Turnabout on labour broking

2010-03-29 08:32

Johannesburg - Trade federation Cosatu is, after all, prepared to accept labour broking if new regulations for the sector are made "watertight".

Cosatu won't indiscriminately shoot down alternative plans, declared Zwelinzima Vavi, general secretary of the union, on Friday.

Upon invitation he addressed the labour brokers' employer organisation Capes without once harping on the union's demand for a total ban on labour broking.

Cosatu would fight to get the best possible legislation through parliament and then use this legislation to the full, he said.

Earlier this month Cosatu promised to call out a countrywide strike in 2010 to demand the prohibition of labour broking - with a second possible strike to protest Eskom's tariff hikes.

In recent months, though, a labour-broking ban has seemed increasingly unlikely.

Namibia's ground-breaking ban on broking, which Cosatu had wanted to emulate, came to naught in December following a judgment in the appeal court of South Africa's neighbour.

The landmark decision declared the ban unconstitutional for reasons that would probably also obtain in South African courts.

Despite regular hot-headed pronouncements against labour brokers, Labour Minister Membathisi Mdladlana also preferred to propose regulations in official policy documents.

The ANC has never officially expressed support for a ban. On the contrary, in his state of the nation speech this year President Jacob Zuma promised a R1 bn fund to establish loan subsidies.

Cosatu slammed the planned subsidy as a "threat" to create a third, even more subservient, category of workers in practice.

In his speech Vavi blamed labour brokers for workers' declining participation in national earnings. Ever since the end of apartheid wages, as part of overall national earnings, have fallen from more than 56% to about 47%.

Research by the Labour Research Service in Cape Town shows that real wages in South Africa have declined 17% since 2005.

Apart from "massive" unemployment, the country is also suffering from an increasing number of poor workers - which is attributable to the circumvention of labour laws, said Vavi.

In Cosatu's view labour broking is one of the main drivers of this process. It creates contractual relationships with little security and weak wage and service conditions.

According to Vavi, statistics on labour broking clearly indicate the industry flourished only after the Labour Relations Act was ratified in 1995.

It was difficult, he said, to ignore this obvious catalyst, with employers seeking alternative contractual arrangements to circumvent the new legislation.

Laws written on paper are all well and good, but in reality we are far from applying all the laws and from changing workers' lives, Vavi continued.

Cosatu accepts that employers frequently need to appoint temporary staff for valid reasons.

Vavi pointed out that the sector was regulated as a "temporary employment sector", while contract workers often worked permanently for their employer's clients.

Labour Court ruling

Meanwhile, Philip de Bruin reports that the Labour Court has prohibited one of the most important standard provisions contained in contracts that labour brokers enter into with workers.

This provision states that a labour broker can remove any worker supplied to an employer from that employer's premises should the employer request it.

Faan Coetzee, a director and labour expert at the firm of Cliffe Dekker Hofmeyr in Sandton, says this Labour Court decision will have "far-reaching consequences".

The Labour Court found that this clause in a contract - especially if it results in the worker losing his job with the broker - is contrary to public policy and amounts to unfair violation of the worker's right to fair labour practice in terms of the Labour Relations Act.

In the case before the court the employer concerned asked the labour broker, INTCS Corporate Solutions, to remove the worker, Simon Nape, from its premises.

INTCS subjected Nape to a disciplinary hearing, gave him a final written warning and sent him back to the employer. But the employer refused to take him back. As INTCS had no other work for Nape, he was dismissed.

The Labour Court found that Nape's dismissal had been substantially unfair.


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