Labour Relations Act, Basic Conditions of Employment Act: finalisation

Meeting report

LABOUR PORTFOLIO COMMITTEE
30 October 2001
LABOUR RELATIONS ACT, BASIC CONDITIONS OF EMPLOYMENT ACT: FINALISATION

Chairperson, Acting: Mr. G. Olifant

Relevant Documents :
Department of Labour: Response to public hearings on amendments to the Labour Relations Act and Basic Conditions of Employment Act
Basic Conditions of Employment Amendment Bill [B70 – 2001]
Labour Relations Amendment Bill [B77 – 2001]
CCMA Powerpoint presentation

SUMMARY
The Committee adopted the Basic Conditions of Employment Amendment Bill and the Labour Relations Amendment Bill with amendments. The CCMA presented on the general impact of the labour law amendments on its work.

MINUTES
In this final meeting dealing with labour legislation amendments, the Director General, Adv R Ramashia, acknowledged the integral role played by Ms Seftel and Mr. Kettledas. Mr. S. Mkhonto, another key player in this process, was unable to attend the proceedings.

Ms Seftel commenced by dealing with the outstanding issues of the public hearings on the amendments to the LRA and BCEA held on the 16 and 17 October 2001.

Basic Conditions of Employment Amendment Bill
Section 34A
This section deals primarily with the payment of contributions to benefit funds. Ms Seftel advised that CLOFED’s proposal entailed the employer paying over contributions to benefit funds within 14 days. This view was not supported by the Department of Labour.

Section 37
This section dealt with notice periods. Disabled People of South Africa opposed the reduction of notice periods . However, this is not supported by the Department of Labour.

Section 41
The section deals with severance pay. SADSAWU recommended that month’s salary be given for every year worked. The Department’s view on this issue was that it be discussed extensively in a sectoral determination.

Ms Seftel then presented the additional proposed amendments for the Basic Conditions of Employment Amendment Bill.

Clause 3
Section 10 of the principal Act would be amended to state:
"(1) Subject to this Chapter, an employer may not require or permit an employee to work:
overtime except in accordance with an agreement;
more than:
three hours’ overtime a day or;
ten overtime hours’ a week."

All political parties were amenable to this amendment.

Clause 9
This clause be amended to read as follows:
"(2A) . . . .
the employees’ ordinary hours of work, rest periods and annual leave are on the whole more favourable to the employees than the basic conditions of employment in terms of sections 9, 10, 14, 15 and 20, and;
the determination has been agreed to in a collective agreement;
is necessitated by the operational circumstances of the sector in respect of which the variation is sought and the majority of employees in the sector are not members of a registered trade union;"

The Committee agreed to this amendment.

Clause 10
This clause merely contained a technical amendment.

The Basic Conditions of Employment Amendment Bill was unanimously approved by the Committee with amendments.

Labour Relations Amendment Bill
Ms Seftel dealt with the outstanding issues of the Labour Relations Act and in particular, the department’s response to submissions made at the public hearing.

Section 194(1)
This section deals with the removal of the cap on compensation. COSATU was of the opinion that the 12 month cap period should be removed. However, this issue had not been raised during the NEDLAC process and would have further consequences for some of the underlying principles of the Labour Relations Act. Presently, there is a 24 month cap for compensation for automatically unfair dismissal, which may require removal to create consistency. The Department does not support this proposal.

Section 197
This section centred around choices in respect of benefit funds. FEDUSA proposed that persons affected by a transfer are to be afforded more options in respect of their benefit funds when being transferred. The Department of Labour rejected this proposal.

Section 197(B)
The Free Market Foundation questioned the relationship between this Insolvency clause and the insovlency Act. These issues will be addressed by the Justice Portfolio Committee when dealing with the Insolvency Bill.

The motion of desirability was supported by the Committee and approved all proposed amendments to this Bill. The Chair suggested, as a point of certainty, that the Labour Relations Amendment Bill be perused page by page to afford members the opportunity to raise any further comments or concerns.

The amendments to Clauses 3, 4, 7, 9, 12, 15, 17, 22, 30, 36, 37, 38, 39, 40, 45, 47, 48, 49, 50, 51, 52, 53, 54, 55, 59, 60 were all agreed upon by members and no further concerns were raised.

The Labour Relations Amendment Bill was unanimously approved by the Committee with amendments.

