New Industry Structure for South African Wine Industry; Committee Programme

Meeting report

LABOUR PORTFOLIO COMMITTEE
12 March 2002
NEW INDUSTRY STRUCTURE FOR SOUTH AFRICAN WINE INDUSTRY; COMMITTEE PROGRAMME

Acting Chairperson: Ms E Thabethe (ANC)

Documents handed out:
Vision 2020 Industry structure for Wine Industry - Power Point presentation
BAWSI Charter for the Wine and Spirit Industry (Appendix 1)
BAWSI Constitution (Appendix 2)
Draft Committee programme (Appendix 3)

SUMMARY
The Black Association of Wine and Spirits Industry (BAWSI) briefed the Committee on the new industry structure for the South African wine and spirits industry, the SA Wine and Brandy Company, a Section 21 company that will come into being this year. He reported on BAWSI's recommendations, Vision 2020, which had been embraced by the industry. The company will have six representatives from each of the three sectors: labour, wine growers/wineries and wine merchants. He provided background about the constitution and aims of BAWSI.

The adoption of the committee programme will be made next week.

MINUTES
Announcements
The acting Chairperson noted that Mr S Manie is on sick leave until 30 June 2002.

New Industry Structure for SA Wine Industry: SA Wine and Brandy Company
Mr Nosey Pieterse, the president of BAWSI, briefed the Committee. He was accompanied by Mr Vukile Mafilika who is both a representative for KWV and a facilitator of BAWSI. After briefing the Committee on the background and aims of BAWSI, Mr Pieterse explained the need for a formal representative structure for the South African Wine Industry that could provide a forum for strategic debate and be the industry's mouthpiece. It would drive the strategic direction of the industry and would centralise efforts devoted to technical research, generic marketing, human resource development, industry intelligence and social responsibility. The Vision 2020 recommendations developed by BAWSI would ensure that this industry structure had effective worker representation and that economic empowerment and affirmative action issues are on its agenda. He discussed the composition of the structure (see documents for detail).

Discussion
The Chairperson wanted to know whether Mr Mafilika was representing KWV or BAWSI.

Mr Mafilika replied that he was aware that he was known to be a person from KWV. However BAWSI was supported by the wine industry as a whole, including KWV. As an employee of KWV therefore, he was also responsible for the facilitation of BAWSI.

Mr Mshudulu (ANC) thanked Mr Pieterse for the briefing, saying that it had clarified issues for him. He noted the use of the word "intelligence" in the briefing and asked for clarity.

Mr Pieterse explained that this referred to the intelligence unit within the industry structure. It ensured that the industry was kept up-to-date on industry-relevant activities nationally and internationally by gather information and make it available to industry members.

Mr Rasmeni (ANC) commended Mr. Pieterse and his associates for having come up with the structure (BAWSI). He said he was not apologetic about it as he considered it a part of the process of black economic empowerment and transformation in this country. He asked Mr Pieterse about the number of black companies in existence in the wine industry.

Mr Pieterse replied that there were small black companies like Mhlobo, Nceda, Nathi and so forth, which were trying to penetrate the industry. BAWSI was assisting people to form these companies and also helping by making their businesses known to the industry. By and large, though, Pieterse admitted that the industry was still white-owned.

Mr Middleton (IFP) asked Mr Pieterse if BAWSI was aware that the wine industry was still practising child labour, slavery and the "dop" system? If yes, what was it doing about it?

Mr Pieterse agreed that BAWSI was aware of some negative practices within the industry. It had brought these practices to the attention of the union and had advised communities on how to tackle this. Now that BAWSI was recognised throughout the industry, they were planning to focus on these negative practices more.

Mr R Ndou (ANC) asked how BAWSI represented the interests of white workers? What type of political activities was BAWSI involved in? How did it relate to Nedlac? And whether BAWSI was not creating another Nedlac in terms of its structure? He also wanted to know if BAWSI would refuse membership to people on account of colour?

Mr Pieterse pointed out that BAWSI was a black association of the Wine and Spirit industry. It only promoted black workers' interests. It was, however, not anti-white. Testimony to that was borne out by the fact that its general-secretary was white. He denied that they were creating another Nedlac as BAWSI was industry-specific.

