Mpumalanga farm inspections: Department of Home Affairs update; Department of Labour 1st quarter 2016 performance; Labour Law Amendment Bill

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Employment and Labour

07 September 2016
Chairperson: Ms L Yengeni (ANC)
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Meeting Summary

The Committee noted that after visiting several farms in Mpumalanga, it had highlighted various problems around non-compliance with immigration laws by employers and had requested the Department of Home Affairs (DHA) and the Department of Labour (DOL) to look into the issues and conduct their own inspections into compliance with both labour and immigration legislation. The DHA was now to present its second report on the inspections. DHA indicated that the two departments, also accompanied by SAPS, had visited various farms, after first ensuring that proper search and seizure warrants were issued prior to inspections and was accompanied by members of the South African Police Services during their inspections. It was observed by the Department that the majority of workers employed on the farms were South African nationals, with Mozambiquans and Swazis being the dominant foreign nationals. Details were given of the findings on the various farms. The DHA had been unable to inspect one farm due to union disturbances and factions threatening to escalate into violence but would visit it later. The Department of Labour mandate had been primarily to look into compliance with labour legislation and it had found that some common areas of non-compliance included failure to keep proper attendance registers and issue pay slips. Those farm owners who had failed to comply were  issued with compliance notices, but it was explained that continuing non-compliance could also mean referral to the Labour Court or prosecution. Advocacy sessions were implemented to educate both employees and employers about their respective rights and obligations under the applicable legislation.

Members of the Committee raised concerns as to whether farmers would be prosecuted if they had employed illegal nationals yet genuinely believed that the documentation shown to them had been valid. The DHA assured the Committee that in these cases prosecution would not be pursued. The DHA also  emphasised  that all illegal  and foreign national employees were guaranteed the same rights as local employees, although this did sometimes create problems, and that the DOL and DHA were complying with international and regional conventions. Members were also assured that the SA Human Rights Commission exercised oversight on all deportations, since this was another concern by the Committee. Other questions related to the lack of budget to conduct more inspections, concerns that health and safety legislation was not being observed, what process employers should follow when they discovered fraud, whether there was evidence that farmers had specifically recruited workers from Mozambique and Swaziland, how distinction was made between workers and visitors on farms, and whether those deported were guaranteed to be paid any money due.

The Department of Labour then gave a report on its performance in Quarter 1 of the 2016/17 year. It was noted that the Department had set eight strategic objectives which consisted of 34 indicators, of which 21 were achieved and 13 not achieved, with an overall achievement rate of 62%. This constituted a 15% improvement from the 47% achievement rate of the Department the previous year. Details of the indicators and targets were then given, with a note of why certain targets were not achieved and what had been done since to improve the situation. The largest expense for the Department was the compensation of its employees, given the labour intensive nature of its work. The Department had had to revise some targets due to the decrease of the budget. Whilst the Committee understood that the current economic climate had resulted in less financial resources, the DOL was encouraged not to use that as an excuse and to continue to increase its efficiency.

The Committee then received a summary of written submissions that had been made on the Labour Law Amendment Bill. Submissions from the Sonke Gender Justice, COSATU, the Commission for Gender Equality, the Law Faculty of the North West University and Harry Terreblanche all supported the Bill in principle, particularly the amendments regulating maternity and paternity leave. The public hearings were still to be held, and the Committee would consider the Bill again after that.
 

Meeting report

Compliance inspection of farms in Mpumalanga: Department of Home Affairs(DHA) update  
Mr Modiri Mathews, Chief Director: Immigration Inspectorate, Department of Home Affairs, introduced the DHA delegation to the Committee. Mr Sam Morotoba, Deputy Director General: Public Employment Services, DOL introduced the Department of Labour (DOL) delegation and also noted an apology from Mr Thobile Lamati, Director General, DOL who was unable to attend this meeting.

The Chairperson gave a brief introduction that this matter stemmed originally from a visit by this Committee to farms in Mpumalanga, which highlighted various concerns. The Committee had specifically requested the Department of Home Affairs (DHA) to investigate those issues and report back to the Committee. The first report of the DHA had not contained sufficient detail, and this was now the second report that she hoped would show an improvement.

