which everyone would contribute to, which would therefore benefit all workers, and employers.

In the event that the UIF is used as a mechanism for payment, women who lose their jobs soon after returning from maternity leave should not have their unemployment benefits prejudiced. We reject the current position that seeks to maintain the levels of payment at 45% in favour of full payment. Taking into account the failure of the tripartite task team to reach agreement on the payment, we request that an independent team be appointed to make recommendations on the level of payment. In the meantime the Bill should be amended to provide for payment being effected through Ministerial determination, at the time that the Bill comes into operation.

Employment Conditions Commission
In addition to these core issues of dispute, COSATU remains concerned about the lack of teeth given to the Employment Conditions Commission (ECC), a crucial institution set up by the Bill. The Commission will have the function of, inter alia proposing minimum wages for vulnerable workers who are not covered by collective bargaining processes. It is problematic that the ECC is being given inferior powers to its predecessor, the Wage Board. We believe that if it is to function effectively, its role must go beyond being a mere advisory institution to the Minister.

Transitional Arrangements
The Bill contains a transitional schedule that suggests that in the case of the Mining, Farming and Security Industry the hours contemplated in the Bill will apply six months after the legislation is operational. We propose that hours of work for security workers be reduced from 60 to 55 hours when the Bill is promulgated and thereafter a further 5 hours every 10 months until 45 hours per week is reached, without loss of pay.

Affected sectors and industries should be encouraged to agree on how this would be implemented. Their discussions will not be about whether or when this should take place, but how to effect it within the stipulated period.

The current draft proposes the exclusion of the public sector for 18 months. This is a new point which was never raised in the negotiations. We do not believe that public sector workers should be excluded from the Bill when it is implemented. We therefore propose that the government motivate why specific areas should be excluded so as to ensure negotiations with the public sector unions on when and how these will be effected.

Double Pay for Sunday Work
Sundays are the only day of the week most workers have a chance to be with their families. In terms of the Bill, when workers - who don't ordinarily work on Sunday - are required to work on Sunday, they should receive double pay. COSATU supports the Bill's provision for double pay on Sundays.

Difficulties emerge where an employee works on a Sunday and receives time off in lieu of extra payment. This is because the proposal in the Basic Conditions Bill is worse than the position under the existing Basic Conditions of Employment Act. Under the existing Act the employer had the option to pay the Sunday worker one and one third times the wage rate and give him or her a paid day off. In terms of the new Bill, there may be an agreement that Sunday workers should be paid at their normal rate and that they later receive an amount of paid time-off equal to the difference between what they have received for their Sunday work and what they were entitled to receive if they had been paid at double pay.

The effect of this complicated formula is that workers who take time-off as part of payment for working on Sunday's will be worse off under the new Bill than under the current Act. Care should also be taken to ensure that there is no difference in benefit between workers who are requested to work on Sunday or on their day off.

The proposed Bill should be amended to ensure that workers who elect to take a day off as part of their payment for Sunday work be placed in at least as favourable a position as is currently provided for under the existing Act.

Compliance
Enforcement mechanisms and penalties need to be appropriate to ensure that the rights contained in the Bill are taken seriously and enforced. Enforcement of workers rights should not continue to be taken less seriously than the enforcement of property, patent, and other rights, which contain huge penalties.

Issues raised by business on the process
NEDLAC and parliament
Business and their representatives in the media are trying to claim that the processing of the Bill through parliament 'undermines tripartism', 'threatens to collapse NEDLAC' etc. Those arguing this either don't understand the nature of the NEDLAC process, or are deliberately trying to obfuscate the fact that business is abusing NEDLAC to subvert the democratic process. COSATU has consistently throughout negotiations on the Bill argued that NEDLAC should not be used to frustrate the parliamentary process, but to enhance it.

NEDLAC was designed to deepen democracy, and to involve stakeholders. Not to frustrate legislation, or prevent parliament from exercising its sovereignty. Any reasonable person observing negotiations on the Bill in NEDLAC surely must accept that after more than a year, these negotiations had run their course, and that parliament now needed to exercise its mandate to take a final decision. It is hypocritical for business to protest at the Bill being taken to parliament, when failure to reach agreement was in large part the result of business refusal to negotiate seriously, or to make meaningful compromises. Many of us gained the clear impression that business was abusing NEDLAC to deliberately frustrate the process, scuttle the Bill, and thereby retain the status quo.

Small business
Big business is using small business as a red herring to conceal their real concern: that the Bill introduces measures which inhibit their power to exploit. Big business organisations which are represented here, and also claim to represent small business, are all affiliates of BSA, which was involved in the NEDLAC negotiations.

Figures on working hours show that it is large employers, not small business, who are working the longest hours, and the longest overtime (see attached overhead). It is therefore nonsense for them to claim that their real concern is to protect small business.

Way forward
Following the many months of negotiations and final disagreement amongst the NEDLAC partners, the task falls on South Africa's first post-apartheid Parliament to decide on the content of the Basic Conditions Bill.

COSATU is confident that the Parliamentary process - including submissions at public hearings - will yield positive results as Members of Parliament are well aware of the conditions and expectations of South Africa's workers.