Complaint by Mr S Mohamed against CCMA: briefing; Committee Report on SETA hearings

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Employment and Labour

16 September 2003
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Meeting Summary

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Meeting report

16 September 2003

Acting Chairman: Mr D A A Olifant (A N C)

Documents handed out:
Draft Report of the Portfolio Committee on Labour on public hearings with the SETAS held on 18 and 19 March 2003 (Appendix)

The Director informed the Committee that Mr Mohamed claimed for fees due to him that were not paid timeously. He was currently unemployed and had damages of  up to R 700 000,00 caused by the actions of the CCMA. The CCMA accused Mr Mohamed of alleged fraud, not co-operating with management, and not performing his work. It was dealt with, unsuccessfully, by two successive arbitrators and by the Governing Board of the CCMA.  Mr Mohamed appealed inter alia to the Speaker, who referred the case to the Committee.

The Committee decided unanimously that it was in no position to adjudicate and recommended that the Governing Board decide. It was suggested that Mr Mohamed should take the case to court if he so wished.

The Chair briefed the Committee on the Draft Report on public hearings with the Setas.  Technical amendments were made to the Report and accepted unanimously, even though a member from the DA was critical of certain aspects.

Complaints by Mr S Mohamed against the CCMA
The Chair stressed that, although the Portfolio Committee was gladly granting the Department of Labour the opportunity, as requested by them, of presenting their side of the case, the Committee would not be in a position to arrive at a conclusive outcome.

Mr Les Kettledas (Department of Labour: Deputy Director-General: labour policy and labour market programmes) introduced the two presenters from the CCMA, Mr Molahlehi and Adv. Van Zuydam.

Mr Edwin Molahlehi (Director: Commission for Conciliation, Mediation and Arbitration CCMA) warned that the case before the Committee was not an isolated case, but that one could well anticipate that a flood-gate for similar cases would be opened up, which was a matter for concern.

There had been questions asked by the public about whether the CCMA’s service delivery had been good, and complaints about commisioners not adhering to time limits and not behaving according to codes of conduct.The CCMA had  to deal with each individual commissioner according to the standard procedures of the CCMA.

Mr Molahlehi had been involved on the case before the Committee for almost a year.  Various complaints and claims were made by Mr Mohamed.  It was not uncommon for commissioners, especially part-time ones, to claim for work which they had not done, so much so that this could almost be considered to be a culture in the CCMA.

No expeditious resolution or consensus could be reached with Mr Mohamed.  Private arbitration was agreed on, and an independent arbitrator was appointed by the Chairperson of the Advocates’ Bar Council of South Africa. This arbitrator recused himself because he found that Mr Mohamed was not co-operating as required by the protocol of the Arbitrations Act.
Another proposed arbitrator was not acceptable to Mr Mohamed, and the CCMA concluded that he was simply frustrating the process, and advised him to go the route through the civil courts.

Adv. Eugene Van Zuydam (CCMA, Convening Senior Commissioner – KZN) explained that the case against Mr Mohamed involved alleged fraud, not co-operating with the management, not signing his contract and not doing his work.   Mr Mohamed’s main complaints against the CCMA was that no more work was given to him, that he had not received fees that were due to him, and that he had suffered damages of  R 700 000,00, which Adv. Van Zuydam considered ludicrous.

Mr Kettledas said that the CCMA  had reported the matter to the Department of Labour, who sent a letter to Mr Mohamed in July 2003 explaining to him that the CCMA was independent of the Department which was legally not in a position to intervene in the dispute.  The Department recommended to Mr Mohamed that he could go the route of normal legal procedures through the civil courts.

The Chair stated that he found the allegations of Mr Mohamed very vague and insubstantial, even referring to discrimination on grounds of religion and race.

Mr C R Redcliffe (DA) asked why Mr Mohamed did not go to the Governing Board of the CCMA with his grievances, as was clearly set out in the relevant legislation as the indicated procedure.  It was hard to see the use of bringing this matter before the Committee except perhaps tin the interests of transparency.