Mr Mathews DHA noted in his introduction that Parliament had oversight over departments, in terms of the Constitution. In fulfilment of the oversight role, the Committee had visited a number of farms in Mpumalanga from 15 to 18 September 2015 and made various recommendations to the Department of Labour, asking that it monitor farm compliance with labour legislation, and report back to the Committee.

The various farms that the Departments of Labour and Home Affairs visited were set out in the presentation. Various DHA officials and inspectors, accompanied the DOL officials, together with members of the South African Police Service (SAPS) who provided safety and security in carrying out those instructions. The mandate was to check and verify travel documents of all workers on those farms, and to confirm that foreign nationals had the necessary visas and documentation to be lawfully employed on those farms. The mandate also extended to deportation of foreign nationals who were working illegally, to charging those who were in the possession of fraudulent documents and to charging employers who had knowingly employed foreign nationals who did not have the required documentation, since this constitutes a criminal offence.

Search and entry warrants were obtained for all farms visited and the employers were notified of the intention of the Department to search those farms in fulfilment of its mandate. A standard operating procedure was adopted as to how farms and workers would be approached to identify themselves and confirm their documentation. If a person did not have the required documentation on their person but insisted that their documents were at home, a team was put in place that could then search department records to determine whether those persons did in fact have the required documents.

Engagement with various stakeholders did assist the DHA in sorting out the social issues and it proved crucial to fulfilling the mandate. It was found that there were various visitors on farms, who were visiting and staying with people on the compound, and that was something that had not previously been taken into account. Labour issues were also raised such as union issues. The view of some farm owners was that the Departments had attended to look into  union instructions. One farmer took particular issue with the departmental presence and engaged a lawyer to scrutinise the warrant, believing that he was being singled out for inspection. The Department had been made aware of particular employers who wanted to frustrate departmental visits to the farm. However, the engagement with the stakeholders did enable it to identify those difficulties in advance and then resolve them before the operation had begun.

The statistics around the inspections were then set out.

On 27 July, the DHA inspected the Inyoni Boerdery. 188 employees were checked for documentation, 133 were South African nationals, 55 were foreign nationals and there did not have to be any “notices to appear”, which would be used for employees who claimed that their documentation was at their home. One person was found to be illegal and was deported. Foreign national employees consisted primarily of Mozambicans (21 males and 17 females) and Swazi nationals (12 males and 5 females).

On 28 July the Umbhabaha Estates farm was inspected. 148 employees were checked, 139 were South African nationals and there were nine foreign nationals. There was no need for “notices to appear”. One foreign  national was detained for deportation. There were 4 male and 1 female Mozambique nationals, and 2 male and 2 female Swazi nationals.

On 29 July Nhlumi Farm was inspected. 83 employees were checked. There were 42 South African nationals and 41 foreign nationals. 30 notices to appear were issued and 11 foreign nationals were deported. There were 15 male and 12 females from Mozambique, and 6 males and 8 females from Swaziland. The owner of the farm was criminally charged for employing undocumented foreign nationals. That case was still pending before the courts.

On 30 July  the Mbhono farm was inspected. 64 employees were checked, 26 were South African nationals, 38 foreign nationals, and no notices to appear were issued. Two Mocambiquan employees were deported. At the time of the inspection only 8 employees were at work. The farm manager indicated that the farm was in the process of retrenchment, due to a water shortage in the area.

On 30 of July the DHA had planned to inspect Tomahawk farm. However, the DHA was informed in advance of the inspection that union officials had told the employees of the farm that the inspection had been instigated by the employer to prevent month-end payments. There were also two rival union factions on the farm, which had created a tense and potentially dangerous situation. A decision was made not to inspect the farm, for fear of violence and physical injury. The farm management told the DHA that there were about 860 employees on the farm, with 200 being foreign nationals. It was decided that a follow up inspection would be conducted at a later time, yet to be determined.

In conclusion, it was observed that further intervention by the DHA was required. The DHA needed to assist farmers to better understand the process to register or renew permits of their foreign employees. It was observed that the majority of foreign nationals employed were from Mozambique and Swaziland, both neighbouring SADC countries.

Department of Labour input

Mr Sam Morotoba, Deputy Director General, DOL, said that the DOL had  accompanied the DHA on its inspections although the DOL was concerned primarily with ensuring compliance in terms of the Basic Conditions of Employment Act (BCEA) and some aspects of the Labour Relations Act (LRA). The findings of the DOL on those points had been sent to the Committee, although the figures had not been handed out in the meeting. He would be pleased to answer any questions on those figures.

