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Shopsteward Volume 27 No. 3

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Publications  |  Parliamentary Bulletins

   

Parliamentary Bulletin Number 3, November 2001

Table of Contents

  1. Editorial
  2. Labour Relations and Basic Conditions of Employment Amendment Bills - A Historic breakthrough
  3. Unemployment Insurence Bill - some gains, some losses
  4. The struggle continues to reclaim the Pension surplus
  5. COSATU engages state asset retructuring in Parliament

5.1.Alexcor
5.2.Electricity restructuring
5.3.Telecommunications liberalisation
5.4.Reorientation of the Industrial Development Corporation

  1. Immigration Bill
  2. Coalition for a Basic Income Grant
  3. Investigation into minimum wages & working conditions for farm workers
  4. Constitutional Second Amendment Bill
  5. Update on Domestic Workers Sectoral Determination Report
  6. The Promotion of Access to Information Act - and why you need to know about it
  7. Policy Development and Engagement
  8. COSATU Submissions

 

Editorial

By Neil Coleman, COSATU Parliamentary Officer

As the 2001 Parliamentary Session draws to a close, the political situation in our country is characterised by tensions, volatility and contradictions, undoubtedly more so than in any period since 1994.

This coincides with growing tensions in the post-September 11 international environment. Conservative forces are calling for a ‘realignment’ of politics, with a new centre, by which they mean a centre-right, to replace the progressive centre of South African politics.

The central debates in the country, which are taking place in our Alliance, are to a certain extent being masked by the realignment of minority politics, with the collapse of the DA, and the emergence of a tactical alliance between the ANC and the NNP, particularly in the Western Cape.

While important, this is nevertheless a sideshow. As anybody with rudimentary knowledge of our politics is aware, the Tripartite Alliance occupies political centre stage. The Alliance needs to resolve the problems which have emerged in recent times, and reassert the true centre of South African politics: a mass based transformation project led by our people’s organisations.

One of the key concerns dominating recent discussions in the Alliance has been the weakening of the leader of the Alliance - the ANC- and therefore the Alliance as a whole, and its growing marginalisation as the driver of transformation.

The period since 1994 has increasingly seen our mass formations, including the ANC, take a back seat to government in directing the pace and content of change. It is generally accepted in the movement that government itself, and the state in general, has been highly contested by a range of forces, who have often succeeded in reshaping and redirecting government programmes and policies to serve their narrow interests.

While conservative forces, particularly business, have been highly mobilised to impose their agenda, the masses themselves have tended to become spectators in the process of transformation. All Alliance partners recognise that this is a problem which needs to be addressed.

The key tension however is that there has been no agreement on how to go about this.

Resolving this problem is not going to be an overnight process. An important aspect of getting our Alliance back on track is to repair damaged relationships.

In the tense climate we are operating under, the biggest mistake we could make would be, as Cde Madiba likes to say, to "think through our blood" or react emotionally. Deepening divisions in our ranks can only promote the agenda of those opposing transformation. We therefore need to refocus on how to jointly tackle the massive reconstruction tasks confronting us.

An important element of this approach is, rather than disengaging, to continue vigorously engaging with issues which are of vital concern to our common constituency, no matter how frustrating this may sometimes be.

Many of the issues dealt with in this edition of the Parliamentary Bulletin demonstrate that none of us, inside or outside of government, have the luxury of criticising from the sidelines. Preoccupation with problems, no matter how legitimate, cannot detract from our duty to service our constituency- even where we are confronting obstacles in driving the transformation project. A key theme running through the engagements which have preoccupied COSATU during this last session of parliament is protecting and advancing the interests of the most vulnerable and marginalised workers, the unemployed and the poor.

This theme is reflected below in articles dealing with:

  • Our campaign for a Basic Income Grant, aimed at addressing the crisis of poverty which faces the majority of our people;
  • Extension of Unemployment Insurance to include those historically marginalized, and improve coverage;
  • The correction of historical injustices against workers who have been denied their fair pension, and to prevent the continued misappropriation of these monies by employers;
  • The setting of minimum standards and wages for the most vulnerable workers, namely domestic and farm workers;
  • The protection of migrant workers from exploitation; and
  • The defence of public sector delivery of affordable basic services.

These and other issues require ongoing, often intense engagement and sometimes contestation with opposing forces. In some areas, such as the amendments to the LRA and BCEA we have achieved major breakthroughs; on issues such as the UIF we have made some significant advances, but also encountered some serious setbacks. In other areas such as the Pensions Surplus issue we continue to be engaged in intense discussion with government and in Parliament, in an attempt to deal with serious outstanding problems.

But in all these processes we need to constantly remember, and assert the reality that we are engaging with our Allies. As part of the Alliance we need to confidently put forward our positions, place alternatives on the table, and bring the debate back to the people who really matter in this whole process: our common constituency - the working people and the poor- who mandated us to advance their interests, and to demonstrate that their interests are in fact the national interest.

Labour Relations and Basic Conditions of Amendment Bills

By Neil Coleman

A major achievement had just been scored in parliament. The Portfolio Committee on Labour passed largely labour-friendly amendments to the LRA and BCEA. This represents the end of a process of nearly 18 months of intensive national debate about labour market reforms, since the Minister of Labour introduced proposed amendments in July 2000.

In his input to Parliament, the President of COSATU, Cde Willie Madisha, argued that much of this debate was aimed at undermining government’s five-year programme aimed at fundamentally reforming the apartheid labour market, put in place between 1994 and 1999.

"Various conservative forces in society, with a vested interest in inherited patterns of apartheid domination… began to blame this progressive labour legislation for the inherited economic crisis, and the effects of conservative economic policies on areas such as unemployment and poverty.

"We were told that the so-called ‘labour market rigidities’ allegedly introduced by this legislation (despite the fact that the legislation had not yet been implemented!) were to blame for low levels of foreign and domestic investment in the economy, and the inability of the economy to create jobs..."

"Investigations by the Labour Ministry… all concluded that in many respects the labour market continued to be too ‘flexible’, in that the legislation and bargaining structures were unable to adequately address the vulnerable position of many workers.

"Further many of the inherited labour market ‘rigidities’ from the apartheid era, such as the lack of skills in large segments of the labour market, and the persistence of inappropriate workplace hierarchies, required more not less intervention to achieve the flexibility required to unleash our productive potential…"

"From the side of COSATU, the broad architecture of the labour market dispensation was strongly defended… (because it)…. correctly reflected the type of transformation required to address the historical legacy of apartheid on the labour market.

"During the labour market review conducted in 1999, we made a number of proposals … to strengthen the legislation, in particular to address problems facing vulnerable workers; to address the crisis of job loss; to address new forms of ‘atypical’ work and to deal with growing attempts to bypass the legislative framework. These included proposals to amend the LRA the Basic Conditions of Employment Act and the Insolvency Act...

"These proposals by COSATU into the labour market review process were never the subject of substantive engagement or negotiation, and many never found their way into the proposed amendments announced by the Minister in mid-2000...

"Once government and ourselves had exposed the poverty of the arguments by those opposing labour market transformation, a new argument emerged... It was not so much that labour market legislation was inflexible…rather there was a widespread perception …(which) it was argued was deterring investment, and therefore legislation had to be amended …"

"It was a matter of serious concern to COSATU that the Minister’s proposed amendments to the LRA, BCEA and Insolvency Act, omitted a number of important issues raised by labour during the review process; that business’ concerns seemed to dominate disproportionately in the package, particularly at the expense of unorganised and vulnerable workers."

Some of the key amendments proposed by the Minister in 2000 included:

  • On retrenchments, workers would still not be allowed to strike, but for large-scale retrenchments a conciliator would mediate;
  • Removal of the premium (normally double pay) for Sunday work;
  • Workers on probation could be dismissed as long as proper procedure was followed, even if the dismissal was substantively unfair;
  • All employers in an industry, including non parties to a bargaining council, would have to be consulted before the Minister could extend agreements, effectively allowing employers to frustrate agreements;
  • The core rights contained in the BCEA would be removed, and the Minister empowered to vary any conditions downward;
  • Positively, ‘independent contractors’ would be considered as employees; workers facing insolvency would be offered greater protection; and labour court judges would have the same status as high court judges.

Labour regarded a number of these proposals as an attack on the hard won rights of workers, an undermining of the government’s programme to transform the labour market, and a failure to honour undertakings made, particularly in the 1999 election manifesto. This led to a dispute being declared. COSATU tabled a Section 77 notice in Nedlac in late 2000, and tabled its intentions to call a general strike from 28-30 March 2001, followed by further general strikes, if this matter was not resolved.

The formation of the Millennium Labour Council (MLC) in July 2000 provided the ideal forum to pursue high-level bilateral discussions on this matter with business. There was a shared recognition, possibly for the first time, that the country faces a crisis of poverty, unemployment and inequality, and whatever the differences which divide business and labour, we needed to seriously address this national reality.

