Labour Relations Amendment Bill, from clause 7: Departmental explanation & deliberations

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Employment and Labour

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

The Committee continued to receive an explanation from the Department of Labour and to deliberate on the Labour Relations Amendment Bill, from clause 7. Clause 7 was extending the range of rights on which workers, instead of striking, must seek recourse in the Courts, because it also mentioned rights in other Acts. It was not removing any rights. Clause 8 amended section 67, whilst Clause 9 was a proposal to delete the words “and supporters” from section 69 of the Labour Relations Act. It was proposed that any unbecoming conduct during strike action would be deemed as a breach of picketing rules, and that unions could be held liable for damages. Many ANC Members were opposed to the clauses, as they feared that they could be abused by employers to deny workers a right to strike, and would affect the rights of supporters to show solidarity during strikes. The point was also made that unions were less likely to draw rules around picketing. However, some Members remained of the view that it was acceptable to hold unions responsible for damage during strikes, even if such damage was caused by supporters and not union members. Members were reminded that supporters were covered under other legislation, and of the recent ruling of the Constitutional Court around damages caused during violent strikes. The Committee held an extensive debate on picketing.

Clauses 10 to 15 were largely uncontroversial, and were concerned with the setting up and functioning of an Essential Services Committee to consider whether certain services should be declared essential, and to impose service level agreements. Customs and Parliamentary services had already been declared as essential, and some strikes had been limited (such as that of refuse workers). The question of who was a “public official exercising authority on behalf of the state” was debated. Clause 16 contained a technical amendment and was not discussed. Clause 17 would enable the Registrar to place a struggling union under administration instead of de-registering the union outright. Clause 18 stated that an appeal would not suspend the decision of the Registrar to deregister the union. It was explained that clause 18 largely was intended to deal with the position of bogus unions. Clause 19 stated that the CCMA rules had to be reviewed every two years. Clause 20 reiterated the fact that for a strike to be certified as protected; a ballot had to be taken, but here an ANC Member asked that it be recorded that the majority of the ANC were not in agreement on the need for a ballot, as outlined in a previous meeting. Clause 21 deleted a paragraph that was superceded by the revisions. Clause 22 stated that the decision of the CCMA could in future be enforced by the Sheriff as if it was a decision of the Labour Court, allowed for non-compliance with a CCMA decision to be considered as contempt of the Labour Court and said that the costs would be calculated on the Magistrate’s Court tariff. Clause 23 introduced an additional ground, for the rescission of an award, of “good cause”, but some Members disputed whether this was necessary. Clause 24 was introduced to address the fact that some employers would bring applications for Review, and then delay them, to delay the payment of awards or reinstatement. In future no Review Application would suspend the award, unless security was paid. In addition, there was a provision that a date for the Review had to be applied for within six months, and that judgment of the Labour Court had to be given as soon as reasonably possible. Members asked why the Bill did not simply order judgment within six months, and an extensive debate on the separation of powers ensued.

Finally, Members adopted minutes from 22 August to 22 September.

Meeting report

Continuation of deliberations on the Labour Relations Amendment Bill
Clause 7
Mr Thembinkosi Mkalipi, Chief Director: Labour Relations, Department of Labour, noted that clause 7 was simply a technical amendment with nothing controversial. At the moment the Labour Relations Act (LRA) restricted strikes on disputes that had to be adjudicated by the Commission for Conciliation, Mediation and Arbitration (CCMA). However, the Labour Relations Amendment Bill (the Bill) was now removing the reference to “this Act” and extending this to “any other labour law”. He pointed out that the Basic Conditions of Employment Act (BCEA) also contained restrictions. Employees could not strike in relation to certain rights as they would be covered by recourse through the courts or the CCMA.

Clause 8
Clause 8 was linked to the issue of having a ballot before a strike, as discussed under previous clauses. It attempted to ensure that unbecoming conduct during picketing would not be protected, as consequences were now being introduced for breaching picketing rules. The Labour sector disagreed with this clause and it was debated extensively in the public hearings. Picketing rules were an agreement by the parties, and this clause referred to consequences for the breach of a union’s own agreement.