The Chairperson thanked the DHA for its report. She said that the DOL should brief the Committee on the progress made in stamping out unfair labour practices, as this issue was raised by the Committee at the time of its initial inspection. She specifically wanted the DOL to give more detail on what specific steps had been taken by the DOL in respect of each farm, in an attempt to address working conditions and unfair labour practices issues raised for each.

Ms Esther Tloane, Chief Director: Employment Services, DOL, offered to answer those questions. It was found that Umbhabaha Estates was not compliant with the Basic Conditions of Employment Act (BCEA). A particular area of non-compliance on that farm was the attendance register, which often failed to indicate whether the employee reported for work and when each employee's work day ended. The DOL issued a compliance order to the farm. Other issues of non-compliance related to employee contracts and payslips. The DOL allowed the Estates some time to correct their non-compliance, but a later inspection showed that the non-compliance had not been remedied. Documents had been filed with the Labour Court and the process was still unfolding.

This farm had also failed to comply with the Occupational Health and Safety Act (OHSA), and follow ups showed that it continued not to comply, and so the owners had been referred to the Labour Court. The case number was reflected in the DOL report on compliance inspections.

DOL had also conducted a follow up inspection on Mbhono Farm, who initially was not compliant with the BCEA, but had become compliant by the time of the later visit. However, this farm also was not compliant in terms of the OHSA, and had thus been referred to the Labour Court. That case was also pending.

Inyoni Boerdery was not compliant in terms of the Unemployment Insurance Act (UIA), but the follow up inspections showed that although management had fixed its non-compliance with the BCEA, it was still also not compliant with the OHSA requirements. The matter was referred to court.

Tomahawk and Nhlumi Farms had both initially been non-compliant with the labour legislation. However, notices were issue, and a follow up inspection for both showed that they had subsequently achieved compliance with the required legislation.

Ms Tloane then identified some common areas of non-compliance. Attendance register non-compliance was was a common issue, where employers signed to certify the workers' attendance but the register failed to show their actual hours of work. This was an issue on which Umbhabaha Estate was still non-compliant. Other common issues included the lack of general particulars of employment,  and incorrect payslips being issued, and these failings had been referred to court as breaches of the BCEA. 

A common area of non-compliance under the Occupational Health and Safety Act was that employers were not conducting risk assessments regarding noise induced hearing loss, maintenance of machinery and continued training and supervision.

Explaining the process, Ms Tloane said that the DOL had put together “a blitz inspection team” as Malelane only had four inspectors. The team was augmented with inspectors from other labour centres, and the team then conducted blitz inspections on 51 farms. Out of those 51 farms, 41 had been compliant with the BCEA but ten were non-compliant. 27 employers were compliant with the Unemployment Insurance Fund (UIF) legislation and  24 were non-compliant. 41 were compliant with the OHS legislation and 10 farms were non-compliant. Follow up inspections were later conducted and many farms had become compliant following the issuing of compliance notices. However, those that continued to be non-compliant were referred to the district police for prosecution, and their the cases of which are still pending. The Department would however continue to monitor farms which were compliant every six months in order to ensure that compliance continues.

Advocacy sessions were also conducted which aimed to educate both employers and employees and update them about the legislation currently being considered by the Department. Common issues identified were also communicated, particularly in regard to lunch breaks, voluntary resignation and payment of benefits. Another common issue was that when the DOL adjudicated UIF appeals, it was often told by the unsuccessful applicant that their employer had advised them to resign or risk being charged with offences such as theft, which then disqualified them from UIF payments without their knowledge. That issue was clarified with employees during the advocacy sessions.

The Chairperson thanked both departments for their detailed reports on the issues raised.

Discussion

Mr M Bagraim (DA) was concerned by the lack of budget for the DOL to conduct more inspections. He said that it would greatly improve the ability of the DOL to fulfil its mandate if it had more inspectors, increased training and better equipment. He was particularly concerned that health and safety legislation was not being complied with and asked what further steps had been taken to remedy that non-compliance. Speaking to fraudulent documentation, he said that in his experience many employers genuinely believed that the documentation that they were given by employees was legitimate. He asked what would happen to the employer in such a situation and what processes employers should follow if they discovered fraud, in order to dismiss that employee? It was likely that a clash would occur between the DHA and DOL, as a person could not be dismissed, in terms of the LRA, simply for not having the required paperwork.

