National Minimum Wage Bill; Basic Conditions of Employment Amendment Bill; Labour Relations Amendment Bill: Labour budget: Committee Report

Meeting report

Consideration and adoption of Committee Report on Labour Budget
The Chairperson welcomed everyone and took the Committee through the recommendations of the draft Committee Report on the Strategic Plan, Annual Performance Plan and Budget 2017/18 of the Department of Labour. She noted that the expenditure estimate for the Department amounted to R3.2 billion, to be divided between its four main programmes. It was important to assess the work of the Department as part of the Committee’s oversight work. The Committee was generally satisfied with the Department’s plans and recommended, among others, that the CCMA budget be reviewed to reflect its additional workload as provided for by the Labour Relations Act. Also, having the Department addressing budget-related issues as raised by the Auditor-General of South Africa (AGSA) was paramount.

Mr P Moteka (EFF) suggested an additional recommendation on consequence management for poor performance. Action must be taken on the Department’s non-performing entities- management within such entities must account.

Mr B Mashile (ANC) referred to unending investigations within the Department. He suggested a recommendation to speak to the need for a speedy conclusion of same. Also, the need for the vacancy rate to be kept to a minimum should be included as a recommendation.

Mr B Martins (ANC) agreed with the Chairperson and added issues identified by AGSA report on the Department went beyond mere budget-related issues. The recommendation should indicate that the Department and its entities must address issues raised by AGSA in their entirety.

Members agreed.

The Chairperson asked the Committee staff to incorporate Members’ input and correct typographical and grammatical errors. She moved for the adoption of the Report.

The report was adopted with amendments.

The DA reserved its position on the Report.

Deliberations on the A-list of the Labour Relations Bill (LRA)
The Chairperson stated that State Law Advisors met with officials from the Department to effect changes to the LRA as proposed by the Committee during previous discussions.

Clauses 1 and 3
Amendments were made to comply with legislative drafting prescripts.

Clause 8
“(8) The Minister, [in] after consultation with NEDLAC, may by notice in the Government Gazette publish guidelines to be applied by the registrar in determining whether an applicant is a genuine trade union or a genuine employer’s organisation and guidelines for the system of voting as contemplated in subsection (9).”

Mr Thembinkosi Mkalipi, Chief Director: Labour Relations, Department of Labour, said changes were made after it was agreed that it would be more advisable to have the Minister publishing guidelines after rather than in consultation with NEDLAC, as the latter would have been more cumbersome.

Members agreed.

New clause (Withdrawal of accreditation)

The section was substituted for section 130 of the principal Act as follows:

If an accredited council [or] accredited agency or a person accredited by the governing body fails to comply to a material extent with the terms of accreditation, the governing body may withdraw its accreditation after having given reasonable notice of withdrawal to that council, [or] accredited agency or the accredited person.

Clause 16
Amendments were corrections on numbering of the Bill.

Members were satisfied that the Committee’s inputs were well-incorporated into the Bill.

Deliberations on the Basic Conditions of Employment Bill
Ms Bongiwe Lufundo, Principal State Law Advisor, took the Committee through the amendments as proposed by the Committee during previous discussions.

Amendment of section 34
Ms Lufundo said section 34 of the Act was amended as proposed by the Committee during discussions on employee remuneration. This amendment (as follows) was not part of the introduced version.

Section 34 of the principal Act was amended-
By the insertion in subsection (1) for paragraph (a) of the following paragraph:
Subject to subsections (2) or (2A), the employee in writing agrees to deductions in respect of a debt specified in the agreement.
By the insertion after subsection (2) of the following subsection:
(2A) A deduction in terms of subsection (1) must not exceed one-quarter of the employee’s remuneration in money.

The Chairperson suggested that this amendment be deleted from the BCEA and inserted into the NMW Bill as it had not been canvassed during BCEA consultation processes. Having this amendment at this stage might open up whole new discussions.

The majority Members agreed.

Amendment of section 51
Section 51 of the principal Act was amended by the addition of the following subsection:
(3) If any sectorial determination already prescribes wages that are higher than the national minimum wage, the wages in that sectorial determination and the remuneration and associated benefits based on those wages must be increased proportionally to any adjustment of the national minimum wage in terms of the National Minimum Wage Act, 2018.

Mr Mashile said the amendment to section 51(3) seems to make provision for automatic adjustments, which seemed to contradict the provision giving the Minister applicable discretionary powers.

Mr Moteka expressed concern that the amendment might affect annual wage increases.

Mr Mkalipi said the amendment was a more robust way of ensuring that workers earning above the minimum wage would not be at risk of not being afforded wage increases when national minimum wage goes up. It would still remain the Minister’s prerogative to apply relevant discretionary powers. The provision provides a mechanism and guides the Minister on how to apply the conditions. He added there was no law guaranteeing annual wage increases. Annual increases are determined by company policy and were also a result of collective bargaining.

Amendment of section 52
Section 52 of the principal Act was amended-
By the substitution of subsection (1) of the following subsection:
Before making a sectorial determination the Minister must direct the [Director-General] Commission to investigate conditions of employment in the sector area concerned
Direct the [Director-General] Commission to conduct an investigation

Mr Mashile queried the exclusion of the Director-General from the provisions. He felt the Director-General should be in a position to be accountable for the work of the Commission.

