Jul 25, 2012
New labour laws will set SA back – BusaBack
Engineering|Africa|Busa|Business South Africa|Business Unity SA|Africa|South Africa|Manufacturing|Retail Organisations|Vanessa Phala
Appearing before Parliament's labour portfolio committee, on the second and final day of public hearings on the Basic Conditions of Employment and the Labour Relations amendment bills, Business Unity SA (Busa) warned the two measures, if enacted, would set back employment creation.
"The level of unemployment is continuing to rise, and we are of the opinion that the bills that we have before us will not take us anywhere in terms of addressing the issue of unemployment," Busa executive director Vanessa Phala told MPs.
Busa represents South African business on macro-economic and high-level issues that affect it at national and international levels.
It also represents local businesses' interests in the National Economic Development and Labour Council (Nedlac).
Created in 2003, through the merger of the Black Business Council and Business South Africa, the confederation includes among its members the SA Chamber of Commerce and Industry and the Chamber of Mines, plus many other professional manufacturing, engineering and retail organisations.
"Let me indicate that this submission by Busa is supported by all our members," Phala said.
Busa's key concern was the need to create jobs. Government's New Growth Path and New Development Plan were good initiatives that set specific targets in terms of the number of jobs that needed to be created.
"But we are of the view that we will not be able to meet those targets if we've got the kind of bills we have before Parliament."
A critical area for the creation of jobs and the growth of business was to have a strong compliance and enforcement mechanism, hence the need to have a very good labour inspectorate in place.
"We are of the view that the kind of laws we [already] have, [together] with very good enforcement, can really achieve the intended objectives."
Phala said it was not a good idea to "always want to change the laws because there is no compliance", and suggested to MPs that they might want first to address enforcement and address compliance.
She also called for a comprehensive assessment of the impact the new bills might have, taking into account the proposals they contained.
"We feel, at the moment, that these bills... will not get us anywhere and not enable us to meet our target and our objectives."
The amendments in the bills provided "poor policy choices", and there were other options.
"The bills... will have a dire, dire impact on small business in particular," she warned.
If you made it difficult for small business to operate, "you are killing many jobs".
Busa had done its own impact assessment, over three key areas.
This assessment showed that about 215,000 jobs would be lost as a result of the equal treatment provisions contained in the amendments.
"It also indicates that between 11,000 and 105,000 jobs will be lost as a result of amendments prescribing wage increases on actual earnings.
"Furthermore... between 38,000 and 80,000 jobs will be lost should amendments to extend collective bargaining agreements be introduced."
This was clearly not a very good picture, and one that business was reluctant to commit itself to.
"We need to really go back... and ensure that the bills passed by Parliament will give us the kind of outcomes we want."
On part-time employment, she said business was not against treating workers equally, but the proposed amendments went beyond discriminatory matters.
"They go on to require employers to pay... the same benefits to part-time workers as those working full-time."
This would increase the wage bill and discourage employers from employing part-time workers.
It would also promote onerous litigation.
South Africa was grappling with a serious crisis of unemployment, but the amendment bills would not help solve this problem.
"What we have before us in these bills is counter to what we are trying to do," Phala said.
Cabinet approved the two labour amendment bills for submission to Parliament in March this year.
Edited by: SapaComment Guidelines (150 word limit)
Updated 5 minutes ago Vuli Cuba has resigned as chairperson of JSE-listed construction group Stefanutti Stocks. Cuba took up the position following the resignation as chairperson of Stefanutti founder Gino Stefanutti on July 15.
Updated 22 minutes ago South Africa’s development is being hampered by a serious shortage of skilled engineers, especially in the public sector, and the situation has been described as one of the worst capacity crises in years, a research report by professional body Royal Institution of...
Updated 1 hour 4 minutes ago To bolster its argument that renewable energy is critical to combating climate change, the World Wide Fund for Nature-South Africa (WWF-SA) has commissioned a series of reports that investigates the state of renewable energy in the country, focusing on how it can be...
Recent Research Reports
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
This Week's Magazine
South African State-owned defence industrial group Denel has announced its fourth consecutive year of profits. The group's results for the financial year 2013/2014 were recently announced at its head office in Centurion, south of Pretoria. Revenues grew by 17%, net...
There is little opportunity for JSE-listed infrastructure company Group Five to grow shareholder value in the domestic market, says CEO Mike Upton. He says value can still be found in the private sector, in the renewable and industrial power sector, as well as in...
The National Association of Automobile Manufacturers of South Africa (Naamsa) has announced the event dates of the 2015 Johannesburg International Motor Show (JIMS). The event will take place from October 14 to October 25, 2015, at the Johannesburg Expo Centre, Nasrec.
UK engineering support services provider Babcock is set to deliver the largest order of global truck manufacturer DAF’s truck tractors in Southern Africa to bulk carrier road-based logistics company Ngululu Bulk Carriers (NBC), with 133 trucks to be delivered in...
Digital radio communications in the African local government space can open up the world, but have many challenges to overcome, notes integration and migration of legacy radio communications infrastructure with digital mobile radio company Emcom Wireless head of...