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LABOUR PORTFOLIO COMMITTEE
5 September 2007
WORKPLACE DISCRIMINATION: PUBLIC HEARINGS
Chairperson: Ms O Kasienyane (ANC)
Documents handed out:
Employment Equity Commission input by its Chairperson
Workplace Discrimination: BMF Submission to portfolio
Black Management Forum submission on Workplace Discrimination
Audio recording of meeting
The Committee was interested in knowing the areas in the legislation that needed intervention. The Commission on Employment Equity suggested that the Council for Conciliation, Mediation and Arbitration (CCMA) should be given more arbitration powers as it afforded easy access to justice for the worker compared to the court system. Fines for non-compliance with employment equity reports needed to be regularly increased. By taking the penalties out of the Act and placing them in the regulations, the fines would be easier to change and keep up-to-date. There was non-compliance or tardiness in submitting employment equity reports as there were no punitive measures. There was a serious need for an increase in the capacity to monitor employment equity reports.
The Committee was concerned that there seemed to be no stringent monitoring measures and they wanted to know if anyone ever verified the reports that were submitted to the CEE. It was acknowledged that employers did not bother with compliance as it seemed that report submission was voluntary without punitive measures for non-compliance.
The Black Management Forum was appalled by the slow rate of transformation in corporate South Africa. There was a need to review the mandates of the Chapter Nine institutions and for renewed campaigns to enforce employment equity compliance under the supervision of the Department of Labour. There should also be a link between the new BEE enforcement mechanisms of the Department of Trade and Industry and the Employment Equity inspectorate. They recommended the use of accredited rating agencies to conduct Employment Equity inspections and the review of Section 10 of the Employment Equity Act to allow for class actions dealing with discrimination.
The Committee wanted to know if the recommendations made by the Black Management Forum were in direct conflict with those made by the Employment Equity Commission and if the BMF felt that the CEE was lacking somewhat. The Committee agreed that black people, women - with the exception of white women - and the disabled were still severely marginalized. It was noted that the Commission for Gender Equality had not arrived to submit a submission.
[PMG note: This meeting was not monitored for the first half hour].
Commission on Employment Equity (CEE) submission
Mr Jimmy Manyi, CEE Chairperson, was accompanied by partner delegate, Mr Thembinkosi Mkalipi, Senior Executive Manager: Labour Relations, Department of Labour.
He began his presentation by emphasizing that despite it being more than ten years into democracy, discrimination was still prevalent. Only now instead of it being blatantly apparent, it took a more sophisticated form and as a result there was still gross under-representation of the designated groups. A very problematic area was that in spite of all the legislation to combat this such as the Employment Equity Act, employers still found ways to circumvent the law. He gave the CCMA as an example of how employers got around the law. Employers were well aware that the CCMA could only conciliate so if the matter was serious and needed adjudication, it had to be referred to the labour courts. But in most cases the justice system is expensive and highly inaccessible to the ordinary man.
Moreover there was also the inconvenience of laws that required a complainant to exhaust all internal dispute resolution mechanisms before they go to the CCMA. The practicality of this was that people were scared of the victimization and trauma they might be subjected to in the process. Another example was the so-called psychometric testing companies used for selection. This testing had a cultural bias and it was too Eurocentric. What they found disturbing at the Commission was the emergence of ‘House Niggers’. These were BEE partners that were used to endorse the discriminatory practices of their white counterparts all in the name of good business sense.
Discriminatory practices with severe racial prejudice were still prevalent. A good example of this was the saga at Alexandra Forbes were they appointed a ‘White’ executive chairperson to baby-sit the ‘Black’ CEO despite the fact that the ‘Black’ CEO was the product of prestigious institutions such as Harvard, Witwatersrand University and UNISA. Moreover the CEO had extensive corporate experience and was producing the numbers.
The claims that white folk were being discriminated against was completely false because the figures showed that at the top of the management ladder, strategic positions were held by white people (74.9%) as opposed to the blacks and coloreds and Indians who sat at 22%, 11% and 6% respectively.
As for the emancipation of women, the situation was dismal as there was still gross under-representation of black women especially with white women being chosen over blacks in a bid to fill the women posts. The question the Commission then asked was ‘Why should white women be a designated group’. The representation of disabled people was the worst with most disabled people being found in unskilled occupation levels. In conclusion he said that the Commission applauded Parliament for stressing the fact that the challenge of creating a non-discriminatory and equal society was an ongoing battle and much more needed to be done. They suggested that in reviewing the Act, they might empower the CCMA to actually arbitrate on issues.