Mr Morotoba replied that the DOL had submitted a budget request to National Treasury, but other steps had also been taken to improve the Department’s finances. A compensation fund had been established under the UIF to finance further inspections, which would also contribute towards ensuring increasing compliance with the OHSA. A recruitment drive had also been initiated to increase the number of inspectors working at the Department.

Mr M Plouamma (AGANG) noted that the majority of foreign nationals were from Mozambique and Swaziland. He questioned whether farmers had specifically recruited workers from those countries, whether the workers signed employment contracts and whether legislation required them to have signed employment contracts.

Ms Tloane replied that the DOL had found that in many cases employers did not properly declare that they had employed foreign nationals, as required by the Unemployment Insurance Act. Many employees therefore did not have signed employment contracts. However, the DOL would also find that when employers were issued with notices that an inspection was to be conducted the foreign national employers often “disappeared” from the farm. This often made it difficult for the Department to ascertain numbers of foreign national employees as they were not officially recorded in the employer’s records. Stronger coordination between the SAPS and DHA was being pursued in order to address those concerns.

A delegate from the DHA added that it had been acknowledged by DHA that in many cases an employer was presented with fraudulent documents which appeared to be genuine, and the DHA could not expect that employers would have the skills to pick this up. In such a case, the DHA would not pursue charges against the employer but would notify the employer of the problem. Some employers had been pro-active and engaged the Department in verifying documents. The DHA had no evidence to suggest that farmers specifically were recruiting from Mozambique and Swaziland, although the DHA did have an optional programme regulating seasonal recruitment that could be implemented by employers if they wished. The majority of employees were South African citizens, which suggested it was unlikely that intentional recruitment of foreign nationals was being pursued by employers.

The Chairperson requested clarity on how the departments distinguished between a worker and a visitor, and how prevalent the issue of  fraudulent documents was.

Mr M Plouamma expressed concern with the haste with which DHA deported foreign nationals when they were discovered with fraudulent documents. He was concerned that employers were exploiting foreign nationals for cheap labour. He asked what processes were in place for those employers who knowingly employed illegal foreign nationals.  He suggested that the current processes relating to employers who did not comply were not sufficiently harsh and he was also not convinced that employers genuinely believed fraudulent documents to be legitimate; it was more likely they deliberately employed illegal foreign nationals. He also wanted to know whether illegal foreign nationals would be paid any wages due to them before they were deported to their home countries.

Mr Bagraim expressed frustration that one of his questions had not been fully answered. He emphasised that he wanted to know whether an employer could dismiss an employee with impunity once s/he had been found to be an illegal foreign national. The LRA made no distinction between an employee who is a South African national and an employee who is an illegal foreign national. He requested either the DHA or DLO to provide further clarity. 

Mr Mathews replied that there is an obligation on employers, when employing a foreign national, to ensure that the visas of those employees would not expire during the period of their employment. A visa application had to be made 60 days prior to the expiry of the visa, and once that visa had expired, a foreign national was then not permitted to work pending the outcome of the visa application. It was an offence for an employer to knowingly employ a foreign national who did not have the right to work in the country. The DHA had brought this to the attention of employers.

Mr Mathews then addressed the query about deportations. The DHA did afford any person, who was found to be in the country illegally, the right to to engage in appeal process against any deportation proceedings. The South African Human Rights Commission (SAHRC) did play an oversight role and whenever a person was detained for purposes of deportation the SAHRC was informed within 48 hours . DHA would ensure that all legal processes were followed for deportation proceedings and various checks and balances were in place in addition to court oversight and the right of appeal. DHA was also actively engaging in charging employers who deliberately employed illegal foreign nationals, as this was a major cause of illegal migration into the country. It did have the ability to fine guilty employers, but it found that prosecuting them was a more effective deterrent.

Mr Morotoba said that the South African labour legislation applied equally to both illegal and legal foreign nationals and South African citizens. This had been implemented in line with International Labour Organisation (ILO) conventions, which recommended that legal and illegal workers should enjoy the same labour rights and benefits when in the country. This was a challenge which was being addressed by the DOL. The Immigration Board appointed by the Minister of Labour was currently reviewing the Immigration Act, had published an Immigration Green Paper, which he recommended this Committee should read. It would publish a White Paper once the necessary Cabinet and internal processes had been completed. A draft Bill would then be brought to Parliament.

