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LABOUR & PUBLIC ENTERPRISES SELECT COMMITTEE
29 September 1998
SKILLS DEVELOPMENT BILL [B81-98]: VOTING; LABOUR RELATIONS AMENDMENT BILL [B133-98]: BRIEFING
Portfolio Committee amendments to Skills Development Bill [B81A-98]
Skills Development Bill [B81-98]
Implementation Plan for Skills Development (see appendix 1)
Explanatory Memorandum on the Labour Relations Amendment Bill (see appendix 2)
Report of the National Economic Development and Labour Council on Labour Relations Amendment Bill (see appendix 3)
The Skills Development Bill was passed without amendments by the committee. There was a briefing on the Labour Relations Amendment Bill. There will be hearings on this Bill, probably on
19 and 20 October 1998.
Skills Development Bill
The committee had already been briefed on this Bill. The minor Portfolio Committee amendments to the Skills Development Bill were explained by Mr Falkov of the Labour Department. The committee members had no questions other than to query when the Skills Development Levies Bill would be tabled. The reply was that the Finance Department had indicated that it would be tabled before the House rises this session.
The Bill was adopted in its entirety without amendments by this committee.
Labour Relations Amendment Bill
This Bill will be having public hearings held by the Portfolio Committee, most probably on 19 and 20 October 1998. In order to fast track the Bill, this committee was briefed on it before it has been processed by the Portfolio Committee. It will be debated by the National Assembly plenary on 3 November and by the National Council of Provinces plenary on 12 November 1998.
Mr van der Walt of the Labour Department briefed the committee on the Bill (refer to briefing document). He said the philosophy behind this Bill was to improve the institutional functioning of the CCMA, the Labour Court and the bargaining councils and to provide mechanisms for the closing down of the Industrial Court. He highlighted Clause 28 of the Bill as being the most significant. This deals with arrangements for those cases still lodged with the Industrial Court (which is being closed down).
Two questions were raised regarding the Bill:
Was there a synopsis available to small employers of such amendments to labour-related Acts?
Response: An easy pamphlet needs to be put out by the CCMA in the near future explaining the industrial bargaining council arrangements and the CCMA.
An explanation of the significance of "court ad equity" in Clause 11 was requested.
Response: It is already such a court, there is no true significance, it just "looks better".
In closing, the committee decided to hold a debate on the Skills Development Bill when it is presented in chambers on 8 October 1998.
IMPLEMENTATION PLAN FOR SKILLS DEVELOPMENT
• Manpower Training Act
• Guidance and Placement Act
3 - 4 Years
• Skills Development Act
• Skills Development Levies Act
EU and other Donors for establishing:
• Pilot Projects
• Project 1: Capacity of DoL developed.
• Project 2: Information systems for strategic planning developed and operationalised.
• Project 3: Learnership programme designed.
• Project 4: In-service training system developed and implemented.
• Project 5: Institutional capacity development for SETAs and NSA.
• Project 6: National funding system established.
• Project 7: Education and Training Quality Assurers (ETQA) supported.
• Project 8: Department of Labour’s Provincial offices and labour centres of competency and efficiency established.
• Project 9: Employment Services available
• Project 10: Career paths and learning programmes for all implementation agents established
PROJECT STEERING COMMITTEE
• NTB finalising at present.
• Members drawn from NTB constituencies.
• Will oversee and steer work of specialists, consultants and officials.
FUNCTIONS OF PSC
• To make recommendations to the relevant project management Committee and policy issues emanating from implementation.
• To recommend work plans and request for funds to the NSSS.
• To advise the NSA.
• To inform the National Skills Authority of progress made with the planning, implementation, monitoring and evaluation of the project.
• To insure representivity of all stakeholders in overseeing the management of the Project.
• To ensure donor participation and prevent the overlapping of donor funds.
• To ensure co-ordination of sub-projects at national level.
• To view progress.
• To solve problems.
• To ensure that alignment with other Directorate’s reporting procedures and needs.
• To inform and updated stakeholders.
