ATC200218: Report of the Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour on the National Minimum Wage Amendment Bill [B 9 - 2019] (sec 75), dated 18 February 2020

NCOP Trade & Industry, Economic Development, Small Business, Tourism, Employment & Labour

Report of the Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour on the National Minimum Wage Amendment Bill [B 9 - 2019] (sec 75), dated 18 February 2020
 

The Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour, having considered the National Minimum Wage Amendment Bill [B 9 - 2019] (sec 75), referred to it, reports that it has agreed to the Bill.

 

1. PURPOSE OF THE BILL

 

The aim of the Bill was to correct a technical error by correcting an incorrect cross-reference contained in section 17(4) of the principal Act.

1.1 PROCESS FOLLOWED BY THE SELECT COMMITTE

 

The National Minimum Wage Amendment Bill [B 9 - 2019] was revived on 17 October 2019 to be considered by the Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour. The Parliamentary Legal Adviser briefed the Committee on 16 July 2019.

 

The Committee advertised the Bill for three weeks using internal and external national newspapers inviting all interested stakeholders to submit written submissions. The advert indicated that interested stakeholders could make written as well as oral submissions. The Committee received two submissions from the Western Cape Provincial Department of Finance and Economic Opportunities (WCFEC) and the Congress of South African Trade Unions (COSATU).

 

2. WESTERN CAPE PROVINCIAL GOVERNMENT

The WCFEC contends that the submitted proposed amendment is not merely a technical amendment as indicated in paragraph 1 of the Memorandum of Objects of the Bill but reforms the law. Further, the WCFEC is of the opinion that Clause 1 of the Bill is retroactive.

 

The WCFEC further submitted that retrospective laws are not necessarily unconstitutional, whether presented in weak or strong legal sense. In advancing their submission, the WCFEC drew reference on the court judgement of Pienaar Brothers (Pty) Ltd vs Commissioner for the South African Revenue Service case no 87760/ 2014. According to the WCFEC, the court laid certain standards that need to be observed to determine the constitutional validity of retrospective legislation. The WCFEC submitted that retrospective legislation may contravene the rule of law where it unreasonably or unfairly impairs the ability of those bound by the law to regulate their conduct in accordance therewith.

 

According to the WCFEC, the Memorandum of Objects of the Bill does not indicate what the rationale is for the change except to state that it is a technical correction. What is lacking in the Memorandum on the Objects on the Bill is an indication of the rationality for retrospectivity, particularly as it relates to unilateral changes to conditions of employment as well as unilateral changes to wages of an employee in connection with the implementation of the National Minimum Wage Act when the Labour Relations Act already as at 1 May 2017 regards such conduct as an unfair labour practice. In this regard, the WCFEC contends that retroactivity is both unnecessary and superfluous.

 

Furthermore, the National Minimum Wage Act only took effect on 1 January 2019 after assent by the President and was not operational by the retroactive date contained in the Bill. The WCFEC advances that that in the absence of rationality being established or capable of being established, as it is clear from the case law, clause 1 is arguably unconstitutional.  Then the WCFEC submitted that clause 1 should be reconsidered.

 

Parliamentary Legal Services responded as follows:

• The National Minimum Wage Amendment Bill extended the definition of “unfair labour practice” to now include the matters referred to in section 4(8) of the principal Act.
• Legislation may be retrospective. The Pienaar judgment confirmed that. However, this amendment Bill has nothing to do with retrospectivity of section 17(4) of the principal Act. The amendment Bill merely seeks to correct a cross-referencing error.
• The passing of the principal Act with an incorrect cross reference was due to human error.

 

3. COSATU

COSATU supported the amendment. Further, it was concerned about the effect of the technical error that it had the potential to expose workers to unfair labour practice. Being cognizant of the NCOP’s limited scope to effect changes to section 75 legislation, COSATU proposed the following amendments, namely:

• That the Department of Employment and Labour and the Committee insert clauses as requested by the Council for Conciliation, Mediation and Arbitration (CCMA) to make its judgements binding in relation to the implementation of the National Minimum Wage, and the judgements should not be appealable in the Labour Court as this has the effect of dragging such matters to the detriment of workers.
• The NCOP should insert an additional provision into either the National Minimum Wage Act (NMWA) or section 80 of the Basic Conditions of Employment Act stipulating that the CCMA findings are immediately enforceable.
• COSATU believes that there is a need to strengthen the Basic Conditions of Employment Act to ensure the protection of actors and performing artists so that these workers may also enjoy the basic rights, protection of benefits as workers in other industries.
• In addition, COSATU further proposed that actors and performers in the creative industry should enjoy the same rights and benefits outlined in the Basic Conditions of Employment Act (BCEA), National Minimum Wage Act (NMWA), Unemployment Insurance Act (UIA) and Compensation for Occupational Injuries and Diseased Act (COIDA).

 

Report to be considered.