public hearing min wages

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REPORT ON THE PUBLIC HEARING: INVESTIGATION INTO THE

SECTORAL DERMINATION NO.13: FARM WORKER SECTOR, SOUTH

AFRICA ON

13th DECEMBER 2012 – BARKLY EAST

Doug Stern and Phillip Gxotiwe represented Agri East Cape at the hearing.

Department of Labour opened the meeting with an introduction and

background of the Sectoral Determination 13. They then went on to explain the

investigation process. In terms of section 56(1) of the BCEA (Basic Conditions

of Employment Act 75, 1997), it is stipulated that the provisions of a Sectoral

Determination remain binding until they are amended or superseded by a new

or amended Sectoral Determination, or they are cancelled or superseded bythe Minister.

It was for the reason above that two notices were published by the Department

on 15 November 2012 – one indicating the intention to cancel the SD and the

other indicating the reviewing of the current Sectoral Determination.

In terms of these notices, interested parties were given 15 days to make inputs

in the form of written representation to the department. In spite of the fact that

the 15 day period had expired, the department was making provision for inputs

by way of having public hearings.

When advising the Minister in determining the minimum wages, section 54 sets

a requirement that the ECC (Employment Conditions Commission) should

consider. The inputs in relation to the minimum wages should therefore be

raised in relation to the following:

• Ability of employers to carry on their businesses successfully.

• Creation and retention of employment.

• The operation of small, medium or micro-enterprises and new

enterprises.

• The cost of living.

• The alleviation of poverty.

• Conditions of employment.

• Wage differentials and inequality.

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• The likely impact of any proposed conditions on current employment or

the creation of employment.

FAWU’s (Food and Allied Workers Union) representative was the first to make

representation. All he did was “farmer bashing” for about ten minutes. We

objected and claimed this to be out of order and not the forum to be used for

farmer bashing. We disputed the legitimacy of those accusations. However, we

invited FAWU to meet with our organisation with the purpose of them revealing

to us who the land owners were that were guilty of those horrendous atrocities

he was eluding to – as we too, do not agree with labour abuse of any kind.

We also made mention of the fact that the Labour Relations Act 66, 1995, had

been revised so as to give the CCMA (Commission for Conciliation, Mediation

and Arbitration), Labour Courts and Labour Inspectors powers with the purpose

of assisting farm workers if they had any problems with abuse.

We then made our presentation as follows:

AGRI EAST CAPE PRESENTATION AT FARM WORKERS PUBLIC HEARING

1. We at Agri East Cape represent about 3,000 commercial farmers and as an

organisation cannot negotiate and set wages on behalf of agricultural

employers, as we have no mandate to do so.

2. In fact – nobody has the right to negotiate, propose or make any

recommendations regarding a new daily wage – or even enter into any form of

collective bargaining on behalf of employers.

3. Must accept that the recent strikes in the West Cape were unprotected and

therefore illegal – in my view, they were politically inspired. As a consequence

of this the whole agricultural fraternity is basically being held to ransom.

4. The current process must take place within the parameters of, and follow the

correct procedures as per the Basic Conditions of Employment Act. The current

impulsive process will definitely have inadvertent consequences, should the due

process not be adhered to. This was alluded to by the Min herself.

5. The only real mechanism for wage negotiation is through the ECC (Employment

Condition Commission). The fact is that Sectoral Determination 13 was

established after a transparent and consultative process, not in a hostile and

threatening manner, as is the case now. Furthermore – any amount paid to anemployee above the minimum wage should be a matter between the employer

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and the employee. If this principle is going to be threatened, then all worker

incentives and initiatives will be destroyed – then the minimum wage will

become the maximum wage – this will lead to workers becoming robots.

6. It would be unfair to expect our farmers to compete in a global context against

farmers who are highly subsidised and protected – if the international wage

norm was to be used, then it is our view that the Government should subsidise

the difference in the wage levels.

7. There is currently huge pressure on the financial sustainability in all the

agricultural sectors – employers are therefore forced to work according to well

planned budgets – of which the stipulated Sectoral Determination 13 for 2013

had been taken into consideration. It would therefore make it impossible for any

of the agricultural sectors in the Eastern Cape to even consider any additional

increases to those already set out in the appropriate Sectoral Determination

documentation, which was entered into and agreed upon for a three year

period.

8. If any additional increases, to those set out in the Sectoral Determination, were

to be considered, then there would be a large increase in unemploymentthroughout the Eastern Cape within the agricultural sector. The agricultural

sector is under huge pressure, having to deal with the large increases in

electricity and fuel alone and simply would not cope with an additional increase

in wages. Coupled to this large portions of our Province were hard hit by

devastating floods which took its toll on the farming sector.

9. It must also be remembered that approx 50% of all commercial farmers in

South Africa have a gross annual turnover of less than R 300,000.00. In the

Mohair Industry, labour costs currently add up to around 30% of theirproduction costs. This figure is very similar for the wool Industry.

10.The Chicory industry in the East Cape, between 2001 and 2002 had about 128

producers who collectively employed about 6 500 casual workers per annum. In

the current season the industry only has some 35 producers (72% less) who

now employ around 1100 casual workers (83% less). As can be clearly seen, all

these industries will not be able to cope with any significant increase in wages

without disastrous results – and as I have mentioned before, this will mean even

greater unemployment. If they had been making lots of money then their

numbers would not have decreased so dramatically.

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11.The National Planning Commission vision 2030 has ambitious goals of job

creation within the agricultural sector – however this will not be achievable with

unrealistic labour legislation including the increasing of minimum wages above

that set out in the Sectoral Determination 13.

12.Employers in agriculture provide far more generally, than just the basic wage –

for example – in many areas they provide: Grazing, housing, electricity, water,

transport to mention a few, for their employees.

13.It is our view that the market should be allowed to determine/dictate the wage

of agricultural employees. We are also requesting that the DoL (Department of

Labour) look into a two tier wage structure. A basic entrance level for beginners

so as to afford them the opportunity to learn the trade before being placed on

par with experienced workers.

14.Our members are also questioning the choice of venue for the whole of the

Eastern Cape? Why could a more centrally situated venue like Cradock or

Queenstown not have been chosen? Why too was the meeting scheduled so late

in the day – long after working hours?

15.Our members will accept the challenge to create employment only within an

economically friendly environment.

16.It is important to point out, and it is our view, that the SAPS become more

actively involved with the prevention of unprotected strikes, as these are illegal

events, threatening the safety and security of rural farming communities, also

causing unnecessary damage to farm property, disrupting traffic and causing

huge losses in various sectors of the economy, as we have just witnessed in the

Western Cape.

There were a few of our member farmers present, who supported and reiterated the

fact that should the minimum wage be increased above that which was agreed upon

by Sectoral Determination 13, then unemployment would increase dramatically as that

increase would not be able to be absorbed by the livestock industry.

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Report by:

Doug Stern

2nd January 2013

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public hearing min wages

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