Mr K Moonsamy (ANC) expressed his difficulty in accepting what he termed racialism as represented by BAWSI in its exclusion of other South African citizens (whites). He said that was against the Constitution. Although he was for black economic empowerment, he wanted to help create a country that did not think in terms of race and colour.

Mr Pieterse replied that committee members needed to understand from where BAWSI was coming. It was intended to empower the previously disadvantaged communities, the people who had been economically excluded. And that there was no intention to be racially exclusive.

Mr Ndou registered his disappointment with BAWSI's constitution. He said it held the potential to be anti-transformation. And that it was going to be cumbersome. He criticized BAWSI's constitution for what he saw as its failure to quote any existing legislation. He also commented that he had been under the impression that KWV was going to give the briefing and not BAWSI.

Mr Pieterse admitted to the fact that the structure was going to be cumbersome. However, he believed that it would be able to work out how it was going to be effective. With regard to legislation, Mr Pieterse dismissed the allegation that there was no reference to existing legislation. As a matter of fact, he said, legislation had been quoted in BAWSI's constitution.

He acknowledged the point that BAWSI had not been scheduled to give the briefing. However the original presenters, Prof Loubsher of Stellenbosch University's Business School and Mr Herman Böhmer, Chairperson of Cape Negotiants, could not come due to personal reasons. The reason that BAWSI had given the briefing was that it was the one that had presented the Vision 2020 recommendations which were subsequently accepted by the whole industry. Thus BAWSI was central to the development of the document. He stressed the fact that there was nothing sinister about him (BAWSI) giving the briefing.

Mr S. Pillay (DP) pointed to the fact that BAWSI's charter referred to the possible establishment of a corporate university and asked who was going to give accreditation?

Mr Pieterse said that a company called Adicorp in alliance with BAWSI, will drive the Corporate University. The Corporate University will integrate all service providers. Warwick University would do the accreditation. He pointed out that that was not a new phenomenon as corporate universities existed in other countries.

Mr C. Stokes (DP) commented that Vision 2020 was interesting. He referred to BAWSI's expectation that the Committee would help it - and noted that the Committee did not endorse anyone or any organisation.

Mr. Rasmeni (ANC) said that the purpose for BAWSI coming was for the Committee to note its existence which the Committee had done. He said he welcomed the initiatives taken by BAWSI.

Committee programme for 2002
The Committee reviewed the draft committee programme for 2002 (see Appendix 3).

Mr. Stokes representing Democratic Party suggested that the Committee decide if they wanted to return to the labour centres visited last year (or those where problems were concentrated such as KwaZulu-Natal and the Western Cape). He also suggested that the Committee receive feedback on the implementation of the Minimum Wage determination.

The meeting was adjourned.

Appendix 1:
THE CHARTER FOR THE WINE AND SPIRIT INDUSTRY

Preamble:

We, the members of Bawsi declare for all to know:

That the Wine and Spirits Industry is owned and managed by whites. That people of colour had been deliberately excluded from participation as capitalists industry but to participate as exploited workers. That formal and/or technical skills are primarily vested in whites and that the industry is managed by whites.

We believe that it is in the interest of the industry as well as the country that the Wine and Spirit Industry is fully representative of the South African Society on levels, structures and institutions privately - as well as stated owned organisations.

We pledge ourselves as members of Bawsi to strive together, sparing nothing of our strength and courage, until the changes for transformation as set out below have been achieved:

Education and Training:

It is estimated that ± 67% of the Economic active population has an education of std. 8 and below. It is further noted that South Africa scores almost bottom of the log of the World Competitiveness Report as far as productivity is concerned.

We suffer of the legacy of the 1924 Industrial Conciliation Act that excluded Africans from the definition of the employee, which resulted in Africans being bared from training as artisans. In addition, because of job reservation and the Civilised Labour Policy of the Apartheid government people of colour were never exposed to a large number of job categories.

Furthermore, due to gutter - (for Coloureds) and Bantu (for blacks) education, we are saddled with graduates with degrees that are not functional in the corporate world.

We therefore resolve:
to work towards the Establishment of a Corporate University that is based upon the N.Q.F principle and governed by the Skills Development Act; to act as a watchdog for the implementation of the Skills Levies Act:

from the submission to the implementation of the Workplace Skills Plan;
to campaign that the South African Wine Industry have a competitive edge in terms of its Skills base.

