Labour Relations Amendment Bill & Basic Conditions Employment Amendment Bill: further deliberations

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Employment and Labour

15 October 2012
Chairperson: Mr M Nchabaleng (ANC)
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Meeting Summary

The Chairperson introduced the new Committee Secretary, Zolani Bakaza.

The Committee continued deliberations on the Basic Conditions of Employment Amendment (BCEA) Bill, starting at clause 13. The import of each of the clauses was outlined. Clause 13 essentially set out technical changes in relation to specifying a date on which the Labour Court must hear a matter. Clause 14 dealt with the enforcement of a compliance order, bringing it in line with the three-year period for prescription of civil claims, and noted that a compliance order could not be issued if there were pending legal proceedings. Clause 15 dealt with the exclusive jurisdiction of the Labour Court in civil matters. Clauses 16 and 17 respectively dealt with an increase in fines and penalties. Members agreed to hold over a clause-by-clause adoption until all the Bills had been considered, so that the consistency could be checked.

Members also agreed to call for public hearings in relation to the Employment Services Bill and the Employment Equity Bill.

The Department of Labour outlined and explained the clauses of the Labour Relations Amendment Bill, up to clause 6. Clause 1 was extending organisational rights to minority trade unions, although it was stressed that this was not automatic, but could be done on application to the Commission for Conciliation, Mediation and Arbitration and after consideration of the prevalence of atypical employment in a particular sector. It was also stressed that this was not intended to undermine any rights of majority unions. Clause 2 extended the right to strike to temporary employees, either at the client’s premises or at their employer’s premises. Business was opposed to this provision and Labour supported it. Picketing rules would also be extended to third parties, provided the third party had been given notice and had agreed to the extension. Clause 3, amending section 32 of the LRA, dealt with Minister’s power to extend collective bargaining agreements. If the union represented 50% plus one of the employees in the sector the Minister had no discretion and had to extend that agreement. Bargaining Councils would have to include provisions in their agreements to deal with exemptions, as the extensions would not otherwise be allowed. There would be a right to appeal, with a 30-day period set for resolution, and the clause also dealt with the requirements around publication.  The Minister would be able to consider the extent of labour-broking in that industry and might still be able to extend even if representivity was low, to take into account the difficulties of organising unions in such industries. Clauses 4 and 5 dealt with the certificate showing a Bargaining council representivity, the purposes for which it could be used, and the fees that a bargaining council may be permitted to charge. Clause 6 was a contentious clause, supported by business but not by labour, that dealt with the workers’ right to strike. The clause aimed to re-introduce the requirement that a trade union wanting to strike must hold a ballot of its members. The rationale was that this should curb violence during strikes. The Department of Labour pointed out that there had been previous challenges to the system and for this reason it had avoided using any reference to “secret” ballots, and the Bill did not propose how the ballot must be held, merely that it was necessary. Some Members strongly opposed the reintroduction of a ballot, believing it would undermine the right to strike, whilst others were of the opinion that it would encourage non-organised sectors to organise. They also disputed the corollaries drawn by the Department, pointing out that the more organised a sector, the less violent the strikes, and questioned whether labour broker employees would not be intimidated. Some took issue with the assertion by the Department that anybody could bring a Constitutional challenge, and stressed that it was the duty of this Committee to ensure that the Bill would pass constitutional muster in every respect.

Meeting report

Chairperson’s opening remarks
The Chairperson noted that it was difficult for this Committee to achieve a quorum.

He also informed the Committee that Zolani Bakaza would be taking over as the Secretary of the Committee.

Basic Conditions of Employment Amendment Bill: Continuation of deliberations
Mr Thembinkosi Mkalipi, Chief Director: Labour Relations, Department of Labour, noted that he would continue to present the Bill, from clause 13.

Clause 13
Mr Mkalipi noted that clause 13 was making technical changes to section 73 of the Basic Conditions of Employment Act (the Act), which dealt with a compliance order. The changes linked up with the enforcement processes in the Act. The compliance order would have to specify the date on which the Labour Court would hear the matter.  There was also a change to link the compliance order to the fines in Schedule 2, and this too was a technical change. The employer may make representations, in the court, for the issuing of a fine, and the Court would then issue, if applicable, in terms of Schedule 2.