FUNCTIONS OF THE NSSS
• To approve workplans and request for the various projects to be submitted to the Donor.
• To make recommendations to the NSA on policy issues emanating from implementations of projects.
• To advise the lower level structure.
• To inform the National Skills Authority of progress made with the planning, implementation, monitoring and evaluation of all Skills Projects.
• To oversee the planning, implementation, monitoring and evaluation of all Skills Projects.
• To ensure representivity of all stakeholders in overseeing the management of Project Steering Committees.
• To ensure donor participation and prevent the overlapping of donor funds.
• To ensure co-ordination of Skills Projects at national level.
• To present project report to Donor and review progress.
• To solve problem.
Expected outcomes of Project 1:
• All projects co-ordinated effectively. (LMSDP co-ordinated)
• Project management information system established.
• Chief Directorate: HRD & ES supported with the implementation of the Skills Development Strategy.
• Effective financial management system for donor funds established.
• Chief Directorate: HRD & ES’s staff expertise enhanced with respect to project and programme planning, management, and evaluation.
Expected outcomes of Project 2:
• Define role of Skills Development Planning Unit (SDPU).
• Identify future skills needs.
• Develop the strategic planning capability of SETA’s.
• Establish the Skills Development Information System.
• Develop a skills forecasting model.
• Establish monitoring, reporting and evaluation system.
• Refine the Skills Development Planning Unit.
• Evaluate Impact of training under EU Project.
Expected outcomes of Project 3:
• Establish a draft learnership framework linked to NQF
• Establish guidelines for the registration of learnerships with the Director General of DoL.
• Establish criteria and guidelines for the registration of learnerships with SAQA.
• Establish criteria and guidelines for the selection of learnerships.
• Establish a competency profile of Learnership instructors.
• Develop relevant Learnerships for formal employment and SME’s.
• Establish system for registering Learnerships.
• Promote Learnerships within selected sectors.
• Establish institutional and management capacity within the involved organisations.
• Establish support for target groups to enter into learnerships.
• Arrange for provision of learnerships.
• Design and implement quality assurance system for pilot learnerships.
• Establish monitoring and evaluation of Learnership training.
Expected outcomes of Project 4:
• NSA adopts Pilot Model(s) and implementation of guidelines.
• Determine financial support to pilot sectors and firms.
• Monitoring and evaluation system designed.
• Consolidated proposal containing: Model, Pilot SETAs and proposed financial support and contribution prepared.
• Establish competencies of implementing agents.
• Provider(s) to train implementing agents identified.
• Providers capacity ensured.
• Final Pilot SETAs and firms participating selected and trained.
• Pilot participants identified and trained.
• Implement model(s) in pilot sectors/firms.
• Evaluation of Pilot Model.
• Finalise guidelines for disbursement of grants to firms.
• NSA makes recommendation on guidelines.
• All SETAs trained on implementation of regulations.
• Establish sustainable National Agency (NA).
• NA facilitates extension of Model to other SETAs and firms.
Expected outcomes of Project 5:
• Define relationship with other relevant national structures.
• Finalise Skills Development legislation process.
• Conduct promotion of Skills Development Act.
• Facilitate establishment and functioning of NSA.
• Assist NSA to perform its roles and functions.
• Facilitate establishment of NSA-committees.
• Develop management systems to assist NSA to perform its functions.
• Promote establishment of SETAs
• Support SETA’s to perform prescribed functions.
• Support stakeholder capacity development.
• Evaluate institutional capacity building programme.
Expected outcomes of Project 6:
• Establish competence of SETAs to collect the levy.
• Establish competency of national agency to collect the levy.
• Establish the National Skills Fund.
• Establish levy-grant disbursement model for SETAs.
• Develop funding framework for learnerships.
• Develop reporting requirements for the financial management of SDS.
• Costing the SDS.
• Develop survey to evaluate impact of policy on training expenditure
Expected outcomes of Project 7:
• Preparatory work for the establishment of ETQA capacity.
• Assist identified sectors to be accredited as ETQAs.
