National Minimum Wage: input by Black Management Forum & Business Unity South Africa

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Employment and Labour

03 September 2014
Chairperson: Ms L Yengeni (ANC)
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Meeting Summary

The Black Management Forum made a submission on the national minimum wage (NMW). The BMF acknowledged that South Africa’s inequality does not only have a racial dimension, but was also growing within the black community. If left unattended, it had potential to reverse the gains that have been made in the last twenty years. Inequality is inherently the antithesis to democracy, social justice and equality. The national minimum wage was undoubtedly one of the most effective mechanisms through which inequality could be addressed. It made reference to Brazil where an increase in the minimum wage implied a rise in income, not only for wage earners but also for pensioners and the unemployed, whose benefits were linked to the minimum wage. The minimum wage had contributed to reducing income inequality between men and women and between white and black workers. Brazil succeeded in lowering poverty and inequality levels as the Gini index dropped from 0.56 in 2000 to 0.53 in 2007. The number of workers whose income was below the poverty line fell from 23% in 1999 to 14% in 2006. The BMF was convinced that the current status quo was not sustainable. Inequality needs to be confronted from all angles to guarantee the future sustainability and stability of the country. However, it was encouraged that when President talked about this, he said the government will “investigate” first. This investigation should take into account a  number of issues: Rationale behind the minimum wage, harmonisation of national minimum wage with sectoral minimum wages, the impact of the national minimum wage on poverty alleviation and reduction of inequality. The impact of national minimum wage on our industrial relations systems, trade-offs that often have to be taken between employment levels and minimum wages. In any policy choices, there were costs and benefits, advantages and disadvantages, winners and losers. All these need to be factored in the final research that will form a basis for the decision on minimum wages. The BMF also noted that when minimum wages were introduced in the agricultural sector, aggregate employment on farms fell by 13% in the four years after 2003. It also said the clothing and textiles factories that survived between 1995 and 2014 did so because they were noncompliant with the minimum wages extended by the Minister of Labour.

Business Unity of South Africa noted that it was researching and would come with a principled position by the end of October. There was need to achieve a balance between protecting vulnerable workers and limiting potential negative economic consequences. It pointed out that South Africa did have a functioning system of sectoral minimum wages which provide for minimum wages per job category. Further, Section 55(8) of the new Basic Conditions of Employment Act Amendment Act allows the Minister to publish a sectoral determination for employees who are not covered by other sectoral determinations. Thus South Africa has provision for a default minimum wage.

The Committee Chairperson and some of the trade unions were not satisfied with BUSA stating it did not have a position yet. The Chairperson questioned whether it took the institution of Parliament seriously. BUSA would need to come again and present on the NMW.

In the discussion that ensued there were various arguments about the NMW put forward by Committee Members and the more than ten trade unions present, ranging from passionate supporters of a national minimum wage to those that were sceptical or critical about its effect. Critics of a NMW argued that it must not be enforced in such a way that it increases unemployment, worsening the Gini coefficient and that sectoral determinations were more finessed. Those that were sceptical questioned the capacity of the economy to meet the NMW proposed by the trade unions. Supporters argued that it was an effective measure for reducing inequality and redressing the injustices of apartheid, deracialising the labour force while ensuring that everyone earns a decent living wage. Those that passionately defended the NMW argued that it was long overdue and case studies from Indonesia, Brazil and Uruguay showed that the NMW did not threaten those economies but increased employment while at the same time reducing the Gini coefficient.

Meeting report

Black Management Forum (BMF) submission on National Minimum Wage
Mr Dumisani Mphata, BMF Board Member, thanked the Portfolio Committee on Labour for the invitation to engage parliament on the discussion around the national minimum wage (NMW). This was an important development, not only for the industrial relations environment, but also for the economy and nation at large. The Black Management Forum was formed in 1976 as a response to continuing discrimination of black managers in the workplace. This was of course part and parcel of systematic discrimination that was brought to bear on the majority of South Africans, blacks. The BMF will be 40 years in 2016. Amongst some of the major accomplishments of the BMF were the leadership roles that the BMF took in the conception of both Employment Equity and Black Economic Empowerment Acts. It pushed for these policy and legislative instruments for a number of reasons. First, it recognised and acknowledged that political freedom and the right to vote on their own do not account for much if they were not accompanied by tangible socio-economic benefits. Colonialism and apartheid continue to have a profound impact on the lives of the majority of black people. To some extent, these systems continue to dictate where one works, stays, the kind of job that one does, and the amount of money that one earns.