Business leaders acknowledged that a failure to do so would ultimately result in a social explosion. The MLC’s founding agreement committed the parties to supporting policies which addressed this social crisis, and in particular channelled investment into employment creation and sought to stem job loss.

It was in this context that an agreement was able to emerge in the MLC in early 2001, after months of negotiations. Parties were also able to go beyond ‘perceptions’, to look at international best practice. For example, a MLC delegation, together with the DG of Labour, travelled to the ILO headquarters to study how other countries dealt with the issue of retrenchments.

This laid the basis for an agreement on the difficult issue of how to deal with Section 189 of the LRA. The MLC discussions were complemented by parallel bilaterals with government.

The package finalised in the MLC in May 2001, led COSATU to suspend its S77 notice of intention to strike. This agreement laid the basis for detailed negotiations in Nedlac between June and August 2001. The package agreed to in the MLC was largely incorporated in the Nedlac negotiations, and in the amendments placed before Parliament.

Parliament finalises the package

Labour supported the broad package placed before parliament. Cde Madisha told Parliament: "It consolidates, and protects the integrity of governments programme of labour market reform. Hopefully, it lays to rest the period of conflict about this programme, and signals a shared commitment by the parties to take this programme forward."

COSATU’s October 2001 Campaigns Bulletin contained a detailed report on the provisions of the Bills. We don’t repeat these details here, but rather summarise the key provisions. We also indicate how Parliament has handled the outstanding unresolved issues of particular concern to Labour.

Amendments to the BCEA and LRA dealing with insolvency:

The bulk of the amendments aimed at protecting workers facing insolvency will be dealt with in terms of proposed amendments to the Insolvency Act. These amendments will only come before the Justice Portfolio Committee in the first session of the 2002 Parliament. The following insolvency-related amendments have been made to the LRA and BCEA:

    1. Requiring that employers notify trade unions or employees of circumstances and legal proceedings that may result in insolvency;
    2. Requiring employers to pay over their contributions as well as deductions made from employees’ salaries for benefit funds within 7 days;
    3. Ensuring that workers whose contracts of employment are terminated when their employer is sequestrated or liquidated are entitled to severance pay.

The main amendments to the Labour Relations Act deal with the following areas:

Retrenchments and S189 of the LRA:

For COSATU, the Nedlac agreement to amend Section 189 of the LRA arguably constitutes the cornerstone of the entire agreement to amend our labour laws. Section 189 of the LRA has been significantly changed to give effect to the right to strike against retrenchments for workers in companies employing more than fifty workers.

The right to strike will apply depending on the number of workers to be retrenched, using the basic formula of 50 workers, or 10% of the workforce, whichever is the lower.

Provision is made for a procedure of facilitation prior to retrenchment, the right of workers to go to Court on an urgent basis for breaches of procedural fairness, and the right to elect either to go on strike, or alternatively to have the substantive fairness of dismissal tested in Court.

An employer will be required to prove that any information that he refuses to disclose is irrelevant. Employers will be required to give 30 days notice of retrenchment to individual workers with more than one years service, after the time periods for meaningful engagement have been exhausted.

Cde Ebrahim Patel, Labour’s chief negotiator on the Bills, told Parliament: "The set of amendments to Section 189 is acceptable to COSATU as a package, although our original proposals went beyond this. Labour originally proposed the right to strike for all workers, regardless of the size of the enterprise…a full right to negotiate on retrenchments… (and)… that the courts be able to … examine whether retrenchments were unavoidable in terms of their commercial rationale. In an effort to reach agreement, however, we settled on this compromise."

In the Parliamentary process, two important changes were made to S189:

  • COSATU proposed that either party should be entitled to trigger a facilitation process through the CCMA, without the other party being allowed to veto it. This would allow the union to motivate for an extension of the timeframes for retrenchments. Despite business’ unhappiness with this proposal, it was endorsed by the Parliamentary Committee, and therefore appears in the final Bill.
  • In addition, COSATU argued successfully for the retention of the reference in the Nedlac agreement to a ‘meaningful’ process of consensus seeking.

Amendments dealing with Bargaining Councils and collective bargaining:

The amendments improve the functioning of collective bargaining structures, and encourage the representation of small business in bargaining councils. The Bargaining Councils’ scope has been extended to cover workers in the informal sector and home-workers, and Bargaining Councils have greater powers to ensure enforcement of collective agreements.

The Public Service Co-ordinating Bargaining Council provisions have been streamlined and improved to give the Council greater say over the variation of scope of the Council, as well as amalgamation of sectoral councils. COSATU’s proposal to Parliament that the Bill be amended to empower the PSCBC, rather than the Minister, to define ‘workplace’ in the public service was not, however, accepted.

The procedure and criteria for the registration of trade unions has been improved to ensure that the ‘bogus trade union’ problem, particularly of consultants posing as trade unions, is addressed.

Transfers of business and insolvencies S197 LRA:

Dismissals for a reason related to a transfer will be deemed to be automatically unfair, as would the dismissal of a worker who used the whistle blowing provisions of the Protected Disclosures Act. Workers rights during transfers of businesses have been more clearly spelt out, with all contracts and collective agreements transferred to the new employer.

Independent Contractors:

A significant number of employers have been seeking to evade their legal obligations in a range of ways, with the phenomenon of a growing number of workers in ‘atypical’ work relationships, having little legal protection. A particularly disturbing example of this phenomenon is the proliferation of so-called ‘independent contractors’ - employed workers who are compelled to sign agreements contracting out of their rights. Amendments to the LRA and BCEA now close the legal loopholes allowing this exploitative practice.

Unfair Dismissals and Probation:

The Amendments improve the resolution of disputes in respect of unfair dismissals and unfair labour practices. Probationary employees will continue to have access to the CCMA, to be protected by procedural and substantive justice, although the test to be applied for substantive reasons will be less compelling than for permanent workers.

Dispute resolution by the CCMA and labour court:

The amendments aim to improve the functioning of the CCMA through measures that will simplify CCMA processes, shorten the time taken to process cases and limit the scope for abuse of CCMA resources and processes. Conarb, whereby conciliation and arbitration is combined, by agreement of the parties, is now provided for in the LRA.

Both business and labour proposed at Nedlac that rules in respect of representation at the CCMA, charging of fees and the criteria for cost awards by commissioners should be developed in consultation with Nedlac. The Bill, as placed before Parliament would have allowed the Minister to determine these rules.

After debating this matter in the Committee, the Department agreed to a compromise that the CCMA governing body, on which labour is represented, would make these rules. This amendment is a significant improvement.

The issues relating to labour court judges were not dealt with by the Committee, pending further discussion, at the request of the Minister of Justice.

The main amendments to the Basic Conditions of Employment Act include the following areas:

Variation of basic hours of work:

The amendments to Section 50 tabled in Parliament gives the Minister the right to increase the ordinary working hours of workers beyond 45 hours, under certain conditions. The variation is permitted if the package of working hours is ‘on the whole’ more favourable than the minima set out in the BCEA.

In addition, the determination must either:

  • Have been agreed to in ‘a collective agreement’;
  • Be necessitated by ‘the operational circumstance of the sector’; or
  • Apply to the agricultural or private security sector.

Labour, in Nedlac and Parliament, expressed strong opposition to this formulation, arguing that it went against one of the key objectives of the BCEA, namely to move towards a 40 hour week. Labour agreed that provision should be made to vary hours of work in exceptional circumstances, where it was impossible to implement a 45 hour week, in an industry such as the Maritime sector, provided that the resultant package is more favourable to employees, and that the variation carried the support of the representative trade union/s.

However labour objected to the amendment on the basis that:

  • Many sectors will apply, all citing ‘operational justification’;
  • Any collective agreement, including plant agreements, where workers are in a vulnerable position, will be used to apply for the variation;
  • Undesirable trade-offs will be forced on workers; and
  • Agreement by a representative union is not required.

To deal with these problems, COSATU argued in the Parliamentary hearings, for various amendments to limit the impact of the proposed variation by the Minister. Despite this, we were only able to achieve two limited changes to the Bill in Parliament which, while significant, do not go far enough in addressing the problems posed by the amendment to Section 50.

Firstly, the package of working hours which will be assessed in determining the ‘more favourable’ test, now excludes overtime and meal intervals, and is limited to ordinary time, leave, and rest periods (Section 50(2) (a)). Secondly, in cases where it is deemed that the ‘operational circumstances of a sector’ necessitate a variation of ordinary working hours, the variation may only be made where ‘the majority of employees in the sector are not members of a registered trade union’.

Overtime:

The maximum hours permitted for purposes of working on any given day will be twelve hours (normal time and overtime combined). A collective bargaining agreement may increase the maximum overtime to fifteen hours per week for a two-month period within any one year.

