The Future of Collective Bargaining in South Africa Time for a different approach? Presented by John Brand To SEIFSA 24 February 2015

Transcription

1 The Future of Collective Bargaining in South Africa Time for a different approach? Presented by John Brand To SEIFSA 24 February 2015

2 INTRODUCTION

3 INTRODUCTION There have been appeals for a radical change in the approach to collective bargaining in South Africa due to the high incidence of strikes and strike related violence These have included calls to curtail collective bargaining and the right to strike However, freedom of association, organisational rights and collective bargaining rights, including the right to strike, are enshrined in the Constitution The rights are therefore legally inviolable, but perhaps more importantly, are essential for a free market economy

4 INTRODUCTION The problem at present is that I do not think that the rights are being properly exercised or regulated I therefore think that there is a need to regulate and exercise the rights more effectively In this presentation I intend to set out why I think there is a need to change our approach to collective bargaining and to explain what I think those changes should be In essence I am going to argue that instead of curtailing collective bargaining it needs to be deepened and strengthened

5 CONTENT Why change? Strike statistics Strike outcomes Strike violence Key problems What needs to change? Conclusion

6 WHY CHANGE?

7 WHY CHANGE? Strike Statistics

8 TRENDS IN THE NUMBER OF WORK STOPPAGES IN SOUTH AFRICA Source: Department of Labour, Strike Statistics

9 WAGES LOST DUE TO WORK STOPPAGES IN SOUTH AFRICA ,000,000, ,000,000, ,000,000, ,000,000, ,666,103, ,732,108, ,000,000, ,000,000, ,000,000, ,000,000, ,705, ,458, ,082, ,073,109, Source: Department of Labour, Strike Statistics

10 PERCENTAGE DISTRIBUTION OF WORK STOPPAGES BY DURATION, 2011 AND Percentage work stoppages 60.0% 50.0% 40.0% 52.3% 38.5% % 20.0% 10.0% 0.0% 0.5% 4.3% 13.2% 22.2% 12.9% 16.4% 14.6% 5.9% 3.8% 9.1% 1.2% 1.7% 1.2% 2.1% <1 day 1-5 days 6-10 days days days days days >40 days Source: Department of Labour, Strike Statistics

11 PERCENTAGE DISTRIBUTION OF WORK STOPPAGES BY DURATION, 2012 AND Percentage work stoppages 40.0% 35.0% 38.5% % 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 0.0% 0.0% 22.2% 26.3% 15.1% 16.4% 19.8% 5.9% 21.0% 9.1% 14.5% 1.7% 1.1% 2.1% 2.2% <1 day 1-5 days 6-10 days days days days days >40 days Source: Department of Labour, Strike Statistics

12 WORKING DAYS LOST IN 2013 AND 2014 The number of working days lost to strike action rose to 5.2 million in 2013 compared with 3.5 million in 2012 (Andrew Levy The wage settlement survey ) The number of working days lost to strike action in the first half of 2014 rose to 7.5 million, compared with 1,8 million in the first half of 2013 and the overall total of 5.2 million in 2013 (Andrew Levy The wage settlement survey ) Strikes have caused the IMF to revise its forecast for South Africa s 2014 GDP growth downwards from 2.8% in January and 2.3% in April 2014 to 1.7% in July.

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15 INDUSTRIAL DISTRIBUTION OF WORK STOPPAGES AND Number of work stoppages Transport Community Wholesale Finance Construction Electricity Manufacturing Mining Agriculture Source: Department of Labour, Strike Statistics

16 TOP TEN TRADE UNIONS INVOLVED IN WORK STOPPAGES WORKING DAYS LOST BY TRADE UNION 2012 AND WORKING DAYS LOST % 2013 WORKING DAYS LOST NUM NUMSA NEHAWU NONE NTM FAWU BCAWU BAWUSA DENOSA SACCAWU % Source: Department of Labour, Strike Statistics

17 WHY CHANGE? Strike Outcomes

18 Outcomes in recent public sector bargaining

19 Public Sector Strike 2010 Municipal Strike 2011 Duration of strike 21 days Wages lost No work no pay [2% per week] 6% ANNUAL SALARY LOST Duration of strike 16 days Wages lost No work no pay [2% per week] 4.2% ANNUAL SALARY LOST Apparent gain/loss suffered [difference between employer offer at start of strike and settlement] ( ) = 1% "GAINED" 0.0% Actual gain/loss [difference of wages lost and apparent gain] (1 6) = 5% LOST (0 4.2) = 4.2% LOST