DOL was also coordinating with the DHA and the Department of Justice to ensure that all foreign nationals would receive any money owed to them prior to deportation in terms of the applicable labour legislation, and he repeated that it applied to both illegal and legal foreign nationals. This was also a requirement of Southern African Developmental Community (SADC) protocol, which imposed certain international requirements on South African labour legislation. An employer was specifically required to pay an employee, whether illegal or legal, any money owed to them in terms of the BCEA.

Another delegate from DHA agreed that it was a constitutional requirement that all labour laws apply equally to citizens and legal and illegal foreign nationals. An undocumented foreign national would have recourse to the Commission for Conciliation, Mediation and Arbitration (CCMA), but the fact of no documentation could have implications on the case.  There was no labour legislation which required an employer to provide employees with a written employment contract although the BCEA did require employers to provide particulars of employment to employees.

The Chairperson commented that both presentations were detailed and informative. The Committee would be going around the country at a future date to inspect various farms, to check whether the labour laws were properly complied with and that employees' rights were being abused. She noted that it was important for the pending cases in the Labour Court instituted by the departments to be finalised as soon as possible and not drag on, although she recognised that this was not altogether within the control of the departments. Both departments should continue to exercise oversight across the whole country, as they had done in Mpumalanga, and the Committee would continue to oversee that both did so.

Department of Labour on  Quarterly Performance Report (2016-17) and Annual Performance Plan

Ms Marsha Bronkhorst, Chief Director: Provincial Operations, DOL, explained the markings on the presentation. A 100% achievement would be in green, partial achievement of 75-90% was indicated in amber and targets not achieved were indicated in red. Partial achievements were not factored into the overall achievements of the Department, and only fully achieved indicators were factored into that calculation.

The Department had set eight strategic objectives for the financial year. Initially 35 indicators had been set however this was later revised to 34, which would be expanded upon further in the presentation.

  • Strategic Objective 1 dealt with contributing to employment creation. Eight indicators were set, five achieved and three not achieved with an overall achievement of 63%.
  • Strategic Objective 2 dealt with the promotion of labour equity in the market. Five indicators were set, three were achieved and two not achieved with an overall achievement of 60%.
  • Strategic Objective 3 dealt with the protection of vulnerable workers. Six indicators were set, three were achieved and three not achieved with an overall achievement of 50%.
  • Strategic Objective 4 dealt with the strengthening of multilateral and bilateral relations however there was no reporting for quarter one in terms of the strategic objective.
  • Strategic Objective 5 dealt with strengthening occupational safety protection. Six indicators were set, four were achieved and two partially achieved with an overall achievement of 67%.
  • Strategic Objective 6 dealt with promoting sound labour relations. Two indicators were set, one was partially achieved, one fully achieved
  • Strategic Objective 7 dealt with the monitoring of the impact of legislation. Two indicators were set, two fully achieved with an overall achievement of 100%.
  • Strategic Objective 8 dealt with the strengthening of the institutional capacity of the Department. Five indicators were set, four were fully achieved and one partially achieved with an overall achievement of 80%.

The overall performance of the Department for quarter 1e was that of the total 34 indicators set, 21 were achieved and 13 not achieved, giving overall performance of 62% of targets achieved.

The presentation then summarised the various indicators for each branch of the Department and their achievements.

  • Programme 1 dealt with administration: five indicators were set, four achieved and one not achieved with an overall achievement of 80%.
  • Programme 2 dealt with Inspections and Enforcement Services: 15 indicators were set, nine were achieved and six not achieved with an overall achievement of 60%.
  • Programme 3 dealt with Public Employment Services: eight indicators were set, five were achieved and not achieved with an overall achievement of 63%.
  • Programme f4 dealt with Labour Policy and Industrial Relations: seven indicators were set, three were achieved and three not achieved with an overall achievement of 50%.

The presentation then dealt with the specific indicators under each programme and which were achieved and not achieved, including the reasons for non-achievement and what further steps would be taken to achieve those indicators in the future.