Income:

Poverty is one of the major contributors to the crime rate and other social problems that we experience in South Africa. Farm workers forms part of the poorest of the poor. We should therefore channel all our energies and resources to not only focus on the symptoms of the problem but to address the causal factors as well.

According to the Report of the International Labour Organisation (I.L.O), South Africa has the highest Gini - Coefficient of all its members' countries in terms of income inequalities.

In terms of Section 27 of the Employment Equity Act, employers must submit a report to the Employment Conditions Commission on their income inequalities as well as a plan on how they are going to reduce it.

We therefore resolve:

to pursue a policy of equal work for equal pay in the industry;
to strive towards civilized salaries in the industry.

Housing:

We note that most workers are still living in appalling conditions on some farms. The Extention of the Land and Tenure Act has limitations insofar as it concerns the spouse of the deceased employee. The Act does not address the issue of property rights, and that some farmers are using housing as a weapon against the workers.

We therefore resolve: to lobby for changes in the Extention of the Land and Tenure Act to address the issue of property right with the introduction of the Agri - Village concept and other creative measures.

Participative Management:

Historically, South African companies have and to a very large extent are being managed in a very Authoritarian Style. Employees have no or little say in the running of Enterprises and the situation on the farms is even worse ("Baas/Klaas" relationship).

It has been proven that participatory management:

Improve productivity
Reduce conflict and industrial action
Restore the dignity of employees
Leads to ownership of decisions and processes.

We therefore resolve: to pursue the matter with all employees in the industry to accept and introduce a participative management style to provide expertise to the industry to implement a programme of participatory management and to create a culture of transparency and trust.

Economic Empowerment:

The Wine and Spirits Industry is owned by Whites. People of colour have been excluded by design. We note that Pseudo empowerment projects are introduced at certain wine estates, and believe that these Pseudo empowerment project are a marketing ploy to benefit the owners of the wine estate as it does not significantly benefit the workers. These are nothing more than tokenism and window dressing. We believe that empowerment should lead to independence.

We therefore resolve:

To present the Industry with a Preferential Procurement Policy.
To Act as a facilitator in the outsourcing of non - care functions to people of colour.
To establish empowerment companies and consortiums in the industry.
To facilitate the establishment of Joint Ventures.
To assist members in setting of Close Corporations and sole proprietors.
To introduce the concept of education based empowerment through the establishment of an industry corporate university.

Affirmative Action:

The South African management consists of ± 90% white males. In the Wine and Spirits Industry, the situation is far worse. The government has introduced the Employment Equity Act to facilitate a more representative workforce on all job levels and job categories. We note the reluctance and resistance to this Act. We further note the poor response in the Minister's report in the year 2000.

We therefore resolve:

To act as a watchdog for the industry and request from all employees in the industry to forward their plans and progress reports to Bawsi.
To provide expertise to the industry to implement employment equity.

Social Responsibility:

We note that farm workers are identified as a most vulnerable community and who suffers from deprivation of a lot of things, taken for granted by others. Social problems are the order of the day. These problems include Alcohol and drug abuse; child labour; crime; illiteracy; lack of recreation; teenage pregnancies; lack of spirituality; etc. Farmers are a major contributor to those factors because of some of their practices.

We therefore resolve:

To engage farmers to establish a code of conduct for farmers and their workers.
To provide expertise to develop an Employee Assistance Programme that will facilitate healing (especially inner healing).
To provide expertise to develop a Social Responsibility Programme for the rest of the Farming Community. Such a programme will include but is not limited to issues such as: Sports and Recreation; Education; Religion; Substance Abuse Rehabilitation.

Worker Rights:

We note that of all workers in the Wine and Spirits Industry, the farm workers are worst off. They are continuously intimidated, victimized and coerced. They are totally at the mercy of the farmer of whom some are extremely ruthless and unscrupulous. This category of workers is at times denied their constitutional rights, their rights under the Labour Relations Act and the basic Conditions of Employment Act.

We therefore resolve that all the workers in the industry should be allowed to exercise the following rights without fear of intimidation and victimization.