Mr A Williams (ANC) commented that the term “material breach” was subjective, and he was concerned that this might not open the way to abuse by employers, who could claim that even frivolous breaches were “material” and therefore justified the removal of picketing rights. He asked if any mechanisms were in place to ensure that this did not happen.

Mr Mkalipi stated that it would be the court who decided on a breach, not the employer; the employer would have to argue the point before the court. This clause would make it possible for third parties to lay civil claims, for instance if members of a trade union caused damage, during the picketing, to property of a third party. The clause was therefore not only limited to grievances by an employer, but also catered for the general public. The courts would have to interpret the law in light of the Constitution, given that the right to strike was a Constitutional right.

Mr E Nyekemba (ANC) asked what informed the disagreements on the clauses.

Mr Mkalipi explained that at the National Economic, Development and Labour Council (NEDLAC) there was disagreement on the extension of the labour law to cover third party claims. Labour feared that this would make it too easy for unions to be sued, and made the point that often it was not union members who had caused the damage, but bystanders. Business argued that the extension was justified because of the damage to property that was increasingly resulting from strikes. Labour was also concerned about the potential restricting of picketing rules, and pointed out that such rules were optional in any event, and there was a likelihood that this clause would discourage the unions from entering into picketing rules. 

Mr A Van der Westhuizen (DA) believed these amendments were trying to strengthen the position of unions, by requiring them to stick to their own rules and their own constitutions.

Mr Mkalipi replied that clauses 8 and 9 went hand in hand, and some questions could be clarified when clause 9 was outlined.

Mr Herbert Mkhize, Adviser to Ministry of Labour, agreed that picketing rules were voluntary and were not a legal obligation. Labour’s argument was thus why the Department of Labour (DOL) was trying to give legal enforcement to rules that were not a legal obligation, and said that this would deter unions from drawing picketing rules in the first place, contrary to the policy that was trying to encourage them to draw such rules. The second issue was that strikes were in fact a way for workers to appeal for broader society support of involvement in the plight of workers. Business supported the provisions because these rules helped to provide disincentives for undesirable behaviour during strike action.

Mr Nyekemba acknowledged that explanation. He gave an example of the 2008 motor industry sector strike, where employers had refused to pay wages, for which workers went on strike, and it was alleged that employers provoked the workers to claim that picketing rules had been breached. He feared that this clause could encourage wildcat strikes, because the right to strike would have been restricted by the requirement of picketing rules.

Mr Mkalipi replied that the clause was not attempting to make picketing rules compulsory. However, he conceded that it could discourage trade unions from entering into picketing rules. It was difficult to sue a trade union that did not have picketing rules. The clause also gave the court the ability to order a strike to stop, or to order trade unions to pay for damages caused during strikes. Picketing rules allowed employees to picket and to influence the public.

Mr Williams questioned the removal of the word “supporters” from section 69A of the LRA. This could have repercussions in the future. He asked for the motivation behind the removal of the rights of South Africans to demonstrate solidarity by supporting picketing workers.

Ms L Makhubela-Mashele (ANC) commented that unions could deny liability for damage caused during strikes by stating that it was not union members, but supporters, who had caused damage. She asked the DOL to state whether this clause was trying to establish accountability by unions for damage that occurred during strikes.

Mr Mkalipi replied that in general, trade unions always blamed “state forces” for violence. The removal of the reference to supporters made it easier for trade unions to control their supporters. He agreed that the clause would introduce accountability on the part of the trade unions. If the trade union contravened its own trade union rules there would be consequences, such as the court ordering the strike to stop, the union bearing costs. On the other hand, if the employer broke picketing rules then the employer would be prevented from using replacement labour. The proposal was trying to marry two different disagreements. Business agreed to the issue of replacement labour, on condition that the picketing rules were adhered to, but did not support third party responsibility.

The Chairperson remarked that picketing was a very important issue and if picket lines were not carefully manned, all sorts of issues would crop up.

Clause 9
Clause 9 dealt with the removal of the words “and supporters” from section 69 of the LRA.

Mr Williams repeated his earlier question, and asked also if it was constitutionally correct that peaceful demonstration be disallowed.