Under Programme 1, a key indicator was to improve management practice and strategic report based on the Management Assessment Tool (M-PAT) criteria which was partially achieved. The vacancy rate of the Department which was achieved. Financial statements indicators were achieved and documents were submitted to the National Treasury and the office of the Auditor General. The payment of invoices timeously was only partially achieved, because the DOL had issues securing banking details of their various suppliers, but that this issue would be resolved once the National Treasury had established a Central Supplier Database (CSD) where those details could be verified in advance. Reporting of irregular, fruitless and wasteful expenditure was fully achieved as there was no such expenditure by the Department during the quarter.

Under Programme 2, the first indicator on the number of designated employees reviewed each year to ensure compliance with Employment Equity legislation was not achieved, as various employers failed to respond timeously to the Department within the designated time frames, and there had been delays in sending those notices to employers. The employers who refused to comply were referred by the Department for prosecution. Issuing notices of compliance to employers was fully achieved. The indicator for  number of employers inspected per year to ensure compliance with employment equity legislation was partially achieved. The reason for the partial achievement was that six inspectors had refused to sign performance agreements and were suspended, and disciplinary proceedings are currently pending against them. The indicator four for the percentage of non-compliant workplaces issued with compliance notices in terms of the BCEA was fully achieved. The target for inspecting workplaces was partially achieved. There were human resource challenges but plans had been put in place to remedy the shortfall in the next quarter. The targets for advocacy and educational sessions conducted per year in identified sectors was not achieved, largely due to poor attendance by union shop stewards, but there were now steps taken to make the training more needs-based and to reach out to unions. The percentage of inspections on request for work permits was partially achieved. The number of workplaces inspected to ensure compliance with OHS legislation was partially achieved, with human resource capacity also being a problem. The number of reported incidents investigated within 30 days was achieved. Applications for the registration of entities were fully achieved. Amendments to the OHS were achieved, through the finalisation of the process at the National Economic Development and Labour Council (NEDLAC). Conducting of employer payroll audits to determine employer’s contribution to the UIF was partially achieved. A challenge in achieving that goal was the high degree of staff turnover in that unit. However, subsequently the posts were filled and training for those employees had commenced.

Under Programme 3, the first target dealt with the number of registered work seekers provided with employment counselling during the year. This was not achieved, due to delays in the constituency nominations for the Employment Services Board, although the process had now been finalised by NEDLAC. Public service advocacy. campaigns targets were achieved, as was the registration of work seekers registered with the employment services system. Similarly, the targets for employment counselling for work seekers was achieved, and the numbers of registered employment opportunities filled by work seekers during the year was over-achieved. The targets for processing applications from private employment agencies and temporary employment services was not achieved, because of delays in the verification processes. However, steps were put in place with the under-performing provinces to help them in the second quarter. The target for processing applications by foreign nationals and corporate visas was also beset by challenges around the verification process.

Programme 4's target for policy instruments developed and promoted to enhance implementation of the Employment Equity Act (EEA) was achieved. However, the target for number of sectoral determinations reviewed during the year was not achieved. Although the amended Hospitality Sectoral determinations report had subsequently been published, the taxi reports had not, because of  requests by stakeholders to commission further research. That research should be finalised by 31 March 2017. The third target dealt with the percentage of collective agreements which had been extended within 90 days of receipt. DOL believed that non-achievement here was due to legislative gaps and amendments had been proposed to the LRA to fix that issue. The target for dealing with labour organisation applications for registration was partially achieved, and again, delays in the verification process were to blame. The DOL is currently reviewing its standard operating procedures to fix that issue. Two labour market reports were produced by June and the annual target for labour market research reports was thus also achieved.

The DOL had improved its performance in quarter one, with an achievement of 62%, in comparison to the same period in the previous year when it achieved 47%. DOL was committed to improving its performance and service delivery in 2016/17, and there had already been an improvement in performance following that commitment. Monthly monitoring reports had been implemented and a monitoring Committee was established to ensure that the Department continued to improve its performance. The reports drawn from each labour centre would be consolidated into provincial and branch reports, to be deliberated on by the Monitoring and Evaluations Steering Committee. That Committee was chaired by the Acting Chief Operations Officer of the Department and reported annually to the Executive Committee, chaired by the Director General. These systems would help to flag any issues and help the DOL to achieve targets. The DOL had also committed itself to sanctioning non-performance.