Clause 14
Section 74 of the Act dealt with the issuing of the compliance order. Mr Mkalipi said that at the moment an inspector could not recoup the expenses if the twelve months had expired, and if an inspector had failed to issue a compliance order for 12 months for any reason, including incompetency or bribery. In general, claims would prescribe within a three-year period, so the twelve-month period in the Act was also now to be changed to three years. However, an important point was that no compliance order may be issued or enforced and no other legal proceedings may be instituted or enforced in respect of any claim that had been determined in terms of subsection 2.

Clause 15
Mr Mkalipi said that this dealt with the exclusive jurisdiction of the Labour Court in civil matters and criminal matters which were referred to the magistrate’s court; for example issues regarding forced labour.

Clause 16
Mr Mkalipi noted that section 93 dealt with fines and penalties. This clause related to increasing of penalties, such as the term of imprisonment from three to six years.

Clause 17
It was noted that Table 1 contained the maximum permissible fine not involving an underpayment.

The Chairperson asked the Committee if they wanted to adopt the Bill now, or wait until the other Bills had been dealt with, which might give rise to some issues affecting this Bill.

Mr D Kganare(COPE) noted that, procedurally, a clause by clause adoption process was needed. He thought that the proper cross-referencing should already have been done.

Mr A Williams (ANC) suggested that the remaining Bill should be dealt with, to avoid a possible re-adoption if there were changes.

Mr S Motau (DA) agreed, commenting that the new Employment Services Bill could affect the BCEA Bill.

Mr E Nyekemba (ANC) also thought that all Bills affected each other and should be finalised at the same time to check similar sections.

Advocate Anthea Gordon, Parliamentary Legal Advisor, agreed.

The Chairperson therefore announced that the clause-by-clause deliberation on this Bill would be postponed.

Employment Services Bill and Employment Equity Bill
The Chairperson said that ideally, public hearings should be held in relation to both the Employment Services Bill and the Employment Equity Bill, to avoid issues being raised at a later date that might require revision of clauses.

Mr D van der Westhuizen (DA)  it would have been ideal to have public hearings on both these pieces of legislation to avoid reversal of issues. He asked whether there was a contrary view concerning public hearings on both Bills.

Mr A van der Westhuizen (DA) agreed that the public needed to be given the opportunity to make comments during public hearings.

Mr A Williams also agreed on the necessity to hold public hearings.

Labour Relations Amendment Bill: Presentation
Clause 1
Mr Mkalipi noted that section 21 of the principal Labour Relations Act (the Act) was being amended by clause 1. This section dealt with the organisational rights of trade unions. Presently, when a Commissioner determined whether a party was entitled to organisational rights, s/he must consider the extent of atypical employment in that sector. Organisational rights could be granted simply on the basis of the prevalence of atypical employment in that company or sector, even if the representation of this type of employment was low. There was general consensus that it was difficult to organise workers in a sector where there were a large number of atypical employees, such as temporary, or fixed term contractors. This was an additional test to the already existing provisions.  The amendments to section 21 were essentially saying that unions who did not represent a majority would still be able to get rights, such as section 12 access to the work place, section 13 deduction of stop orders, section 14 shop representatives, and section 15 access to or disclosure of information. He explained that a minority union could approach the Commission for Conciliation, Mediation and Arbitration (CCMA), arguing that rights to which it did not currently have access should be granted. Mr Mkalipi stressed that this was not giving automatic rights to minority unions. However, they were being provided with an avenue to access those rights in appropriate cases. He also explained that the amendment was not attempting to do away with majority unions. Business supported majority trade unions, and had argued that this would produce multiple trade unions.

The Chairperson remarked that the Committee seemed to agree in principle that the approach would elevate workers’ rights to the level of human rights, and that they were not currently seen in this light. He highlighted that even workers represented by a minority union could have a negative impact on an industry.

Mr van der Westhuizen noted the events over the last few months, including previous deliberations on these issues, and asked if the Department of Labour was still proposing these amendments.

Mr Mkalipi replied that the Department still stood by the Bill, as it believed it was fully constitutional and increased the possibility of workers engaging collectively with employers. There was no objection by business against the granting of organisational rights to trade unions.

Mr Motau requested clarity on the issue of the threshold that a union must have, in order to access organisational rights. He asked if the Commissioner at the CCMA was likely to use the existing thresholds or consider different ones.

Mr Nyekemba commented that the issue of the threshold was relevant to collective bargaining, since the threshold also determined who could come to the bargaining table.

