EMPLOYMENT EQUITY BILL:
SUBMISSION TO THE DEPARTMENT OF LABOUR AND TO THE PARLIAMENTARY COMMITTEE BY MANCO-FIBASA

PART 1: INTRODUCTION
MANCO-FIBASA together with the other organisations associated with our urgent submissions, represents a significant section of unaligned members who have no voice on NEDLAC, including N.l.E.A.S.A., The Chemical Employers' Association of the Western Cape, the CMT and Small Clothing Employers' Association.

Although it is universally recognised that small/medium business is the engine for job creation and prosperity, SME's have neither the time nor the personnel to attend time-consuming meetings away from their place of business with the result that employer representation at NEDLAC and at bargaining council level is provided by Big Business.

Should NEDLAC be reconstituted on a regional basis, we would be glad to participate but in the meantime the only opportunity we have to convey our views and representations is to the Department of Labour direct and to the Chairman and members of the Parliamentary Portfolio Committee on Labour. We are thus highly appreciative of the Committee's invitation.

As concerned South Africans we fully support special measures to improve the quality of life and prospects for previously disadvantaged South Africans and wish to record our sincere appreciation for what, despite the huge backlog inherited from the previous regime, the state has already done in the fields of education, housing, basic health care, access to electricity and fresh water.

These positive measures are greatly welcomed but we are disturbed by the fact that, however laudable its intentions, the Employment Equity Bill once again introduces legislation based on race/colour and for reasons we record later in the submissions, we must urge re-thinking on the measure and that it be at least temporarily withdrawn for this purpose. We sincerely believe that this would be equally welcomed by the international community to the benefit of investment, job creation and stability of our currency.

PART 2: OUR REASONS
1. Whilst The Bill also deals with the position of women and disabled persons, its primary objective is to achieve employment "equity" by requiring employers to ensure that the numbers they employ reflect the race and sex composition of our rainbow population. With this as an end objective we have no quarrel but it is the draconian measures contained in The Bill that we believe to be both unnecessary and self-defeating.

To illustrate the draconian measures and the administrative burden imposed on employers as well as the utter futility of the exercise, we attach an abbreviated example of what will be required on the part of a furniture removal firm. Annexure A.

To simplify the exercise we have omitted wages, although this information would be essential and could in itself give rise to a host of queries.

For example, employee A may be earning more than employee B in the same occupational category but although of a different race or colour, the reason could be either on merit or because of length of service. Purely in relation to occupational levels, the scope of queries by a militant inspector is wide open.

A question that will be raised by an inspector would be: "Why do you employ van assistants with many years of service but take on a new driver, when you should have promoted a van assistant?"

Most employers make provisions for forward planning to ensure that in the event of persons going on leave or resigning, there will be someone to take his place but there are practical limits to the extent to which small employers can realistically do so.

An employee with a speech impediment may make an outstanding machine operator but be quite unsuitable as a telephonist or radio controller. Others may not have the education and/or qualification for promotions to higher grades.

Must the employer provide the education and/or training? Should the ambitious van assistant not use his annual leave or other free time in which to obtain his driver's licence?

Whilst in theory even the junior messenger should have access to promotion to the highest grades, this will depend not on his race or colour but on whether he is the best man for the job each step of the way and, even more important, whether there is a vacancy. Many examples exist today of aspiring persons who by training and diligence have achieved higher posts. The original Training Act of 1977 has been of great significance in this matter.

In today's almost static economy, vacancies seldom arise and over zealous inspectors could impose compliance orders which the employer may find impracticable.

In such instances the employer can appeal to the Director-General but if the Director-General confirms the requirements of the inspector, the employer is faced with the time and expense of having to go to the Labour Court - something many small employers can not afford, particularly as the fines for non compliance range from a minimum of R 500 000 to R 900 000!!

2. Drift of rural population to city areas is a world-wide trend and while measures taken during the apartheid years in an endeavour to stem such flow in South Africa were clearly based on race and were universally condemned, the point must be stressed that whatever government had been in power at the time would have been faced with the same problem.

Moreover the majority of white employers certainly in the Western Cape vigorously opposed these measures on humanitarian and economic grounds and can not be accused of acquiescing to their imposition.

The Cape Chamber of Industries, the Paarden Eiland Association and the Epping Industrialists Association were for example vigorous opponents of the apartheid measures, not on party political lines, but because of their impact on the economy and race relations.

As a result, widespread exemptions were obtained by the writer from job reservation orders and restrictions on employment of "Bantu" in Epping, Paarden Eiland and other industrial areas.