The Presidency’s Twenty Year Review states that: “South Africa remains one of the most inequitable countries in the world. When using the Gini coefficient measurement, inequality increased from 0.64 in 1995 to 0.69 in 2005, but improved to 0.65 in 2010/11. The share of wages in national income has been decreasing from just below 55% in 1994 to a low of 49% in 2008. It then increased to 51% in 2012.” The review states that that the average income for females remains less than their male counterparts. It notes that in 2012, the median income for an African household was under R3000, for coloureds and Indians over R7000, while for whites it was around R20 000.

In South Africa, inequality does not only have a racial dimension but inequality was growing within the black community. If left unattended, inequality had potential to reverse the gains that have been made in the last twenty years. Inequality is inherently an antithesis to democracy, social justice and equality. Whilst the BMF had successfully lobbied for the institutionalisation of employment equity and black economic empowerment, it is possible for the country to seriously address inequality by coming up with targets that the country can use to evaluate if it is making progress or not on this pressing social challenge. Inequality is complex and has so many dimensions, but it can be broken down and a comprehensive approach can be arrived at. The national minimum wage was undoubtedly one of the most effective mechanisms through which inequality could be addressed.

The BMF was therefore more than pleased when the President Zuma during his State of the Nation Address of 17 June 2014 announced that government will investigate the possibility of a national minimum wage as a key mechanism to reduce income inequality. The minimum wage was not new to the industrial relations system. Since 1999 detailed minimum wages schedules have been developed covering eleven sectors of the economy. Research indicates that there is no single minimum wage even within a particular sector, the mandated wage can vary by occupation type, number of hours worked and geographic location. The meeting takes the discourse of minimum wage to a different level, that is, at a national level.

The BMF is encouraged because when the President talked about this, he said the government will “investigate”- this is very important. Its view is that this investigation should take into account a  number of issues:
• Rationale behind the minimum wage, harmonisation of national minimum wage with sectoral minimum wages, the impact of the national minimum wage on poverty alleviation and reduction of inequality. The impact of national minimum wage on our industrial relations systems, trade-offs that often have to be taken between employment levels and minimum wages. In any policy choices, there were costs and benefits, advantages and disadvantages, winners and losers. All these need to be factored in the final research that will form a basis for the decision on minimum wages.

The BMF said that what was known about Sectoral Minimum Wages was that:
• Minimum wages lift the working poor from extreme poverty;
• When minimum wages were introduced in the agricultural sector, aggregate employment on farms fell by 13% in the four years after 2003;
• In the clothing and textile industry, rapidly rising minimum wages in the non-metro areas have driven many low-wage; more labour-intensive producers out of business, whilst subsidies from the Department of Trade and Industry has helped higher end fashion producers;
• The clothing and textiles factories that survived between 1995 and 2014 did so because they were noncompliant with the minimum wages extended by the Minister of Labour.

Some Case Studies
Indonesia -
In Indonesia, a minimum wage hike had a modest impact on the conditions of the Indonesian labour market. Average wages increased by 5-15% and urban wage employment decreased by 0- 5%. The impact of a minimum wage hike varied according to the size of the enterprise. Employment in small enterprises decreased substantially, whilst in large firms, employment increased