Ms A Dreyer (DA) said that Mr Manyi's comments and submission were not helpful as they consisted of vague generalisations. She reminded him that he was working for the Minister and thus a public servant, accountable to the taxpayer. His statements were not reliable. An independent audit of the information in his annual report showed that the figures were unreliable and did not add up. The company survey that the CEE conducted each year was not valid as they did not use the same companies each year which was necessary for statistical consistency.
She added that Mr Manyi was stirring up racial feelings and his attitude was divisive. She was saddened and shocked by the re-racialising of South African society. It seemed that the post 1994 period of the rainbow nation had disappeared and that they had degenerated into a Animal Farm (George Orwell) situation.
Mr Manyi commented that committee members like Ms Dreyer should refrain from making unhelpful comments especially if they did not have all the facts and had not investigated the issue fully. He emphasised the point that he was not a public service employee but a private based employee and to prove that he had his business card.
Ms A Dreyer (DA) asked the Committee Chairperson to call for order.
The Chair asked for a point of order and proceeded to request Mr Manyi to respond to comments and questions raised by the other committee members.
Mr B Mkongi (ANC) recounted how a person had told him that South Africa was a white country with a black head of state and this was what it seemed like on the ground. He asked for the important areas in the legislation that needed intervention.
Mr Mkalipi replied that Mr Manyi had raised the issue of the CCMA, in that the CCMA only had conciliation powers and could not arbitrate so if the parties did not agree, the labour court was the only option unless all the parties agree that the CCMA arbitrate. What the Committee had to keep in mind was that the courts were not user friendly. Their recommendation was to give the CCMA arbitration powers because it dealt with more than 100 000 cases which was more than what the courts dealt with.
The other matter that the Commission had looked at was the issue of fines. The current problem was that they had to be changed on a yearly basis because of inflation and if one changed the fines they had to change the law as well. Their suggestion was to take the fines out of the law so that it became more flexible to change them. Secondly, the fines should be meaningful in that they should be able to force employers to comply in fear of the fine. As it stood now, a fine of R250 000 for a company that had a turnover of millions, was quite insignificant.
The other issue that needed serious intervention was the fact that an employer can fail to comply and submit the required employment equity reports on time and the only remedy was for the Director General to request a compliance order. Some employers submitted their reports when they wanted and by the requisite date because they were well aware that nothing can be done except to be issued with a compliance order. Moreover, the Director General actually had to go to the court to make sure that the order was enforced.
In the same vein there was need to look at when they should approach the court because currently they could only go to court if they wanted to enforce a compliance order. This should be extended to encompass a situation were they would be able to send to court an employer who blatantly went against the Act.
Mr Mkongi asked who represented the workers if a case went to the labour courts.
Mr Mkalipi replied that if one had money then one could hire lawyers and if the worker had joined a workers union then the union would represent them. This was a major problem due to the financial constraints of the workers hence they were clamoring for the extension of the CCMA’s powers to include arbitration.
The Chair commented that this issue of the CCMA was very big as it seemed that the BMF was also calling for the CCMA to have arbitration powers and it need serious looking into.
Mr Mkongi asked how the group that claimed that it was not white enough under the white government and not black enough now under black governance, was going to benefit.
Mr Manyi replied that it was a fact that such complainants were in the least targeted group but they were not going into who was more discriminated than the other - even though they could make a case out of it. Their view was that people had to be advanced according to their economic equity progression and according to this, Africans should be sitting at 71.4%, coloureds at 10%, Indians at 3% and whites at 5.5% but on the ground one hardly found any black person at all. All they were advocating for was the equity scales determined by the legislation. Whether there was now a duplication of characteristics, they would have to find out when statistics on the current position came out.
Mr Mkongi remarked that the balance of power in the corporate world left much to be desired as companies employed white managers to baby sit black managers.
Mr Manyi replied that there were all kinds of artificial barriers and frivolous excuses as to why employers refused to employ black people. One excuse they encountered was an employer who refused to hire a black person because they could not swim. Another example could be found at Anglo Gold where black people in managerial posts were given portfolios such as industrial relations or corporate governance. They were given posts that were deemed not critical for the running the company - as if white people were born with experience.
Mr Mkongi asked how they thought the government could help improve such a situation.
Mr Manyi replied that the government so far had done a lot but what it needed to concentrate on was the strengthening of monitoring because making policy decisions had to be followed up with proper policing. He gave the example of SARS which put in stringent policy measures and everyone was taking it seriously.
Mr Mkongi remarked that in the area of submitting employment equity reports, there were no punitive measures and it seemed to be voluntary hence the employers were not complying. He asked for suggestions of what could be done about this and an elaboration of the constraints they had faced in this area.
