13 June, 2012
RADICAL COSATU POLICY ON MINIMUM WAGE AND OTHER
Copy of an article that appeared on
the front page of the Business Day on Wednesday 6th
June. The policy proposals are extremely radical and if adopted by
Government could lead to job shedding on a large scale.
Cosatu set to push for
minimum wage policy
Congress of South African Trade Unions also
proposes radical overhaul of collective bargaining
Published: 2012/06/06 06:30:26 AM
THE Congress of South African Trade Unions (Cosatu)
is proposing the introduction of a national minimum wage and a radical overhaul
of the collective bargaining system, according to a draft policy document to be
discussed at its congress in September.
The call was influenced by concerns about a wage
agreement in the clothing sector last year, where a Cosatu affiliate agreed new
employees could be paid 30% less than the negotiated, minimum wage. It is also
part of Cosatu's campaign for "decent work", which has led to clashes
with its ally, the African National Congress (ANC).
The national minimum wage - which last year would
have been R4800-R6000 according to Cosatu's calculations - would, coupled with
collective bargaining "forge a new wage policy for SA", the document
"We are therefore at a strategic crossroads.
Either we continue the current approach of trying to win wage battles purely at
a sectoral level, with the danger of systematically being driven back,
particularly in low wage areas of the economy ... or we adopt a new approach,
which builds on the strengths of a reconfigured centralised bargaining system
and combines this with the exercise of state regulation through the
implementation of a national minimum wage, and comprehensive social
protection," it argued.
Minimum wages are established through collective
bargaining councils or by the government through sectoral determinations.
South African Chamber of Commerce and Industry CE
Neren Rau said the proposals did not adequately take into account the
structural weaknesses partly responsible for the plight of SA's workers - such
as skills shortages, lack of economic momentum and labour militancy.
A national minimum wage was more
"interventionist ", which spelled rigidity, when what the country
needed was more labour flexibility. Mr Rau warned of "unintended
consequences", including a flight by employers to lower wage levels away
from higher-salaried, older workers.
Cosatu proposed a three-tiered approach - the
introduction of a national minimum wage; establishment of a
"mandatory" centralised bargaining system to replace the current
"voluntary" one; and "universal income support" for all
"Our departure point is that one national
minimum wage has numerous advantages over the current situation, providing it
is set at a reasonable level, to improve workers' lives," the draft
"It would be comprehensive, clear, simple, and
provide a social floor for all. This is in contrast to our numerous, fragmented
sectoral minimal wages with massive discrepancies and gaps."
The document recommended that if Cosatu endorsed
the proposals, it should develop a political strategy to ensure buy-in from the
ANC by the end of this year for implementation next year.
An overhaul of collective bargaining would include
"wall-to-wall mandatory" sectoral bargaining; the demarcation of
national sectors; an alignment with developmental strategies, industrial
policy, skills, retirement funds; and an explicit mandate to address wage and
Labour analyst Tony Healy said yesterday that any
minimum wage legislation would affect job creation negatively.
Although the proposals were
"understandably" in the best interest of Cosatu's members - the
employed - it was not in the best interest of the "silent sizeable
majority" of unemployed people as it would increase the burden on
companies that were hiring.
"Minimum wage legislation inhibits job
creation and we have a crisis when it comes to unemployment. We should rather
focus on removing minimum wage legislation already in place," he said.
Cosatu spokesman Patrick Craven said the draft
document had been distributed to affiliates for discussion.