Labour Broking Committee Report: deliberations

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Employment and Labour

08 March 2010
Chairperson: Ms L Yengeni (ANC)
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Meeting Summary

Members were unanimous about the seriousness of the abuse of workers, especially farm workers and domestic workers, brought about by labour broking. Although the Committee had earlier been divided on whether to ban labour broking outright or allow it to continue but regulate it, nothing further was said about the complete removal of the practice of labour broking. On the contrary, there was a smooth discussion about new legislation that should regulate it. They agreed that the present legislation - the Basic Conditions of Employment Act and the Labour Relations Act being two of those – did not address the abusive labour practices brought to their attention during the public hearings held in the last quarter of 2009.

The discussion raised several concerns. There was an appeal made that the proposed legislation be as simple as possible, thereby making it easy to implement. The administration of a small business might be hampered if the legislation created too much bureaucracy. The department, in crafting new legislation, should be mindful of the concern that the professional sector, as well as the scarce skills sector, that operated under the present labour broking system, did not require the type of protection that other workers needed. Discussion about the commission extracted by labour brokers gave one example of as much as a third of the worker’s earnings channelled to the labour broker’s pocket.

Members agreed that the Committee Report on Labour Broking would be adopted at the 23 March meeting. However, a four member sub-committee, represented by the ANC, DA and IFP, would meet the following day to compile a list of the abusive practices brought to the Committee’s attention at the public hearings, This would assist in the drafting of the legislation to eliminate all these practices. The Chairperson thanked the members for demonstrating their willingness to work together across the political spectrum.

Meeting report

The Chairperson commented that this was the first meeting to deliberate on the draft Committee Report on the Public Hearings on Labour Broking which would be adopted at the meeting of 23 March 2010. Everyone was aware of their mandate and the task before the Committee. An apology for Mr W Madisha (COPE) who had had an operation, was noted. She asked whether the members had any opening remarks.

Mr V Ndlovu (IFP) said he was thankful for the opportunity to have gone out to so many areas in the provinces to hear what the people most affected by labour broking, were saying. It was important to understand the background of people who “feel bad” about labour broking. It was Parliament and government’s task to listen to these complaints. Amongst committee members there were two views – one that supported the complete end to labour broking, and the other which was in favour of its existence but with the proviso that it be regulated. The system should it continue, must be applicable to, and take cognisance of the suffering of people affected by it. The affected people were mainly temporary workers. There were also professionals such as doctors working under this system. This was one advantage for keeping the system and for regulating the system. However, he was very firmly against the operations of labour brokers who were “milking” the workers. The Committee needed to remove those operators who seem to have “no office” and who kept their computers “in the boot of their cars” and who exploited the workers.

Mr A Louw (DA) was grateful for the opportunity to have visited the provinces for this purpose. He acknowledged that poor practices existed, and labour brokers falling foul of the law should be taken to task. However, there were good practices as well. He had gained a lot from the hearings, especially about the exploitative practices. The plotting of the way forward was what was needed now.

Mr I Ollis (DA) related a story of a friend who had worked on the mines as a plumber. He was retrenched and some time later, through the services of a labour broker, was placed in a position with another mine. This time, though, he received a salary of R8 000 instead of the usual R12 000 received by other plumbers doing the same work in the same position. This example was clearly a case for “equal work, equal pay”. The tussle between the labour broker and the client company was at the core of the matter. He believed that labour brokers should be registered and in this way a form of regulation could be imposed so that they comply with, for example, making statutory payments such as UIF. If they did not, the registration procedure would ensure that there would be recourse.

Mr E Nyekembe (ANC) said that he was fortunate to have met so many people during the public hearings. The question for him was how to move forward, and what was required to enable that. In the professional sector, as well as the scarce skills sector, there was a need to work out how to retain these people. The department, in crafting legislation, should be mindful of this. The input from Mr Louw and Mr Ollis was a representation of real problems. Abusive labour practices must be captured and dealt with in the legislation. He agreed that there needed to be registration of labour brokers. This could be one way that the Committee could advance, in dealing with the problems raised at the public hearings by people affected by abusive labour practices. The Department of Labour could begin to shape the legislation based on this, and then bring a Bill to the Committee.