Mr Mkalipi stated that all citizens had a right to protest in terms of the Constitution. Protest by workers was protected by the LRA, but there was a distinction between picketing and protesting. A protest would be done in terms of section 77. Section 69 referred to a specific picket. If a member of the public wanted to protest in support of the strike, there were other laws regulating supporters. The clause was not taking away any constitutional rights, as there still remained other avenues for supporters to get involved in strikes under other pieces of legislation.

Mr Nyekemba stated that the issue of supporters should not be limited to members of the public. The ability to show solidarity could not be limited. He noted that support came in different forms. In addition the explanation for violence was one-sided. There were institutions dealing with violence; for example before a strike happened, the SAPS was usually informed. Ultimately, concern was raised about the LRA curtailing the right to strike.

Mr Mkalipi replied that members of the trade union who did not even work in the same sector could also be involved in the strike, since the LRA allowed all members of a particular union to picket. The section might prevent members of a different union from picketing, but it certainly did not curtail solidarity.

Ms Makhubela-Mashele commented that when there were violent strikes, somebody had to take responsibility. She was not inclined to leave the legislation open so that nobody was held responsible. As much as supporters and sympathisers were important, the reality was that during strikes some people took the opportunity to loot, especially from people like street vendors and she fully agreed that the trade union that had organised the strike should accept responsibility so that those affected by looting or damage had recourse.

Mr Williams asked the Department of Labour (DOL)  to respond to his direct question as to why this amendment was introduced, as it was limiting ordinary citizens’ rights to demonstrate.

Mr Mkalipi replied that the LRA regulated relations between employers and employees, but did not deal with supporters. The LRA regulated the conduct of members of a union. Section 69 was one of only very few sections in the Act that related to “supporters”.  The removal of “and supporters” from this section was not implying that supporters had no role. The trade union could still authorise picketing by its own members. However, it had no authority to authorise picketing for non-members (supporters). The amendment was not attempting in any way to curtail peaceful demonstration.

Mr F Maserumule (ANC) noted that the practical realities and personal experience must be taken into account. Those never exposed to worker conditions in South Africa would find it very easy to argue for this. However, in his personal experience, typical South African conditions contained “brutal exploitation” of workers and workers had effectively no other rights other than their constitutional right to strike. He reminded the Committee that many workers had only their labour to use as a bargaining tool.

The Chairperson asked the Department to respond to the issue of responsibility, and not to the issue of picketing. Supporters showed support in various ways, but he wondered why their acts should be imputed to trade unions. He needed to be convinced of the wisdom of taking away solidarity.

Ms Makhubela-Mashele submitted that there would always be sympathisers and supporters. This clause would require people who were supporting trade unions to be acknowledged by the trade unions and, in the event that matters got out of hand, the trade unions must bear responsibility for them. She admitted that not all strikes were violent. However, somebody had to take responsibility when they were. She indicated her support for the clause.

Mr Nyekemba reminded Members that at this stage the deliberations were informative, and it was not yet the time to support or not support clauses. He thought it was not for Parliament to rule out support of procedural strikes.

Ms Suraya Williams, Principal Legal Adviser, Office of the Chief State Legal Adviser, stated that the Bill had been certified as constitutional. A recent Constitutional Court case ruled that “the Constitutional right to assemble and demonstrate is constitutionally protected and guaranteed, so long as it is exercised peacefully. In the event that an organisation reasonably foresees the possibility of damage or mayhem resulting  from the gathering, it has a choice to proceed or cancel the gathering. Accordingly the decision to assemble rests with the organisation, and … it should be responsible for reasonably foreseeable damage arising from such assembly”. In this case, the Constitutional Court had examined and detailed the rights of strikers. When rights were competing and caused tension with other rights, there was a need to weigh up the limitations and infringements. Rights were not absolute. A brief summary of the case would be provided for the Committee.

Mr S Motau (DA) asked if Mr Williams would be satisfied by that response.

Mr Maserumule was worried whether the Committee had enough information before it and asked if workers were not aware of their rights and the limitations of those rights, as well as the consequences of their actions.

Mr Mkalipi stated that the Constitutional Court was of the view that the union had to take responsibility for the actions of workers, and also had to inform its members of their rights.