Financial report
Mr David Kyle, Acting Chief Financial Officer, DOL, summarised that the DOL had an original allocation of R2.8 billion for the financial year. By 30 June it had spent R675 million. Most of this was for transfer of payments in the first quarter, which came to 54%, and these payments were made to external institutions such as the CCMA and NEDLAC. However, the calculations in the presentation excluded the transfer payments in order to give a more accurate picture of the overall financial situation. Without those transfers taken into account, the DOL had spent R320 million, or 20% of the original allocation, in the first quarter.

Compensation of employees constituted the largest expense, at almost 75%, which showed that the DOL itself was very labour-intensive. 

Breaking the spending down by department, he noted that Programme 1 spent the lowest, at 22%, and the Labour Policy and Industrial Relations had the highest expenditure, at 24%. Several Human Resources matters were still to be completed, such as performance assessments, which would in turn impact on paid progression expenses.

The expenditure on transfers was dominated largely by CCMA payments of over R800 million, and during the first quarter R320 million had already been transferred. The rest of the transfers dealt with subsidies to the work centres for the disabled, Productivity SA and NEDLAC; a total payment in the first quarter of R416 million collectively.

Discussion

Mr T Rawula (EFF) raised a concern that the first report did not provide provincial demographics of the targets achieved. He would like to know which provinces were the most and least successful in achieving the targets of the Department. He also asked in which sectors the Department had achieved the majority of its targets. He asked about the effect of the work seeker registration programme and if those work seekers were actually finding employment in the market. Finally he questioned only two indicators being used for the assessment on sound labour relations, which raised concerns about the amendments to the LRA and whether there was proper measurement of progress. When the DOL reported in the last quarter, its performance on strengthening institutional capacity was very low, because the DOL said it was training new inspectors. He asked if the improvement now was due to that training.

Ms F Loliwe (ANC) noted improvements in many areas, but was still worried about the protection of vulnerable workers and the application for foreign nationals, topics on which the Committee had raised concerns for some time. She asked why there was no improvement here. She asked when the disciplinary processes against the suspended inspectors would be finalised. Furthermore, given that the DOL was very short of inspectors, she hoped that this decision had not been taken lightly.

Mr Plouamma was concerned about the amount of R674 million which was initially allocated for the employment of additional inspectors, and later withdrawn. The report did not say who made the decision to withdraw that funding, or why, and the inspectors played a crucial role in the Department's operations.  The report mentioned the regulation of private employment agencies, but there were no specific details on what steps had been taken to regulate those agencies, what indicators were used by the Department, and whether there had been difficulties. He expressed concern that the indicators were not sufficiently detailed on progress made, and he wanted more detailed indicators in the future, particularly to enable the Committee Members to report back to their constituencies.

The Chairperson agreed that Mr Plouamma's point on indicators was very important. The Department had cited how lack of capacity in HR prevented it from fully achieving many goals.

Ms Bronkhorst replied that the performance report as submitted to the National Treasury would be circulated also to the Committee. That report had the provincial breakdown for targets achieved. A provincial breakdown would also be included in future reports to the Committee.

Mr Morotoba told the Committee that the DOL was the only department that had a central and up to date database detailing unemployed people, where they are located, as well as their qualifications and contract details. Statistics South Africa had also begun to utilise that same database. DOL was considering whether to pass a regulation to the effect that unemployed people who failed to report back to the Department within a certain time after registration would be removed from the database. This information was useful for employment and recruitment opportunities, to ensure that job seekers could be matched with appropriate employment opportunities.

Another delegate from DOL confirmed that consistent training of inspectors had indeed contributed towards the Department meeting more of its targets.

Mr Morotoba stated that verification of employment agencies had to be properly done in order to prevent the registration of private employment agencies who do not meet the Department's requirements, and so it was more important to have close scrutiny than merely to register for the purpose of meeting targets. The Department had found that many private organisations were involved in fraudulent practices, which made it even more important to check them properly, and to scrutinise businesses who preferred to employ foreign nationals over South African citizens. The Department had revised its targets but conceded that it was not yet meeting them. Recommendations had been made to go back to old inspection reports, which would improve performance on that issue.

Mr Morotoba did not have the full details on the suspended inspectors with him, but confirmed that the DOL did not lightly suspend inspectors, and that in many cases inspectors had been found complicit in issues such as bribery. He could supply further information broken down into the individuals, further reasons for their suspension, the stage of the various disciplinary procedures and expected finalisation dates.

