HOW ABSOLUTELY ABSURD IS THIS?
- Seifsa enters into an agreement with NUMSA – and of course with other trade unions as well;
- realising that this agreement is unaffordable, they recommend that their members apply for exemption; simultaneously however
- they commit themselves to the extension of this agreement to non-signatories to their agreement, attempting to force others to do what they can’t do themselves.
Gill Marcus – previous Governor of the Reserve Bank
Gill Marcus claims that, although collective bargaining may have contributed to labour peace in South Africa, it has also favoured big firms at the expense of smaller ones.
This in turn has had an inhibiting effect on the growth of small and medium sized firms. She states:
“We have not seen the dynamic growth of small and medium sized firms as one would have expected in a country at the level of development in South Africa.
A major feature of the labour market regime has been the inability to more closely link pay to productive growth. This was not what was intended. When the LRA of 1996 was passed, the intention was for collective agreements to serve as framework agreements, covering minimum pay and basic benefits.
The intention was that within these framework agreements, firms would negotiate firm-specific agreements linking salary increases to productivity gains. In practice, this is the exception rather than the rule. To introduce greater links to performance one does not have to change the law. Within the existing legal framework such agreements are possible.
…it is critical that we focus on growing labour intensive sectors…”
International Monitory Fund (IMF)
The IMF thoroughly researched the economic and social challenges currently facing South Africa. With regards to wage-setting they explicitly recommended that it is imperative “to stop extending negotiated wages to other firms that were not part of the bargaining process. While discontinuing this mandatory extension will be politically challenging, it would open the way to firm-level bargaining and facilitate wage outcomes that are conducive to employment gains.”
Lesetja Kganyago – Governer of the Reserve Bank
“Under this system, dominant firms in a sector negotiate wage rates with the dominant unions. The agreed wages are invariably extended by government to the whole sector. …this forces new and smaller firms to close unless they can shift to a more capital-intensive approach…The upshot has been a lower level of employment at higher wages and a concentration of fewer, more profitable firms.”
This is John Kane-Berman’s – a policy fellow at the South African Institute of Race Relations, a think-tank promoting political and economic freedom – view on the current arrangement:
“Bargaining councils function as price-fixing cartels, the price being that of labour. Like all cartels, they seek to eliminate competition. This is illegal in many other fields. So too should it be in industrial relations.”
Deputy President Cyril Ramaphosa
The Deputy President pleads for the relaxing of economic regulations to spur job creation. Addressing delegates at the annual conference of the National Economic Development and Labour Council in Ekurhuleni, he said: “As government, we have taken measures to reduce the regulatory burdens of investing in the country and improve the ease of doing [business].”
Although the regulatory burden in the MEIBC environment is perhaps the most cumbersome of all industries, Seifsa does not ‘see’ it that way. Perhaps they ‘think’ that they ‘know’ better. Judged by their actions, everything in this Industry is plain sailing and continuing on this Industry destructive path is totally acceptable to them.
The words ‘see’, ‘think’ and ‘know’ can however not be attributed to the Seifsa leadership.Seifsa only acts out of self-interest and weakness.
If you are an employer who puts South Africa and therefore economic growth, job creation and other SMME’s first, and in the unlikely event that you are still (somehow) affiliated to Seifsa (out of 11 000 businesses, there are only approximately 1300 of them left in the Steel Industry), it’s now the time to take the morally and logically correct action by turning your back on them.
Your support of Seifsa is causing damage to the Industry.