Labour's new, 'friendly' face fails to inspire instant rapport
Equity rules set the table for an unwelcome increase in labour regulation, writes CIARAN RYAN
THE long-awaited Labour Relations Act (LRA) came into being this week with thousands of businesses and workers still uncertain of its likely impact.
The Act is designed to foster a more conciliatory approach to dispute resolution which, it is hoped, will markedly reduce the level of disruptive labour action.
The LRA regulates industrial action, introduces workplace forums and creates a number of vehicles for dispute resolution, including a Commission for Conciliation, Mediation and Arbitration (CCMA) which provides statutory dispute resolution services. A Labour Court, Labour Appeals Court and sector-wide bargaining councils are part of the panoply of institutions designed to usher in this new era of labour peace.
"However, in both employer and labour circles, much scepticism exists regarding the capacity of the CCMA, the Labour Court and the Labour Department to administer the Act effectively," according to the SA Collective Bargaining Survey in its October edition. The survey says that the pending legislation on employment equity and basic employment standards is anticipating even greater regulation in the labour market. In the light of the growing unemployment crisis, the legislation may not emerge in such a labour-friendly shape as did the Labour Relations Act.
"Equity legislation, or at least the affirmative action component of it, is widely expected to be slowed down in the wake of the ongoing flight of predominantly white skills and the impossibility of replacing these in the short term through affirmative action."
The LRA continues the existing practice of extending industrial council agreements to non-parties, but makes provision for small businesses to apply to an independent body, rather than the council itself, for exemptions. This is a marginal improvement, says the Small Business Project (SBP), a non-governmental organisation lobbying for more appropriate legislation.
The Confederation of Employers of SA says the practice of extending industrial council agreements to non-parties is unconstitutional, violating rights to freedom of association and economic activity.
While the LRA makes provision for small business representation on bargaining councils, the definition of representivity has raised a few eyebrows by giving "undue weight" to the number of employees in an industry rather than the number of employers - effectively allowing unionised workers to escalate costs in competitor firms by determining minimum wages and conditions of employment.
The SBP called for automatic exemption of all small, medium and micro-sized enterprises below a certain size, measured in terms of the number of employees. This, however, was ignored.
One consequence of the Act already in evidence is a switch from employed to contract labour, beyond the reaches of the LRA. Thousands of companies are reportedly using contract labour to escape the regulatory maze of the LRA.
Keith Herman, a legal advisor with the Small Business Project, says one flaw in the Act is that small-scale employers and workers may have no legal representation in the dispute resolution hearings held under the auspices of the CCMA. The difference is that workers have access to legal advice through their trade union federations.