Ms A Rantsolase (ANC) said that, one way or another, these abuses had to be prohibited. A definition was needed for the terms “employer”, “employee”, and “workplace” and the employer-employee relationship must be defined by the Minister. She agreed with the previous speakers that the situation was very serious.

Ms L Mashele (ANC) said that where there was a poor or no relationship between the employer and employee, the labour broker found opportunity. The emphasis in the proposed regulations must fall on the labour which was outsourced or sub-contracted. Those workers become vulnerable and had no one speaking on their behalf. They were prohibited from joining unions and the largest sector of such workers were farm workers and domestic workers. Government should introduce unions for this sector. She agreed that a Bill to capture this should come before Parliament.

Mr Ndlovu agreed that abusive practices should be dealt with firmly. These should be carefully communicated to the Minister so that they are clearly understood. It was not sufficient to communicate with the Minister’s spokesperson, rather the Minister had to understand the seriousness of the abuses.

He commented along with other members that the draft report produced by parliamentary staff was excellent. The Chairperson echoed these comments.

Ms F Khumalo (ANC) said that it was widely known that workers rights were being violated. All relevant legislation should be examined for corresponding points of violation.

Mr Ollis said that he would be in favour of legislation but it should not be too complicated for small business to comply. Small business was the engine of the South African economy and this sector must be kept in mind when formulating the legislation. Care must be taken that such legislation did not “shut down” small business as in the past there were many forms to fill in and many levies and taxes to pay. The resultant time it took with administration was in some cases too much to cope with for small business. With regard to unions, the Department was in a position to facilitate the presence of unions.

Ms Mashele responded to Mr Ollis by saying that legislation was applicable to all citizens. It would in this instance ensure that all business, whether big or small, operated above board.

The Chairperson asked Mr Ollis to elaborate on his point concerning small business.

Mr Ollis replied that in the past there had been a regional services levy, there was also a skills development levy, unemployment insurance fund as well as taxes. These could easily be dealt with by the human resources department of big businesses, but in small business with limited capacity it was a bureaucracy and a burden. Under current laws, workers could already join unions freely. He would prefer the focus of the proposed legislation to be on statutory aspects, for example, where the safety of workers require the use of gloves, that that should be enforceable by law. The legislation must be simple to implement.

The Chairperson said she would ensure full engagement with the draft Bill.

Ms N Mnisi (ANC) said she would like to see the violations listed alongside the relevant law that it trespassed. There were sections of various laws such as the Basic Conditions of Employment Act and the Labour Relations Act, which were enabling these poor practices and therefore the Minister should consider repealing if necessary, those sections of legislation.

Ms Rantsolase said the violations of labour brokers should be listed, based on actual practice, and should not be generalised.

The Chairperson said that Mr Ollis had explained how the Bill should be drafted.

Ms Rantsolase said the needs of small business must be captured somehow in the draft legislation.
The Chairperson agreed with Ms Ransolase and said this also concurred with Mr Ollis’ observations.

Mr Nyekembe said there should be a way of linking what Mr Ndlovu and Mr Ollis had said, that is, how to include the services of professionals as they operate now, under the new legislation.

Ms Mashele said that as with all legislation, it should promote decent working conditions as well as a means towards fighting poverty. The taxi recapitalisation programme, for example, did not provide for compliance with the payment of statutory deductions for taxi drivers. These workers had been left out, and they were also discouraged from joining a union. Some of these workers had been left vulnerable and struggling with poverty. She was therefore making an appeal that sub contractors and outsourced labour be protected so as to promote decent working conditions.

Mr Ollis said he agreed in part that taxi drivers had been left out. But it was not the job of Parliament to get these workers into a union.

