A MUST READ (Part 10): Why the so-called "consolidated main agreement" should not be extended to non-parties - 90% of employers in the Steel Industry.

Dear Steel Industry employer

What follows is another letter by a Steel Industry employer to the Minister of Employment and Labour.

Regards

Letter by employer:

Dear Minister,

We have a Government that realizes that SMME’s are the main contributors to job creation in South Africa. These businesses should be supported and yet every time we face hardship, it is because of rules and regulations imposed upon us by this same Government.

This time, it revolves around the extension of the Main Agreement to non-parties which will severely hamper the feasibility of us as an SMME.

The South African market has been subdued, but we managed to grow our export to sub-Saharan Africa where we sell manufactured steel products. In spite of the South African situation, we managed to hold onto our workforce even in the light of reduced production-levels, but if the Main Agreement is extended to ourselves, it will immediately lead to the loss of those jobs we managed to hang on to – 20 percent of our total workforce.

This means that 11 out of the 55 factory employees that we employ, will have to go, if the feasibility of the business is to be maintained. The labour rates in the countries where we supply our products, are a mere fraction of what this Main Agreement will impose. The fact that we compete is due to our manufacturing efficiencies. The extension of the Main Agreement will just be the tipping point in our cost-structure in terms of competitiveness and we will lose the markets in sub-Saharan Africa where there is at least economic growth.

The first blow we had, also a regulation of Government, was when import duties on our raw material were introduced. There are also 9 new tariff codes on raw material steel products where more duties might be imposed. There is no certainty and an expansion project to our factory has been on hold pending the outcome of these potential tariffs.

Big businesses always seem to get their way in terms of tariff protection in spite of Government’s ideology that job creation is vested in SMME’s. Big business, whether it is chicken, tyres, steel, etc., have a stranglehold on our policy-makers that are causing the de-industrialisation of South Africa and contributes to our high jobless statistics.

We call on you, the Minister, not to even contemplate the extension of this Main Agreement, since the devastation it will cause, will only be realised once it is too late.

For more information:
NEASA Media Department
media@neasa.co.za