Brazil - An increase of the minimum wage implied a rise in income, not only for wage earners but also for pensioners and the unemployed, whose benefits were linked to the minimum wage. The minimum wage had contributed to reducing income inequality between men and women and between white and black workers. Brazil succeeded in lowering poverty and inequality levels. The Gini index dropped from 0.56 in 2000 to 0.53 in 2007. The number of workers whose income was below the poverty line fell from 23% in 1999 to 14% in 2006. The minimum wage also serves as a benchmark for social security benefits. One of the main factors contributing to economic growth in Brazil in the period of 2005-2008 was the growing domestic market. The minimum wage valuation process played a key role. Evidence showed that minimum wages were important for informal worker earnings. Employees and employers often negotiate wages using the minimum wage as a benchmark. It plays an important role in redistribution particularly for the disadvantaged and vulnerable in society. Evidence showed that minimum wage helps reduce existing gender and racial discrimination. Minimum wages contributed to the reduction of the Gini by 44% compared to pensions which were 21%.

Conclusion
The BMF is convinced that the current status quo is not sustainable. It is inimical to the ideals of justice and equality. It is dangerous in the long run, it has a potential to undo any major and minor accomplishments that had been made. Inequality needs to be confronted from all angles to guarantee the future sustainability and stability of the country. However, the BMF appeals to parliament to fully apply its mind on all major and minor implications of this policy proposal. It knows that trade-offs are inevitable, there will be benefits and costs, there are bound to be winners and losers, there will be advantages and disadvantages of whatever policy choice is made. BMF stands for a fair and just society. In principle it was in full support of the introduction of the national minimum wage, provided it is based on sound research and information. It appealed to Members to weigh all the evidence and decide accordingly. The introduction of a national minimum wage should not be seen as a panacea. The economy was constrained by a myriad of challenges that include low growth rates, under investment by the private sector, structural unemployment and an increasingly volatile industrial relations environment. Further, the introduction of a national minimum wage will not achieve much if it is not accompanied by serious rethink on executive pay. This was an opportune time to seriously think and reflect about a ceiling/ lid on executive pay. If this was not done, equality will remain an illusion and a moving target. The earnings differentials between executives and workers in this country were obscene.

Discussion
Mr I Ollis (DA) said there was a major problem with poverty in South Africa. Its Gini coeficient was the worst in the world. About 35% of people were unemployed. A minimum wage may not fix it but make it worse. This was  typified by the loss of more than 200 000 jobs in the agricultural sector, making the Gini coefficient worse. It might be better to negotiate wage per sector, for example, the security and taxi industry having different minimum wages. He asked if BMF really supports a national minimum wage (NMW) and it must do research on the unintended consequences of the NMW pushing people into unemployment.

Mr M Bagraim (DA) said the President had invited Members to investigate the issues related to NMW. He asked about the link between executive and operational staff salaries on the NMW. Many people in South Africa were covered by a minimum wage through bargaining councils and sectoral determinations. In the agricultural sector, the minister over stepped the NMW and thousands of people lost their jobs and other farms have mechanised whilst other farms closed because they could not afford the minimum wages. He asked BMF to explain which sectors were likely to be vulnerable to the NMW.

Mr Mheli Mbana, Regional Educator: South African Commercial Catering and Allied Workers Union (SACCAWU), categorised Mr Bagraim as a person who disregards the welfare of the workers against profits. One has to measure NMW against executive salaries and business people were taking away from this country. These people have no interest in developing and redressing apartheid regime imbalances. Their main concern is enriching their pockets. The comments of learned economists on television disregard the dimension of the profits and concentrate on wages. Profits in this country must be regulated with the intervention of the government.

Mr Mbana said the NMW cannot be looked in isolation to the social wage. A social wage is the impact of public transport on the salary of poor people. The apartheid government had created demographic locations where poor people travel long distances to reach their work places; leaving their homes at 4am and getting back at 8pm. These people pay for taxis and trains to get to the workplace. This refers to people working for Pick N Pay, Game, Shoprite, Checkers and Spar. One cannot deny that public transport indirectly impacts on the wages of these workers. Food prices were increasing every day. There must be a government policy regulating the price of basic food commodities. Some people travel long distances to access clinics and reach services that should have been located at their backdoor because of the policies of the previous and current government. The R2800 wage has to pay for school fees, food, medication and transport for school children. The NMW must not be looked in isolation to the costs incurred by workers in their day-to-day life. There must be a concerted effort by government to reverse the policy that leafy suburbs such as Claremont, Sandton and Hout Bay were for people with very high salaries. There must not be high rentals for people to live in these suburbs. People must live wherever they want to live so their meagre salaries are not spent on transport. More so, the policy of neo-liberalism where everything was being privatised with no interest in giving back to society, just maximising profits. Through privatising, the government was creating problems that it was supposed to resolve.