• Fund plans for identified pilot sectors to develop ETQA functions.
• Support SETAs to perform the following functions.
• Enable SETAs to accredit providers and/or specialised assessors.
• Develop and write an evaluation system for accredited providers and specialised assessors.
• (Jointly managed by SAQA and the Department of Labour).
Expected outcomes of Project 8:
• Define new roles and functions of provinces.
• Establish new work systems and procedures.
• Clarify new organogram for provinces and Local Labour Centres.
• Build capacity of staff.
• Implement pilot project (e.g. SDI)
Expected outcomes of Project 9:
• Define new roles and functions for public and private employment services.
• Establish new information system for Labour Centres
• Define skills required for staff and prepare training programmes.
• Pilot new systems in three labour centres.
• Establish new performance management system in employment services.
• Define partnership with private and other employment services.
• Prepare regulations for the registration of private employment services.
• Develop monitoring and evaluation system
Expected outcomes of Project 10:
• All key implementing agents identified I.e.Department of Labour staff (H.O, Prov, L.C), SETA reps, SETA STAFF, NSA reps.
• Knowledge and skills for implementing agents identified.
• Requirements formulated in SAQA terminology.
• Stats and qualifications registered on NQF.
• Providers identified.
• Curriculum developed.
• Priority programmes delivered.
• Ongoing upgrading planned.
DEPARTMENT OF LABOUR
EXPLANATORY MEMORANDUM ON THE LABOUR RELATIONS AMENDMENT BILL, 1998
The objectives of the Bill to amend the Labour Relations Act, no 66 of 1995 (hereinafter referred to as the principal Act), are to improve the institutional functioning of the Commission for Conciliation, Mediation and Arbitration (CCMA) and bargaining councils as well as to close down the Industrial Count and to effect certain technical amendments.
The CCMA is currently experiencing capacity and case management problems owing to the unexpectedly high volume of disputes referred to it.
The amendments relating to the CCMA essentially propose procedural changes aimed at expediting the case flow.
Section 32(3)(e) of the principal Act requires bargaining councils to set up an independent body to adjudicate non-panty mainly small and new businesses applications for exemption from collective agreements. The proposed amendment changes this body to one of appeal which should expedite the processing of such applications.
The industrial Count is being finally closed down. The amendment enables cases that have been referred to the Count to be transferred by way of notice in the Government Gazette to the CCMA for disposal as if the relevant labour relations laws had not been repealed.
The Bill was unanimously agreed to by the social partners in Nedlac who reported accordingly to the Minister of Labour in terms of section 8 of the Nedlac Act, 1994.
Amendment of section 28
Presently provident and pension funds established in terms of a collective agreement of a bargaining council are excluded from the scope of the Pension Funds Act, 1956. The same applies to medical aid schemes which can similarly be excluded from the Medical Schemes Act, 1967. The magnitude of the funds and schemes has grown to such an extent as against the position when the exclusion was effected in 1956 that it has become necessary that they should now fall under the relevant Acts.
The objective of adding section 28(2) and (3), is to provide for all new pension and provident funds as well as medical aid schemes which are so established after the amendment comes into operation, to register under and comply with the Pensions Act, 1956, and the Medical Schemes, Act, 1967.
This will place the oversight of the funds or schemes under the Registrars provided for under the latter two Acts who have greater specialised capacity. It is the intention that such existing funds established or continued in terms of the exclusion under section 2 of the Pension Funds Act, 1956, will, once transitional arrangements have been worked out with the Registrar of Pension Funds, also be required to register under this Act.
Amendment of section 32 of Act 66 of 1995, as amended by section 7 of Act 42 of 1996
Under the 1956 LPA all applications for exemption from a bargaining council collective agreement were dealt with by the council. The 1995 LRA required a council to establish an independent body to consider non-panty applications in accordance with criteria set by a council. It became clear that the former process in terms of which the bulk of the applications were approved by the council should be restored and that only where a council declines an application would the aggrieved panty need a right of appeal. In consequence the independent body is being converted into a body of appeal. This will reduce expenses and expedite the process for applicants.
