‘Gov­ern­ment fail­ure’

Finweek English Edition - - Business strategy -


who helped shape South Africa’s Labour Re­la­tions Act (LRA) in the Nineties, still firmly be­lieves in the good of sec­toral bar­gain­ing but is highly crit­i­cal about how Gov­ern­ment has failed to de­velop the bar­gain­ing coun­cil sys­tem.

Hav­ing been called in to help ne­go­ti­ate a new deal for the Na­tional Cloth­ing In­dus­try Bar­gain­ing Coun­cil (NCIBC) he re­fused to com­ment on the cloth­ing in­dus­try specif­i­cally.

Chea­dle says the Labour De­part­ment should have writ­ten a model bar­gain­ing coun­cil agree­ment shortly af­ter the pro­mul­ga­tion of the LRA and should have in­cor­po­rated it into a clear pol­icy on min­i­mum and ac­tual wages.

Says Chea­dle: “It’s not an in­flex­i­ble pol­icy. So it doesn’t say you can only have min­ima and ac­tu­als must be dealt with else­where. It’s one that says in cer­tain cir­cum­stances ac­tu­als are ap­pro­pri­ate but, as a rule, un­less there are com­pelling rea­sons against it (bar­gain­ing coun­cils should) set min­ima that ex­pand the com­pli­ance net and don’t con­sti­tute a bar­rier to job cre­ation and to al­low ac­tu­als to be de­ter­mined at plant level.”

Chea­dle says the Labour Min­is­ter had also failed to set pa­ram­e­ters for bar­gain­ing coun­cils by rub­ber-stamp­ing col­lec­tive agree­ments with­out giv­ing sub­stance to the LRA’s pre­scrip­tion that a coun­cil should be “suf­fi­ciently rep­re­sen­ta­tive” of an in­dus­try be­fore an agree­ment could be ex­tended to be­come law for the en­tire in­dus­try. If the min­is­ter ex­er­cised his dis­cre­tion prop­erly, he could en­sure that small busi­nesses’ in­ter­ests are re­flected in the agree­ments, even though they have prob­lems tak­ing part in bar­gain­ing coun­cil struc­tures.

In the same way, the min­is­ter could and should send a col­lec­tive agree­ment’s ex­emp­tion pol­icy back for im­prove­ment if it’s too bu­reau­cratic or oner­ous. Chea­dle says a busi­ness should be able to ob­tain ex­emp­tion from bar- gain­ing coun­cil agree­ments if it’s start­ing up, if it’s fallen on hard times or if the work­ers agree to it.

How­ever, as things stand there’s no clear pol­icy con­cern­ing ex­emp­tion in SA’s bar­gain­ing coun­cil sys­tem.

“The min­is­ter, and the Pres­i­dent, can guide col­lec­tive bar­gain­ing in a way that meets the con­sti­tu­tional obli­ga­tion and the eco­nomic con­cerns. I call it Gov­ern­ment fail­ure.”

Ne­go­ti­at­ing par­ties them­selves are also to blame for not de­vel­op­ing col­lec­tive bar­gain­ing. “Both unions and em­ploy­ers con­tin­ued as they did be­fore (1994). You can see some of th­ese agree­ments go back to 1940. Some of them haven’t even changed the lan­guage of th­ese agree­ments. They’re fat – and they’re im­pos­si­ble to read.”

The of­fice of the Labour Min­is­ter didn’t re­spond to re­quests for com­ment.

Firmly be­lieves in the good of sec­toral bar­gain­ing. Hal­ton Chea­dle

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