ASSIGNMENT A, B & C by SARVESH NAIR Submitted in partial fulfilment of the requirements for the subject Collective Employment Law (JML 503) for the degree MAGISTER LEGUM in LABOUR LAW in the FACULTY OF LAW at the NELSON MANDELA METROPOLITAN UNIVERSITY 1
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ASSIGNMENT A, B & C
by
SARVESH NAIR
Submitted in partial fulfilment of the requirements for the subject
Collective Employment Law (JML 503)
for the degree
MAGISTER LEGUM
in
LABOUR LAW
in the
FACULTY OF LAW
at the
NELSON MANDELA METROPOLITAN UNIVERSITY
September 2015
1
Declaration by student:
I hereby declare the following:
This is my own work and I have not copied any parts thereof from anyone
else;
I have referenced all direct quotations and paraphrased explanations of
another’s work
I understand that plagiarism is a violation of the university disciplinary
code and that should I be guilty thereof that I will be subject to any
disciplinary steps that the university may institute against me,
One of the primary objects of the Labour Relations Act 66 of 1955 (hereafter the
LRA) is to provide a framework within which employees and their trade unions on
the one hand, and the employers and their employers’ organisation on the other,
can collectively bargain to determine wages, terms and conditions of employment
and other matters of mutual interest.1 Employers commonly enter into collective
agreements with a registered trade union with the aim of establishing uniform
conditions of service for all employees falling within the scope of the agreement. 2
Where non-compliance with a collective agreement occurs, a number of remedies
are available to the affected person. What follows is a definition of a collective
agreement, followed by the legally binding effects of same and finally the remedies
available to affected parties by non-compliance of collective agreements.
1 1 Defining a collective agreement
Section 213 of the LRA defines a collective agreement as a:
“written agreement concerning terms and conditions of employment or any other matter of
mutual interest concluded by one or more registered trade unions, on the one hand and, on
the other hand –
(a) one or more employers;
(b) one or more registered employers’ organisations; or
(c) one or more employers and one or more registered employers’ organisations.”3
1 Section 1 of the Labour Relations Act 66 of 1995 (hereafter the LRA)2 Modi “Interpreting Collective Agreements” (undated) http://www.bowman.co.za/News-Blog/Blog/INTERPRETING-COLLECTIVE-AGREEMENTS-Priyesh-Modi (Accessed 2015-08-12) 3 Section 213 of the LRA.
According to Basson et al a collective agreement need not be signed by the parties
to be valid as all that is required is that the agreement must be in writing. 4
Furthermore, only registered trade unions can be parties to a collective agreement
as defined by the LRA.5 The definition also states which topics may be regulated by
a collective agreement viz: terms and conditions of employment or any other matter
of mutual interest.6 The former relates to those substantive provisions of the
employment contract such as working hours, remuneration and leave while the
latter is considered a much wider concept which boundaries are yet to be clearly
delineated by case law.7 Collective agreements typically take the form of
recognition agreements (rules of engagement in the relationship); substantive
collective agreements (normally concluded after the recognition agreement and is a
product of bargaining on wages, conditions of employment) and procedural
agreements which relate to disciplinary procedures, amongst others.
1 2 Legal effect of Collective Agreements
Section 23 of the LRA, entitled Legal effect of collective agreements, states as
follows:
(1) A collective agreement binds – a. The parties to the collective agreement;b. Each party to the collective agreement, in so far as the provisions are
applicable between them;
4 Basson, Christianson, Dekker, Garbers, le Roux, Mischeke and Strydom Essential Labour Law 5ed (2009) 278; Basson et al further contends that a collective agreement need not be contained in a single document as parties may confirm the contents of the agreement in separate correspondence.5 Basson et al Essential Labour Law 278; where an unregistered trade union concludes a collective agreement with an employer, the agreement merely falls outside the scope of the LRA and cannot be enforced by the LRA. 6 Basson et al Essential Labour Law 279; needless to say, there are, certain limits to the parties contractual freedom, i.e. the provisions agreed to in the collective agreement must be enforceable and not contra bona mores.7 Basson et al Essential Labour Law 279; The requirements of a valid collective agreement are therefore registration, a written agreement, product of agreement and “Terms and Conditions of employment or any other matter of mutual interest” which includes both narrow and broad interpretation.
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c. The members of a registered trade union and the employers who are members of a registered employers’ organisation that are party to the collective agreement if the collective agreement regulates –
i. Terms and conditions of employment; orii. The conduct of the employers in relation to their employees or
the conduct of the employees in relation to their employers;d. Employees who are not members of the registered trade union or trade
unions party to the agreement if – i. The employees are identified in the agreement;ii. The agreement expressly binds the employees; andiii. That trade union or those trade unions have as their members
the majority of employees employed by the employer in the work-place.
(2) A collective agreement binds for the whole period of the collective agreement every person bound in terms of subsection (1)(c) who was a member at the time it became binding, or who becomes a member of the registered trade union or registered employers’ organisation for the duration of the collective agreement.
