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Unemployment because of SA labour laws – Neasa (Demo)


South Africa (Neasa) disagrees with recent comments by Minister of Labour Mildred Oliphant, suggesting that SA’s labour legislation was not to be blamed for the prolonged and often violent strikes that have hit various industries across the country.
Speaking at the recent 2014 Mining Lekgotla, Oliphant said the lack of real transformation in mining and persistent inequality across the rest of the economy, were the more likely drivers of labour instability and workplace discontent.
‘Whilst we agree that the current labour legislation is not a direct or the only driver of the violent strikes, one should not shy away from admitting that South Africa’s labour laws play a huge role in exacerbating unemployment, poverty and inequality,” Neasa CEO Gerhard Papenfus said on Wednesday.
“Employers all over the world respond negatively when governments over-prescribe to them how to run their affairs. Unemployment, poverty and inequality will therefore continue as a result of SA’s labour law dispensation, which is of a very interfering and prescriptive nature.”
He said according to Oliphant a quick fix or an emotional solution to the country’s bitter labour relations will not be sustainable.
‘We agree with Minister Oliphant on this, but there has been ample opportunity to consider fundamental changes which could stimulate business, especially SMME development, which would have resulted in addressing SA’s biggest challenges,” said Papenfus.
“The latest changes to the Labour Relations Act (LRA), apart from the cosmetic and technical changes and changes to appease Cosatu, gave business very little to be excited about. The problem is that the ANC’s tripartite alliance partners, and to a lesser extent big business in Nedlac, are the only ones to have the minister’s ear,” said Papenfus.
Neasa maintains that the current labour laws are detrimental to sustainable growth and development.
“The strict laws on dismissals serve as a deterrent to job creation and, as an unintended consequence, also has a downward impact on wages. But under pressure from the alliance partners, government refrains from addressing this problem,” said Papenfus.
Another issue, in his view, is the fact that, although SMME’s play an absolute strategic role in government’s NDP-strategy, they have no voice in the LRA collective bargaining provisions.
“Changes in these areas will, however, require a huge amount of political determination. It will also require a willingness to differ with alliance partners such as Cosatu and the SACP on these issues, as well as an urgent realisation that the broader South African interest must have preference over short term political convenience,” said Papenfus.

Lack of transformation

He said during her address at the Mining Lekgotla, Oliphant also said the lack of real transformation, socio-economic equity, mutual respect and trust in the workplace have contributed to the anger and frustration that can be seen in the current industrial relations dynamics.
“What transformation is Minister Oliphant referring to? Is she referring to the development of skills, improved education and the development of a new approach towards job creation?” asked Papenfus.
“If that is what she’s referring to, we entirely agree with her. We suspect, however, that this is not what she means with ‘transformation.”
Neasa also scoffs at suggestions that the strikes were more about the ever-increasing wage gap between management and workers and the “appalling” living conditions of workers.
“Research all over the world has shown that the more government intervenes in the workplace, the more inequality increases. Minister Oliphant is right when she says that laws are not the answer. But what she has in mind is to leave the current restrictive and unfriendly business laws unchanged, to bring no relief in this area and hope things will get better. It won’t. Doing nothing won’t bring a different result,” said Papenfus.
In his view government’s continued excessive interference in the workplace is fuelling unemployment, poverty and inequality.
“South Africa needs to move in the opposite direction, towards fewer labour laws and less interference. This however requires a completely new mind-set, a new philosophy and a new understanding of the capabilities and constraints of business. Unfortunately, we’re not there yet,” he said.
Oliphant maintains that the primary goal of the labour market legislative framework is to create an enabling environment and tools to address the harsh reality.
“Minister Oliphant is so right when she says that. And labour legislation may have succeeded in putting exorbitant and unequal power in the hands of trade unions. But the LRA is not an enabler of business and since it is not inviting employer creation, the act will ultimately fail in employment creation,” said Papenfus.
“Unless something drastic is done about it, our socio-economic challenges will increase. At some point we’ll have to face this reality and make radical decisions,”.
According to Oliphant, the mediocre compliance with existing labour laws further contributed to the “militant stance” of workers dealing with collective bargaining processes.
“Where there is general mediocre compliance with laws, it is usually because such laws are against the common good of those affected. How can Minister Oliphant expect SMMEs to be enthusiastic about arrangements stemming from collective bargaining processes, when their powers are curbed as a result of bizarre and completely undemocratic labour law arrangements?” asked Papenfus.
Source: Fin24

Our Thoughts

We concur with Papenfous’s views. Labour legislation needs to be revisited, particularly strike legislation. Where unions ignore procedures and their members become violent, they must be held accountable. In situations where employees on a protected strike engage in violence, intimidation and damage to property the strike should be declared unprotected.
Strike ballots should be mandatory with a majority of 55% of eligible employees in the bargaining unit voting in favour of strike action before a strike is protected.

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