Freedom of Association
The right to organise
Access to farms to organise
The right to strike
The right to Collective Bargaining at a central level

Ecology:

We note that a tendency exist to focus very narrowly when ecological matters are discussed. The environment is discussed as if the human beings are not a part of the environment. Damage to human beings is at times totally ignored. Horrific stories are being told of women spraying vineyards with their babies on their back and workers who act as beacons for aircrafts that are spraying vineyards. It is told that these workers are covered with a plastic bag over their head.

We therefore resolve:

To develop an environmental policy in conjunction with all stakeholders in the industry. Such an environmental policy will respect all elements in the environment.

Health and Safety and Employee Benefits:

Whilst it is commendable that some workers in the industry belong to a Medical Aid it must be noted that the majority is still without any cover. The majority of these workers also have no retirement provisions apart from the meager state pension.

We therefore resolve to pursue the following issues:

Medical Aid Schemes for All.
Provident Funds for All.
Aid Awareness and Caring Programmes.
T.B Awareness and Treatment.
Clinics on farms where it is justified.

As Signatories to this charter we hereby state that we:

Acknowledge the need for genuine economic upliftment of all sectors of the previously disadvantaged groupings as a prerequisite for long term social and economic stability in South Africa

Commit ourselves to the design and implementation of a comprehensive empowerment programme for all levels of employees on a fair and equitable basis.

Accept that all initiatives in which BAWSI participates under the banner of empowerment will be subject to an annual independent audit to verify authenticity of the empowerment programme including quality of training, distribution of profits and adherence to recognized ethical practices.

Believe that adherence to this charter should be represented visually on accredited empowerment products and services by a standardized emblem or logo to create consumer awareness, confidence and support.

Interpret the term empowerment to mean:

The full and willing intellectual transfer of knowledge with a view to creating a competent human resource from within the disadvantaged community.

The creation of genuine opportunities for substantial equity participation or ownership within the proposed empowerment initiative.

The design and implementation of upliftment programmes which will enable the most disadvantaged members of the community to participate with, and benefit from, each and every empowerment initiative.

To support development programmes for health, education, gender equity, labour relations skills transfer, housing, and job creation through commitment.


Appendix 2
BLACK ASSOCIATION OF THE WINE AND SPIRITS INDUSTRY

CONSTITUTION

1.DEFINITIONS:

"Bawsi" - means the Black Association of the Wine and Spirits Industry.

"Constitution" - means this constitution and all amendments affected thereto from time to time.

"Members" - means all other members who subscribe to the Founding Principles of the Association and who have a clearly demonstrated interest in the Wine and Spirits Industry.

"Black" - means coloured, African and Indian.

2. NAME:

The name of the association is the "Black Association of the Wine and Spirits industry". Hereafter refer to as Bawsi.

3. OBJECTIVES:

The primary objective is the transformation of every aspect of the Wine and Spirit Industry so that it can be representative of the South African Society.

4. FOUNDING PRINCIPLES:

4.1 Bawsi notes that people of colour were not allowed to participate in the wine industry as capitalist but only as the exploited.

The association therefore resolves to:

4.1.1 To play a meaningful role in the empowering of people of colour that will enable them to become owners of the means of production.

4.1.2 To organise entrepreneurs of colour with an affinity to the wine and spirits industry.

4.1.3 To assist all members of the association to gain access to the Wine and Spirits Industry.

4.1.4 To mobilise for the representation on all structures in the Wine and Spirits Industry.

4.2 Bawsi further notes that farmworkers who are a cornerstone in the creation of wealth are not empowered in any meaningful way and therefore resolve to:

4.2.1 To agitate for the improvement of the living conditions of the farmworkers and ensure compliance to all labour legislation by the industry.

4.2.2 To contribute in ensuring the development and training of farmworkers.

4.2.3 To contribute in ensuring the formal certification of farmworkers who have been performing tasks under the guise of unskilled workers.

4.2.4 To advocate a culture of participatory management in the Wine and Spirit Industry as a whole.

4.2.5 To agitate that all role players in the Industry make a meaningful contribution in terms of their social responsibility.

4.2.6 To promote property ownership for farmworkers.

5. MEMBERSHIP:

Membership is open to all organisations of colour, black owned businesses and other parties of colour with a vested interest in the wine and spirits industry. The executive reserves the right to refuse membership.