Notice periods:

Amendments to Section 37 now mean:

    • For workers who have been employed up to six months, notice will be one week;
    • For up to twelve months, two weeks;
    • For more than one years service, four weeks.

A collective bargaining agreement cannot reduce notice periods for workers with more than one year’s service to less than two weeks.

Sunday work:

Government’s initial proposal had been for the premium (double pay in most circumstances) to be removed for work performed on a Sunday. In the event, government dropped this proposed amendment on Sunday work. The issue therefore fell away and the previous provisions in the BCEA remain in effect.

Liability for withholding funds:

Employers are now required to pay over their contributions as well as deductions made from employees’ salaries for benefit funds within 7 days. However labour’s proposal that directors of companies should be held criminally and civilly liable if they do not pay over contributions to pension and provident funds was not accepted by the Department during the Parliamentary hearings, and has not been incorporated.

Postscript on Parliamentary process:

At the time of going to press, it had become apparent that these two Bills would be passed by the National Assembly (on 16 November), but would only be dealt with by the NCOP at the beginning of 2002.

Unemployment Insurence Bill- some gains, some losses...

By Neil Coleman

In the COSATU Parliamentary Bulletin No. 2 we reported that, despite some progressive proposed reforms, serious problems had arisen with the Unemployment Insurance Bill (UI Bill) tabled in Parliament in March 2001. Most important of these were:

  1. Exclusion of domestic and seasonal workers from the Fund;
  2. Exclusion of public sector workers;
  3. Limitation of maternity benefits;
  4. Lack of financial guarantees for the Fund;
  5. The failure of government to table the Contributions Bill.

At the time of writing, the Bill had been approved by the National Assembly, and was awaiting processing through the NCOP. Outlined below is a summary of the key debates and decisions, as well as a glimpse of the frustrations experienced by those involved in the process. Despite all the efforts of civil society organisations to address a range of problems in the Bill, the final product is nevertheless unsatisfactory, although important advance have been made.

The role of the Department

Strong mobilisation around the five issues listed above, by COSATU and other civil society organisations, led the Parliamentary Portfolio Committee on Labour to effectively suspend deliberations earlier this year, to allow for the necessary discussions, and for the Department to redraft problematic elements of the Bill.

It was expected that after these discussions had taken place, the Department would table its amendments in Parliament during the second session of Parliament, between May and June. In the event, the Department only tabled its proposals in the third session, during October.

The conduct of the Department during this process led to enormous frustration for civil society organisations, organised in a Coalition to resolve the outstanding problems, and raises broader questions about the approach of government Departments to engagement.

In particular, the Department requested the Coalition to draft terms of reference for an investigation into extension of the UI to domestic workers. Considerable resources were invested in meeting this request, and collating civil society’s proposals on other areas.

The Department’s conduct however, suggested either that it did not take seriously the organisations it was supposed to be co-operating with; or an approach of going through the motions of consultation, with little intention of executing agreements reached in the process.

The period between suspension of parliamentary discussions in March, and retabling in October, was characterised by a number of ‘agreements’ being reached, including on the terms of reference for the domestic workers investigation, and the content of alternative formulations in the Bill, only for these agreements to be ignored.

The result was, when the Department’s proposed amendments were tabled in October, they bore little relation either to the instructions given by the Committee, or to the discussions with civil society.

Unfortunately, this experience is not unique to the Department of Labour. A number of Departments appear to have developed a culture of going through the motions of engagement, to neutralise potential opposition to their proposals, without a serious commitment to engage with a view to reaching consensus.

Many Departments realise that they have a position of power, which they can use to inform or misinform Parliament, given that Departments usually have the final say on matters of policy and legislation.

Parliament and Civil Society Intervene

As a result, the Department report back to the Parliamentary Committee in October showed little progress on the issues identified by the Committee as problem areas. In some respects, however, the Committee and civil society were able to intervene to correct this situation. In other areas the problems remain unresolved. The result of these final deliberations by the Portfolio Committee, as reflected in the final version of the Bill (subject to ratification by the NCOP) is summarised below.

Areas where significant progress has been made, include:

  • Domestic workers: the Department attempted to reintroduce a proposal similar to one previously rejected by the Committee, which had effectively made the inclusion of domestic workers dependant on the outcome of an investigation, and contained no clear time frame for their inclusion. A last minute intervention by COSATU and the ANC resulted in this formulation being rejected and alternative legal wording being adopted which provides that the Fund will effectively cover domestic workers one year after the Act is promulgated.

The investigation to be appointed by the Minister, which must be completed within the year, will not determine whether domestic workers are to be covered. Rather it will focus on the mechanisms for collection and other issues related to the logistics of administering the Fund for domestic workers. This is an important breakthrough for domestic workers, who will for the first time in our history have access to unemployment benefits.

  • Financing of the Fund: the Nedlac agreement had specified that government would settle the debt of the UIF, underwrite the fund, and make good any shortfalls in the Fund. The Treasury subsequently resisted this, and the Bill tabled in March failed to give legal effect to this agreement. In fact the memorandum to the Bill specifically stated that the "state will not be called upon to contribute or even guarantee the fund" apart from a ‘very short term’ financing strategy to help the Fund until 2002.

COSATU strongly raised the need for the Nedlac agreement to be honoured, and for the necessary amendments to be made to the Bill. As a result, slight amendments were made, and an undertaking made that the statements in the memorandum (which is not formally part of the Bill) were incorrect and did not reflect government policy.

The amended Bill allows the Minister of Labour to ‘request’ the Minister of Finance to make an allocation in terms of an emergency provision of the Public Finance Management Act, to "cover any deficit in the fund". While an improvement, this still does not oblige the government to make good the deficit, unlike the legal drafting proposed by COSATU, since the Minister of Finance has the discretion to refuse the request.

This is especially problematic, given the financial crisis facing the Fund. Despite these concerns, the Department of Labour has indicated that government intends to address the deficit, and that R605 million has already been made available to this end. COSATU will monitor the situation and hold them to the undertakings made in the Parliamentary process, and discussions with civil society.

Progress, however tentative, registered in the above areas is contrasted by the effective deadlock reached in other areas between the Committee and Civil society organisations and the Department. The most important of these were the following:

  • Exclusion of public servants: the Bill passed by the Committee continues to exclude public servants at provincial and national level from the UIF. While the Committee supported the view of COSATU and others that public servants should be included, they were unable to reach agreement with the Departments of Labour and Finance.

Proposals from the Departments that the matter should be referred to the PSBC for negotiation was rejected in principle, since this approach would allow sectors to contract out of national labour or other legislation through collective bargaining processes. A compromise was proposed by labour to the Committee which had been floated in the Nedlac negotiations.

In a formal letter from the COSATU General Secretary to the Chair, COSATU proposed that public servants be covered, but government exempted from paying the employer contribution, since government would already be guaranteeing the Fund. This proposal won general support in the Committee, but was not taken forward because the ANC component could not reach agreement with the relevant Ministers/Departments.

Parliament’s decision to accept the exclusion of public servants was therefore reluctant, and the Committee in its report noted that it sympathised with the view that they should be included. The Committee report also recommended that the Minister of Labour conduct an investigation within 9 months and report to the Committee on the financial implications and viability of including public servants.

While carrying some weight, this instruction is not legally enforceable, and Departments have been known before to circumvent injunctions in Committee reports. COSATU will have to consider its options, including the possibility of launching a Constitutional Court challenge given the discriminatory character of this exclusion.

  • Maternity Benefits: while women will be able to claim maternity benefits without affecting their rights to claim unemployment benefits, civil society organisations raised serious concerns about the low level of benefits which women will receive, even though they are only entitled to benefits for four months (as opposed to the normal period of 8 months for unemployment benefits).

Maternity benefits will be pegged on a sliding scale depending on the level of the contributor’s income: at a maximum of 60% for those earning R150 per month, down to 30% for those earning R10 000 per month. Further those receiving some maternity benefit from their employer would not be entitled to draw any maternity benefits from the UIF, if the employer maternity benefit was equal to or greater than the benefit set out in the sliding scale.

This is in contrast to the agreement by the Alliance leadership in August 1997 that all women should be entitled to four months paid maternity leave, at a level ‘substantially greater’ than the 45% previously provided by the UIF. In addition, those excluded from the UIF, including public servants and, for a limited period, domestics would not qualify for these benefits.

The Commission on Gender Equality argued that this limitation on maternity benefits is unconstitutional, and discriminatory. The Portfolio Committee report noted these concerns, also requested the Minister of Labour, in consultation with the CGE, to conduct an investigation within 9 months and report on the financial implications of full coverage, especially for the most vulnerable workers.

  • UI Contributions Bill: the splitting of the original Bill into two Bills - the UI Bill and the UI Contributions Bill has created a number of problems. This has been worsened by the fact that the UI Contributions Bill - the so-called ‘Money Bill’- had not been tabled by the time the Labour Portfolio Committee had processed the UI Bill.