The Western Cape has a long tradition of inter racial tolerance and harmony and employment "equity" can safely be left to employers without the draconian and racial measures contemplated in The Bill. With the removal of restrictions as to who may be employed in what capacity the natural trend for employers to appoint the best person in a job is and will continue to blossom.

During the apartheid years the Liberation Movement enjoyed widespread support and ultimate achievement of its goals was not only acclaimed internationally but resulted in a wonderful spirit of "we are one" within our borders.

To introduce legislation now based on race will not only set the clock back internally but will be a setback to foreign investment essential to the massive job creation required if our 4 and a half million unemployed are to be given the jobs they so badly need.

Investors require to earn maximum income in a peaceful and a crime -free environment and in a free market economy.

Not only will foreign investors be put off by the re-introduction of race and colour in our legislation but the serious "brain drain" caused by emigration elsewhere will accelerate - something South Africa can not afford when our immediate need is for jobs, jobs and still more jobs.

Rightly or wrongly, the impression exists that the legislation is more to meet the requirements of CCSATU in relation to its two and a half million members rather than to create the urgently needed jobs for our 4 and a half million unemployed.

PART 3: LESSONS IN HISTORY
During the 1920's South Africa was severely affected by the world economic depression and faced an influx of whites from rural to city areas.

Measures taken at the time to solve the "poor white problem" could well be compared to what is now required to solve what is. because of their numerical preponderance, very largely a "poor black problem".

We believe such comparison reflect favourably on what the new South Africa is already doing to resolve the issue of poverty.

The government of the day during the depression years was white and tackled the "poor white problem" through a systematic program of relief works accompanied by social measures.

At Cape Town docks, for example, gangs of white labourers were engaged to off load trucks of fruit for cold storage pending shipment overseas. Because of the depression, labourers included well educated persons but the bulk were in fact unskilled and included some who were really outcasts of society. But they had an opportunity to earn an income.

At the same time the Martin Adams housing project [still standing at Brooklyn], ensured small but adequate housing for the whites concerned and schooling was provided for their children. Social workers ensured school attendance and that the money earned by the father was properly used on the necessities of life and not on drugs and liquor.

Other subsided labour schemes such as the work-colonies in the Kakamas district were also introduced but permanent success was dependant on job creation. Fortuitously the economy improved, due partly to the efforts of the then destitute to ensure that their children obtained proper schooling, in which the government assisted, and the "poor white problem" is now largely a thing of the past.

Today's problem is much greater and will take longer to solve, but it is pleasing to note that the process of providing adequate housing, education, basic health and other services to those previously disadvatanged has already started. That which has been achieved will greatly enhance qualifications for employment.

We note too that within the constraints of affordability, relief measures have been inaugurated e.g. the eradication of alien vegetation has provided work for a portion of our unemployed but the lesson of history is that a permanent solution will require massive additional job creation.

Here too we are appreciative of what the state is doing and are confident that with improvement in the world economy, we shall with the passage of time solve the current problems in the same way as job creation solved the previous 'poor white" problem. For this, time is needed and it is also common opinion that if the government's Intentions were carried with more diligence and integrity much more would have been achieved by now.

Having in recent times eradicated race and colour from our laws. let us not put the clock back by introducing the blatantly racial measures in The Employment Equity Bill.

PART 4: A SUGGESTION TO KICK START JOB CREATION
South Africa has traditionally observed a two-tier method of wage regulations: The Wage Board brought out minimum wages that permitted even the marginal employer to remain in business and it was left to collective bargaining to provide for higher wages to be negotiated.

Unfortunately at the behest of white dominated unions, the system of extending agreements to "non parties" was introduced to "protect civilised wages".

Today COSATU is not white dominated but the system of extention to non-parties remains to the detriment of job creation.

The employer parties to bargaining councils are nominated by employer representatives from large companies and it is obvious that big employers can afford higher wages and contributions than the small individual struggling to make a living for himself and his employees.

But if he can not afford the levies and wages imposed by the bargaining council, he is ruthlessly closed down and his workers thrown on the streets.

We give hereunder, a specific example.

CURRENT "HOUNDING" OF WESTERN CAPE SME's BY THE BARGAINING COUNCIL FOR THE CLOTHING INDUSTRY
Small entrepreneurs struggling to make a living for themselves and their workers, can not afford the same wages and contributions to provident, sick and other funds to the same extent as large concerns such as Rex Trueform.

To protect their interests, small employers have thus banded together to form the CMT and Small Clothing Employers' Association and have applied to the council for a measure of exemption. But despite this, some members are still being hounded and ordered to pay thousands of rands or be forced out of business with the result that they and their workers face being thrown on the street to join South Africa's already unacceptably high 4 and a half million unemployed.

