Private security wants wage-setting council

Johannesburg - The private security industry has asked for its own bargaining council, which would possibly bring one of South Africa’s largest sources of employment into the statutory central bargaining system.

While this new council might help root out the security industry’s infamous “compliance problems” around wages and benefits, the primary motive is to maintain the extraordinary “normal” hours of work in the sector, said Tony Botes, national administrator of the Security Association of South Africa (Sasa).

Sasa is an employer group representing 75 companies with 140 000 guards. It made the application for a bargaining council, which was published in the Government Gazette last week, and is supported by another employer group, the SA National Security Employers’ Association, as well as 18 unions.

Private security has adopted 12-hour shifts as its basic organising principle, which means the sector’s normal working hours are 48 hours a week divided into four shifts.

The Basic Conditions of Employment Act makes the 45-hour week (nine hours a day) the standard working arrangement in South Africa.

Legally speaking, the security industry has to continually ask for and get an annual deviation from that to maintain its business model.

If the security industry did not get its variation, it would fundamentally alter the cost structure of private guarding, said Botes.

If shifts were limited to nine hours, a company would need to hire 13% more guards to provide the same service. By cutting hours, all workers’ earnings would drop, he said.

The industry has a bargaining forum without statutory powers that produces wage deals that have tended to be wholly accepted by government and imposed on the whole sector in the form of a sectoral determination.

Imminent changes to labour law will end this arrangement, said Botes.

“Within three months, we will see a new Labour Relations Act, Basic Conditions of Employment Act and national minimum wage legislation,” said Botes.

“Over the years, we have negotiated variances from the Basic Conditions of Employment Act on hours and shifts. We have had no guarantee that we can maintain the 48 hours under the new act.”

Instead, according to Botes, the department has relatively concretely indicated that it would no longer permit the variance.

“We don’t know what it will contain,” he said of wage schedules that will be produced next year.

However, the labour law amendments give the industry an opportunity to guarantee its agreements by lowering the bar for bargaining councils to get the power to set sectoral wages.

“The big deal for us is the extension of bargaining agreements. They are dropping the requirement that both sides are representative,” said Botes.

The unions that have signed up for the bargaining council only represent 92 613 workers – nowhere near enough to demonstrate “representivity”.

The employers at the table, however, employ 211 000 people – theoretically enough to qualify as representing the guarding industry.

It is, however, hard to know how large the industry really is. The employer groups driving the new council put the relevant number at 250 000, which is derived from the membership of the industry’s provident fund.

This measure clearly excludes thousands of workers, but Botes justifies it as the only number that “at least has some backing”.

If you ask the Private Security Industry Regulatory Authority (Psira), there is almost double this number of “security officers”.

The total is 497 394, said Mpho Mofikoe, deputy director of Psira. This, however, includes all sorts of security occupations, such as locksmiths, alarm installers and private investigators.

Psira is unable to say how many of the registered officers are guards, which is what matters for the new bargaining council.

According to the Quarterly Labour Force Survey, “protection services” employ about 591 000 people – about 3.6% of all jobs in the formal and informal sectors.

Taken at face value, this makes security the third largest occupation in South Africa after farm labour and domestic work.

In the formal sector, it is the largest occupation, making the proposed bargaining council potentially an important institution within the labour market.

“I can’t see any legitimate companies challenging the extension of our agreements,” said Botes.

Large bargaining councils have been under attack in the past few years from minority employer groups and liberal think-tanks, which blame them for squeezing small employers out of business by setting high wage rates.

The security industry could be the prototypical two-layer sector, with much of it currently flying under the radar without paying contributions into the provident fund or registering employees with Psira.

“The need to minimise costs and competition within the security services market encourages private security service providers to exploit workers in many ways,” said Mofikoe.

She said that probably 20% to 30% of security workers were not declared to the regulator.

Botes said: “We are dealing with serious compliance problems. I see gross underpayment every day.”