Mr Nyekemba wanted to raised the question of how parties entered into collective agreements. He wanted to see the realisation of the right to freedom of association in the Constitution, and asked if this amendment would not interfere with pre-existing collective agreements.

Mr van der Westhuizen asked whether the CCMA could nullify existing collective agreements.

Mr Mkalipi explained that this section was not related to the issue of collective bargaining. However, the CCMA would not nullify any collective agreements. The rulings of the CCMA only related to whether a third party could be granted organisational rights. The Labour Relations Act did not confer the right to collective bargaining, even on a majority union. Employers were still allowed to refuse to negotiate collective bargaining agreements. He pointed out that section 23 of the Act dealt with the legal effect of collective agreements but did not confer a legal right to collective agreements. He assured Members that this amendment did not dilute rights of majority trade unions.

Mr Herbert Mkhize, Adviser to Ministry of Labour, added that in Marikana, the Department of Labour (DOL) had to rely on a “gentleman’s agreement” to allow the union AMCU to come on board. The three majority unions understood the situation, and allowed AMCU to come to the negotiating table. This revision to section 21 was now creating an avenue for minority trade unions, such as AMCU, to negotiate in the future.

The Chairperson also stated that even though AMCU was at the centre of the crisis, it had had no legal recourse as a minority union. The public was not aware of the fact that it was not recognised by law.

Mr Williams commented that the Committee had seen what happened when there was a gap between organised labour and non-organised labour. This amendment provided a forum for non-organised labour to become organised, an important point.

Clause 2
Mr Mkalipi explained that this clause gave temporarily-employed workers the right to exercise their organisational rights, either at the place they worked, or against their employers. This was intended to address the existing problem, in that employees employed by a labour broker in one city could exercise their rights in another city, where they were actually working. The clause also proposed that when there was a discussion about picketing rules, those rules could affect third parties, on condition that the third parties had been given an opportunity to express their views, by way of a notice being sent to them.

Mr Mkalipi noted that there was disagreement on this point at National Economic Development and Labour Council (NEDLAC). Business was opposed to this provision and Labour supported it.

Clause 3
Mr Mkalipi noted that section 32 of the Act set out what the Minister needed to consider when extending a collective or bargaining council agreement. The Minister could only extend a collective agreement, but not any other agreements. In addition, the Minister could only extend collective agreements to non-parties if they were representative of 50% plus one of employees in the sector, or if the particular employers employed 50% plus one of the employees in the sector. The Minister had no discretion, and had to extend that agreement on these terms.

The provision further stated that if the Minister was of the view that the non-extension of the agreement would affect or undermine collective bargaining, then the agreement could be extended to non-representative parties. Bargaining Councils, in their agreement, must have procedures to deal with exemptions. The Minister could not extend the agreement if these exemptions were not included by the Bargaining Council. The Council must resolve these applications for exemptions in 30 days. If the exemption was refused, there was a right to appeal. The individuals sitting on the appeals body could not be the same as the office bearers of the Council, because of the competition implications. If parties were in a majority, then the Minister would not have to publish the extension of the agreement. However, this should be done if the parties were not in a majority.

Mr Mkalipi pointed out that when dealing with representivity of a bargaining council, the Minister could consider the extent of labour broking in that industry. In such an instance, even if representivity was very low, the Minister could still extend the agreement. This was because of the difficulty of organising unions in an industry where there were a large number of temporary employees.

The final point was that appeals must be determined within a specific period of 30 days.

Clause 4
Mr Mkalipi noted that at present, section 46 stated that the Registrar could give a bargaining council a certificate showing the representivity of that bargaining council. This certificate would last for three years. When the law was amended in 2002, the intention was that a representivity test would be used as form of insurance to the council, since it would still be valid even if the bargaining council lost members in that time frame.  However, the section had not stated that the Minister could use this certificate to establish the representivity of a bargaining council, which opened it up to challenges that the Minister had not applied his/her mind when extending the agreement. This clause would now rectify that situation; it stated that the Minister could in future use the certificate to determine representivity.

Clause 5
Mr Mkalipi noted that this was intended as an enabling provision that a bargaining council could only charge fees that did not exceed the fees charged by the CCMA.

Mr Nyekemba asked for clarity in terms of administrative fees and fees relating to dispute resolution.

The Chairperson requested a fee structure.

Mr Mkalipi stated that Mr Nyekemba was referring to levies and not fees. This clause applied to fees charged to employees, for whatever reason. There had been a discussion that a fee should be introduced for parties who wanted to access the CCMA. This would, on the one hand, discourage frivolous cases but might, on the other hand, deny access to justice for poor employees.