20 Public Sector Strike 2010 Number of weeks for workers to recover actual loss using apparent gain 156weeks Municipal Strike 2011 Number of weeks for workers to recover actual loss using apparent gain Never

21 Outcomes in 2012 private sector bargaining

22 National Road and Freight Strike Metal Industry Strike Chemical and Petroleum Industry Strike Mining Industry Strike (Diamond) Mining Industry Strike (Coal) Mining Industry Strike (Gold) Cleaning Sector Strike Duration of strikes 6 Days 14 Days 21 Days 14 Days 10 Days 4 Days 21 Days % Wages lost [no work no pay]

23 National Road and Freight Strike Metal Industry Strike Chemical and Petroleum Industry Strike Mining Industry Strike (Diamond) Mining Industry Strike (Coal) Mining Industry Strike (Gold) Cleaning Sector Strike Apparent gain % [difference between employer offer at start of strike and settlement] Actual gain/loss % [difference of wages lost and apparent gain]

24 Outcomes in 2013 private sector bargaining

25 Automobile Industry Motor Gold Mining Construction SAA Bus Strike SAB Duration of strikes 15 Days 20 Days 3 Days 15 Days 15 Days 15 Days 30 Days % Wages lost +- [no work no pay] - 6% - 8% -1.6% - 6% - 6% -6% -12%

26 Automobile Industry Motor Gold Mining Construction SAA Bus Strike SAB Apparent gain % [difference between employer offer at start of strike and settlement] % +3% 0% Actual gain/loss % [difference of wages lost and apparent gain] - 4.5% - 7.5% - 1% 0% - 6% - 3% - 12%

27 2014 Platinum strike

28 2014 PLATINUM STRIKE - Deadlock at approximately 300% apart - AMCU s first move in the negotiation 2 months into the strike - 23 weeks of strike action - Extensive violence - 46% of annual wages lost by each striker - Total wages lost by workers R10 billion - Employees have lost R23 billion in revenue - Those workers still employed in 3 years time will only benefit then

29 WHY CHANGE? Strike Violence

30 E.G. - NUMSA STRIKE 2014 Workers lost just more than 8% of their annual wages in the strike At best workers gained 2% due to the strike The strike was marred by severe violence

31 NUMSA STRIKE 2014 Source: SEIFSA Survey

32 NUMSA STRIKE 2014 Source: SEIFSA Survey

33 WHY CHANGE? International comparison of working days lost due to strike action

34 THE FREQUENCY AND EXTENT OF STRIKE ACTION IN EUROPE Working days lost through industrial action per employees, annual average Denmark France Belgium Finland Spain EU 15 and Norway Cyprus Ireland Italy All countries Malta UK Norway Slovenia Portugal NMS 12 Lithuania Poland Germany Seden Romania Hungary Netherlands Luxembourg Slovakia Latvia Estonia Austria Source: EIRO

35 All European countries South Africa South Africa Average working days lost per employees Maximum Minimum

36 South Africa International comparison of working days lost AMONG THE HIGHEST IN THE WORLD AMONG THE MOST VIOLENT IN THE WORLD

37 WHY CHANGE? KEY PROBLEMS The negotiation process

38 KEY PROBLEMS The negotiation process - Letter with a list of demands from the union - Rejection and low counter proposals by the employer - Assumption of eventual compromise - Lack of counter proposals by the employer - Superficial positional preparation

39 KEY PROBLEMS The negotiation process - Exaggerated motivation at the negotiation table - Demeaning of opponents - Threats to walk out and walk outs - Early declaration of disputes - Assumption that real negotiation will only take place with imminent or actual strike action

40 KEY PROBLEMS The negotiation process - Hope that an opponent will take fright and make concessions - Un-reciprocal concessions - Slow moves from concession to concession - Manipulation of information - Adversarial rhetoric

41 KEY PROBLEMS The negotiation process - Incremental removal of non-wage issues - Threats to use power - Benign uses of power - Widespread bad faith bargaining - All out strike action - Eventual compromise

42 KEY PROBLEMS THE NEGOTIATION PROCESS PARTY A PARTY B Position Position Position Position COMPROMISE Position Position Position Position Absurd Zone Insult Zone Threat and Power Zone Haggle Zone zone of potential agreement ZOPA Haggle Zone Threat and Power Zone Insult Zone Absurd Zone