Clauses 10 to 15
Mr Mkalipi highlighted only some areas of clauses 10 to 15.

He noted that clause 11 dealt with essential services. There was a general consensus in this area, except on two areas, namely, the definition of essential services and dispute resolution relating to them. The definition of “ “essential services” was not amended although Labour had argued for this. Presently, the legislation law defined essential services as police services and Parliamentary services. Labour argued that Parliamentary services should not be essential services.

There was also disagreement on dispute resolution relating to essential services. These disputes should be resolved through arbitration, but it was stated that if an arbitration affected the state financially, then the award by the arbitrator was not binding. The Minister, within 14 days, had to refer that award to the members of Parliament, who must then decide whether or not the award was binding. These issues were not in the Bill, but were the main areas of contention by Labour.

He pointed out that the new section 70A dealt with the composition of the Essential Services Committee (ESC), and there was no controversy in this area. The proposed section 70B dealt with the powers and functions of the Essential Services Committee. The ESC now had the power to impose service level agreements. Service level agreements stated how many workers were needed to keep services running. There was never any agreement reached in relation to service level agreements, because Labour would argue that everyone had to go on strike and management wanted no one to go on strike. It was for this reason that the decision was now to rest with the ESC. There was no disagreement on the appointment of the ESC, nor on its jurisdiction, administration or regulation.

However, there was a problem on the proposal stating that public officials exercising authority could be declared essential by the committee. Previously, the only test used to determine whether a service was essential was the “life and limb” test. Now, an additional test was being proposed, for “public officials exercising authority on behalf of the state”. Mr Mkalipi explained that this would, for instance, cover customs officials, immigration officials and officials in the administration of justice. If these officials went on strike, life and limb would not be threatened, but the authority of the state could be undermined.

There was no disagreement on the issue of minimum service level agreements.

Mr Nyekemba asked for clarity on the current opposition of extension of the test to public officials exercising authority on behalf of the state.

Mr Motau was curious as to whether teachers could be included in essential services, pointing out the serious effect of strikes that were crippling the schools system.

Mr Mkalipi noted that section 213 of the LRA defined “essential service” as one who interruption would endanger the life, personal safety and health of any part or the whole of the population. At the moment, such essential services were the police services and Parliamentary services. In order for teachers to be deemed essential as well, there would have to be proof that the “life and limb” of pupils would be endangered by strikes, and the International Labour Organisation (ILO) recognised that many cases would not be supported by the “life and limb” argument. He said that it would be too wide to try to include teachers in the definition of “officials exercising authority on behalf of the state”.

The Chairperson remarked that all employers wanted their officials to be declared essential. A few weeks previously, one organisation had petitioned to have refuse collectors determined as essential services.

Mr Mkalipi stated that refuse collectors had been declared to be an essential service, in the sense that a strike that would affect refuse collection was not allowed to exceed 14 days before the service was declared essential.

Mr Maserumule asked for clarity on the ESC, and whether the words “citizen ordinarily resident in South Africa” would include a permanent resident.

Mr Mkalipi replied that “ordinarily resident in South Africa” qualified that it referred to a citizen who was actually staying in the country.

Mr Nyekemba asked whether it was necessary to have an ESC, since there were other institutions dealing with similar matters, or legislation dealing with these areas. He believed that at the end of the day, everything could be declared essential.

Mr Mkalipi explained that the section of the LRA did not declare all services to be essential. The employer still had to go to the ESC and convince it that the services in this particular instance were essential. Some of these functions had already been declared essential, such as customs officials.

Clause 16
This was explained by Mr Mkalipi to be a technical amendment and no questions were raised.

Clause 17
Mr Mkalipi noted that this clause proposed that the Registrar of Labour Relations could have the power to go to the Labour Court and put a union under administration. This was a similar concept to business rescue. Instead of deregistering a union that was not functioning properly, the union could be assisted to function properly, and an Administrator would be appointed over the union.

Clause 18
Mr Mkalipi said that this clause provided that if the Registrar took the decision to de-register a union, then the Application for Review that was lodged in the Labour Court would not suspend the Registrar’s decision.

