Put union capture on the radar
AJanuary 2015 amendment to the Labour Relations Act (LRA) was all that saved Cosatu from being catapulted into a potentially major financial scandal. The amendment saved the federation’s Chemical, Energy, Paper, Printing, Wood and Allied Workers’ Union (Ceppwawu) from almost certainly being deregistered amid allegations of massive financial impropriety.
This would have rebounded on Cosatu at a time when the ANC-aligned federation was dealing with a nine-union rebellion, led by the National Union of Metalworkers of SA (Numsa).
Key to this was the decision by Numsa — in accordance with the Cosatu constitution — to cease affiliation to the ANC.
Ceppwawu, by then already deeply mired in controversy, largely because of the business dealings of its general secretary, Simon Mofokeng, was one of the mainstays of Cosatu’s pro-alliance faction.
The union, although apparently bankrupt, also co-sponsored the World Federation of Trade Unions’ congress in Durban last year.
But since 2010, Ceppwawu, riven by factions, failed to provide audited accounts and there was no apparent mention in the union’s books of the estimated R4 billion in assets held by the union’s investment company.
Because of this failure to comply with the rules of accountability, the registrar of labour relations was faced with having to deregister Ceppwawu.
However, to do so, it would, as one senior labour department official noted, “leave the chequebook in the hands of the general secretary and his supporters”.
Deregistration would also, as labour registrar Johan Crouse admits, have had a possibly devastating effect on the members of the union.
It was for this reason that Crouse had, in the past, exercised the discretion allowed him by the act, not to move to deregister any union as soon as it defaulted.
I admit I was one of those who criticised him for this, feeling he was giving too much leeway to union bosses. I was wrong. Several unions have been deregistered, but only when they had clearly failed, not when they had millions or perhaps billions of rands in assets that needed to be accounted for.
Such assets, often under the control of union leaders or their appointees, rightly belong to the members.
Deregistration in such circumstances could leave the members with nothing and no way of knowing what was happening to their investment company assets.
January 2015 changed all that: the problems of deregistration could be avoided.
Crouse used the new LRA provision, applying to the labour court to have Ceppwawu placed under administration.
It was preferable to deregistration, but would still not have reflected well on the union or Cosatu.
At this stage, Labour Minister Mildred Oliphant stepped in to order that the application be withdrawn. It wasn’t and Crouse, accused of insubordination, was replaced by his deputy, Malixole Ntleki, who withdrew the application.
A series of court cases followed in which the decision by Oliphant was found to be “irrational, invalid and procedurally unfair”.
Crouse is now back as registrar and it seems that the application to place Ceppwawu and its finances under curatorship is again under way.
Time perhaps for workers to think as much about the state of unions and union capture as about the state of the nation and state capture.