Clause 6
Mr Mkalipi pointed out that this clause related to section 64, which dealt with the right to strike. The 1956 Act had had a requirement to ballot, but this was changed in 1995, because employers would challenge strikes on the technicalities of ballots, and the ballot system was abolished. Subsequently, however, NEDLAC proposed that the ballot system should be re-introduced, to deal with the violence occurring during a strike if the strike was not supported by all members of the union. This clause therefore said that a ballot was valid if a certificate was issued by the CCMA. However, there was disagreement on the point. Presently, the constitution of a union might or might not require a ballot, and labour formations were against the clause, although business supported it.

Mr Kganare drew attention to the fact that during the public hearings the issue was raised as to whether the ballot should be secret. A further point was made that the “majority” must relate not to those who voted, but the majority of members of the union. He asked how the Department responded to that point.

Mr Mkalipi replied that the Department did not want to specifically require a secret ballot, because of potential challenges around the term “secret”, which did not have a legal definition. There were various different ways to ballot. The Department had therefore opted for the requirement of the majority of those who voted. He drew an analogy to Parliamentary elections, noting that national election results were compiled against the people who voted on the day, rather than the number of eligible voters. The union could not be required to force all its members to vote.

Mr van der Westhuizen asked how a win/win situation could be achieved, considering, on the one hand, the abuse by employers of the ballot system and, on the other hand, the need to avoid employees being held to ransom by a small group of people who wanted to strike.

Mr Mkalipi indicated that the section dealing with a certificate restricted the validity of the ballot to the issuing of the certificate only.

Mr Williams asked for clarity on the certificate that would be issued to make the ballot valid, particularly whether there was any mechanism to prevent delays in issuing of the certificate, in the event of a deadlock.

Mr Mkalipi responded that it would still be the responsibility of the trade union to decide when and how to ballot. The employer was not involved in how the ballot would take place, so there was no reason for a long delay.

Mr Kganare asked how the DOL addressed the issue of “majority” if the majority was exactly 50%+1, which would leave 49% unaccounted for

Mr Mkalipi stated that the question was a difficult one, to which the DOL did not have a ready answer. The Department could only state its rationale behind this provision, that a vote was likely to cut out the need for violence. In the clothing sector, the ballot system was used, and in this sector the strikes were always peaceful. On the other hand, the security sector had low representation and the incidence of violence in this sector was high. Although there was no scientific research done into the matter, experience showed that sectors that had the ballot system had less violent strikes than counterparts who did not.

Mr Motau highlighted the fact that the earlier clause on minority unions would give the minority union the right to have a ballot as well.

Mr Williams questioned the rationale that the ballot system was being brought back to curb violent strikes, and asked if there was any scientific research that linked violence in strikes to no ballot.

Mr Mkalipi replied that no scientific research had been conducted to determine whether violent strikes were linked to the absence of a ballot. However, he reiterated that sectors with the ballot system had less violent strikes than others. The matter was open to debate.

Mr Nyekemba asked if violence during strikes occurred only after the 1956 Act’s provisions were removed. He wondered if the provision would undermine the constitutions of the trade unions. He also asked if those who were not members of trade unions would be required also to strike.

Mr Mkalipi responded that the ballot system would not undermine the constitutions of the trade unions. A ballot would still be conducted in terms of the union constitution, so nothing had changed in this regard.

The Chairperson commented that the Committee did not have to decide on the secrecy or non-secrecy of the ballot, but simply whether a ballot system should be reintroduced. DOL was specifically avoiding prescribing how the ballot must be held, to avoid technical and legal challenges.

Mr Motau was pleased that the issue of secrecy had been explored. He said that strikes were about safety and intimidation. He was not entirely in agreement with the parallels drawn by Mr Mkalipi between the national vote and the labour relations vote.

Mr Kganare was uncomfortable with linking the ballot to violence in strikes. He felt that the main issue was the legitimacy of a strike, and whether the strike was supported by the members. A genuine union used the ballot process to mobilise its members and help them understand the need for a strike, in which case there should not be violence by union members. He urged that people should not be identified as to whether they had supported a strike.

Mr Williams also commented on the Department’s rationale that the ballot would address the issue of violent strikes, and the comparison of the clothing and security sectors. However, he thought that the more organised a sector, the less violent it would be; this had nothing to do with a ballot. He thought that this amendment would in fact undermine the workers’ right to strike.