Mr M J G Mzondeki (ANC) also had reservations about bringing this matter before the Committee as it served little purpose and set a dangerous precedent.  He could also not find any substance in the very general accusations, and proposed that the meeting not deal with it further.
Mr R M Moropa (ANC) stressed that the correct procedures according to the rules should be followed under the proper area of jurisdiction so that no bad precedent was established.

The Chair explained that the Committee had responded to Mr Mohamed in the vein now proposed.  The matter had, however, been referred to the Committee by the Speaker, whose prerogative it was to do just that.  What was required was a motion stating that the matter should be dealt with according to the CCMA stuctures and not by the Committee.

Mr Redcliffe was of the opinion that the appropriate forum was the Governing Board of the CCMA.

Mr Edwin Molahlehi explained that the Board had been dealing with six similar cases during the past year. A problem for them was that Mr Mohamed was not a full-time but a part-time commissioner which made it much more difficult to dispense with the matter.  What  was worrying was that a precedent had been set where similar appeals had already been made to the Auditor-General, the Public Protector, Nedlac and were probably on its way to the Committee.  A way had to be found to deal with individuals who abused the system with impunity.  For example, Mr Mohamed’s appeal to the Auditor-General, where no irregularity was found, had cost R356 000,00.
The Governing Board of CCMA had decided that they were not proceeding with the matter, and the claimant would have to take it to court if he wished.

Mr Redcliffe stated that it was worrying that the Speaker had instructed the Committee to attend to this, while there were more suitable forums.

The Chair said that it was the prerogative of the Speaker to instruct the Committee to apply their minds.  Letters would go to the Speaker and to Mr Mohamed to convey the Committee’s findings to them. 

Mr Moropa insisted that the Committee had done nothing wrong.

Draft Report on public hearings with Setas- Briefing
The Chair explained that no comment had been forthcoming from the Department of Labour on the Draft Report before the Committee.  The Committee would go through the Report giving inputs on what had happened after the public hearings, presentations and submissions referred to in the Report.

Mr Redcliffe stated that, although the DA was critical of certain aspects, they were in support of the Report.

Various members identified spelling and syntax mistakes in the Report.

Mr S A Mshudulu (ANC) stated that too little time was allowed, and proposed that in future a full day workshop be set aside for dealing with a report like the one under scrutiny.

The Chair concluded that the Committee members were unanimous in deciding to take the Report to their respective caucuses or study groups to make recommendations. 
He urged Committee members to grab the opportunity offered to them (which had been funded) to attend the Conference on Skills Development taking place on 14 to 16 October 2003.

The Committee was adjourned.


Draft report of the Portfolio Committee on Labour on public hearings with the Setas held on 18 and 19 March 2003


The Portfolio Committee on Labour, having conducted the hearings and having noted the presentations and submissions made to it, reports as follows:


A. Terms of reference


The Committee resolved to conduct the hearings on 18 and 19 April 2003. The objectives of the hearings were to:


1.      Monitor progress and establish problems in the implementation of the Skills Development Act (Act No 97 of 1998).

2.      Determine the level of performance of Setas since their inception.

3.      Assess measurable outputs and indicators which show the development of Setas.

4.      Identify the challenges and constraints faced by the Setas.

5.      Monitor the level of compliance with the PFMA.

6.       Assist in formulating proposals which may assist in developing a way forward

7.      Fulfil its mandate of overseeing the Department of Labour (DOL) and statutory bodies that fall within its portfolio.

8.      Determine whether policy developments take place in accordance with the key objectives and aims as stated in the 15-point plan of the DOL.


The Committee agreed that a report would be compiled and tabled in Parliament after all the information had been collated and analysed.


B.      Background


Eight Setas and officials from the SETA Co-ordination unit of the DOL appeared before the Committee. Each Seta was represented by the Chief Executive Officer, Chairperson, representatives from the organised labour and business.  The DOL was represented by the Senior Executive Manager: Seta Co-ordination, European Union Team Leader: Seta Co-ordination, and the Manager: Seta Co-ordination.