Mr Manyi replied that this was what Mr Mkalipi had elaborated on, especially the fact that the Act had a weakness in this aspect. As a result, if an employer refused to submit a report, the process to ensure justice was long as one had to be taken to court. And there was also the issue of the fines, hence these problems were among the top of their recommendations.
Mr Mkongi asked for the shortcomings in the implementation of employment equity and broad based black empowerment.
Mr Manyi replied that there had been a lot of discussion between the Department of Labour and the Department of Trade and Industry to ensure convergence. The Commission was very happy to say that even thought the Department of Trade and Industry targets were still yet to be met, there was convergence between the two.
Mr M Nene (ANC) confirmed the truth of the reports before them. He had found that in companies, discrimination was still prevalent. This was even worse for disabled people because not only were they discriminated against from holding critical posts but most companies did not even have facilities for the disabled which meant that they did not even envisage them at their places of employment.
Mr Nene remarked that even though people kept pointing to the fact that they were 13 years into democracy, it seemed as if change was too slow in coming. He wanted to reiterate the point that it would take time to change the status quo.
Mr Nene pointed out that presenters should not give their way forward because this was the job of the Committee to deliberate on and come up with possible solutions for the way forward.
The Chair replied that listening to suggestions from the presenters was necessary because their suggestions were helpful.
Mr Mkongi asked if anyone verified the employment equity reports that were submitted to make sure that they were a reflection of the true state of affairs and not just a cut and paste job.
Mr Manyi replied that they received the report signed by the CEO and this was quite fundamental in that no one else signed the report. If it happened that the CEO signed a fabricated report, then they would bring a case of fraud against the CEO as it would be a case of misrepresentation. In this area there was serious need for an increase in the capacity to monitor.
Ms Dreyer agreed with Mr Mkongi that there was a need to have more stringent monitoring. However, her comments were of a more constructive nature as she was of the opinion that there was a need to focus energies on real problems such as the education of the people, skills training and making it easier for people to enter the job market by means of labour flexibility so that people would be able to get jobs after acquiring the requisite skills. They should concentrate on this in order to uplift the dignity of the people.
Mr M Mzondeki remarked that it might be better if members refrained from making such comments as they would regret them. He was of the opinion that they should wait until all the submissions had been made, heard the recommendations and at least have deliberated over the issues. The reason was that, if one made judgemental comments, then others were bound to make counter comments and this would end up detracting from the aim of the meeting.
Mr Manyi remarked that what needed to be emphasized was that the Employment Equity Act was very specific to the area of work - as such it was work-based only. The assumption and the expectation that it dealt with everything was quite unrealistic as this was impossible. The different issues such as poverty and criminality, among other things, had to be distributed among the various ministers for them to tackle.
The Chair remarked that it was clear that the Act was work based and it aimed to eradicate discrimination at the workplace and that was why they were conducting public hearings so that Parliament could perform oversight and ensure compliance with key labour legislation. She thanked them for the presentation and informed them that if there was a need to speak to them some more, they would be called in again.
Black Management Forum (BMF) submission
Ms Nomhle Nkumbi-Ndopu, BMF Deputy President, introduced her co-delegate as Mr Mncane Mthunzi, BMF Managing Director. Noting that her written submission was before them and in the interests of time, she highlighted the areas which they thought were most important as the Committee could read the submission at their leisure.
She began by describing the BMF and noting that for three decades it had been vocal in the transformation landscape and they hoped to assist the government, parastatals and private companies in the pursuit of socio-economic justice, fairness and equity. The BMF had always been at the forefront of black empowerment and they had been among the leaders in the affirmative action debate in the early 1990s. What worried them however was that 13 years since the Commission had released its recommendations, corporate South Africa still fell short of the targets placed by the Affirmative Action Blueprint. The BMF also played a central role in the drafting of the Employment Equity Act and it was the BMF that facilitated the establishment of the Black Economic Empowerment Commission and most of its recommendations ended up being endorsed by the government in the BEE policy.
She said that the debate now needed to be focused on creating ways of stimulating the EE process and targets because currently most employers were more concerned with fulfilling the requirements/targets for EE than focusing on and creating their own EE plans and fulfilling compliance processes and reports. The BEE Codes of Good Practice were promulgated in December 2006 but BMF was appalled by the worsening situation in the workplace and seriously concerned with the disturbingly slow pace of transformation in corporate South Africa.
