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Jul 24, 2012

Eskom concerned about labour law changes

Construction|Eskom|Measurement|Contracting|Electricity Supplier|Nerina Otto|Power|Measurement

Electricity supplier Eskom is concerned that certain proposed changes to labour legislation could "negatively impact" its power station construction programmes, it said on Tuesday.

Eskom legal department official Nerina Otto told MPs that a section of the Basic Conditions of Employment Amendment Bill, which, if enacted, will give the Minister of labour the power to regulate or prohibit sub-contracting, could be interpreted as being unconstitutional.

The power utility is one of about a dozen organisations making submissions at public hearings on the draft legislation, as well as on the Labour Relations Amendment Bill. Two measures were approved by Cabinet in March this year for submission to Parliament.

The two-day hearings are being hosted by the National Assembly's labour portfolio committee.

"This [section of the Bill] could be construed as unconstitutional, insofar as it may interfere with the right to trade. Unintended consequences could include the drastic increase in the operational costs of a business," Otto said.

A large part of Eskom's sub-contracting arrangements had to do with its construction programme, including at Medupi and Kusile power stations.

"This is where we have an opportunity to bring in an element of BEE [black economic empowerment] as well as our SDL [supplier development and localisation].

"Our concern is that in the event these sub-contracting arrangements are regulated restrictively, or perhaps prohibited, that would negatively impact on our ability to grow the economy in that regard."

Otto said Eskom also had concerns about the inclusion of temporary workers in organisational rights disputes, as proposed by the Labour Relations Amendment Bill.

This could lead to practical and administrative problems for an employer, as well as a "proliferation" of trade unions, she said.

"It is Eskom's submission that the inclusion of non-standard workers in the consideration of a dispute about organisational rights could lead to practical and administrative problems for an employer, insofar as implementation and compliance are concerned.

"This does away with the principle of majoritarianism (sic) that is underlying the Labour Relations Act. It could lead to a proliferation of trade unions in the work place and could also result in tension among them."

Otto said Eskom had a recognition agreement that set out thresholds for representation. The utility had a "multiplicity" of employees who belonged to the National Union of Mineworkers, or the National Union of Metalworkers of SA, or Solidarity.

"Clarity needs to be provided on what trade unions representing 'a significant interest, or a substantial number of employees' means. This should be defined so that it is measurable, or capable of measurement to avoid confusion," she said.

In a statement on Tuesday, the department of labour said the hearings would "offer stakeholders, that have in recent months been grumbling about the amendments, a chance to voice their inputs".

Among the organisations set to make inputs are the SA Chamber of Commerce and Industry, the Mr Price Group, the Banking Association of SA, the SA Society for Labour Law and the Federation of Unions of SA.

The hearings end on Wednesday.

Edited by: Sapa
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