The annual membership fee shall be:

Individual -

Organisation -

6. OFFICE BEARES:

6.1 The duration of the term of office will be 2 years.

6.2 The A.G.M will elect:

6.2.1 President

6.2.2 Vice - President

6.2.3 General Secretary

6.2.4 Assistant General Secretary

6.2.5 Treasurer

7. DUTIES OF OFFICE BEARERS:

7.1 President:

President over meetings.

Represents Bawsi.

Acts as spokesperson.

7.2 Vice President:

Fulfil role of President in his/her absence.

7.3 General Secretary:

Represents Bawsi.

Act as spokesperson.

Manage administration of Bawsi.

7.4 Ass. General Secretary:

Responsible for recording of minutes and written communication.

7.5 Treasurer:

Financial Record Keeping.

Financial Reporting.

8. VACATING OF OFFICE:

8.1 Actions that brings Bawsi in disrepute.

8.2 Undermines Bawsi's objective.

8.3 Violating the constitution.

8.4 Using Bawsi's name and or resources for personal gain or for the unfair gain of the individuals organisation.

9. POWER OF THE EXECUTIVE COMMITTEE:

9.1 The executive may:

9.1.1 create additional portfolios.

9.1.2 co - opt members.

9.1.3 establish sub - committees.

9.1.4 initiate and execute discipline.

9.1.5 open a bank account.

9.1.6 set up a Trust Fund.

9.1.7 employ full - time staff.

9.1.8 appoint members to represent the organisation if and when the president and or general secretary is unavailable.

9.1.9 Initiate special projects.

10. MEETINGS:

10.1 The executive will meet as frequently as required.

10.2 The executive will meet at least once a quarter with the ordinary members to give a progress report and to receive recommendations.

11. QUORUM:

A quorum shall be 50% + 1 of the Executive Committee.

12. EXECUTIVE COMMITTEE:

The Executive Committee shall be composed of the President; Vice President; General Secretary; Assistant General Secretary; Treasurer; and

Three representatives from organised Labour, elected at the A.G.M

Two representatives from the Empowerment Companies, elected at the A.G.M

Two representatives from N.G.O's, elected at the A.G.M.

One representative from C.B.O's, elected at the A.G.M.

13. ANNUAL GENERAL MEETING:

An A.G.M shall be composed of the President; Vice President; General Secretary; Assistant General Secretary; Treasurer; and

Twenty reps from organised labour

Two reps per empowerment company

Two rreps per N.G.O

One rep per C.B.O

Individuals without organisation affiliation will have no voting rights but are eligible for election to office.

14. FINANCE:

14.1 President, General Secretary and Treasurer are the signatories to the cheques.

14.2 Two signatories, of which one must be the treasurer, are required to validate a cheque.

15. INDEMNITY:

Should any proceedings (whether civil or criminal) be instituted against any executive committee member or person's arising out of the fulfilment of any of its duties as mandated by Bawsi, it shall be the of the executive committee to pay out the funds of Bawsi all costs incurred in defending such proceedings.

16. AMENDMENTS:

Changes can only be affected by a two thirds majority at a duly quorated A.G.M

17. WINDING - UP:

17.1 When a decision has been taken to wind - up the organisation, the executive shall pay all the debts from the association's funds and the rest shall be distributed amongst the members.

17.2 A decision to wind - up can only be affected by a majority decision at an A.G.M or special A.G.M


Appendix 3:
Draft Committee Programme
The ANC proposals were as follow:

DATE ACTIVITY BY WHOM

12 March 2002 Briefing by KWV Task team

19 March 2002 PROGRAMME Task team

21 March 2002 - 20 March 2002 Constituency period

22, 23 & 24 April 2002 Pretoria visit (Department of Labour and PC*
surrounding areas), UIF, Workman's
Compensation commission

30 April 2002 Occupational Health and safety, visit to PC
the high incident of accidents areas in the
Western Cape.

07 May 2002 Budget vote DOL**

14 May 2002 International labour market trends
Provincial Report by Committee section DOL

29 and 30 July 2002 Provincial visits; Nedlac PC

20 August 2002 Provincial reports, discussion & adoption PC

September 2002 Follow up on all the visits undertaken by PC the Committee * Portfolio Committee ** Department of Labour