Section 34(4) is being repealed as the two organisations specified in the gazetted Schedule 10 list are not the appropriate organisations to nominate people to sit on such a large number of independent bodies. By virtue of the repeal of section 34(4), Schedule 10 will fall away.
Amendment of section 43 of Act 66 of 1995, as amended by section 10 of Act 42 of 1996
Subsection (4) merely makes the same provisions provided for in section 28(3) and (4) also applicable to pension, provident or medical aid schemes established by a statutory council.
Amendment of section 59
There are some bargaining councils which over the years have built up large pension or provident funds and also operate medical aid schemes but which now find that they are no longer "sufficiently representative" for the purposes of section 32(5) to have their agreements extended to non-parties and consequently could decide to dissolve. In the future statutory councils may also decide to discontinue. This amendment makes provision that where the panties agree that they would want such funds or schemes to continue to operate despite the winding-up of the council, they can apply to the Minister of Labour for the continuation of the fund or scheme, provided that it has registered in terms of the applicable law. The Minister can by notice in the Government Gazette declare the rules of the fund binding on the employers and employees who fall within the jurisdiction of the Council as from the date on which the council is wound-up, so as to preserve such funds or schemes.
Amendment of section 70
The Act was silent on who should appoint the chairperson of the Essential Services Committee. The amendment provides for the Minister of Labour to appoint the chairperson from among the members of the committee.
Amendment of section 115 of Act 66 of 1995, as amended by section 3 of Act 42 of 1996
Currently the proceedings and procedures for the conduct of the resolution of disputes under the auspices of the CCMA are regulated by Pant C of Chapter VII of the Act and the proceedings of the governing body meetings are dealt with in item 4 of Schedule 3 to the Act.
A consequence of regulating in this way is that the "rules" are fixed and can only be changed by amending the Act. The amendment gives the CCMA the power to make rules to regulate the proceeding of governing body meetings and the practice and procedure for the conduct of dispute resolution proceedings, which gives the CCMA a flexible means to develop and change the rules governing such proceedings, which will help this new institution to deal more quickly with unforeseen circumstances. The CCMA must publish any rules made in the Government Gazette.
Amendment of section 118
The large volume of work as well as the geographical location of the CCMAs provincial offices makes it imperative that the Director of the CCMA should be able to delegate certain functions such as for instance signing subpoenas. The amendment in section 118(6) makes delegation possible, in consultation with the CCMA Governing Body, but excludes the appointment of staff and the extension of the period within which an arbitration award is served and filed.
Amendment of section 135 of Act 66 of 1995, as amended by section 36 of Act 42 of 1996
A CCMA commissioner when hearing more than one dispute involving the same parties has to set down separate conciliation dates for each dispute, which is time consuming and limits such commissioner's availability to conciliate other disputes. The new subsection (3A) permits of the joining of such disputes so that they may be dealt with in the same proceedings.
As the representation in conciliation proceedings of a party to a dispute by a co-employee went too wide and led to abuse, subclause (4) is being amended to remove the power of co-employees to represent a party in conciliation. Only registered trade unions and employers' organisations will be able to represent members in future. Similar amendments are made to sections 138 and 191.
Amendment of section 136
At present there is no time limit within which any party to a dispute may request that a dispute not resolved through conciliation should be referred for arbitration. This is unsatisfactory as if a long time elapses the circumstances surrounding the dispute could become vague, making arbitration more difficult.
The amendment provides that a request for a dispute to be arbitrated must be made within 90 days of the date on which a certificate is issued that conciliation has failed. However, a commissioner may condone a late request on good cause shown.
So as to expedite dispute resolution the Act promotes the concept of the process moving from conciliation direct to arbitration by the same commissioner. A panty to the dispute may not like the way a referral has been handled and rather want another commissioner to do the arbitration and in such an instance may object. Problems have been experienced where a date has been set down for arbitration to take place and just before the proceedings are due to commence an objection is lodged, which means that another commissioner has to be appointed and a new hearing date has to be set.