This is like trying to build a house without being able to construct the walls, since the architecture of these Bills is so interlinked. Thus for example, COSATU’s compromise proposal on public servants would have required amendments to the UI Contributions Bill, since it involved exempting the employer contribution. It was difficult to discuss this since the UI Contributions Bill had not been tabled.

Despite the strong views expressed by inter alia, business and labour in Parliament in March, with some support from the Committee, that the Department of Finance needed to expedite the tabling of the UI Contributions Bill, this still had not been done by October, when the UI Bill was considered. The strong impression created was that the Department of Finance was using the UI Contributions Bill as a lever - by withholding it, they could bring pressure to bear on issues with fiscal implications, such as the inclusion of public servants, or the formulation dealing with financing of the Fund.

This impression was reinforced by the process of discussions around deadlock issues, as well as the fact that the tabling of the UI Contributions Bill was held back until the processing of the UI Bill: at the time of writing the tabling of the UI Contributions Bill in the Finance Committee was imminent, without the Labour Portfolio Committee ever having sight of it, even in draft form.

Because the UI Contributions Bill is a Money Bill, the Finance Committee will not be empowered to amend it. Therefore if there are any major problems with the Bill, the processing of the reforms to the UIF will be further delayed until next year, as the Bill would have to be sent back to Cabinet. The more likely scenario is that the UI Contributions Bill will be processed with little debate, as has been the case with a number of other Money Bills.

The Struggle continues to reclaim the "Pension Surplus"

By Fiona Tregenna

In the second edition of the COSATU Parliamentary Bulletin we reported on the origins of the R80 billion pension ‘surplus’, the Nedlac negotiations on this issue, and COSATU’s approach.

The pension ‘surplus’ represents assets of workers and former workers, which largely arose when they transferred from defined benefit (pension) to defined contribution (provident) funds during the 1980s. The Pension Funds Second Amendment Bill is government’s way of dealing with this issue, by setting out who can gain access to these assets and how.

We have subsequently engaged in an intensive process in Parliament with the Portfolio Committee on Finance, in an attempt to make the legislation give effect to workers’ rights to the ‘surplus’. Extensive legal and actuarial (advanced accounting) expertise was brought in, and numerous documents submitted by COSATU to the Committee and the ANC Study Group. While certain of COSATU’s proposals have been taken on board, our major concerns have not been addressed.

At the time of writing, the Finance Portfolio Committee and the National Assembly had passed the Pension Funds Second Amendment Bill, despite COSATU’s objections to various provisions. As it currently stands the Bill will not restore to hundreds of thousands of workers and former workers the full value of their hard-earned pensions.

Rather it will legalise certain forms of past appropriation of these benefits by employers and give them further access to the R80 billion ‘surplus’. This is a highly sensitive issue for workers, given that the pension assets which employers are hoping to access further often represents their only form of saving.

The Bill does have some positive features, such as the introduction of a minimum benefits regime. Certain improvements were also made in the course of the parliamentary process, including members getting a more equitable portion of the fund on leaving, the appointment of a person to safeguard the interests of former members, and including all former members (regardless of reason for leaving) in the prior charge on the surplus.

COSATU’s major outstanding concerns with the Bill can be summarised as follows:

  1. The Bill provides for employer access to surplus. This goes against the very purpose of retirement funds. As the Bill stands employers will definitely get access to ordinary surplus and may get access to extraordinary surplus (investment reserves belonging to individual workers which they have been denied until now).
  2. Related to the above concern, the Bill leaves issues of central importance to be prescribed in regulation, rather than setting them out clearly in the legislation itself. These include the statutory valuation basis for determining minimum benefits on exit from a defined benefit fund; the actuarial assumptions for calculating members’ actuarial reserve value; and the assumptions on which the calculation of minimum pension increases will be based.
  3. These and other assumptions and formulae will be central in determining whether former members receive the redress to which they are entitled, as well as whether members will receive equitable pension increases in future. COSATU has been calling for the determination of these crucial aspects to be subject to the decision of elected representatives.

  4. A large chunk, if not the majority, of the R80 billion ‘surplus’ which members are waiting to be repatriated to them, may well be given back to employers as a result of the way the Bill defines past ‘improper’ use of surplus. Past ‘contribution holidays’
  5. by employers – where they decided not to contribute to pension funds for particular periods – is condoned by the Bill even where these were funded from extraordinary surplus, not approved at the time, or where the employer could afford to pay.

    Furthermore, at the last minute the Bill was amended so that past improper use of fund assets will be condoned if it was ‘approved’ by members or unions - this was a proposal of BSA which had previously been rejected in the Nedlac process.

    Particularly in the light of repressive conditions and the lack of awareness about ‘surplus’ issues at the time – even on the part of the FSB – as well as the failure of employers to disclose all relevant information, it is unfair to deny former members their rights on such a basis.

    A major problem is that employers will only be required to pay back surplus which is defined as having been ‘improperly utilised’ (in terms of the above and other problematic criteria); meaning that members/former members in funds where the employer has successfully depleted surplus through various disingenuous schemes will be unfairly prejudiced.

  6. The way that the Bill is currently crafted, the requirement to allocate ‘surplus’ seems to be (possibly inadvertently) limited to funds which are compelled to undertake a ‘surplus’ apportionment exercise. This may actually exclude defined contribution funds from having to apportion surplus in terms of the provisions of the Bill.
  7. Similarly, it appears that in the case of defined benefit funds, where there is a deficit on termination of the fund, employers may not be required to pay this back. Similarly, where there is a deficit on conversion of a fund, employers will not be required to pay this back.

  8. COSATU is highly concerned that the window period provided for in the Bill opens a gap for employers to contract out of the legislation, at the expense of members whom it is supposed to protect.
  9. This period allows for funds which are unwilling or unable to meet their statutory obligations to renegotiate benefits, not just for a limited period but indefinitely. This means that workers unfortunate enough to be in such funds may never enjoy the statutory minimum benefits.

  10. In terms of the future use of ‘surplus’, employers will be allowed to use funds for a range of problematic purposes, such as improving the benefits of a category of staff as determined by the employer, such as a payout to senior management.
  11. Furthermore, a situation will be allowed in future where employers take contribution holidays and contribute less than members to funds. Member trustees will not be allowed to exercise their votes in respect of issues of how surplus will be utilised by the employer.

  12. In terms of institutional issues and decision-making powers, the sole power of apportionment of ‘surplus’ is to rest with the board of trustees in funds in which ‘surplus’ exists – boards which are often in practice controlled by the employer.

Once trustees have decided on the scheme for apportionment, members and former members will not have any right of recourse to the dispute resolution process provided for in the Bill. Apportionment of future surplus will be completely discretionary for funds, without recognising members’ entitlements to their share of fund. Dispute resolution will be by an ad hoc tribunal, despite COSATU’s criticism of this.

At the time of writing COSATU had sought an urgent political intervention in an attempt to correct the problems in the Bill through the National Council of Provinces process.

Despite meetings with the Deputy Minister, the Financial Services Board and some ANC members of the Committee, however, these attempts were largely unsuccessful. A couple of small technical amendments were made, but the fundamental issues raised above remain unresolved.

The Bill has been processed through the NCOP Select Committee, and is awaiting formal processing through the Council.

COSATU members need to remain vigilant on the issue, as further action might be needed in order to protect workers’ rights and assets. In particular, forms of collective action in workplaces directly affected by the issue may have to be considered. The problems in the Bill also raise constitutional questions and we are seeking legal advice on the options open to us in this regard.

COSATU engages state asset restructuring in Parliament

By Fiona Tregenna

While millions of COSATU members and supporters were taking to the streets in opposition to privatisation, COSATU has also been engaging in Parliament with various cases of state asset restructuring.

Privatisation of Alexkor, restructuring of the electricity sector, liberalisation of the telecommunications sector and the reorientation of the Industrial Development Corporation are some of the cases on which the federation has made submissions in Parliament recently.

In these engagements we have opposed moves towards privatisation and liberalisation, as well as trying to better position state owned enterprises to fulfil their public mandates.

Alexkor

Alexkor is a wholly state owned asset in the Northern Cape involved mostly in diamond mining, with some agricultural and related activities. Alexkor is a strategic state asset, especially when the dependence of the regional economy on it is considered.

The Department of Public Enterprises introduced the Alexkor Limited Amendment Bill, which essentially made it easier to privatise Alexkor. COSATU together with NUM stated our opposition to the proposed privatisation and the Bill itself.

The submission analysed in detail the current financial problems being experienced at Alexkor, which clearly have a significant negative effect on its bottom line.

We argued however that transforming Alexkor and addressing its problems does not require a jettisoning of state ownership and a takeover by the private sector. It requires a turnaround and thoroughgoing transformation, which is not only possible under continued public ownership, but can best be achieved under government control. The significant private sector interest in buying into Alexkor is indicative of its future profit-generating potential.

