Reforming Labour Broking:
A Joint Policy Paper
I. The labour broking market
The increase in temporary employment services isan international phenomenon, indicative of theneeds of a rapidly changing global village, whereindustries expand and contract at increasing speedand modify their product offerings to matchprevailing global demand.Temporary workers are often needed to assist intimes of rapid change and retooling. Industries inthe throws of this rapid change may not have therecruitment skills to locate temporary workerswithin the required time frame. This function isoften filled by brokers and temporary employmentservices.Many industries, including agriculture, are cyclicaland therefore need more staff at particular times.The employment of full staff compliments duringoff-peak times is not efficient or affordable. Labourbrokers help workers during off-peak periods tofind work.Labour brokers operate across the entire economy,including the professional and manual labourmarkets. Brokers provide temporary staff forgovernment and state owned enterprises (SOEs),the IT industry, the financial sector, productionindustries, construction and mining. Labourbrokers are, therefore, a key component ofeconomic activity, and provide a vital service to theworkers they place and the companies they staff.The concerns that have been raised regarding theexploitation of individuals employed by labourbrokers are real and need urgent attention. It islikely, however, that an outright ban or excessiveregulation will deepen exploitation by driving theindustry underground.The Namibian Model is instructive in this arena.Having introduced legislation in November 2007,aimed at an outright ban on labour brokers ortemporary employment services, many ofNamibia’s temporary workers are nowunemployed. (Figures quoted range between 10%and 40%). If a similar approach to labour broking isintroduced in South Africa, many hundreds ofthousands of jobs could be lost. This will bedevastating to the many currently employedpeople who will be forced to join the ranks of theunemployed.
An outright ban on labour brokers will result in:
Immediate job-losses for temporaryworkers who will not have the resources tolocate temporary work opportunities inmany dispersed locations.2.
Vacancies in some industries going unfilleddue to an inability to locate staff with thecorrect skill-set.3.
A rise in costs due to employers needing toemploy larger in-house Human Resourcesand recruitment staff to fill the gaps left bythe exit of temporary employment services.4.
A switch to the use of small sub-contractorsinstead of temporary workers (therebydefeating the objective).5.
Fewer people being employed in the longterm.6.
The industry continuing to operate,illegally, with an increase in exploitation.
II. The proposal
Self-regulation, with industry peers andgovernment monitoring the process, is requiredand will involve:1.
Mandatory registration for all practitioners.2.
The establishment of an Institute or self-regulatory Board of Labour Brokers thatwill enforce a set of standards for theindustry.3.
A code of conduct, enforced by theindustry board itself. (Legitimate players inthe industry have an incentive to stamp outthose labour brokers who exploit workers –they place the industry at risk and takeaway business).