The council says that only the independent body required under the new LRA can grant exemptions but that it can not appoint such an independent body until the Department of Labour has approved of the council's amended constitution already submitted some time ago.

The CMT and Small Clothing Employers' Association has accordingly sought an assurance that, because of this delay, all assessments and prosecutions be placed on hold pending decision by the independent body required by law.

A follow-up meeting has been agreed to by the council to take the matter further.

In the meantime threat of closure remains a potent barrier to job creation. Removal of the right of council to force non-parties to comply with agreements arrived at between Big Business and the unions would result in SME's being free to fulfil their role as job creators and the alleged danger of "slave wages" and "unfair competition" can readily be dealt with under the LRA and The Basic Conditions of Employment Act as disputes can be dealt with by the CCMA.

Restriction on the rights of non-parties also conflicts with freedom of association.

Our 4 and a half million unemployed should be able to sell their skills at whatever rates they are willing to accept but at present are not free to do so.

In submitting our proposal that bargaining council agreements should be restricted to the parties agreeing thereto, we pose the question whether it is not better to employ a thousand at R 500 a week or a hundred workers at R 1 000 per week?

TWO TYPICAL CASES OF WHAT IS NEEDED NOW
We have already paid tribute to what the state is doing to improve the employability of those currently without jobs but housing, education, etc. are longer term projects and something more is urgently needed.

The following actual cases are quoted:

Case no.1: A young African lady has arrived in Cape Town seeking employment. She is neat, well dressed and has a Senior Certificate. But although she got 45% for English (her second language) for her Senior Certificate, her command of the language is poor and she can not do herself justice when being interviewed in English - currently a pre-requisite in the city.

The State should provide free courses or subsidise employment whilst applicants gain confidence in their second language.

Case no.2: Refers to a young African adult who lost his job at the Cape Turf Club following amalgamation with the Kenilworth Club. Although employed originally in gardening and ground maintenance, he kept minutes of the Liaison Committee whilst at the turf club so had demonstrated potential. At present he is employed washing cars and has enrolled at an "Academy of Learning" to improve his prospects.

He deserve state assistance as, like the lady in case no.1, he also needs more confidence to communicate clearly in English.

During the depression years, many an Afrikaans speaking boy seeking employment in the city experienced a similar problem but a few months in the SSB or the Youth Training Brigade brought confidence in both the official languages at the time and something similar is needed now.,

Moreover, with the increasing number of black entrepreneurs in our area, Xhosa will progressively take its rightful place locally, but temporary measures are needed in the meantime - including of course encouragement to non-Xhosa speakers to learn that language too : as their contribution to MASIKANE - we are one!

ANNEXURE A
FURNITURE REMOVAL COMPANY: FICTlTIOUS EXAMPLE ILLUSTRATING HOW BIG BROTHER CAN CAUSE PROBLEMS WITH YOUR EQUITY PLAN

You employ the following:

Management and Admin. Staff:
Managing Director: 1 White Male
Accountant: 1 White Male
Operations Controller: 1 White Female
Yard supervisor: 1 White Male
Salesmen: 2 White Males
Clerks: 2 Male 1 White 1 Coloured
2 Female 1 White 1 Coloured
Telephonist: 1 Coloured female
Messenger: 1 Black Male

Drivers and Van Assistants
Drivers: 5 White Males. 20 Coloured Males, 3 Black Males
Van Labour: 0 White, 50 Coloured Males, 25 Black Males

Radio Control Room
Radio Operators: 2 Coloured Males
Clerks: 1 White Male, 2 Coloured Females

Workroom
Mechanics: 2 Coloured Males
Labourers: 1 Coloured Male, 1 Black Male

Yard Labour
Security Officer/Gatekeeper: 1 White Male
5 Coloured Males, 5 Black Males

As the firm pays good wages under an agreement with the Transport & General Workers' Union, labour turnover is comparatively low. In toady's economic situation, the company is battling to keep its current labour force. What possible useful purpose can be served in requiring the employer to set numerical goals at this stage towards "employment equity"?

In the meantime militant inspectors could be creating problems: In each category the wages must be shown giving Big Brother plenty scope for queries:

- Why are there not blacks in senior positions?
- What plans and time schedules exist to remedy this?
- Why no female drivers?
- The messenger should have an M.D.'s baton in his knapsack - what steps are being taken to train and promote him?
- Similarly, what steps are you taking and within what time limits to train van assistants as drivers?
- Why are you paying male clerks more than the females?

NB. Inspectors can impose compliance orders on you to rectify "unfair discrimination". You can appeal to the General-Director who can confirm the order and you can appeal to the Labour Court -at the cost, according to Horst Peschkes of a minimum of around R 10 000 in legal fees!