In fact it remains our strong suspicion that Nabera, the management consultant given a contract to manage Alexkor, has deliberately downplayed the financial viability of Alexkor to convince government of the urgent need to proceed with privatisation, to be prepared to sell Alexkor at a discounted price, and even to discourage other prospective private buyers.

Rather than simply rejecting the Bill, COSATU, after extensive investigation of the Alexkor situation, put forward a viable alternative proposal: to turn around Alexkor under continued public ownership, so that it generates positive revenue for public coffers while generating employment and development for the region.

This proposal was based on expert geological knowledge and knowledge of Alexkor operations by NUM representatives, as well as independent reports from the private sector. COSATU’s submission detailed a Seven-point Plan for Alexkor, the key proposals of which were:

    1. Improving mining methods;
    2. Transforming and upgrading management;
    3. Human resource development;
    4. Crackdown on theft, wastage and corruption;
    5. Capital injection;
    6. Improvement of non-mining activities;
    7. Integration in a regional industrial strategy.

A Joint Operational Task Team was also proposed to take forward the process.

COSATU and NUM’s proposal was however rejected by both the Department and the Portfolio Committee, without interrogating it on its merits. It became clear that there was one agenda: pushing ahead with privatisation, no matter what the objective evidence or viable alternatives.

After senior departmental officials denied during the public hearings having a clear intention to privatise Alexkor, the Deputy Director-General of the Department has subsequently been quoted as saying that Alexkor is slated for full privatisation – a further example of the obfuscation which has characterised the Department’s way of doing business.

Electricity restructuring

COSATU, together with affiliates in the sector, presented at a workshop of the Minerals and Energy Portfolio Committee on electricity restructuring, which laid the basis for upcoming legislation in this area.

COSATU noted its concern with current restructuring proposals being considered by the Department, in that they involve substantial changes in pricing and supply systems that are not justified by developmental needs, and indeed seem likely to impose substantial price increases on consumers. This would undermine government’s programme of socio-economic transformation.

Overall, the proposals seem driven by an ideological commitment to establishing a market for electricity – a model that has proven a failure in other countries. This policy direction does not seem to be based on hard evidence but rather on a faith in the efficacy of markets.

At the level of process, there is no clear process for discussing the restructuring proposals, which has caused major uncertainties for both industrial and household consumers, as well as for workers in electricity. Even as government and labour are negotiating electricity restructuring under the NFA, the National Electricity Regulator (NER) is moving ahead to implement its own proposals.

While critiquing government’s approach, COSATU also put forward proposals for the sector:

  • Integration of municipal sectors into a national distributor;
  • Vertical integration under continued public ownership, rather than fragmenting generation, transmission and distribution, into specific entities;
  • A stronger regulatory regime;
  • Accelerated implementation of the lifeline block tariffs model, with cross-subsidisation as required by region, by sector (industry to households) and by income group;
  • Increasing levels of electrification (quantities per household) to adequate amounts of electricity for full household use and basic economic activities;
  • Raising finance through Eskom bonds where necessary to fund increasing supply;
  • Increased focus on renewable sources of energy;
  • Propose movement towards a National Energy Summit, which would facilitate an inclusive and comprehensive approach to the restructuring of the energy sector.

There is an ongoing process of engagement around electricity restructuring, both bilaterally with government and later in Parliament, through which we will continue to advocate the federation’s positions.

Eskom, and other state assets involved in various stages of the electricity supply and distribution process, are critical state enterprises both for South Africa’s economic development and for the meeting of basic needs. It is imperative that these remain in state hands with a structure and orientation that ensures that the public mandate is fulfilled.

Telecommunications liberalisation

After engaging earlier this year with various policy proposals of government on telecommunications restructuring, COSATU and CWU made a submission to the Telecommunications Portfolio Committee on the Telecommunications Amendment Bill, which essentially deals with the liberalisation of the telecommunications sector.

The Bill, which is being finalised by the Committee at the time of writing, opens up for a Second National Operator to compete with Telkom. This falls squarely within COSATU’s definition of privatisation, as set out in our notice of protest action to Nedlac, which includes the introduction of private competitors in sectors historically controlled by the state.

COSATU argued against the proposed liberalisation, on the basis that it would not be conducive to the meeting of basic needs but would be more likely to lead to cherry-picking (i.e. concentrating on the more profitable segments of the market) and a commercial orientation.

While we are not necessarily opposed to some regulated competition for the provision of high-level services to business, we are opposed to competition in the provision of basic telephony. Given the massive needs for extension of telephonic services, we believe that the optimum market structure would be for Telkom to have sole responsibility for the roll-out of basic telephony, with this responsibility being funded both from the fiscus and dedicated levies on operators providing other telecommunications services.

COSATU also argued that any telecommunications providers, including Telkom, need tightly circumscribed license conditions and ongoing monitoring and regulation, to ensure that government objectives, particularly universal service, are indeed met.

In terms of achieving universal service, with its twin dimensions of availability and affordability, COSATU believes that it is possible for government to set a target of universal service for all within five years. We have proposed a price structure based on the system of lifeline services and progressive block tariffs developed for municipal services.

In the context of the existing Cabinet decision on liberalisation of the telecommunications market, as well as intense lobbying for industry players wanting a bite of the market, the liberalisation seems to be a fait accompli.

Particularly disturbing is the fact that government has made major flip-flops in policy on telecommunications because of pressure from vested business interests, but has effectively ignored its own Alliance partners’ concerns about their policy positions. Future battles in this area include opposing the listing of Telkom and its further privatisation, as well as continuing to push for universal service.

Reorientation of the Industrial Development Corporation

COSATU has always made clear that it is not opposed to the restructuring of state assets; indeed, many of these public enterprises do need some changes in order to better position them to meet basic needs and to contribute effectively to South Africa’s socio-economic development. Several COSATU resolutions have identified the need for the restructuring of the Industrial Development Corporation (IDC) so that it can effectively play its role in active industrial policy and in job creation.

It was from this approach that COSATU made a submission to the Trade and Industry Portfolio Committee on the Industrial Development Amendment Bill.

COSATU argued for a package of amendments both to the Bill and to the original Act. These included the following:

  • Expanding the objects of the IDC to put more emphasis on employment retention and creation and on the promotion of co-operatives;
  • Empowering the IDC to use the tool of differential interest rates for a range of economic activities;
  • Beefing up the criteria by which the IDC evaluates projects to shift it from a commercial to a more developmental orientation;
  • Using the leverage of IDC funding to promote compliance with labour standards;
  • Improving the representivity and accountability of the IDC Board; and
  • Enhancing its accountability to Parliament.

While the Committee took on board a few of our proposals, it was felt that the package was too comprehensive to process through a limited amendment bill. DTI has, however, made a firm commitment to a comprehensive review of the entire Industrial Development Act as a result of COSATU’s intervention.

COSATU will press for this to take place as soon as possible and in an inclusive manner, so that our proposals are taken on board and the IDC is able to make an optimum contribution, as a public asset, to our industrial development.

Immigration Bill

By Prakashnee Govender

In our last issue we reported on indications that Cabinet may fast-track a new draft Bill which would prioritise certain areas of migration policy, and allow more time for outstanding contentious issues to be resolved. Instead Home Affairs introduced a revised version of the previous Bill before NEDLAC and Parliament.

As a result the Parliamentary process has been the centre of major controversy, with the Bill’s constitutionality being brought into question, as well as continuing debates on unresolved policy issues.

COSATU’s concerns around procedure have not been dealt with. In particular we had maintained the need to finalise the Migration White Paper, in order to set out the framework for the Bill. Substantive problems with the Bill include the continuation of the system of compulsory deferred pay and the failure to integrate a regional emphasis.

COSATU has nevertheless decided to participate in the process, providing that unresolved issues from the White Paper, including that of compulsory deferred pay and regional economic development, is dealt with in a later process. In line with this we have prepared a joint submission in conjunction with NACTU and FEDUSA, which will be presented to NEDLAC on behalf of labour.

A positive feature of the Bill, in response to COSATU’s interventions on the White Paper, is that foreign workers may not work under terms and conditions that are inferior to those applicable to South African workers. This takes into consideration our concerns that exempting foreigners from labour standards would undermine general labour standards and entrench the exploitation of migrant workers.

However, the Bill also states that chartered accountants must certify that these employment standards are being met. We have argued that this should be the Labour Department’s responsibility.

The Department of Home Affairs may issue corporate permits. Employers who hold these permits may in turn issue work permits to foreign workers, provided that certain conditions are met. The Department will prescribe in regulations the maximum number of work permits that may be issued in this way. This provision will in effect delegate a core responsibility of the Department to employers and business. The implementation of this permit will be difficult to regulate in order to ensure compliance with legal obligations. COSATU has therefore raised serious objections to the proposal for corporate permits.