Ms Makhubela-Mashele asked why this was the case; in normal matters a review or appeal meant that the first decision was in fact suspended.

Mr Mkalipi stated that the proposal was intended to deal with bogus trade unions that were simply money-making schemes. In terms of section 106 of the LRA, the Registrar could investigate a union and decide whether it was legitimate. The de-registration of the union did not mean that it would cease to exist, but instead the de-registration took away the union’s right to go to the CCMA. From a practical standpoint, bogus trade unions would go to the Labour Court and lodge appeals simply to delay the de-registration process, and this was not in the interests of collective bargaining.

Ms Suraya Williams highlighted the difference in onus in civil and criminal matters. In criminal matters, the burden of proof was much higher, requiring proof beyond reasonable doubt. This was not the same in civil matters, where the principle did not hold that litigants were innocent until proven guilty. For this reason, the suspension of proceedings did not apply.

Ms Makhubela-Mashele asked whether the deregistration of trade unions would not spark mass demonstration, particularly because the decision of the Registrar was not suspended and unions would have been aggrieved by this process. She was also concerned about the fact that the legislation could end up performing a gate-keeping function that could result in the suppression of emerging unions.

Mr Mkalipi explained that the section did not relate to an incoming union, but to a pre-existing union. The provisions were intended to deal with unions who should not have been registered in the first place. Unions that were not genuine sometimes slipped through the cracks. The provisions gave the Registrar an opportunity to “clean up” those unions. They also would allow for instances where the Registrar did not believe that de-registration was appropriate, where the unions simply needed assistance.

Clause 19
This clause stated that the CCMA rules would have to be amended every two years. The CCMA was also required to assist workers earning less that R172 with faxing applications and any other assistance in making applications. This also gave the CCMA the right to prescribe consequences for employers not showing up to disputes. Such consequences could include reinstatement of the employee, or a fee being charged for administrative costs.

Clause 20
This clause was also related to the issue of the ballot. In order for a strike to be certified a ballot had to be done.

Mr Nyekemba asked for the record to reflect that the Committee had not agreed to the issue of introducing a ballot.

Clause 21
This was a deletion of a paragraph, as a result of the changes in clause 22.

Clause 22
Mr Mkalipi explained that the purpose of clause 22 was to remove the need to go to the Labour Court, based on an award. The amendment was basically streamlining the mechanism for enforcement. The decision from the CCMA could be taken directly to the Sheriff. The award would automatically have the same force as a decision of the Labour Court. In instances of contempt, if an employer did not comply with the decision of the CCMA, this would be considered as contempt of the Labour Court. This award would be enforced under the rules of the Magistrate’s Court, which would mean that the fees would be cheaper than if the Labour Court had to be approached. The clause was also intended to address the backlog of matters in the Labour Court, in terms of certification of awards.

Clause 23
Mr Mkalipi noted that the proposals for section 144 were essentially introducing a new ground for the rescission of an award. Previously, an award could only be rescinded on three conditions – where there had been a mistake, where it was unclear what was meant by a word, or where there was an obvious error. Now, a new ground of “any other good cause” was being added.

Mr Nyekemba questioned the addition of the ground of “good cause”, making the point that the existing grounds were in themselves good cause, and questioning why a repetition of this was necessary.

Mr Mkalipi replied that the inclusion of “good cause” was informed by the experience of the CCMA. “Good cause” was a well-established legal principle. If an applicant showed good cause, the court would have to accept this, although the opposing party was at liberty to dispute it. The existing list was not exhaustive, and the addition of “any other good cause” would broaden the grounds. He stressed that this would also not dilute the rights of workers. Labour at NEDLAC supported the inclusion of good cause, but Business was not happy about its inclusion.

Mr Nyekemba maintained that he still did not believe it was necessary, despite the fact that “good cause” was an accepted legal term.

Ms Suraya Williams added that there might be another situation not originally envisioned by the legislature, and the insertion of wider grounds would mean that an applicant was not prejudiced. The drafters did not want to limit the discretion.

Clause 24
Mr Mkalipi noted that clause 24 was intended to apply in scenarios where employees were awarded reinstatement and compensation by the CCMA, but employers would then immediately apply for review, thereby suspending the award, and delay the matters, so that it could happen that as long as twelve months might pass without the award being enforced.

