‘NEDLAC’ stands for the National Economic Development and Labour Council. This is a high level forum where, amongst other things, legislation regarding labour and economic development issues is debated and formed in preparation for enactment in Parliament. This body therefore has a major responsibility to arrive at proposals for legislation that will promote economic development and a healthy labour economy.

The parties represented at NEDLAC include Government, labour unions, business and community. Their deliberations aim to achieve goals such as legal protection for workers and reversing unemployment. However, two key factors bedevilling the success of this forum are the severe conflicts between the above two goals of NEDLAC and the hugely disparate agendas of groups represented on the forum.

The two goals of protection of employee rights on the one hand and of reversing unemployment on the other hand need not necessarily be conflicting goals. However, in the current South African situation they do seriously conflict with each other. This because, the more the unions and government conspire to tighten up labour laws in the ‘interests of employee welfare’, the more employers are reluctant to employ people in South Africa.

The current labour laws impose strong impediments to termination of employment for operational, misconduct and poor performance reasons. The law thus provides limited flexibility for employers and imposes very heavy obligations on them. Again, the more that employers suffer under this yoke the more reluctant they are to employ people. Thus, the very laws that are designed to protect employees have the effect of reducing their employability. The burden of the labour law yoke is felt all the more by smaller employers who do not have the resources to manage the labour law burden but who represent the great majority of businesses in South Africa.

Business owners and aspirant business owners, in response to this problem are:

  • Cutting back on existing labour
  • Resisting the need to hire people
  • Turning to mechanisation
  • Looking for non-labour intensive opportunities
  • Keeping their businesses small
  • Closing their factories and moving them to the far east, thus exporting South African jobs to the orient
  • Choosing not to open new businesses here
  • In the case of potential foreign investors, (with a few exceptions) finding other countries to do business in.

Those few foreign businesses such as Wallmart that are willing to open up here are not always welcomed by the unions.

All of this shows that strong elements in the labour movement do not see job creation as the number one priority for South Africa. Ironically, our government is well aware of the serious damage that our labour laws are doing to the creation of jobs. This is proven by the admission by Minister Trevor Manuel who said, earlier this year, that our labour laws are hampering the creation of employment. Against the backdrop of President Zuma’s highly ambitious goal of creating 5 million jobs by 2020 Minister Manuel’s statement is hugely significant. A major concern is that, even in the unlikely case that the five million job target is achieved, it will not be nearly enough to solve the unemployment problem in SA. This is because of the many millions of school leavers that will be entering the job market over the next nine years.

This renders all the more alarming the labour minister’s introduction of the three new labour Acts that became effective over the past 14 months, which contain a number of changes highly unfriendly towards employers and thus not conducive to job creation. Our labour dispensation noose has now been drawn so tight as to choke the life out of employment creation by the private sector.

At the same time the government is making it very easy for Zimbabwean citizens to work in SA and to reduce job opportunities for South Africans even more. When South Africans complain they are criticised and labelled as xenophobic.

Examples of key changes include:

  • Fixed-term employees are able to take employers to CCMA if they have a reasonable expectation of being offered permanent employment
  • Employers have the primary legal responsibility for the rights of people placed with them by temporary employment agencies and labour brokers
  • Employers now have to work very hard to justify the differences in pay between jobs of equal value.

To attend our 23 October 2015 seminar in Johannesburg on HOW TO WIN AT THE CCMA please contact Ronni via 0845217492 or ronni@labourlawadvice.co.za.