The Bill introduces a fee for work permits, which will be allocated to a training fund. In principle this represents a positive development as it means that the investment into the development of local skills and training. However, this should not be implemented in a way that compromises job security of existing migrant workers.

Immigration policy is a priority issue for COSATU since it affects both member interests and broader social and economic development. Therefore in addition to engaging in this process, we will continue to lobby the Department and other state role players to take on board our concerns. Discussions continue in Nedlac on the proposed Bill.

Coalition for a Basic Income Grant

By Nape Nchabaleng

COSATU has called for the introduction of a Basic Income Grant (BIG). We have proposed that a Basic Income Grant should serve as one of key policy aspects of implementing a Comprehensive Social Security System. A BIG would provide a minimum level of income to everyone, ensure the poorest households are able to afford their basic needs, facilitating an equitable economic development, and promoting social stability.

The BIG Coalition was launched by Cde Joyce Pekane, COSATU Second Deputy President on 2 July 2001. The BIG Campaign Platform was endorsed by a number of civil society organisations, including South African Council of Churches, Southern African Bishops Conference, South African NGO Coalition, Treatment Action Campaign and Gender Advocacy Programme.

The main objective of this Campaign is to achieve the introduction of a BIG, based on the following extract from the campaign platform, which outlines its key principles:

  • Universal Coverage: It should be available to everyone, from cradle to grave, and should not be subject to a means test. The principle of universal coverage would favour larger households, which tend to be poor. It would also ensure that both working poor and the unemployed are covered. It furthermore ensures that the state minimises administrative costs and constraints.
  • Relationship to existing grants: no individual should get less in social and assistance grants than prior to the introduction of the Basic Income Grant. This is based on the understanding that a BIG should add to, rather than reduce, household’s incomes. Hence, it should not substitute the existing grants.
  • Amount: The Coalition agreed that the grant should not be less than R100 per month for each individual on introduction. Furthermore, it should be inflation-indexed.
  • Delivery mechanism: payments should be facilitated through public institutions, preferably Post Banks. This is linked with a need to facilitate expansion of financial infrastructure in the rural areas.
  • Financing: a substantial portion of the cost of the grant should be recovered progressively through the tax system. This would demonstrate solidarity by all South Africans in efforts to eliminate poverty. It is further proposed that the remaining cost should be borne by the fiscus.

The Ministerial Task Team on Comprehensive Social Security is expected to submit its Report to Cabinet by November 2001. This Report would, amongst others, include recommendations on the feasibility and the implementation of the Basic Income Grant.

Investigation into minimum wages and working conditions for farm workers

By Prakashnee Govender

Farm workers continue to work and live under extremely exploitative and insecure conditions. In recent years there have been massive job losses in this sector. Women, children and migrant workers on the farms are the most exploited.

Farm workers experience a wide range of abusive practices at the hands of farmers. This is not only physical. At the same time they are dependent on farmers for a variety of social and basic needs such as housing and water, in addition to earning a wage.

General trends indicate that wage levels have decreased in real terms and workers are increasingly being employed on a casual basis. This is worrying especially since this has always been a difficult sector to organise or enforce labour standards.

The Department of Labour released a report in September on the investigation into minimum wage and working conditions for farm workers. The Employment Conditions Commission (ECC) is currently considering its proposals.

Final sectoral determinations will only be made after considering comments from the ECC and public. This process is of extreme importance to us. Therefore, we are in the process of formulating our response in conjunction with SAAPAWU.

The report considered the overall social and economic conditions affecting farm workers, in addition to labour standards. Here it provides valuable statistics, some of which include the impact on children living on farms, literacy rates, average wage levels, housing conditions and working hours. The report also considers the economic situation of farmers and the impact that proposed determinations will have on them.

Some of the key proposals of the report include:

  • Setting of different minimum wage levels ranging from R400 to R750 a month, depending on the area;
  • Restricting payment in kind to food or accommodation, either of which should not be more than 10% of the total wage;
  • Setting differential rates of pay for Sunday work depending on the number of hours worked;
  • Defining night work as taking place between 20h00 and 04h00 (In other sectors it is defined as between 23h00 and 06h00); and
  • Setting minimum housing standards for farm workers.

It must be borne in mind that sectoral determinations, like all other labour regulations, represent the setting of formal legal standards. These must be followed up by meaningful social and economic interventions in order to bring about a real turnaround in the lives of farm workers. The setting of minimum wage and working conditions must be seen as only part of a broader objective to ensure a decent quality of life for farm workers and their families.

The Human Rights Commission is currently conducting investigation in farming communities on violation of the rights regarding land, safety and security and social and economic conditions. They are calling for written submissions from civil society and the public, the deadline for which is 16 December 2001.

Regional hearings will be convened in the New Year. his is to be followed by a national conference. COSATU and SAAPAWU are currently preparing a national submission, which is to be forwarded to the SAHRC.

Constitutional Second Amendment Bill

By Prakashnee Govender

This Bill amends the Constitution in order to address a number of practical difficulties experienced in regulating public finance matters. The proposed amendments include widening the definition of money bills, requiring that only the Finance Ministry be allowed to introduce a broad range of draft legislation on public finance into Parliament and changes to financial regulation of local government.

In our submission we objected to the amendment which would only allow the Minister of Finance to introduce draft legislation covered by Chapter 13 of the Constitution on finance matters. All other Ministries currently share the authority to introduce draft legislation with members and committees of the National Assembly.

The amendment would have meant finance legislation would have be treated differently from other types of legislation, and in particular would have limited Parliament’s powers to prepare and introduce finance legislation.

We also objected to the extension of the definition of Money Bills, which would restrict Parliament’s power. Parliament currently does not have the power to amend the Budget and other Money Bills, and therefore is forced to accept (or reject) them in their entirety. This is despite the requirement in the Constitution that legislation be passed giving Parliament the power to amend Money Bills.

The Justice and Constitutional Development Portfolio Committee has since passed the Bill. Our concerns regarding legislation under Chapter 13 have been taken on board. The revised amendment now provides that only the Division of Revenue Bill falls under the Finance Ministry’s exclusive competence. However, the proposed amendment to the money bills definition remains substantially the same.

The Bill is currently before the NCOP’s Select Committee on Security and Constitutional Affairs and is being fast tracked with the intention of passing it in this session.

Update on Domestic Workers' Sectoral Determination Report

By Nape Nchabaleng

The Department of Labour released a report on the investigation into Minimum Wages and Conditions of Employment for domestic workers on 10 July 2001. The report provides a basis for discussion on the improvements of the living and working conditions of the domestic workers. Its objective is to inform the Employment Conditions Commission in formulating a sectoral determination for domestic workers.

Domestic workers, mainly African women, are one of the most vulnerable and exploited sectors in the labour market and therefore require effective state intervention to protect their rights. In line with this observation, the Report states that domestic workers represent a vulnerable category of workers and domestic work is an undervalued activity performed by people from disadvantaged social groups.

Statistics South Africa (OHS99) indicates that there were about 10.4 million employed people in South Africa in October 1999, of whom approximately 799 000 were employed in domestic work. COSATU has made a submission to the Department, in 1999 outlining specific proposals to protect domestic workers. These proposals included:

  • Setting and enforcing minimum wages for domestic workers. This should be a living wage, informed by the social and economic needs of domestic workers and their responsibilities in providing for their families. Furthermore, we proposed that once the minimum is set, there should be a graduated real increase over an agreed period. Where the introduction of minimum wages impacts on the affordability of domestic work, an adjustment should be made in terms of reducing the number of hours worked.
  • A comprehensive education and training strategy for domestic workers. Skills development for domestic workers should be catered for within the ambit of a Cleaning SETA.
  • The Basic Conditions of Employment Act should apply uniformly to domestic workers. In addition, the Employment Conditions Commission should regulate further issues specific to domestic workers.
  • The establishment of a state supervised pension/provident funds for domestic workers.
  • Extension of both the UIF and COIDA coverage to domestic workers.
  • The establishment of a state regulated agency through which domestic workers would be employed. This would play a critical role in ensuring that minimum wages and working conditions are enforced.

The report outlines the main problems and constraints faced by domestic workers. These include, but are not limited to, social isolation, lack of privacy, poor working conditions and low wages. The report recommends key proposals relating to the conditions of employment for domestic workers, and indicates that the BCEA provisions should be enforced within the sector.

This relates to issues like working hours, rest period, meal intervals and leave provisions.

COSATU welcomes these recommendations but we have raised concerns on the proposed minimum wages, a failure to consider the establishment of a state regulated agency and a lack of emphasis on skills development for domestic workers.

The report proposes that a minimum wage should be based on geographic differentials and therefore suggests: R400 in rural areas, R500 in peri-urban areas and R600 in urban areas. It argues that the intention is to minimise job losses.