The following Setas appeared before the Committee:


·      Diplomacy, Defence and Trade and Industry Sector Education and Training Authority (DIDTETA)

·      Energy Sector Education and Training Authority ( ESETA)

·      Health and Welfare Sector Education and Training Authority (HWSETA)

·      Insurance Sector Education and Training Authority (INSETA)

·      Media Advertising Publishing Printing Packaging Sector Training Authority (MAPPP SETA)


·      Mining Qualifications Authority (MQA)


·      Transport Education and Training Authority (TETA)


·      Tourism and Hospitality Education and Training Authority (THETHA)


C. Introduction


The Committee received a broad overview on the functions of the Setas.  The briefing included; major success of the establishment phase, and challenges faced with respect to the implementation of the National Skills Development Strategy.


It was mentioned that the Setas had within the last three years spent a substantial amount of time and effort on:


·      establishing systems and structures;

·      building the capacity of all the role-players ; and

·      adopting policies to institute proper governance practices.


The Committee was further informed that the Setas were starting to implement programmes and initiatives aligned to the long-term objectives of the National Skills Development Strategy.


The Setas presentations focussed more progress made and challenges faced by the Setas around the following:

·      Skills planning and Grant Disbursements

·      Quality Assurance

·      Learnerships

·     Finances, and

·      Governance









(1)   Skills Planning and Grant Disbursement


            One of the core functions of Se3tas is to facilitate and monitor skills planning and reporting.  As well as to disburse skills grants to qualifying companies in the sector.


(1.1)   Success to Skills Planning and Grant Disbursement


(a)                  The DOL has approved the Sector Skills Plans of all the economic sector.

(b)                  In each economic sector there has been a definite increase in the number of Workplace Skills Plans (WSPs) and Annual Training Reports (ATRs). This growth  participation, however, means that more skills grants are being disbursed to qualifying companies by the Setas.     

(c)                  The number of strategic projects identified and supported by the various Setas through discretionary grants has increased considerably.

(d)                  The requirement for companies to nominate and register Skills Development Facilitators (SDFs) with various Setas has meant that there is a dedicated resource in the companies to facilitate the planning, reporting and consultation on skills development.  Setas have implemented training programmes for SDFs, and have thus built capacity in the sectors.  Efforts to ensure representativity among SDFs are ongoing in the different sectors are ongoing in the different sectors.

(e)                  Setas are promoting a learning culture in companies.  They are best placed and resourced to encourage the concept of the workplace as a place of learning.  Setas, however, are able to track the trends of skills development in their respective sectors, and measure the impact of the outcome of training in relation to productivity and performance of the overall sector.

(f)                   Setas have increased their effort and found various creative ways of involving and supporting the SMMEs.  Meanwhile the DOL has established an SMME Forum to facilitate dialogue on this challenge that is facing the Setas.





(1.2)         Challenges to Skills Planning and Grant Disbursement


(a)             The participation rate by companies within each sector with respect to grant disbursement is a major constraint that is faced by most Setas. 

(b)             Unclaimed levies result to an accumulation of surpluses with the Setas.

(c)             Setas are faced with a challenge of increasing participation of the SMMEs in the Skills Development Strategy.  Generally, SMMEs are of the view that the effort of claiming grants is not worth the return.  Tis is one of the key challenges that require a legislative rethink.

(d)             The quality and accuracy of the second generation of Sector Skills Plans (SSPs) need to improve with more data available from WSP and ATR. As well as more time available to conduct research and consult with the industry.

(e)             The capacity of trade unions to participate in company skills planning and reporting need to improve.  The DOL has specific programmes planned for this purpose.

(f)               Many levy-paying companies have not yet seen the relationship between training of employees, and greater productivity and profitability in their business.  Some companies continue to view the skills levy as an additional tax on the business, and therefore reluctant to participate in the skills development strategy.


(2)             Quality Assurance


                  The quality assurance function of Setas is governed by the South African Qualification Authority (SAQA) Act of 1995, and its related regulations.  To fulfil their functions, Education and Training Quality Assurers (ETQAs) are required to have a Quality Management Systems (QMSs) in place, with clear defined policies, procedures and review mechanisms.


(2.1)         Successess to quality assurance


(a)                  All Setas have been accredited by SAQA to fulfil the ETQA functions.