Mr P Moteka (EFF) said transformation will never been pursued by those that were anti-transformation. It must be a must. A farm worker was a person used by somebody to get rich while getting a stipend at the end of the month. That person cannot afford to send children to school or use the money to buy food if food was not provided on the farm. The person lives in a three square metre room with his family. Any person earning less that R4 500 was earning a stipend. The threat of job losses was only said by those who were anti-transformation. By 2014, South Africa should not be discussing a NMW. Farm workers start working when very young and finish very old and sick with no material property. There must be a law to enforce NMW.

Mr Neil Coleman, Strategies Coordinator: Confederation of South African Trade Unions (COSATU), said COSATU would give a detailed submission the following week. COSATU had done extensive research on the NMW for three years and this will be published. NMW was an effective mechanism for reducing poverty and inequality. The Democratic Alliance has shown its colours by opposing the NMW and protection to workers. The DA spokesperson said if the unions were doing their work properly, there was no need for a NMW. The DA and its allies have mobilised against NMW. The propaganda that was put out was very unfortunate. It was a lie that there were widespread job losses and 650 000 jobs were gained in sectors were a sectoral determination had been implemented. In some sectors, hours were reduced and aggregate wages were increased. He asked if BMF was engaging with other business organisations to advance the idea of a NMW.

Ms P Mantashe (ANC) said the status quo was unsustainable. The difference in household incomes was scary and South Africa cannot run away from a NMW. SA needs to look into radical transformation of the economy and the NMW will assist in realising the goals of this country. Anyone who opposed a NMW was earning more than R20 000 per month which many people have never been paid.

Mr Woody Aroun, Parliamentary Officer: National Union of Metalworkers of South Africa (NUMSA), said while NUMSA appreciates the discussion on NMW, there was no draft document from the Department of Labour about NMW. This would help NUMSA prepare a discussion document.

Mr M Plouamma (AGANG) said there was a need to understand the dynamics of growing inequality among black communities. The NMW must be implanted in such a way that it benefits the majority. The change of government in South Africa reflected the compromises made for South African democracy but the compromises do not serve SA citizens well. Those who benefited before SA democracy, continue to benefit, but people speak the same language that they love SA very much. He supported the NMW. But it must not perpetuate the emergence of a black bourgeoisie elite.

Mr Eddie Majadibodu, Production Pillar Head: National Union of Mineworkers (NUM), said SA needs a NMW, whether national or regional. Sectoral wages had been exploited where rock drill operators in gold, coal and platinum mines earn different income whilst doing the same job requiring the same skills. Former president of Brazil, Lula da Silva, put money in the hands of the poor to trigger economic development because they spend their money there without the need to go overseas to enjoy the profits. SA must not speak of redress without income redress. The question of salaries of executive and operational staff need addressing because some executives earn what would take a worker a 100 years to earn. Two executives in the mining sector earned R51 million. People must not hide under certain terminology. The SA labour market needs intensive research as it had been premised on cheap labour. It justifies taking money from certain individuals and giving it to others in the same company. The concern was that people were hiding behind scientific terms to avoid a NMW. The proposal by NUMSA for a discussion document should be done as soon as possible as time was running out.

Ms F Loliwe (ANC) said the Brazil model created many jobs in the domestic sector and asked how it was related to SA. The Committee would call all stakeholders interested in the NMW to pave the way forward. Some of the debates raised the speakers were immature. The Committee would tease out the various matters raised. She complained that some members were moving onto other discussions without seeking questions of clarity from BMF.