Ms Rantsolase said the
ILO Convention Regulation 181 on temporary employment services must be ratified and must be regulated.

The Chairperson said that those definitions mentioned earlier needed to be included as well as the listing of all the abusive practices. She asked the Committee how it would like to proceed.

Mr Louw said that through the public hearings, all these practices had already been identified. What was required now was to list these and present the list at the next meeting scheduled for 23 March 2010.

The Chairperson said that there was a consensus and she would like to have the Committee’s confirmation on the way forward.

Mr Nyekembe proposed that a sub-committee of four members be tasked with making the list which the Secretary could distribute to members prior to the 23 March meeting. This then would form the framework on which to base the discussion.

The Chairperson wanted to know if there was a seconder for this proposal.

Ms Rantsolase said she favoured a different approach. A list would be inadequate. Each item listed would have to have the law it violated, listed alongside it. This would make it easier to examine.

Mr Louw said that he favoured Mr Nyekembe’s approach since every member present had been witness to the inputs at the public hearings.

The Chairperson said she was satisfied that Mr Louw was the seconder and therefore the sub-committee would consist of 4 members which would ensure that the task was done in time for the 23 March. Should there be any disagreement, this would be brought to her attention before that date so that there was no possibility that the process would postpone the meeting.

Ms Mashele said that as all discussion had been noted by the Secretary, she could not foresee any problem arising with the sub-committee.

The Chairperson said it was a way of ensuring that by saying she should be alerted, it provided the space for any such possibility arising.

Ms Rantsolase returning to her previous point, said she would also like to have listed the legislation that had been violated.

The Chairperson said that she had noted Ms Mnisi’s earlier point concerning the repeal of sections of legislation and the Minister’s role in considering that legislation.

Mr Louw said that the sub-committee should represent all political parties. He asked at which stage of a disagreement in the sub-committee, should the Chairperson be alerted, in other words, by which date.

The Chairperson replied that this meeting had progressed very smoothly and was in agreement about the sub-committee and its task of making a list of all the abusive practices. She asked, what then, it was that the Committee did not agree about.

Mr Louw repeated that in the event of a “misunderstanding” and a need for an intervention, when the appropriate time would be for the Chairperson to be consulted.

Mr Nyekembe said that the Committee’s work would culminate in a set of recommendations. That work must be completed, therefore making it possible for the report to be adopted.

The Chairperson said that where there might be issues of disagreement, she would decide which ruling would be suitable and appropriate.

Ms Rantsolase said it would not be necessary for recommendations. She wanted only the list of abusive practices.

Ms Khumalo agreed with Mr Nyemkembe but asserted that there would be disagreements. She was not sure that the ruling that might be made, would be applicable. She was tempted to call instead for a special committee meeting.

The Chairperson asked whether there were any other issues for discussion.

Mr Nyekembe suggested that the sub-committee be proportionally representative.

The Chairperson said it had been agreed on the number of four. There would be one member each from the DA and from the IFP.

Ms Rantsolase said that not all parties were present in the meeting that day.

Ms Khumalo withdraw her previous point and agreed on the 4-member sub-committee.

Ms Mnisi said that the parties who were not present should not serve on the sub-committee.

Mr Ollis said that the sub-committee would not have voting powers so it did not matter.

Ms Mashele proposed that the sub-committee consist of the ANC, DA and IFP.

Mr Louw said that he proposed that his colleague, Mr Ollis, should serve on the sub-committee and because of the urgency, that the meeting take place on Wednesday 10 March.

The Chairperson said that the sub-committee would consist of Mr Nyekembe, Ms Mashele, Mr Ollis and Mr Ndlovu. The meeting date as proposed by Mr Louw would be Wednesday 10 March 2010. The meeting had gone very well and demonstrated the seriousness of the matter by members working together across the political spectrum. It afforded an opportunity for those who had attended the public hearings, as well as constituents, to see how seriously Members of Parliament considered their inputs.

The meeting adjourned.


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