(b)                  Learning providers are being accredited by Setas.

(c)                  Setas are funding the training of assessors and moderators.  The latter are registered into the Setas databases.

(d)                  Systems and security mechanisms for Certification of Learners are being standardised across the ETQAs.

(e)                  A culture of outcomes-based assessment, including the process for recognition of prior learning has been introduced in every sector.

(f)                   Setas are contributing to the development of Qualifications and Unit Standards within their respective sectors.

(g)                  The promotion of quality is implemented by Seta ETQAs.


(2.2)         Challenges to quality assurance


(a)   Companies and training providers feel that the accreditation process is time consuming.  Setas are continuously investigating ways and means of simplifying the accreditation process without compromising the requirements and standards set by SAQA.

(b)   There is lack of capacity within the public-private provider fraternity on QMSs.

(c)   There is a need to build the capacity of training providers to develop outcome-based learning materials.

(d)   There is lack of assessment guides and tools, and a limited number of qualified and experienced assessors and moderators.

(e)   The delays on NQF registered qualifications and unit standards impact negatively on provider accreditation and assessment processes.


(3)   Learnerships and Skills Programmes


Setas design, register, administer and promote learnerships and skills programmes in the various sectors.


(3.1)             Successes to learnerships and skills programmes


(a)                  Almost 406 learnerships have been registered among 25 Setas, and over 25 000 learners have embarked learnerships.

(b)                  All Setas have spent a substantial amount of time and resources creating and promoting awareness on the new learnership system in their respective sectors.

(c)                  The apprenticeship system is being successfully maintained and converted into the learnership system in the relevant sector.  The DOL has facilitated the dissolution of Industry Training Boards(ITBs).


(3.2)        Challenges to learnerships and Skills Programmes


(a)        An ongoing challenge facing the new skills strategy is to obtain and maintain the buy-in from employers who would be the ones signing up learners.  The DOL and Setas are currently engaged in joint marketing efforts and incentive schemes, including grants and tax incentives for employers.

(b)        Building the capacity of training providers should be prioritised.

(c)        Access to learnerships by the youth and unemployed peole has been identified as a national priority.  In an effort ot raise awareness on emerging opportunities, the DOL and Setas will conduct a learnership campaign  as well as a learnership weeek will be held from 16-21 June 2003.

(d)        Some of the funds that could support learnerships are under-utilised partly because of the slow up-take of learnerships.


(4)   Finances


(i)               Nature and flow of funds


                           Setas derive their income in the form of levies paid in terms of the Skills Development Act and Skills Development Levies Act.  These levies are based on the rand value of payrolls of employers in their respective sectors.  Currently, the rate of levy is 1% of the gross payroll value.


                           Following is a table which illustrates the actual amounts involved, expressed in percentage totals:


Total levy paid by employers


Withheld by the DOL for the National Skills Fund


Paid over to Setas


Available to meet the operational costs of the Setas


Available for grants to employers



                        The grants available to Setas are distributed as follows:


                        *           Mandatory                                 60%

                        *           Discretionary                            10%


(4.1)         Successes to Finance


A number of Setas have had success in getting money back to their stakeholders as envisaged by the Acts.  Grant payments, both for mandatory and discretionary have increased steadily as Setas built their own capacity.  More employers have started to participate in the activities of their respective Setas, and complied with the legislative requirements.


(4.2)         Challenges to Finance


(a)                  Due to teething problems that were initially experienced, there had been problems in aspects such as the receipt of levies and flow of monies back to the stakeholders.

(b)                  One of the constraints that affect all the Setas is the time taken to get grants back to the employers.  The implementation grants ( amounting to 45% of the total levy)  can only  be paid once the year in question has passed.


(5)   Governance


(5.1)         Successes to governance


(a)                  A number of Setas have succeeded  in establishing best practise governing structures that comply with the PFMA of 1999.

(b)                  The DOL has implemented a Board / Council and stakeholder capacity building programmes which are available to all the Setas.

(c)                  Many stakeholders have taken up the opportunity to become involved in the decision-making processes of the Setas.

