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Public hearing min wages

Public hearing min wages

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Published by Diekasteel
Document on wages
Document on wages

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Categories:Types, Business/Law
Published by: Diekasteel on Jan 15, 2013
Copyright:Attribution Non-commercial


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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75, 1997), it is stipulated that the provisions of a Sectoral Determination remain binding until they are amended or superseded by a new or amended Sectoral Determination, or they are cancelled or superseded by the Minister.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.


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.


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 an employee above the minimum wage should be a matter between the employer 2

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 unemployment throughout 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 their production 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. 3

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.


Report by: Doug Stern 2nd January 2013


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