Mr Mkalipi pointed out that the Commission needed to be independent and make own recommendations directly to the Minister. The Commission was expected to be better capacitated as it would be expected to canvass expert views from various stakeholders before coming up with its recommendations. However, this would not prevent the Director-General from submitting his/her own recommendations to the Minister separately.

Members agreed.

Clause 11
The clause was amended as follows:
The CCMA may issue an arbitration award in terms of subsection (1) requiring the employer to comply with the compliance order, if it is satisfied that-
The compliance order was served on the employer; and
The employer has not referred a dispute in terms of section 69(5).
Mr Mkalipi said CCMA rules were in the process of being amended in compliance with the provision.

Clause 12(4) and (5)
The CCMA must appoint a Commissioner in terms of
(4) The CCMA must appoint a Commissioner in terms of section 135 of the Labour Relations Act, to attempt to resolve by conciliation any dispute that is referred to the CCMA in terms of subsection (1)
(5) The CCMA must commence the arbitration of a dispute contemplated in subsection (1) immediately after certifying that the dispute remains unresolved in terms of section 135(5).

Mr Mkalipi said provision would ensure that conciliation and arbitration is compulsory in the event that an employer is not willing to comply. The provision was meant to ensure justice is not delayed for vulnerable workers.

Clause 16
Mr Mashile felt 16(2) and 16(3) were not talking to each other. Given that (2) spoke to the level of fines imposed for non-compliance, (3) should have outlined the guidelines on the determination of non-compliance.

Mr Mkalipi agreed the provisions needed to clearly capture the essence of what the provisions sought to address.

New Clause (Transitional provisions)
The new clause was drafted as follows:
With effect from the date of the establishment of the National Minimum Wage Commission established by section 8 of the National Minimum Wage Act, 2018-
The Employment Conditions Commission established by section 59 of the principal Act, is hereby disestablished;
The functions of the Employment Conditions Commission are hereby transferred to the National Minimum Wage Commission; and
The members of the Employment Conditions Commission in office at the time of the establishment of the National Minimum Wage Commission, are hereby transferred to the National Minimum Wage Commission, for the remainder of their term of office.

Ms Lufundo said the clause sought to clarify the modalities on the transition and transfer of functions from the Employment Conditions Commission to the National Minimum Wage Commission.

Members agreed.

Deliberations on the National Minimum Wage (NMW) Bill
Ms Fatima Ebrahim, Parliamentary Legal Adviser, took the Committee through amendments to the National Minimum Wage Bill as agreed to by the Committee.
Fatima

Clause 1
On page 4, from line 26, to omit the definition of “organised community” and to substitute the following definition:
“‘organised community’ means those non-governmental organisations contemplated in the National Economic Development and Labour Council Act, 1994 (Act No. 35 of 1994);

On page 4, from line 37, to omit the definition of “worker” and to substitute the following definition:
“‘worker’ means any person who works for another and who receives, or is entitled to receive, any payment for that work whether in money or in kind.”

Clause 5
On page 5, after line 34, to insert the following subsection:
“Any deduction made from the remuneration of a worker must be in accordance with section 34 of the Basic Conditions of Employment Act, provided that a deduction made in terms of section 34(1)(a) of the Basic Conditions of Employment Act does not exceed one quarter of a worker’s remuneration.”.

Clause 6
On page 5, from line 48, to omit subsection (6) and to substitute the following subsection:
“The Minister must, by a date fixed by the President by proclamation in the Gazette, determine the adjustment to the national minimum wage, and by notice in the Gazette, amend the national minimum wage contained in Schedules 1 and 2.”

Ms Ebrahim noted that the Committee had agreed that adjustment to the NMW should be an executive function. The amendment were consistent with this decision.

Clause 9
On page 6, in line 29, after “experts”, to insert “, who are knowledgeable about the labour market and conditions of employment.”

Ms Ebrahim said a criteria for the appointment of ‘experts’ was added as it was initially unclear.

Clause 10
The clause was amended as per as per Committee’s directive as follows:

On page 6, after line 52, to insert the following subsections:
“(5) The chairperson and members of the Commission—
(a) Must act impartially when performing any function of the Commission;
(b) May not engage in any activity that may undermine the integrity of the Commission; and
(c) Must recuse themselves from advising the Minister on any matter in respect of which they have a direct or indirect financial interest or any other conflict of interest.
(6) The Commission must appoint a member to act as chairperson whenever the chairperson is absent from the Republic or from duty, or for any reason is temporarily unable to function as chairperson.”

The Chairperson expressed the Committee’s satisfaction that the A-lists of the three Bills were, in the main, a reflection of all the previous discussions. The final amendments to incorporate Members’ input would be made by the drafters, and the Bills would be tabled before Committee the following week, on 16 May.

Mr America said there would be need for more time to enable Members to take the Bill to party caucuses, and one week would not be enough. He suggested an additional week for Members to canvass views from respective political parties.

Mr Martins disagreed with Mr America and said one week was sufficient time for consultations identified by Mr America. No major changes had been made to the Bill which would warrant a whole two weeks for perusal by Members.

The majority Members agreed with the way forward as enunciated by the Chairperson.

The meeting was adjourned.