(d)                  In cases where irregularities and mismanagement have occurred, the latter were dealt with in terms of the law by the governing bodies and DOL.


(5.2)  Challenges to Governance


(a)             Continuous improvement of good governance structures and systems will remain a challenge to the Setas.

(b)             Some cases have occurred where working relations between the Board /Council and the operational staff of Setas have not been properly and clearly defined in terms of duties and responsibilities assigned to both parties.  This has led to tensions between the Board/ Council members and the CEOs/ management staff in many Setas.  The King 2 report on corporate governance could guide Setas in this regard.




(1)   Seta Performance


The Committee sought clarity on whether were showing tangible signs of improvement, and structures in place to enhance progress.

The DOL mentioned that Setas were not uniform in their levels of performance, they vary form good to the poor.


A Memorandum of Understanding (MOU) which will be used as an interim measure in the absence of a legislative provision to allow for the DOL to sign a Service Level Agreement with all the Setas had been concluded. The MOU, however, outlines departmental obligations such as monthly transfer of skills development levies to Setas.  It also puts an obligation on Setas to spend money in implementing their individual business plans, and delivery of agreed skills development targets. The DOL also indicated that it was satisfied with the operations of the majority of Setas.  Intervention was made in areas of non-performance.  Transparency had been exercised in isolated incidences of fraud which lead to the negative publicity of Setas. Quarterly monitoring and reporting system had been agreed at to assess the individual performance of each Setas.  A Quartely National Skills Development Forum wherein the NSA will be liaising with Setas regarding the quarterly report had also been established.


Other concerns raised by the Committee to the DOL and Setas included the following:


(a)   The salary levels of the CEOs and staff of the Setas, Board members allowances, use of consultants and Seta reports.

(b)    Learnerships and skills training seem to be carried to the bright students only.

(c)   The level of co-ordination between Setas and the government.

(d)   The interaction between the Setas.

(e)   The degree of progress in the alignment of Setas with the local government and other government institutions.

(f)     The relations between DOL and the Department of Education.

(g)   The interaction of Setas with the clothing and textile industry.

(h)   The involvement of trade unions in the job creation process.

(i)     Translation of manuals into the various languages.

(j)     The approach of Setas to the disabled and HIV/Aids.

(k)    Progress of skills development and training programmes in the taxi industry.

(l)     Whether there were rules governing the roll-over funds.

(m)  The lack of employment for matriculants and graduates.

(n)   The availability of comprehensive databases form government.


Responses, comments and suggestions to some of the concerns raised were as follows:


   On the issue of salary scale, it was mentioned that benchmarking salaries would be difficult. The feeling was that this aspect would evolve into a more equitable system.  The Committee expressed its concern over the issue of salary scales and called for guidelines to be set up.


The Committee was also advised that there were guidelines which were carefully adhered with respect to the roll-over funds.


The DOL reiterated that an attitude of co-operation between Setas and government had pertained.  Further, that the stakeholder interest had been served by appointing members to Seta boards selected from organisations such as FEDUSA, COSATU,etc.


The Committee suggested that attention would need to be to be given to the ways and means of establishing accurate databases through government. 



(2)   Awareness and advocacy


The Committee wanted to know whether there has been progress in reaching out to the rural communities. It was mentioned that Setas area given opportunity to meet the general public, including showcasing themselves during the Annual National Skills Development Conference.  Road shows had also been conducted.  Setas had adopted various strategies in meeting their stakeholders. The Committee suggested that public awareness on Setas, especially in rural communities should be enhanced, 


The Committee wanted to know whether there were any steps taken regarding cross sector training.  It was suggested that further consideration should be given to group training in order to fast track the process.


On the issue of the training of SMMEs.  It was recommended that Setas must ensure that SMMEs are trained in relevant areas which they need training on.


The accessibility of Setas was raised as a concern be the Committee.  The suggestion made was that these should be located close to the labour centres.


With respect to clarity sought on skills development and training of the rural communities.  It was indicated that interactive training had been successful, especially in the tourist industry.  Rural communities had participated in the conversation and tourist projects.  Adequate attention had been given to informal traders, especially those in the craft sector.


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