Their first recommendation was that there was a need to review the mandates of the Chapter Nine institutions. There was also a need for renewed campaigns and a drive to enforce employment equity compliance under the supervision of the Department of Labour. There should also be a link between the new BEE enforcement mechanisms of the Department of Trade and Industry and the EE inspectorate. They recommended the use of accredited rating agencies to conduct EE inspections and the review of Section 10 of the EE Act so as to allow class actions dealing with discrimination. BMF also suggested the setting up of a Commission of Inquiry into racism and other forms of racial discrimination in the work place and they endorsed the recommendation already made by the Chair of the Commission for Employment Equity, that the CCMA be given arbitration powers.
Mr B Mkongi (ANC) asked if BMF thought the skills development programme a success and if the problem was gate keeping and red tape that somehow prevented the people who had just acquired the skills from rising. He asked if the many recommendations they had made were not in direct conflict with the recommendations made by the Commission. The Commission argued that accessing courts was problematic and as such they recommended that the CCMA be empowered to arbitrate. He asked if the BMF recommendation that there be a Commission of Inquiry meant that the Commission for Employment Equity was lacking in its own mandate.
Ms Nkumbi-Ndopu replied that gate keeping was unfortunately still prevalent in the corporate sector and it came in many forms such as gender or race. Nevertheless, BMF was in total support of the Joint Initiative on Priority Skills Acquisition (JIPSA) and from their perspective such a strategy was encouraging. This did not mean that there was conflict in the recommendations made by the CEE and BMF.
It was true that there was difficulty in accessing the justice system resulting in the CEE recommending that the CCMA be given arbitration powers. Having a Commission of Inquiry was not contradictory; it was actually complementary as people entered the justice system at different intellectual levels and monetary strength.
Ms Nkumbi-Ndopu said that their recommendation was quite clear especially in the area of BEE that
employment vacancy agencies be used in the same way as other services in the country in terms of financial discipline and reporting. As a result they were effectively saying that the cost be borne by the company and not the government, should the situation arise.
Mr Mzondeki thanked the BMF for its presentation especially since it had always advocated for black empowerment and he remembered the BMF from the days when he was a youth. He asked if an audit had been done to establish if there were a lot of skilled black people on the ground that were able to join the workforce if called upon.
Mr Mthunzi replied that from the evidence of BMF databases, these skills were available and companies were well aware of them. However, black people were on average three levels lower than where they should be performing. What was actually happening was that the management in the workplace was simply not giving black people the opportunity to be responsible for the key operations they viewed as critical to the company. Black people were being given menial jobs such as corporate relations and as a result black talent was being under utilized. What they wanted was that black people be given the opportunity.
Ms Dreyer remarked that she was basing her comment on two very good examples of black entrepreneurship - one was the taxi business and the other was the hair product business. These were so many success stories that they should be held up as a banner and role model as these had made huge contributions to the economy. She was of the opinion that they should look at these stories of success and ask what exactly they did for them to be successful.
Mr Mthunzi replied that he did not find such comments helpful at all. Truth be told, they were actually patronizing as black people were more than able to run taxis and do hair. Such examples suggested that black persons were only good for certain stereotypical work and could not handle critical positions in companies and it was this kind of mindset that blocked blacks from being selected for critical positions.
Ms Dreyer said that she was very sorry to hear that Mr Mthunzi had taken her comments to be patronizing. These were examples that came to her at that time and she was pretty sure that there were other better ones but her point was that they should hold up success stories and be able to learn from them.
The Chair remarked that social rights such as the right to dignity and fair labour practice were null and void without economic rights. Hence the need for social rights to go hand in hand with economic empowerment. Be that as it may, she was bothered by the fact that employers were still reluctant to use EE criteria. As a result black people, women with the exception of white women and the disabled were severely marginalized. Therefore it was important that discussions among stakeholders be encouraged as this helped the Committee to make better suggestions and recommendations.
The Chair noted that the Commission for Gender Equality had not arrived and she hoped that they were not withdrawing or scared off by the matter at hand as they needed the input of the various stakeholders because of their useful suggestions which helped the Committee in making its recommendations. The Chair remarked that social rights such as the right to dignity and fair labour practice were null and void without economic rights. One needed to have economic empowerment hand in hand with social rights. Be that as it may, she was bothered by the fact that employers were still reluctant to use employment equity criteria. As a result black people, women with the exception of white women and the disabled were severely marginalized. Therefore it was important that discussions among stakeholders be encouraged so as to hear about the shortcomings in the implementation of employment equity and broad based black empowerment. This helped the Committee to make better recommendations. The Committee had been pleased with the submissions as they were well researched and showed a true representation of the situation.
The meeting was adjourned.
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