COSATU proposed that a minimum wage should ensure that domestic workers are able to sustain their families and provide for their material and social needs. We proposed that employers have the option to reduce the total cost by decreasing the number of hours worked. COSATU proposes that the department and the Employment Conditions Commission should reconsider these issues.

Know your Rights! Claim Your Rights!

The Promotion of Access to Information Act - and why you need to know about it

By Alison Tilley, Open Democracy Advice Centre

There has been an explosion in the amount of information held by governments, companies, NGOs and CBOs. Information is power – very often, the more you know the more you are able to influence events and people.

Information is vital for individual citizens, communities and citizen’s organisations if they are to participate in the democratic process and to realise the many other rights that are now enshrined in the South African Constitution.

The Promotion of Access to Information Act 2000 (POATIA), which came into force on 9 March 2001, is an important and far-reaching law that has great significance for everyone. Under POATIA citizens and organisations, such as trade unions, have the right to access records held by private bodies, like companies and closed corporations, and government, provided that they have made the request for the record in the prescribed way, and an exemption does not apply.

Certain, limited, records are exempt. A request for information in such a case can be refused. But access cannot be refused if disclosure of the record would reveal evidence of:

  • A substantial breach of the law, or
  • An imminent and serious public safety or environmental risk.

However, the law provides that ‘the public interest in the disclosure of the record’ must outweigh the harm contemplated by the exemption. The decision to refuse access to a record can be challenged in the courts by the requester.

Further the Act gives persons the right to know by providing for the automatic publication of certain classes of information by the state and private bodies. This means that people will only have to go through the process of requesting information if it is not automatically, or proactively, provided.

Thus, as well as providing a huge opportunity for individual citizens and community organisations to access information, POATIA will also make a big difference to the way in which a private body controls and records information. Private bodies must organise their records in an open, efficient and democratic way, in the interests of all South Africans.

Legislative history

Section 32(1) of the final constitution, enacted by the National Assembly in 1996, guarantees ‘everyone ... the right of access to any information held by the state and any information that is held by another person and that is required for the exercise or protection of any rights.’ [emphasis added.] Not only is the right of access to publicly held information no longer qualified by the stipulation that the information be needed for the exercise or protection of a right, but a qualified right of access to information has also been established with respect to private bodies and individuals.

The constitution that came into effect on 3 February 1997 gave Parliament three years to enact legislation to give effect to the right articulated in section 32(1) and to regulate its application.

How do I ask for information?

1. Decide what record you want. You may not be able to describe it exactly, but it is important to remember that you are asking for a record, and not for information. To illustrate the difference: if you ask to see a report from a company given to your local government on how the company is correcting the problems with low cost housing that has been badly built in your area, you are asking for a record.

If you ask the council to tell you information that is not in that report or any where else, for example, how all the necessary repairs will be paid for, then you cannot use the POATIA to ask for that information. You can ask for the record that shows what people in the company earn, such as salary scales, but you can’t ask how many people earn less than you do, unless that is already part of a record somewhere.

2. Fill in the form. You can get copies of the form from the Human Rights Commission, the Department of justice, ODAC, and you can also ask your local advice office. Remember, there is one form for getting records from private companies and a second one for getting information from government. If you need help to fill in the form, the government officials in the department you are asking the information from must help you.

3. Take the form, with R35 worth of revenue stamps, and give it to the person you think has the record. Ask them to sign a receipt that they have accepted it, and put the date on that receipt. Keep that receipt.

4. If you are the refused the record, ask your local advice office, LRC or ODAC to help you to lodge an internal appeal with that organisation.

The Open Democracy Campaign Group

Civil society played an extensive and influential role in helping Members of Parliament to craft the final Act. From the outset, civil society organisations took a keen interest in open democracy legislation, including its information access provisions.

Having worked for the realisation of a democratic vision, many of these groups saw Open Democracy legislation as a crucial mechanism for the consolidation of participatory democracy, grassroots advocacy, and accountable government in South Africa.

The Objects of POATIA

The Objects of the Act are (section 9):

  • To give effect to the Constitutional Right to Access Information (section 32 of the Constitution);
  • To generally promote transparency, accountability and effective governance of all public and private bodies, by establishing procedures to do so, which enable requesters to obtain records held by the state and by private bodies as swiftly, inexpensively and effortlessly as reasonably possible;
  • In a way that balances the right with other rights in Chapter 2 of the Constitution (the Bill of Rights);
  • And the need for certain justifiable limitations, such as privacy, commercial confidentiality and effective, efficient and good governance.

In addition, the Act’s objects include the empowerment and education of everyone so as to:

  • Understand their right to access information in order to exercise their rights in relation to public and private bodies;
  • Understand the functions and operation of public bodies;
  • Effectively scrutinise, and participate in, decision-making by public bodies that affect their rights.

This applies especially to the group of rights in the constitution known as socio-economic rights, such as the rights to adequate health care, education and clean environment. It is also important for the right to equality.

The experience in other parts of the world has shown that in equality cases it is very difficult to prove discrimination because of a lack of evidence. Access to information will facilitate such a claim by allowing an open assessment of all the facts surrounding the alleged discrimination.

Accessing information for citizen and community action – opportunities for action

As well as providing an opportunity for requesting information that your organisation or community may need to advance another right, such as a concern about pollution affecting the health of children growing up in your area, it is also important for having your voice heard in policy-making.

Getting access to the information upon which the private sector or government is basing their policy judgments could be crucial to your strategy and to your ultimate success or failure.

There are many challenges ahead, in relation to the effective implementation of POATIA, but what are some of the mostly likely or important? Persuading the many and various government departments to prepare for the mass divulging of information may not always be easy.

The procedural requirements may deter people from making requests. They must be de-mystified through guides such as the one prepared by the Human Right’s Commission.

Some people may focus on the range of exemptions and see POATIA as a ‘closing down’, rather than andopening up’ law. But just because an exemption has been claimed by the holder of the information does not mean that they are necessarily entitled to withhold the information from you; they may be counting on you not challenging it.

The Right to Company Information: Possibilities and Constraints.

This presents a unique opportunity – to tackle corporate power – in which once again South Africa will be leading the way. No other country in the world has legislation which allows access to privately held information in this way.

In areas such as banking and pensions, the opportunity to use the legislation to expose unlawful or unjust policies such as ‘red-lining’ will exist. In the sphere of the environment, there will be an opportunity to elicit the information pertaining to pollution testing, for example. In the realm of consumer protection, there will be the opportunity to ask for information relating to safety testing.

In the realm of product pricing – drugs, for example – there is the opportunity to get information relating to production costs and profit margins and how these affect affordability and accessibility in your community.

The challenge for civil society and community organisations will be to be creative in deciding what information is needed and second, to actually use the Act and the system it creates for accessing information.

This will be a tough battle; the private sector perhaps even more than the public sector may well be against the idea that it must provide access to information. Companies may well offer resistance to any attempts to penetrate their traditional walls of secrecy.

The greatest challenge will not, perhaps, be to make the legislation work and to penetrate age-old walls of secrecy, but to accurately identify the information that the different communities need in order to develop better lives.

Civil society organisations must act as a bridge to elicit information, using the new law that will serve the interests of the weak and the poor. Inequality of access to information is a key part of the deeper inequality of power that scars society across the globe. If civil society is active, then POATIA will be a useful tool in the fight for social justice.

Understanding Governance

Policy development and egagement

By Neil Coleman

In the last ‘Understanding Governance’ column in the May edition of the Parliamentary Bulletin, we produced a detailed organogram outlining the Policy and Legislation Chain, setting out the various steps from the earliest stages of policy development to finalisation of legislation.

The input below reflects on some of COSATU’s experiences, and the complexity of the challenges involved. The article suggests that we need to develop both the ‘art and science’ of engagement, to ensure effective interaction with these processes. Often, the key to this is to systematically track the bewildering range of policy processes happening at any point, a painstaking planning process, and an approach to ensure high quality interventions.

Policy chain

An effective engagement strategy requires timely intervention at all points in the policy chain whether in Government, Parliament, Nedlac or elsewhere. The usual links in the chain are:

  • Policy documents- from discussion documents, green papers to white papers;
  • Legislation- from draft Bills to Bills, to Acts;
  • Secondary legislation- codes and regulations.

The earlier we engage in the policy chain, the greater the possibilities of influencing the architecture of the policy/law. However, political interventions later in the chain can also be highly effective.

Tracking policy and planning engagement

On a daily basis a bewildering range of policy documents, draft bills, bills, regulations, discussion documents etc are being generated by government departments, statutory institutions, and other organs of state. Many of these are accompanied by requests for public input, formal oral and written submissions, often with relatively short deadlines.

Given the complexity of the issues involved, by the time these become public, or by the time an organisation becomes aware of the issue, it is often too late to engage meaningfully.