43 Claimer Claimer = MEDIOCRE MEDIOCRE Outcome

44 Structural Collective Bargaining Problems

45 STRUCTURAL COLLECTIVE BARGAINING PROBLEMS - Failure to use statutory minimum wage fixing appropriately - Fixing sectoral minimum wages by centralised collective bargaining and extension - Failing to use centralised collective bargaining optimally - Prohibiting company level bargaining - Pattern bargaining - Too centralised, aggregated and removed from the workplace

46 Simple company level negotiation EXCO NEGOTIATING TEAM NEGOTIATING TABLE NEGOTIATING TEAM WORKERS

47 More complex company negotiation BARGAINING UNIT A BARGAINING UNIT B

48 Multi-employer negotiation COMPANY A B C D E F G H ETC EXCO ETC NEGOTIATING TEAM NEGOTIATING TABLE NEGOTIATING TEAM UNION A B C D

49 KEY PROBLEMS LRA Shortcomings

50 LRA SHORTCOMINGS - Lack of an appropriate organisational rights regime - discouragement of industrial democracy - No statutory duty to negotiate in good faith - No prohibition of pattern bargaining

51 LRA SHORTCOMINGS - No CCMA or Labour Court power to designate appropriate bargaining units within a workplace - No CCMA or Labour Court power to compel good faith bargaining in appropriate bargaining units

52 LRA SHORTCOMINGS - Facilitating the extension of collective bargaining agreements to non-parties both if representative and even if not - No statutory duty to hold independently monitored strike ballots

53 LRA SHORTCOMINGS - No Labour Court power to declare violent strikes unprotected - Lack of a properly resourced body to: - educate social partners about economics - train social partners in modern negotiation skills - provide reliable economic information

54 WHAT NEEDS TO CHANGE? Basic organisational rights must be granted easily with low thresholds of representativeness in appropriate constituencies to encourage a habit of coexistence between unions in the workplace A statutory duty to negotiate in good faith must be established Independently monitored ballots must be conducted to test representativeness

55 WHAT NEEDS TO CHANGE? In the absence of agreement the CCMA must be given the power to designate appropriate bargaining units within workplaces Unions must compete democratically for the status of representative collective bargaining agent in appropriate bargaining units The BCEA must be used to properly fix minimum wages Tiers of collective bargaining must be encouraged

56 WHAT NEEDS TO CHANGE? Substantive decentralisation and process centralisation must be encouraged Bargaining Councils must focus on economies of scale issues at central level and service to members at company level Independently monitored strike ballots must be conducted The Courts must have the power to declare strikes that are accompanied by substantial levels of violence as unprotected

57 WHAT NEEDS TO CHANGE? Bargaining Councils or an independent institute to: Educate the social partners about economics and their rights and obligations in terms of the Bill of Rights and ILO Conventions Train the social partners in modern interest based, mutual gain, good faith negotiation and risk analysis skills Provide the social partners with reliable financial and economic information relevant to collective bargaining

58 WHAT NEEDS TO CHANGE? A specialised industrial action protection unit be established within the South African Police Service to protect workers and employers from criminal conduct during industrial action. Trade unions, trade union officials and office bearers be required to respect the right of non-strikers to work

59 WHAT NEEDS TO CHANGE? Trade unions, trade union officials and office bearers be required to take reasonable steps during industrial action to maintain public order, prevent violence, damage to property or intimidation of non-strikers by union members and their supporters provided that the right of trade unions, trade union officials and office bearers to peacefully incite workers to participate in a strike is respected. The Labour Court be given the power to grant appropriate and proportional relief for any breach of the law to any party whose rights are violated during industrial action. This may include suspending the protection of industrial action for limited periods of time in extreme cases.

60 WHAT NEEDS TO CHANGE? The Labour Court also be given the power to lift industrial action protection in the event of acute national emergency. In such event, compulsory arbitration must be substituted as the method of determining disputes.

61 CONCLUSION There is much that can be done by the social partners, without legislative intervention, to improve collective bargaining in South Africa There is also much that the Legislature could do to improve collective bargaining in South Africa Unless significant changes are made, Bargaining Councils will collapse and the South African economy will continue to fail South Africa cannot expect to continue with the same approach to collective bargaining but expect different results

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