The amendment therefore proposed that the applicant would have to apply for a date for the matter to be heard, within six months, and that the judgment by the Labour Court must be given as soon as reasonably possible. NEDLAC had proposed that judgment must actually be given within six months, but the legal team had been advised that it would be unconstitutional to impose a timeline on the Court, as this would infringe on the separation of powers. Finally, if an award was given which prescribed the payment of an amount of money, it would not be suspended by the lodging of a Review Application, unless security was provided. If the award was for reinstatement, then the security had to amount to 24 months’ pay. Prescription would also only start to run from the time when the Review Application was completed. Business was not satisfied with the requirements around the giving of security.

The Chairperson asked what purpose the security would serve

Mr Mkalipi replied that the intention had always been to make decisions of the CCMA final and binding. In practice, however, there was an avalanche of Review Applications to the Labour Court. The requirement that security must be paid was supposed to discourage frivolous reviews and to encourage the review of only seriously flawed cases. The payment of security would be a strong indicator that the Review Application was serious, and was not merely a tactic to delay reinstatement or to frustrate a worker.

Mr Nyekemba asked why it was considered unconstitutional to impose a time period on the Court for making decisions. This was not telling the judges what should be contained in the actual judgement

Ms Suraya Williams replied that giving judges a time period of six months would infringe on the fundamental principles behind the separation of powers, because it was essentially interfering in how the judiciary would regulate its business. There were numerous factors affecting how and when judgements could be handed down, including the length and complexity of cases. Section 165 of the Constitution safeguarded the independence of the judiciary. A Court could be directed as to what factors to take into account, but no time period should be prescribed.

Dr Barbra Loots, Parliamentary Legal Adviser, stated that principles of fairness informed everything in the Bill. In the same way, the Constitution allowed Parliament to determine its own schedule, and it was up to Parliament to determine how long it needed to pass a Bill. Courts had to determine their own schedule too, and could not be told when to finalise cases.

Mr Nyekemba was of the opinion that overly special attention was being given to the judiciary. He pointed out that the Constitutional Court ruling on the Scorpions had required the Executive to take certain steps, and questioned why, if the judiciary was permitted to issue instructions to the Executive, the legislature should not be able to issue instructions to the judiciary. He reminded the Committee that the Courts were dealing with the plights of poor workers, who needed speedy access to justice.

Advocate Anthea Gordon, Parliamentary Legal Adviser, said that the Scorpions issue was related to section 2 of the Constitution The Constitutional Court had the power to look at any law passed by Parliament, and assess whether it was inconsistent with the Constitution, in which case, in terms of section 2 of the Constitution, it could be declared unconstitutional. Section 172(10)(b) provided that the Constitutional Court could give Parliament a time period in which to rectify the Bill, and this was how this power was derived.

Mr Williams asked for clarity as whether the judiciary was not also subject to laws made by Parliament.

Ms Suraya Williams replied that the Constitution was to be used as a threshold, and its sections could not be read in isolation. Section 165 of the Constitution had to be read together with section 2. Any law made by the legislature (Parliament) had to be consistent with the Constitution. The Constitution provided for the separation of powers. All laws had to be therefore made in a way that would entrench that separation of powers, as well as being in line with other provisions of the Constitution.

Mr Mkalipi was not keen to see the exclusion of the six months period, but also stressed that the Bill should not be attacked on the grounds of non-Constitutionality. There were many far more important issues in the Bill that were important for the labour market. In the bigger picture, it could be a little loss compared to delaying the whole process.

Mr Nyekemba noted that it was important to take into account the different factors that affected the drafting of the Constitution and the background of the Members themselves.

Other business: Adoption of Minutes
The Chairperson tabled minutes of previous meetings for consideration.

Members adopted the minutes of the meeting on 22 August.

In relation to the Minutes of 4 September, Ms Makhubela-Mashele noted that her name had not been reflected on the attendance list even though she was present. An amendment was noted, and the minutes were adopted, subject to this amendment.

Members also agreed on the adoption of the minutes of 11 September, and 22 September.

The meeting was adjourned.

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