CCMA presentation
Ms T Orleyn, Director of the CCMA, noted that the vision of the CCMA was to promote social justice and economic growth with social partners by transforming relations in the labour market. This, it is believed, would be achieved by delivering high quality, low-cost dispute resolutions and prevention services.

Ms Orleyn pointed out the disadvantages and advantages of the Labour Law Amendments on the CCMA:

Section 115 Con/Arb processes
The Con-Arb process would have the following impact:
(a) Advantages for the CCMA
- medium to long term potential for cost saving
-expedient dispute resolution process.

(b) Disadvantages for the CCMA
- immediate system and process changes
- this will result in a cost implication.

Section 143 – Orders of Court
The Director may make an award an order of Court:
- 700 applications are received by the Labour Courts per month.
- The Sheriff’s Act 90 of 1986 and Section 163 of the LRA requires amending.
- Requires changes to systems and processes.
- Additional administrative burden on the Director’s office.
- Additional resources required – both human and financial.

Section 188 – disciplinary hearings
- Additional demands for Commissioner interventions.
- Changes to systems and processes required including cost recovery from parties.
- Hard to gauge demand at this stage.

Section 191 – retrenchments
- Individual retrenchments may be referred either to the Labour Court or the CCMA.
- Last year the Labour Court dealt with some 120 retrenchment cases.
- A cost of some R360 000 per annum can be expected.
- The effects of this amendment will be slight.

[The rest of the meeting was not minuted by PMG]

Appendix:
AMENDMENTS PROPOSED: BASIC CONDITIONS OF EMPLOYMENT AMENDMENT BILL [B70-2001]
1. Section 28(2)(b) of the principal Act is deleted.

NEW CLAUSE

CLAUSE 9

3. On page 5, in line 4, before 'employees' insert 'the';

4. On page Sin line 4, omit "overtime, meal intervals,".

5. On page 5, on line 8, before 'determination' insert 'the';

6. On page 5, in line 11, after 'sought' insert 'and the majority of employees in the sector are not members of a registered trade union'.

CLAUSE 10

CLAUSE 7

4. On page 4, in line 41 - 42, omit 'a contract of'.

5. On page 4, in line 43 - 44, omit "in terms of section 49(1) of the Basic Conditions of Employment Act".

6. On page 4, in line 52, to omit "Commission" and to substitute "council".

7. On page 4, from line 52, to insert

"(b) If a party to an arbitration in terms of this section, that is not a party to the council, objects to the appointment of an arbitrator in terms of paragraph (a), the Commission, on request by the council, must appoint an arbitrator.

(c) If an arbitrator is appointed in terms of sub~paragraph (b) -

(i) the Council remains liable for the payment of the arbitrator's fee; and

(ii) the arbitration is not conducted under the auspices of the Commission."

CLAUSE 9

CLAUSE 12

"Unless otherwise agreed to in a collective agreement," before "Sections 1 42A".

10. Amend footnote 11 to the principal Act by inserting after "disputes" in the first line of the footnote "contemplated by subsection (3)".

11. Amend footnote 11 to the principal Act by inserting after "disputes" in the second paragraph of the footnote "contemplated by subsection (3)".

CLAUSE 15

CLAUSE 17

14. On page 8, in line 25 to 26, omit "in contemplation or in furtherance of the strike or lock-out".

CLAUSE 22

"(k) the right of any person or category of persons to represent any party in any conciliation or arbitration proceedings;

(I) the circumstances in which the Commission may charge a fee in relation to any conciliation or arbitration proceedings or for any services the Commission provides, and"

17. On page 10, in line 31, renumber paragraph (k) as (m).

18. On page 10, from line 34, omit subsection (2B).

CLAUSE 30

19. On page 12, in line 12 omit "to the Commission";

20. On page 12, in line 12, omit "for" and substitute "to".

21. On page 12, in line 15, omit sub-paragraph (c) and insert-"The Commission may on good cause shown waive the requirement in
sub-paragraph (b) and pay to the witness the prescribed witness fee."