Mr Jeff Mphahlele, General Secretary: Association of Mineworkers and Construction Union (AMCU), said the debate on NMW was long overdue. In 1933 former United States President Franklin Roosevelt made a statement that any business that wants to exist on the premise of cheap labour does not have the basis to exist. The SA government must follow that path. SA must not merely have beautiful laws that are not monitored. AMCU welcomed the NMW. The involvement of government in the platinum strike has left questions of whether it was government or business – because it was crossing the line. It cannot be business as usual anymore. AMCU support actions, not just talk shows.

Mr Zamile Sinuka, President: CONSAWU (Confederation of South African Workers Union), welcomed the NMW. The NMW embraces the dignity of workers to have a fair share of per capita income between blacks and white. Any form of exploitation where people do not get a minimum salary to allow them decent living is against the principle of equality in democracy. Further research need to be done before implementing the NMW which will uphold the dignity of people.

Ms Stephanie Duffy, Shop Steward: SACCAWU, said in 2012 the University of Pretoria and University of South Africa suggested a level of R4 000 to R5 500 based on the cost of a basket of goods that each institution defined as necessary for basic living. The International Labour Organisation (ILO) argues that a NMW should not be less than 40% to 50% of the average wage or about two thirds of the median wage. The median wage is the point at which the same numbers of workers earn below and above the median. The current ratio was around 22% of the national average and if the ratio was applied, the NMW would range between R4 800 to R6 000 if the medium wage calculation was used. The introduction of a NMW in Brazil did not result job losses. The majority of shop floor workers were not even earning half of the minimum wage. Even if R5000 was to be given as a NMW, the majority of workers in the country were migrants from different parts of the country for which half the income will be taken by rent alone then school fees, food, transport, electricity, medication, and other expenses. About 75% of workers in SA earn an average of R3 300 which is below a minimum living level, 85% of labour force work more than 40 hours a week, 30% work more than 45 hours a week, and only 32% medical aid benefits, 71% was not unionised and 43% had no access to paid maternity leave. The NMW “may not affect you today, but this will be the conditions for your child one day”.

Mr Jeremy Marillier of the Cape Chamber of Commerce, asked if the example of Brazil and Indonesia cited by BMF was done in the context of an economic growth trajectory and whether it was in the context of flexible labour rules. The debate must not only centre on the NMW, but also include labour productivity.

Ms Alfreda Sirmonpona, Labour Relations Officer: Public Servants Association (PSA), said there were many people in government who earn below a living wage. The draft policy on the NMW must not centre on the private sector but must also include the public sector.

Mr Trenton Elsley, Executive Director at the Labour Research Service, said it was important that BMF was sensitive to executive pay. There were facts in the BMF submission that were half truths. He disagreed with Mr Bagraim that executive pay was not related to inequality. The heart of corporate governance was social norms around remuneration. In commissioning research that is meant to inform people for a structured policy decision, the Committee must be wary of commissioning research that is one sided. The research must be able to capture a balance of perspectives and context. Statistics were lies. It was surprising that there was no benchmark for a decent living wage which would make consensus building easier than engaging in a highly polarised discussion. A decent living wage was something more than just surviving. The University of Pretoria and UNISA studies referenced by Ms Duffy had methodological bias, were racist, vague and were initiated by employers.

Mr D America (DA) said the major problem with unemployment was that the majority people end up willing to earn anything for a living. The eradication of unemployment should be done within the context of discussing economic growth which will raise levels of employment and consequently discussion on a fair wage. The current large segments of unemployed were youth with a low level of skills. An enforced NMW against industry and small business would result in greater levels of unemployment. Any discussion on a NMW must not be emotive.

Ms S van Schalkwyk (ANC) said case studies have shown that a NMW was never a threat to their economies. SA needs to visit those countries with a NMW to get an understanding of what exactly transpired. The initiative would benefit the poorest of the poor.