To avoid this kind of delay. inconvenience to the other panty and the expense attached to the commissioner's time, the amendment to subsection (3) provides that the objection must be made within seven days of the dispute being certified as unresolved through conciliation.
Amendment of section 138
The amendments to section 135 relating to a co-employee and registered trade unions and employers organisations are also effected in respect of arbitration proceedings.
Amendment of section 151
In section 167(1) the Labour Appeal Court is established as a court of law ad equity. The amendment to section 151(1) brings the Labour Court into line by also specifying that it is a count of equity.
Amendment of section 153 of Act 66 of 1995, as amended by section 42 of Act 42 of 1996
The amendment brings section 153 into line with the provisions of the Constitution of the Republic of South Africa, Act no 108 of 1996 relating to the Judicial Services Commission and substitutes "High Count" for "Supreme Count".
Amendment of section 154 of Act 66 of 1995, as amended by section 43 of Act 42 of 1996
"High Count" is substituted for "Supreme Count" to bring the section into line with the 1996 Constitution
Amendment of section 157
Section 157(2) is problematic in that it applies to any fundamental right entrenched in Chapter 2 of the Constitution of the Republic of South Africa, 1996, which goes too wide and only applies to the state in its capacity as employer. The amendment narrows the jurisdiction of the Labour Count and the High Count to fundamental rights arising from any of the laws for which the Minister of Labour is responsible for the administration and from employment and labour relations and give the section general application.
Amendment of section 159 of Act 66 of 1995, as amended by section 45 of Act 42 of 1996
"High Count" is substituted for "Supreme Court" to bring the section into line with the 1996 Constitution.
Amendment of section 161
The amendment brings the provisions relating to who may represent a panty before the Labour Count into line with similar amendments to sections 135 and 138 relating to conciliation and arbitration proceedings before the CCMA.
Amendment of section 163
"High Count" is substituted for "Supreme Court" to bring the section into line with the 1996 Constitution.
Amendment of section 167
"Supreme Count of Appeal" is substituted for "Appellate Division of the Supreme Count" to bring the section into line with the 1996 Constitution.
Amendment of section 168 of Act 66 of 1995, as amended by section 46 of Act 42 of 1996
"High Count" is substituted for "Supreme Count" to bring the section into line with the 1996 Constitution.
Amendment of section 169 of Act 66 of 1995, as substituted by section 47 of Act 42 of 1996
The reference to the definition of the Judicial Services Commission in the interim Constitution is being deleted and "High Count" is being substituted for "Supreme Count".
CLAUSE TWENTY ONE
Amendment of section 170 of Act 66 of 1995, as amended by section 48 of Act 42 of 1996
"High Count" is substituted for "Supreme Count" to bring it into line with the 1996 Constitution.
CLAUSE TWENTY TWO
Amendment of section 173
The references to the interim Constitution are being deleted and "Supreme Count of Appeal" is being substituted for "Appellate Division of the Supreme Count".
CLAUSES TWENTY THREE AND TWENTY FOUR
Amendment of sections 177 and 180
"High Count" is substituted for "Supreme Count" to bring it into line with the 1996 Constitution.
CLAUSE TWENTY FIVE
Amendment of section 191
The amendment is to bring section 191 into line with the amendment of section 136 50 as also to provide that where unfair dismissal disputes such as those that are automatically unfair or those based on an employers operational requirements etc which are not resolved through conciliation must be referred ,by any panty who makes a request for arbitration to the Labour Count within 90 days of it being certified that they remain unresolved. The Labour Count can condone late referrals for good cause shown.
CLAUSE TWENTY SIX
Amendment of section 207 of Act 66 of 1995, as amended by section 50 of Act 42 of 1996
This amendment deletes the provision for the Ministers to add to Schedules 1 and 7 as the Constitutional Count has ruled that Acts and such Schedules can only be amended by Parliament. The power to list institutions referred to in section 32(4), which is being repealed, is being deleted.