CLAUSE 36

CLAUSE 37

CLAUSE 38

CLAUSE 39

CLAUSE 40

CLAUSE 45

29. On page 17, in line 4, omit "inquiry" and substitute "arbitration".

30. On page 17, in line 11, omit 'an inquiry in terms of this section' and substitute 'a pre-dismissal arbitration'.

31. On page 17, in line 13, omit 'inquiry' and substitute 'arbitration'.

32. On page 17, in line 16, omit "an inquiry in terms of this section" and substitute "a pre-dismissal arbitration".

33. On page 17, in line 18, omit "inquiry" and substitute "arbitration in terms of this section".

34. On page 17, in line 26, omit "inquiry conducted" and substitute "arbitration".

35. On page 17, in line 32, omit "inquiry" and substitute "arbitration".

36. On page 17, in line 34, omit "inquiry" and substitute "arbitration".

On page 17, after line 37, insert-

"(9) An arbitrator conducting an arbitration in terms of this section must, in the light of the evidence presented and by reference to the criteria of fairness in the Act, direct what action, if any, should be taken against the employee.

(1 0)(a) A private agency may only conduct an arbitration in terms of this section if it is accredited for this purpose by the Commission

(b) A council may only conduct an arbitration in terms of this section in respect of which the employer or the employee is not a party to the council, if the council has been accredited for this purpose by the Commission.

CLAUSE 48

CLAUSE 49

41. On page 19, after line 22, insert-"(c) the consulting parties may agree to vary the time periods for
facilitation or consultation."

42. On page 19, in line 36, omit sub-paragraph (b).

On page 19, in line 40, omit sub-paragraph (a) and substitute
"(a) the time period, and the variation of time periods, for facilitation."

44. On page 19, in line 48, omit 'of the termination of ' and substitute 'to terminate'.

45. On page 19, in line 48, omit 'contract' and substitute 'contracts'.

46. On page 19, in line 52, omit 'of contract of employment'.

47. On page 19, in line 57, omit 'the' and substitute "a".

48. On page 19, in line 57, before 'Commission', insert "a".

49. On page 19, in line 58, omit "a".

50. On page 20, in line 2, omit 'of termination of and substitute 'to terminate'.

51. On page 20, in line 2, omit 'contract' and substitute 'contracts'.

52. On page 20, in line 6, omit 'of the contract of employment'.

On page 20, from line 13 omit "sub-section (10) and substitute
"10(a) A consulting party may not-
(i) give notice of a strike in terms of this section in respect of a dismissal, if it has referred a dispute concerning whether there is a fair reason for thrat dismissal to the Labour Court;

(ii) refer a dispute about whether there is a fair reason for a dismissal to the Labour Court, if it has given notice of a strike in terms of this section in respect of that dismissal.

If a trade union gives notice of a strike in terms of this section -

(i) no member of that trade union, and no employee to whom a collective agreement concluded by that trade union dealing with consultation or facilitation in respect of dismissals by reason of the employers' operational requirements has been extended in terms of section 23(1)(d), may refer a dispute concerning whether there is a fair reason for dismissal to the Labour Court;

any referral to the Labour Court contemplated by subparagraph (i) that has been made, is deemed to be withdrawn.

54. On page 20, in line 27, omit sub-paragraph (b) and substitute -"(b) subject to subsection 2(a), section 65(1) and (3);"

On page 20, after line 46, insert -

"(d) make an award of compensation, if an order in terms of sub- paragraphs (a) to (c) is not appropriate".

56. On page 20, from line 49, omit sub-paragraph (b).

57. On page 20, in line 58, omit 'a'.

58. On page 21, in line 8, omit "an operational" and substitute 'a'.

CLAUSE 50

60. On page 21, in line 46, omit 'at any stage after' and substitute 'once'.

61. On page 21, in line 52, after 'conditions' insert 'or circumstances'.

62. On page 21, in line 53, omit 'of' and substitute 'at'.

63. On page 22, in line 5, omit 'section' and substitute 'subsection'.

64. On page 22, in line 21, omit 'the' and substitute 'a'.

CLAUSE 51

CLAUSE 52

On page 22, after line 51 insert-

"(3) The compensation awarded to an employee in respect of an unfair labour practice must be just and equitable in all the circumstances, but not more than the equivalent of 12 months remuneration

CLAUSE 53
On page 23, in line 3 - 4, omit 'or undertaking' and insert', "undertaking or service".

On page 23, from line 24, omit sub-paragraph (3) and substitute -

"3(a) The new employer complies with subsection (2) if that employer
employs transferred employees on terms and conditions that are on the whole not less favourable to the employees than those on which they were employed by the old employer.
(b) Sub-paragraph (a) does not apply to employees if any of their collective agreement."

