1. Name of presenter: Hermann Nieuwoudt Title of Presentation : Comments on the Labour Relations and Basic Conditions of Employment Amendment Bills, 2012 SASLAW SUBMISSIONS TO PARLIAMENT

2. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 449(2)-(4)These subsections do not provide for any mechanism for the registrar or another party to verify the information received from a bargaining council. This means that the Minister will be obliged to extend a bargaining council agreement without proper evidence that the bargaining council is representative. Provision should be made for the registrar having to verify the information or that the bargaining council should be required to verify the information in some way, for example, by means of an independent audit.

3. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 6(a)64(a)(iii)- (iv)  Where a dispute concerns a single employer only, no ballot should be required, even if the employer is a member of an employers’ organisation.  In non-unionised workplaces, the CCMA (or another appropriate body) should be required to organise a ballot.  Amend to exclude the need for a ballot where a dispute concerns a single employer only, even if the employer is a member of an employer’s organisation.  Amend to provide for the CCMA organising ballots in non-unionised workplaces.

4. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 8(a)67(7)The replacement of the word ‘despite’ at the beginning of the subsection with the word ‘notwithstanding’ would probably more accurately reflect what is intended. Delete the word ‘despite’ at the beginning of the subsection and replace it with the word ‘notwithstanding’.

5. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 9(b)69(6)Subsections (d) and (e) should read (a) and (b). Amend subsections (d) and (e) to read (a) and (b).

6. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 9(c)69(8)Sub-section (c) should be extended to include material breaches of a picketing agreement and rules established by way of a collective agreement.  Add ‘or a picketing agreement constituting a collective agreement’ at the end of subsection (c).

7. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 9(d)69(12)Provision should be made for the Labour Court to be empowered to lift the suspension of a picket, strike, employment of replacement labour or a lock-out on good cause shown. Add a new subsection (15) reading: ‘In the event of the Labour Court granting an order of suspension in terms of subsection (12)(c) or (d), it is empowered to grant an order uplifting the suspension on good cause shown.’

8. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 19(b)115(2)( d) The BCEA threshold (currently some R170 000 per annum) is too high and will place enormous strain on the CCMA; the service is probably better reserved for only the indigent. Provide for a reduced threshold.

9. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 24145(5)This is an issue best dealt with in the Rules or by way of a practice directive developed in conjunction with practitioners. SASLAW has previously endorsed the proposal contained in the draft practice manual developed by the Judge President in this regard, which is modelled on rule 5(17) of the Labour Appeal Court Rules in relation to appeal records. Delete this subsection.

10. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 24145(6)The time limit of six weeks within which judges are typically required to deliver judgments in reviews is considered unrealistic; it may well constitute an interference with judicial independence; and it will probably take its toll on the quality of judgments and ultimately our review jurisprudence, which will be counter- productive. If at all, this issue is best dealt with in the Judicial Code of Conduct applicable to all judges. Delete this subsection.

11. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 24145(7) 145(8) There is a concern about how the security process is going to be managed, although this is probably best dealt with in the Rules. Provide for the security process having to be regulated by the Rules.

12. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 27151(2)The references to ‘Supreme Court’ should be amended in accordance with this proposed amendment in sections 153(2)(a) and 160(2). Amend sections 153(2)(a) and 160(2) by deleting the words ‘Supreme Court’ and replacing them with the words ‘High Court’.

13. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 30(b)158(1B)There is a concern that this will prevent reviews against jurisdictional rulings, with the result that parties will be locked into arbitrations in relation to which the CCMA does not actually have jurisdiction. Although this could fall within the category of ‘exceptional circumstances’, the permissibility of jurisdictional reviews should be expressly provided for. Amend this subsection to read ‘save in respect of jurisdictional issues, in the absence of exceptional circumstances …’

14. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 30(d)158(5)Reference is made to the comments in relation to section 145(6). Although not considered appropriate, if a six-month time limit is to be imposed on Labour Court judges, this should be extended to the Labour Appeal Court. Delete this subsection.

15. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 33168(1)(c)The following consequential amendments should be made in the light of this amendment: Amend sections 153(2)(a) and 169(2) correspondingly.  section 153(2)(a) should be amended to read that the Judge President and Deputy Judge President of the Labour Court must be judges of the High Court or the Labour Court; and  section 169(2) should be amended to read that judges of the High Court or the Labour Court may be appointed to serve as acting judges of the Labour Appeal Court.

16. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 36187(1)(c)There is a concern that it is unclear whether the amendment is intended to prohibit retrenchments in relation to changes to terms and conditions of employment. Clarify this subsection.

17. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAWProposed amendment to Bill 38188B  Although a few members consider the section to be pragmatic, the predominant view is that the explanation given in the explanatory memorandum for this amendment does not justify depriving the employees in question of their right not to be unfairly dismissed. On the face of it, the section appears vulnerable to constitutional challenge as there are other means of addressing the concerns expressed in the explanatory memorandum.  Delete this section.

18. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAWProposed amendment to Bill 188B  If the section is to remain, there is a concern that an employer could invoke it to deprive a long serving employee of severance pay in circumstances where the actual reason for dismissal is the employer’s operational requirements. Although such an employee would presumably still be entitled to severance pay in terms of section 41 of the BCEA, the onus should then be on the employer to prove that the employee was not dismissed on account of its operational requirements.  Otherwise amend section 41 of the BCEA to provide for the onus being on the employer to prove that an employee earning above the threshold was not dismissed on account of its operational requirements.

19. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 39(a)189A(2)(d)There is a concern that this subsection may serve to defeat the overall object of the section, which is to attempt to facilitate the conclusion of a joint consensus-seeking process within 60 days. Delete this subsection.

20. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 43(c)198(4E)(a)The reference to ‘subsection (11)’ is incorrect as no such subsection exists; presumably this should read instead ‘subsection 4B and 4C’. Delete reference to ‘subsection (11)’ and replace with ‘subsections 4B and 4C’.

21. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 43(c)198(4F)The proposed legislation in terms of which a TES is to be registered should be promulgated now so as to enable all stakeholders to comment on envisaged registration requirements since that could affect the approach adopted to this subsection. It is not desirable to legislate piecemeal. Promulgate related legislation.

22. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 44198A(3)The words ‘for the purposes of this Act’ have led to controversy within the labour law community regarding whether employees falling within section 198A(3)(b) are actually employees of the client or whether they are only its employees for the purposes of the Act. Clarify this subsection.

23. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 44198A(5)  The requirement to treat the deemed employee ‘on the whole not less favourably’ than the employee performing the same or similar work is vague and uncertain. The obligation not to treat the employee ‘on the whole less favourably’ could be interpreted to mean more than terms and conditions of employment. It is proposed that the obligation should be limited to terms and conditions of employment (as is the case in section 197(3)(a)).  Amend to read: ‘An employee deemed to be an employee of the client in terms of subsection (3)(b) must be employed on terms and conditions of employment which are on the whole not less favourable than the terms and conditions of employment of an employee of the client performing the same work or similar work, unless there is a justifiable reason for less favourable terms and conditions of employment.'

24. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 44198B(8)  It is unclear whether this subsection applies to employees who are permissibly on fixed term contracts for more than six months in terms of section 198B(3), or to employees who are deemed to be on indefinite contracts in terms of section 198B(5), or to both. This requires clarification.  The comment made in respect of section 198A(5) is repeated with the necessary contextual changes. Clarify to whom the subsection applies, and amend the balance of the subsection to read: ‘… must be employed on terms and conditions of employment which are on the whole not less favourable than the terms and conditions of employment of an employee employed on an indefinite basis performing the same work or similar work, unless there is a justifiable reason for less favourable terms and conditions of employment.’

25. Comments on the Labour Relations Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW Proposed amendment to Bill 44198C(3) (a) The comment made in respect of section 198A(5) is repeated with the necessary contextual changes.  Amend the subsection to read: ‘employ a part-time employee on terms and conditions of employment which are on the whole not less favourable than the terms and conditions of employment of a comparable full-time employee performing the same work or similar work, unless there is a justifiable reason for less favourable terms and conditions of employment;’

26. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 233A(2)The proposed insertion of section 33A(1)(b) and section 33A(2) raises the following concerns:  On the plain reading of this section employers would be entitled to require employees, through a ‘clothing scheme’ or ‘tool scheme’ to pay, for example, for their own uniforms/ hard hats/tools, particularly if by sourcing these through such an employer-run scheme the employee gets them at a discount as opposed to purchasing the items on the open market.

27. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 33A(2)  The proposed section 33A(2) therefore goes further than providing for share option schemes, and would therefore also potentially cover schemes whereby employees must pay for their own tools, equipment, safety gear, uniforms, etc. Is this what was intended?  In addition, group medical aid schemes and retirement schemes will, on a plain reading of this section, be covered. However, there may be an argument that the first proviso in the proposed section 33A(2) may not necessarily be met, namely that the employee must receive a ‘financial’ benefit from participating in the scheme.

28. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 33A(2)  It is proposed that this clause be amended to specifically permit group medical aid and retirement schemes. This could potentially be done by providing that the employee ‘receives a financial or other benefit’.  It is further proposed that the section be amended to specify that the purchase of the goods, products or services must be a fair and reasonable requirement in the context of the employee’s employment.

29. Comments on the Basic Conditions of Employment Amendment Bill, 2012 Proposed amendment to s 33A(2) Bill Amend the proposed subsection to read (our suggested amendments are underlined): ‘Subsection (1)(b) does not preclude … if – (a)the purchase of the goods or services is a fair and reasonable requirement related to the employee’s employment; (b)the employee receives a financial or other benefit from participating in the scheme; (c)the price of any goods, products or services provided through the scheme is fair and reasonable; and (d)the purchase is not prohibited by any statute.’

30. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 855(4)(b)No consensus was reached within SASLAW on the issue of whether a sectoral determination should be able to prescribe actual wage increases.  On the one hand it is argued that employees earning above the prescribed minimum ought also to be entitled to increases at a rate prescribed by the Minister.

31. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 55(4)(b)  On the other hand it is argued that the State should only fix the minimum terms and conditions of employment where essential and leave actual terms and conditions to collective bargaining and contractual negotiation. The effect of this proposed amendment is that the Minister will have the power to determine increases not only in respect of employers paying at the prescribed minimum, but also in respect of employers paying in excess of the minimum. This may also have the unintended consequence that employers would not pay above the prescribed minimum but would simply pay minimum rates, which would obviously be detrimental to employees.

32. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 9, 10 and 12 68, 69, 71-72 The effect of the proposed amendments to these sections is:  to make an attempt to secure a written undertaking in terms of section 68 discretionary and to permit the Department of Labour to issue a compliance order without the need to attempt to seek a written undertaking;  to do away with the employer's current right to object to compliance orders and to appeal against such orders;  to enable the Director-General to apply to the Labour Court to have the compliance order made an order of court.

33. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 68, 69, 71-72 There is no consensus within SASLAW in respect of these amendments.  On the one hand it is argued that these proposed amendments will expedite enforcement proceedings and will address the abuse of the current system by non-compliant employers.  On the other hand other members argue as follows.

34. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 68, 69, 71-72 o The proposed amendments do not give employers sufficient opportunity to engage with an inspector of the DoL prior to the drastic step being taken to issue a compliance order. This may infringe an employer's right to fair administrative action. Although it is envisaged that the order itself will make provision for representations these are envisaged after the compliance order has been granted. In addition it merely permits the employer to make representations to the DoL and the Labour Court. Nothing in the proposed amendments obliges the DoL to consider these representations prior to making application to the Labour Court. In any event, there is no explicit provision which empowers the DoL to withdraw the compliance order.

35. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAW 68, 69, 71-72 o This could also lead to further court backlogs as employers would have to challenge the order in court, and this will place the court under significant pressure. o It is proposed that a formal audi alteram process must be prescribed prior to the compliance order being granted and that reasons be given for such action. This would, in any event, be prescribed by PAJA.

36. Comments on the Basic Conditions of Employment Amendment Bill, 2012 ClauseSectionComment: in the opinion of SASLAWProposed amendment to Bill 1577(1)A consequential amendment to section 93(1) is required. Currently, this section provides as follows: ‘Any magistrates’ court has jurisdiction to impose a penalty for an offence provided for under this Act.’ Delete section 93.