CLAUSE TWENTY SEVEN
Amendment of Schedule 5 of Act 66 of 1995, as amended by section 55 of Act 42 of 1996
The amendment ties into the addition of section 28(2) (see clause 1) section 43 (see clause 3) and provides for the exclusion of existing provident and pension funds from the scope of the Pension Funds Act, 1956, in respect of such funds continued in a collective agreement concluded in a council registered under the principal Act. A similar amendment is effected in respect of the. Medical Schemes Act, 1967.
These are consequential amendments which replace the reference to the 1956 LRA with a reference to the 1995 LPA in the Insurance Act, 1943, and the Friendly Societies Act. 1956.
CLAUSE TWENTY EIGHT
Addition to Schedule 7 of Act 66 of 1995, as amended by section 59 of Act 42 of 1996
The objective of clause 28(1) is to insulate the amendments to Schedule 7 made by the Minister in the Gazette from attack in the Constitutional Count in the light of the Constitutional Count decision that Acts and such Schedules can only be amended by Parliament. It is done by way of the validation of the contents of the Gazette notices which are repeated in Annexures A, B and C to the Bill.
The Industrial Count is being closed down. A new item 22A is being added to empower the Minister after consultation with the CCMA, to authorise the CCMA by way of a notice in the Government Gazette, to perform the Industrial Court's functions which will mean that pending cases will be disposed of by the CCMA as if the relevant labour relations laws had not been repealed. This does not affect the competence of the Industrial Count to finalise all pending matters that are partly heard as at the date on which the authorisation takes effect. The rules governing proceedings before the Industrial Court will apply to proceedings of all matters to be decided by the Commission.
CLAUSE TWENTY NINE
Amendment of table of contents of Act 66 of 1995
The amendments are consequential so as to bring the contents of the Act into line with the amendments effected to the Act.
Short title and commencement.
The Act will come into operation on a date determined by the President by proclamation in the gazette.
15 September 1998.
REPORT OF THE NATIONAL ECONOMIC DEVELOPMENT AND LABOUR
COUNCIL ON THE LABOUR RELATIONS AMENDMENT BILL
31 July 1998
1.1. The Labour Relations Act was negotiated in Nedlac and concluded on 17 July 1995.
1.2. The Labour Relations Act was implemented on 11 November 1996.
2. PROCESS IN NEDLAC
2.1. At the Labour Market Chamber meeting on 21 May 1998 it was agreed that a subcommittee would be established under the auspices of the chamber to consider possible amendments to the Labour Relations Act, 1995, relating to the implementation of the Act.
2.2. The members of the subcommittee included E. Patel from labour, L. Seftel from government and A. van Niekerk from business.
2.3. The subcommittee met on 26 June 1998 to consider a draft labour relations amendment bill.
2.4. There was an agreement between the parties on the subcommittee that only amendments which were urgent, which related to the application of the Act and on which there was full consensus would be incorporated in the bill.
2.5. The members of the subcommittee liaised on the draft amendment bill over a period of four weeks and on 24 July 1993 finalised the bill.
2.6. At the Labour Market Chamber convenors meeting held on 2 July 1995 it was agreed that the convenors would obtain a mandate, from their respective representatives on the Labour Market Chamber, to consider and endorse the draft Nedlac report on the amendment bill.
2.7. The Labour Market Chamber convenors at their meetn9 on 28 July 1998 endorsed the draft report.
2.8. The Management Committee has a general mandate from the Executive Council to ratify agreements relating to the implementation of the Labour Relations Act, 1995.
2.9. The Nedlac report was ratified by the Management Committee at its meeting on 31 July 1998,
The Labour Relations Amendment Bill, 1998, which is attached to this report, is supported by Nedlac. No reservations were recorded Parties agreed to continue discussions in an attempt to reach consensus on the amendment, proposed by government, to the existing section 154 relating to the position of Labour Court Judges.
This report therefore completes consideration of the issue in Nedlac, and the report and the labour relations amendment bill are hereby submitted to the Minister of Labour in terms of section 8 of the Nedlac Act, No.35 of 1994.
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