On page 23, in line 33, after 'satisfied' insert footnote 53a with the following text -

"Section 14(i)(c) of the Pensions Funds Act requires the registrar to be
satisfied that any scheme to amalgamate or transfer funds is reasonable and equitable, and accords full recognition to the rights and reasonable benefit expectations of the persons concerned in terms of the fund rules, and to additional benefits which have become established practice."

On page 23, from line 45, omit subsection 6 and insert -

6(a) An agreement contemplated in subsection (2) must be in writing
and concluded between -

(i) either the old employer, the new employer, or the old and new employers acting jointly, on the one hand; and

(ii) the appropriate person or body referred to in section 189(1), on the other.

(b) In any negotiations to conclude an agreement contemplated by paragraph (a), the employer or employers contemplated in subparagraph (i), must disclose to the person or body contemplated in sub-paragraph (ii), all relevant information that will allow it to engage effectively in the negotiations.

(c) Section 16(4) to (14) applies, read with the changes required by the context, to the disclosure of information in terms of paragraph (b)."
72. On page 23, in line 57, after 'employer' insert 'in the event of a dismissal by reason of the employer's operational requirements'.

CLAUSE 54

74. On page 24, in line 37, insert 'provisional' before 'winding-up'.

75. On page 24, line 39, before 'rights' omit 'the'.

CLAUSE 55

CLAUSE 59

78. On page 27, in line 11, after 'repealed' insert ', and any reference in this item to those sections is a reference to those sections prior to amendment by the Amendment Act.

79. On page 27, in line 20, omit 'inquiry' and substitute 'arbitration'.

80. On page 28, from line 49, omit item 32.

CLAUSE 60
81 On page 29, in line 26, omit 'code' and substitute 'Code'.

 

77. On page 27, in line 8, omit 'regulations made by the Minister in terms of section 11 5(2B)(a) and substitute 'rules made by the Commission in terms of section 11 5(2A)(k)'.
76. On page 25, after line 37, insert -"(4) NEDLAC must prepare and issue a Code of Good Practice that
sets out guidelines for determining whether persons, including those who earn in excess of the amount determined in subsection (2) are employees."
73. On page 24, in line 29, omit "and" and substitute "or".
On page 22, from line 41, omit sub-section (1) and insert-

"(1) The compensation awarded to an employee whose dismissal is
found to be unfair either because the employer did not prove that the reason for dismissal was a fair reason relating to the employee's conduct or capacity or the employer's operational requirements or the employer did not follow a fair procedure, or both, must be just and equitable in all the circumstances, but may not be more than the equivalent of 12 months' remuneration calculated at the employee's rate of remuneration on the date of dismissal."
65. On page 22, in line 36, omit 'a'.
59. On page 21, in line 42, before "time" insert "relevant".
40. On page 19, in line 17, omit "dispute" and substitute "dismissal".
38. On page 18, in line 17, insert "in writing" before "all".

39. On page 18, in line 37, after "arbitrator" insert "or the Labour Court".
27. On page 16, in line 23 - 24, omit "of employment" and substitute "or circumstances at work".

CLAUSE 47
28. On page 17, in line 1, omit "inquiry into allegations about employee's conduct and capacity" and insert "pre-dismissal arbitration".
25. On page 15, from line 1, omit clause 39.
26. On page 15, in line 53, omit "either".
24. Page 14, from line 7, omit clause 38.
23. On page 14, from line 1, omit clause 37.
22. On page 13, from line 43 onwards, omit clause 36.
15. On page 10, in line 30, omit 'and';

16. On page 10, from line 30, insert-
13. On page 8, in line 25, omit "any".
12. On page 8, in line 11, omit 'needs' and substitute 'need'.
8. On page 6, in line 3, to omit 'Application to establish statutory council' and to substitute 'Disputes between bargaining councils in public service'.
9. On page 7, in line 8, to insert -
3. On page 4, in line 41, after "which" to insert "in terms of section 49(1) of the Basic Conditions of Employment Act".
7. On page 5, in line 24, omit 'contained' and substitute 'of employment'.

AMENDMENTS PROPOSED: LABOUR RELATIONS AMENDMENT BILL [B77-2001]

CLAUSE 3
1. On page 3, in line 33, to omit "domestic" and to substitute "home

CLAUSE 4
2. On page 3, line 47, to omit 'a bargaining council: and to substitute 'bargaining councils'.
2. On page 5, in line 3, omit 'the'.
 

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