Mr Ollis said the input from Mr Mbana was incredibly invaluable that black communities live very far away from work and much of their income was lost in transport. The DA does not have a position on a NMW. Putting the blame on the DA comes from tired communists trying to get attention because communism has died. There was no DA document about a NMW.

Ms Mantashe said Mr Ollis must not play double standards. If the spokesperson of the DA says something anti-NMW, then it is presumed to be the DA position. The Committee was prepared to work with progressive organisations towards establishing a NMW for Southern Africa. It was the Committee’s responsibility to ensure that the poorest benefit.

Mr Moteka said the EFF has taken a position that the NMW was a 'must' which must happen. The EFF was not going to compromise on the NMW. Some of the wages earned by farm workers were not wages worthy of protecting, as they were tantamount to slavery. He agreed with COSATU, NUMSA and AMCU on the NMW. Anti-transformation must not be allowed any longer.

Ms Loliwe said the BMF had not come to cast in stone its views on NMW, it was their view. There was no conclusion to be drawn by listening to the BMF submission alone. It was imperative to reserve grandstanding until the consolidation of inputs from all stakeholders.

Mr George Warrington, Shop Steward: Federation of Union in South Africa (FEDUSA), said a NMW needs to be looked at across a broad spectrum as costs for services will go up to recover that cost to the extent that a NMW will be useless.

Mr Coleman said he was not aware that FEDUSA had already taken a position. COSATU was not ‘tired’ and will fight for NMW with all the energy and history was on COSATU’s side. The DA statements were clear that it opposed to the NMW by emphasising the dangers of a NMW for unemployment and the sectoral determination. The logic of the DA was to oppose anything that protects workers’ rights and everybody knows that that was its reality. The propaganda the DA broadcast was that 75% of people were employed by small businesses. This was against the Stats SA report on labour dynamics which showed that the greatest number of employers were medium to large enterprises.

Mr Mphata said BMF had given its views on the NMW, not that it had been commissioned to do research on the NMW. The NMW should not only be looked as a labour issue but as an economic instrument to address the challenges faced by government. It was important to engage because points were missed if positions were taken in a partisan manner. Executive pay remains a reminder of the insensitivity of businesses to black workers. There was a need to seriously look into redistribution policies.

Business Unity of South Africa submission on Minimum Wages
Ms Vanessa Phala, BUSA Chief Director: Social Transformation, said BUSA was committed to participating constructively on the NMW. It had commenced research into the national minimum wage looking at international and national experiences and that research was being finalised to inform BUSA’s position.

The ILO Convention 131 states that a NMW is to give wage earners necessary social protection regarding minimum permissible levels of wages. The criteria to determine minimum wages includes the needs of workers and their families taking into account the general level of wages in the country, the cost of living, social security benefits, the relative living standards of other social groups and economic development, levels of productivity and desirability of attaining and maintaining a high level of employment. SA has a functioning system of sectoral minimum wages through sectoral determinations which provide for minimum wages per job category.

Section 55(8) of the Employment Equity Amendment Act states that the Minister may publish a sectoral determination that applies to employers and employees who are not covered by other sectoral determinations”. Minimum wages set the floor for compliant employment, but if set too high it can push more people into informality. National minimum wages should be set relative to employment rates, productivity, and employment of vulnerable groups, inflation, tax and social contributions. Differentiation and decentralisation via a sectoral system was important to take into account the different costs of living in different areas, productivity levels and employer ability to pay (particularly small business). We have to ensure that we do not repeat the mistakes of the Agriculture wage setting at 52% which resulted in about 73 000 job losses. The biggest challenge was to achieve a balance between protecting vulnerable workers and limiting potential negative economic consequences.

Discussion
Mr Moteka (EFF) said the BUSA submission was not that intense since it was still researching and it did not sound against a NMW. BUSA talked of balancing the protection of workers and damaging the economy which was good in that there was need to balance not exploiting workers while keeping the economy balanced.

