A MUST READ: 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, 

I think one needs to stand back and look at what the government want to do with the manufacturing industry as a whole, in which the Metal Industry falls, as to whether the Main Agreement should be extended to all non-parties or not.
 
I think it is a well established fact that government understands the importance of manufacturing to grow the economy, and in particular SMME’s (Small and Medium Manufacturing Enterprises) who employ more people than any other sector. Government (particularly the President) has also stated on a number of occasions the importance of the manufacturing sector for a number of reasons, primarily to increase formal employment of people.
 
If the Seifsa/Numsa Main Agreement is extended to all non-parties, it will hurt the very businesses that need to grow and contribute more to employment and the economy of the country. They will not be able to pay the high minimum rates that have been negotiated, so will be forced to reduce staff levels, or at worst, close shop. Businesses will embark on retrenchment processes and that will be devastating for a country that is trying to recover post Covid19.

I understand that companies can apply for exemption, but that will not solve the issues, this is a mere application and there is no guarantee that it will be granted. Businesses need to employ more people, and pay them based on what they can afford.If this main agreement is extended, no employer in its right mind will employ any more employees, due to affordability. We need to keep jobs and not loose jobs, and the extension of this agreement will, guaranteed, lead to job losses and worse, business closures. Is that what you want?

Statistics that unfortunately can never show is how many people have not started businesses because of the very high cost of entry into manufacturing because of high labour rates. It also does not show how many people have left the country in frustration at factors such as loadshedding, corruption, and additional laws imposed upon business such as BBBEE that stand in the way of a free economy. They have taken their ideas and skills with them, along with the potential to employ people, at great cost to the country.

Not all businesses are the same and therefore should not be treated the same in terms of what minimum rates to pay employees, and leave it market forces to determine rates of payment, particularly for smaller businesses.    

If the government wishes to stagnate and ultimately see a decline in the manufacturing industry and hence employment (of which the metal industry is a part of) then they must extend the agreement to non-parties, or alternatively, don’t extend it, and encourage people to start and grow manufacturing businesses, but the route taken will definitely send a strong message to manufacturers in the country, so I implore you to think very carefully about the decision to extend the agreement to non-parties, the consequences could be dire.

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