Mr Kyle responded to the question on budget, and indicated that in November 2015 the Department had received an initial budget allocation letter from the National Treasury, which included an allocation of funding for increasing the national inspectorate. The economic situation then prompted a revised budget allocation with a decreased baseline across almost all government departments. The DOL did have a compensation allocation reserve, but that was also completely removed, so that less funding was made available for training and employment of more inspectors.

Ms Bronkhorst said that in future reports, there would be more detail on how indicators had been partially achieved.

The Chairperson appreciated the fact  that the Department had less resources due to budget cuts from National Treasury, but warned that this should not be used unnecessarily as an excuse for a failure to meet its targets. All government departments had to adjust in order to achieve their targets with a reduced budget, and so it was even more important to increase performance.

Mr Morotoba replied that this was a legitimate concern and that the Department had begun to make increased use of technology to maximise its efficiency. The Department was working towards establishing a mutually beneficial relationship with employers, so they would voluntarily comply with the applicable legislation rather than the Department having to direct increased resources to inspectors as a policing function. Further details would be circulated to the Committee at a later date.

The Chairperson repeated that the Department had to operate in a climate with less funding, but the Committee was continuing to exercise strong oversight. Progress was noted, and continued achievement of Departmental  targets was expected, despite financial difficulties.

Labour Laws Amendment Bill: Summary of written submissions

A State Law Advisor and the Committee's Researcher presented a summary of the written submissions made to the Committee on the Labour Laws Amendment Bill given by the public.

Five submissions had been received, from:

  • Sonke Gender Justice
  • COSATU
  • Commission for Gender Equality (CGE)
  • Mr Henry Terreblanche
  • North West University Potchefstroom Law Faculty.

Sonke Gender Justice wanted clarity whether the term ‘consecutive days’ in clause 2 of the Bill referred to either working or calendar days. It also recommended that the term ‘parent’ be broadly defined to accommodate the full range of family units in South Africa. It was also recommended that section 25(1) of the BCEA, which deals with maternity leave, should be amended to extend maternity leave entitlements to six months with 75% of full pay. It raised two concerns on section 25(1)(b) of the BCEA; firstly, that the provision dealing with consecutive weeks was unjustifiably limited, and secondly, that the legislation is unclear as to whether adoptive mothers are entitled to maternity leave under the BCEA, as also that the provision could be indirectly discriminatory against adoptive fathers. They recommended that adoption leave be six months, with 75% being claimed by both parents. Further concerns were raised that ten weeks of parental leave was too short and should be extended to six months.

COSATU supported the provisions of the Bill, believing it was progressive in achieving improvements in the lives of workers and their families. They strongly supported the proposal of ten days’ parental leave with full pay to ensure the long term well-being of the child. It suggested that parental leave should be separated from maternity leave. There was a suggestion that the Swedish model of 480 days leave, to be shared by both parents could be a model to be followed in South Africa. They also submitted that adoptive parents should be entitled to ten weeks parental leave, and the BCEA should be amended to achieve that.

Commission for Gender Equality did not support the insertion of section 25A in its current form, because it did not take account of parents who are already on maternity leave. CGE submitted that parental leave should expressly exclude parents who were already benefiting from maternity leave. The word “father” should be deleted and replaced with the word “parent”.

Henry Terreblanche indicated that he was in support of the Bill, particularly as it pertained to maternity and paternity leave. His submissions also contained a copy of a report concluded by the Fatherhood Institute in the United Kingdom on the impact and benefits of paternity leave on children, mothers, fathers, couples and businesses.

North West University Law Faculty submitted that fathers should be entitled to two weeks’ paternity leave in addition to the three days of family responsibility leave.

In conclusion, all written submissions supported the Bill in principle. Most of the submissions highlighted the positive impact of paternal leave. The focus was primarily on maternity leave, and the general view was that more generous leave should be the ultimate objective.

The Chairperson noted that the submissions just presented were a summary of the primary written submissions. The Bill had yet to be taken through to public hearings, where more submissions by those organisations would be made. Any further issues arising from those hearings would then need to be addressed, and she suggested that the Committee delay any further discussions on the Bill until after that date.

Ms Loliwe and Mr Plouamma agreed.

Adoption of Minutes

The Committee adopted the minutes of the meeting on 24 August 2016.

The meeting was adjourned.
 

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