Mr Williams asked whether an employer would provide the resources to set up a ballot for a small group of non-unionised employees who wanted to go on strike

Mr Mkalipi stated that there had never been procedural strikes by non-unionised workers, as they were not concerned with following processes prescribed by the Act.

Mr van der Westhuizen agreed with Mr Williams that it would be better for each sector to be more organised. The unions must be protected against non-organised structures, in order to rebuild trust in the unions, but at the same time unions must also be seen to be employing democratic principles.

Mr Kganare questioned why the Bill said nothing about protection of temporal workers, and asked whether they were protected elsewhere

Mr Mkalipi replied that the law, at present, protected temporal workers who support a protected strike. There were pronouncements on this by the Constitutional Court.

The Chairperson asked the Members not to lose focus of the fact that the discussion was about balloting. At the outset of the meeting, Members had noted the inter-relationship of the Bills. He reiterated that the organisational rights would be granted to non-majority unions. The ballot system was supposed to provide proof that there was a buy-in into the strike, but it was up to the members of those unions to decide how to conduct the ballot process. The Act did not need to prescribe how to ballot; it needed only to provide for a ballot.

Mr Mkalipi reminded Members that there was a Constitutional right to strike, and so any processes that limited this right must stand up to constitutional scrutiny. He reiterated that any reference to “secret” would lead to technical challenges on the notion of secrecy. It had been for this reason that the ballot system, which was then based on secrecy, was removed, as it had prevented workers from going on strike. The word “secret” was deliberately excluded from this amendment. He used the example of a postal ballot to show how complex issues around secret ballots might arise.

Mr Mkalipi also noted that requiring the majority of the members of the union to go on strike was tantamount to saying that the union must go on strike, and this too would restrict the right to strike because it was unlikely that unions would be able to meet this requirement.

Mr Williams commented that violence occurred in wildcat strikes, and he thought that it was not justified to add anything around balloting. He remained of the opinion that this would undermine workers’ right to strike. He strongly believed that unions were likely to challenge this in the Constitutional Court.

Mr Mkalipi remarked that anything could be challenged in the Constitutional Court, but the question was whether that challenge would succeed or not.

Mr Williams interjected that departments should not simply hope that the legislation they introduced would not be challenged. It was this Committee’s responsibility to try to ensure that the legislation passed would not be open to challenge.

Mr Mkalipi maintained that the Department could not stop anyone from bringing any challenge to any legislation. However, the DOL was confident that this Bill would pass constitutional muster.

The Chairperson asked the Parliamentary Legal Advisors to shed more light on the potential of constitutional challenge. He also asked if they had identified any likely loopholes that needed to be dealt with.

Advocate Gordon agreed that a national vote and a labour vote had to be distinguished from each other. A union was essentially about membership, and not necessarily about the workers in the workplace. In her opinion, the vote should include a majority of the members of the union. She gave an example of a union that might have 500 members, but only 150 might vote, which was not even a majority, and thought that, as a matter of policy, if not of law, it would be incorrect to use this result.

Dr Barbara Loots, Parliamentary Legal Adviser, concurred with Advocate Gordon that this was a policy question. She asked permission to respond in writing to some of the legal concerns around the question of voting.

Mr Kganare asked for an assurance that employees employed by labour brokers would not be prejudiced by strikes occurring through the ballot system, because they may wish to strike but could face intimidation.

The Chairperson asked whether the exercise of these workers’ rights was protected by the Basic Conditions of Employment Act (BCEA).

Mr Mkalipi stated that these employees would be protected, but under the proposed amendments to section 21 of the Labour Relations Act, not the BCEA. Section 21 spoke to organisational rights and the courts had interpreted the law to include protection to these workers.

Mr Mkalipi agreed with the Parliamentary Legal Advisors that policy issues were raised, and said that Members could recommend any changes to policy in this highly contested area. He also reiterated that the labour sector in NEDLAC was violently opposed to the inclusion of the ballot.

Mr Mkhize explained that the implementation of the ballot system was only one of the instruments that could be used to curb violent strikes. The Committee was free to advance more creative ways to deal with violence. However, he noted that violence in strikes was not in the purview of labour law, since it bordered on criminality and this was in the mandate of a different Ministry. It was unfortunate that past event had made it necessary for the Department to deal with violence in strike action.

The Chairperson adjourned the meeting.

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