Mr Bagraim said the amendments to the Basic Conditions of Employment Act provide the Minister with power to regulate remuneration increases and to look at areas not covered by a sectoral determination. The Minister can make a decision to increase the minimum wage of any workforce. He therefore asked if there was any need to debate the NMW.

Mr Aroun said the BUSA submission cited the World Bank. It was well known that the international financial institutions (IFIs) have got their own positions on this. The research must have a balanced perspective by looking at other research such as the 2013 United Nations Conference on International Trade which gave another perspective on instruments to grow the economy. The IFIs never had an interest in developing SA. NUMSA want a NMW and will continue to lobby to de-racialise the labour force, ensure that workers’ rights were protected and create decent employment. NUMSA would also like to present its ideas on a NMW in a more structured way than just to sit and shout in response to other stakeholders’ submissions.

Mr Majadibodu said it appeared that BUSA as an employer organisation was expected to be given another chance to present its position. It was surprising that BUSA does not have a principled position on a NMW despite the President mentioning NMW in the State of the Nation Address. SA’s economy was based on cheap labour. It operates on a 3:2:1/2 basis which entails tripling profits, doubling production with half the labour force.

Mr Coleman appealed to BUSA to find a position on the NMW as soon as possible. A lot of employers were not implementing the basic employment requirements. Sectoral determination was a big problem. The NMW will apply to everybody across the board regardless of sector. It makes it easier for workers to enforce their rights. Brazil had a regional differentiation over and above the NMW. BUSA continues to support sectoral determination. The amendment giving the Minister of Labour powers to cover those not covered by a sectoral determination added to the fragmentation as this entailed multiple arrangements for different sectors. About 50% of workers in SA were earning below R3 033 a month while 35% earn below R2 000. This was a continuation of the apartheid cheap labour regime. Brazil increased the NMW by 86% over six years after inflation, creating 17 million jobs. Uruguay increased the NMW from US$100 in 2003 to US$500 in 2014. The rate of unemployment has gone below a historic level of  6% in Uruguay. There was a need to question job losses in the farming sector as there was a massive job gain in the agricultural sector as well. The gains and losses were not premised on a NMW but on a contingency of factors such as sectoral conditions, liberalisation of agriculture and industrial policy.

Mr Llowellyn Domingo, General Secretary: National Certificated Fishing and Allied Workers Union (NACFAWU), said it was difficult to understand BUSA’s position on the protection of vulnerable workers. Business was clear that it does not intend helping with the NMW in that it says it must not be set too high to avoid job losses. There was need for a basic living salary for the poorest of the poor coming from business, yet BUSA was not clear on its position.

Mr Crosby Booi, Western Cape Regional Secretary: SACCAWU, said BUSA holds a particular position by referring to particular legislation. COSATU made a position on the NMW as far back as 2012 and BUSA needs to take the NMW issue very seriously. The aim was to close the apartheid wage gap to address imbalances of the past.

Ms Mantashe said it was unfortunate that BUSA was not prepared for its submission. BUSA said nothing and she questioned whether it takes the Committee seriously. She was disturbed by its behaviour.

Mr Omar Parker, Provincial Administrator: National Union of Public Service and Allied Workers (NUPSAW), said the NMW was not a new debate and this was not a simplistic debate. Inequality must not be exacerbated in a mechanical approach by hiding behind scientific terms. In the public sector, there was vast wage differentiation between the executives and the cleaners, for example, those working at Parliament, who were public service workers.

Mr Plouamma said having a NMW that was not a living wage served no purpose. There was no need to value investment at the expense of poverty unless profit makes business lose its conscience. Humans need to think humanly and be moral as there was no need to do business whilst workers suffer. If businesses do not think proactively, it would lose all investment as the country will burn.

The Chairperson said it looked like BUSA was given its last invitation. BUSA does not take Parliament seriously at all and it must come back and discuss its position. The trade unions, academics and BMF were serious.

Ms Phala said BUSA would have a position on the NMW by the end of October. BUSA had participated in various parliamentary committees and takes Parliament seriously.

The meeting was adjourned.


 

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