Coupled with this, extensive drafting processes which often take place out of the public eye, within e.g. Government Departments, selectively involve certain stakeholders. In particular business or business-linked interests, such as consultants, sometimes have a disproportionate role in influencing the architecture of policy or legislation.

It is therefore critical to have an effective early warning system, which comprehensively monitors and tracks all these key documents as early in the process as possible. This requires not only excellent information systems, but also extensive networks in government institutions and civil society organisations. Use should also be made of statutory institutions we are represented on, especially Nedlac, to officially request information.

This systematic monitoring should lay the basis for proactive planning of engagements on a range of issues. The short time frames, however, still require a rapid response capacity from us, both in terms of securing mandates, and preparing inputs.

It also demands effective co-ordination between COSATU departments, affiliates and Regions to ensure coherent engagement on issues, the avoidance of parallel processes, confusion as to who is dealing with an issue, and therefore things falling through the cracks, or even contradictory inputs on a particular issue.

While this approach should allow us to increasingly engage in the earlier phases of policy-making, we need to ensure that this engagement is meaningful and that its status is clear. Thus there is a danger e.g. that general information sharing is passed off as detailed consultation; or that our presence on a drafting team or statutory institution backfires because we don’t input effectively, and we are then held to be bound by the outcome of the process, even if we are totally unhappy with it.

Once we have begun an engagement on an issue, it is vital that we systematically track progress on it, so that it isn’t a once-off input. On issues we regard as significant, we need to drive our agenda to the end of the policy chain, including regulations, and develop a strategy for implementation.

Screening process

COSATU regularly interacts with, and is expected to respond to issues emanating from, about 20 government departments and parliamentary committees. Prioritisation of these issues, given the flood of demands, requires a rigorous screening process, or a mechanism to determine the strategic relevance of particular issues for COSATU, and what constitutes an appropriate response in each case.

Minimum standards - the discipline of engagement

The demands placed on us by engagement are extremely rigorous, and require certain internal protocols or minimum standards, and a high level of discipline, if we are to establish and maintain our status as one of the key actors in society which is taken seriously on all critical issues of policy.

The attainment of this reputation and status has not been an accident, but has required painstaking work and attention to detail. While difficult to establish this reputation, it would be relatively easy to destroy it, if we began to compromise these minimum standards.

A basic, but non-negotiable element of this discipline is the meeting of deadlines. Further, an issue must be approached with the necessary rigour, and any input defended down the line. Formal inputs on issues cannot be withdrawn, without embarrassing the organisation.

Over time, we have developed protocols and processes for our written submissions, which have assisted in developing COSATU’s reputation in many quarters as being one of the organisations which produces the best-researched and motivated inputs.

This requires a rigorous process of preparation, initially based on a memorandum outlining the core strategic issues which need to be addressed and the proposed approach. Ideally all submissions essentially follow the same format:

  • Summarising the key elements of the policy/ legislation being addressed, in an accessible way, so that those who don’t have access to the policy document are able to understand the key issues;
  • Outlining our response to core proposals, including where we support, and where we oppose particular issues;
  • Outlining our proposed alternatives, including specific wording;
  • In the case of legislation, proposing alternative legal drafting, where appropriate.

We avoid general, ‘philosophical’ inputs which are unable to stand the scrutiny of detailed engagements. Detailed research is done, where required, to ensure that we are on top of the policy and legal questions, which are not sometimes readily apparent on first reading. Both with policy, but particularly with legislation it is always important to remember that the "devil is in the detail".

It is important that comrades subject inputs to collective scrutiny. Issues are often complex, both conceptually and politically, and require examination by more than one mind, and testing of different options, particularly when it comes to different tactical approaches which can be taken.

Finally, the systematic development and utilisation of specialised knowledge in the organisation is critical for effective policy engagement. The Parliamentary Office for example has developed a significant degree of specialisation. Portfolios have been allocated to comrades in the office, covering the 20 government departments we deal with, with the HOD taking overall political responsibility.

This means over time the development of a body of specialised knowledge, contacts and data which allows us to manage a vast range of engagements, despite our limited person power.

Taking forward our victories and monitoring progress

Formal policy gains may be rendered hollow if progressive legislation and policy is not implemented. This realisation led to the proposal for the setting up of Policy Desks, to drive strategic implementation of gains.

Continuous engagement to drive forward our victories results in a dynamic approach to policy engagement. The alternative is a fairly formalistic and narrow process of engagement which ends once a policy is adopted.

This approach of continuous engagement gives us the space to test in practice whether particular policies are suitable to achieve their desired objective, and propose modifications where these are needed. It requires an education and mobilisation process of our constituency, to empower them to understand their rights, and to practically claim them.

It also requires that we take stock not only of our gains, but also our setbacks, and develop strategies to re-engage, where strategically important. Recent gains on labour law amendments are a good demonstration of this potential to turn setbacks into gains. There are no permanent victories or defeats, only gains and setbacks.

This is an edited extract of an input to a national COSATU Policy Workshop held in August 2001

COSATU Submissions

COSATU SUBMISSIONS

August 2000 to November 2001*

By Joan Africa

*This updates the list of submissions from 1995-2000 contained in ‘Accelerating Transformation"

.

ISSUE

DATE SUBMITTED

COMMUNICATIONS

Submission on the Review of Rate Regime for Public Switched Telecommunication Services; &

Proposed Regulations on Fees

31/01/01

23/07/01

Submission on the ICASA Discussion Paper on the Review of Local Content Quotas

12/03/01

Submission on the Green Paper on E-commerce

30/03/01

Submission on the Intended Telecommunications Policy Directions

02/05/01

Submission on Telecommunications Amendment Bill

28/09/01

EDUCATION & TRAINING

CHE Report on the Size and Shape of Higher Education

03/10/00

FINANCE

Submission on the FFC Recommendations for 2001 – 2004 MTEF Cycle

23/08/00

Comment on the Medium Term Budget Policy Statement

01/11/00

Submission on the Capital Gains Tax

23/01/01

Submission on the Revenue Laws Amendment Bill

19/06/01

Submission on the Pension Funds Second Amendment Bill to the Portfolio Committee

22/08/01

Submission on the Pension Funds Second Amendment Bill to the Finance Select Committee

29/10/01

People’s Budget Response to 2001 Medium Term Budget Policy Statement

08/11/01

HOME AFFAIRS

Labour’s initial submission on the Immigration Bill to the Nedlac Labour Market Chamber

November 2001

HOUSING

Submission on the Greater Johannesburg Metropolitan Council Housing Strategy

04/08/00

Submission on the Home Loan and Mortgage Disclosure Bill

26/09/00

JUSTICE & CONSTITUTIONAL DEVELOPMENT

Letter to the Justice Department on Commencement of the Promotion of Administrative Justice Act

26/09/00

Submission on the Draft Constitution of the Republic of South Africa Second Amendment Bill

21/09/01

LABOUR

Submission on the Unemployment Insurance Bill

19/03/01

Submission on the Domestic Workers’ Sectoral Determination Report

01/10/01

Submission on the Labour Relations & Basic Conditions of Employment Amendment Bills

16/10/01

LAND & AGRICULTURE

Submission on the Draft Co-operatives Bill

30/03/01

MINERALS & ENERGY

Submission on the Draft Gas Bill

11/08/00

Submission on Minerals Development Draft Bill

30/03/01

Input on Electricity Restructuring

19/09/01

Comments on Draft Petroleum Pipelines Bill

22/10/01

PROVINCIAL & LOCAL GOVERNMENT

Submission on the Municipal Infrastructure Investment Framework

30/08/00

Submission on the Municipal Systems Bill

22/09/00

Submission on Traditional Authorities Powers and Functions Act

11/04/01

Submission on the Property Rates Bill

18/04/01

PUBLIC ENTERPRISE

Comments on the Transnet Pension Fund Amendment Bill

23/08/00

Submission on the Eskom Conversion Bill to the Department of Public Enterprises

23/11/00

Submission on the Eskom Conversion Bill to the Public Enterprise Portfolio Committee

09/05/01

Submission on the Alexkor Limited Amendment Bill

05/09/01

PUBLIC WORKS

Submission on the Construction Industry Development Board Bill

12/09/00

SOCIAL WELFARE

Submission on to Committee of Enquiry on Social Security

December 2000

TRADE & INDUSTRY

Submission on the Competition Second Amendment Bill

30/08/00

Submission on the Report: Examination of Costs and Interest Rates in the Small Loans Sector

08/09/00

The Arms Deal and Employment Creation: COSATU’s view

06/02/01

Submission on the Industrial Development Amendment Bill

21/08/01

TRANSPORT

Submission on the National Land Transport Transition Act Draft Regulations

Submission on National Commercial Ports Policy

14/12/00

14/11/01

WATER

Submission on the Water Regulations

04/10/00

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