(3) Where applicable, a collective agreement varies any contract of employment between an employee and employer who are both bound by the collective agreement.
(4) Unless the collective agreement provides otherwise, any party to a collective agreement that is concluded for an indefinite period may terminate the agreement by giving reasonable notice in writing to the other parties.8 (Own emphasis)
Collective agreements have a binding effect on both parties to the agreement as
well as members to such an agreement. Parties to the agreement are those entities
that concluded the collective agreement, viz: employers’ organisations and trade
unions. Members refer to members of trade unions or, in the case of employers’
organisations, to members of the employers’ organisation.9 A collective agreement
may also bind employees who are not union members if the following requirements
are met: firstly, the collective agreement must expressly state that it binds those
employees; secondly, the employees must be expressly identified and the trade
union(s) must represent the majority of employees working in the workplace. 10 The
legal effect of a collective agreement is that it will supersede the affected
employees’ individual contracts of employment and where a collective agreement is
concluded in a bargaining council for the industry, the Minister of Labour can, in
8 Section 23 of the LRA, own emphasis added. 9 Basson et al Essential Labour Law 279.10 Section 23(1)(d) of the LRA; Basson et al Essential Labour Law 279–280.
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certain circumstances, extend the terms of the agreement to non-parties.11 The
collective agreement is binding for the whole period of the collective agreement and
thus, even if a member of the trade union were to resign from the trade union, the
terms of the collective agreement would still apply to that person for the duration of
that agreement.12
1 3 Disputes about collective agreements
A dispute exists where the parties to the agreement disagree over the meaning of
particular provisions or where the parties disagree whether the agreement applies
to a particular set of facts or circumstances.13 A wider interpretation has also been
followed where it has been held that “a dispute about a collective agreement
applies to the situation where there is non-compliance with a collective agreement
and one of the parties wished to enforce its terms”.14
Where a person is affected by the non-compliance of a collective agreement the
LRA provides for a remedy. Section 24 of the LRA specifically requires that a
collective agreement (except for an agency15 and closed shop agreement16) must
provide for a procedure to resolve disputes about the interpretation and application
11 Modi “Interpreting Collective Agreements” (undated) http://www.bowman.co.za/News-Blog/Blog/INTERPRETING-COLLECTIVE-AGREEMENTS-Priyesh-Modi (Accessed 2015-08-12)12 Ibid.13 Grogan Collective Labour (2010) 132.14 NUCW v Oranje Mynbou en Vervoer Maatskappy Bpk 2000 2 BLLR 196 (LC).15 An agency shop agreement is defined in the LRA as “A representative trade union and an employer or employers’ organisation may conclude a collective agreement, to be known as an agency shop agreement, requiring the employer to deduct an agreed agency fee from the wages of employees identified in the agreement who are not members of the trade union but are eligible for membership thereof.” the employee must pay agency fee but doesn’t become a trade union member.16 A closed shop is where “A representative trade union and an employer or employers’ organization may conclude a collective agreement, to be known as a closed shop agreement, requiring all employees covered by the agreement to be members of the trade union.” all employees and new employees must become trade union members.
of the collective agreement.17 The dispute procedure must first require the parties to
attempt to resolve the dispute through conciliation and, if the dispute remains
unresolved, to resolve it through arbitration.18 Where a collective agreement does
not contain a dispute resolution procedure, or if the procedure is not operative, the
dispute may be referred to the CCMA.19 This has traditionally been interpreted as
limited to interpretation or application of collective agreements. The process is one
of Conciliation and Arbitration.20
A dispute about the interpretation or application of a collective agreement may also
be referred to the CCMA if one of the parties has frustrated the dispute resolution
procedure contained in the collective agreement.21 Basson et al uses the example
of a party obstinately refusing to comply with the dispute resolution procedure
contained in a collective agreement and contends that such a dispute may not be
the subject of a strike or lock-out and the CCMA may charge an arbitration fee.22
1 4 Section 33A
Section 33A must be read with section 24.23 A bargaining council may monitor and
enforce compliance with its own collective agreement. As mentioned supra the
latter deals with the resolution of disputes concerning the interpretation or
application of a collective agreement and provides for such disputes to be referred
to the CCMA for conciliation and, if necessary, arbitration. Section 33A contains an
17 In the agency shop, employees are not compelled to be or to become members of a trade union while in the case of a closed shop all employees who are covered by the collective agreement must be or must become members of the trade union.18 Basson et al Essential Labour Law 280; Section 24 of the LRA.19 Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context (2012) 193.20 See Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context (2012) ch 14.21 Basson et al Essential Labour Law 283.22 Ibid.23 Of the LRA.
9
exception and provides that despite any other provision in the LRA a council may
monitor and enforce compliance with its own collective agreements. The council
may adopt its own process24 or may also opt to incorporate the procedure provided
for in sections 33A(2)-(12). This process involves an agent of the council issuing a
compliance order in the event of non-compliance with an agreement of the council.
Any dispute regarding this may then be referred for arbitration by an arbitrator
appointed by the council.25 Where the non- complying party is not a party to the
council, it may object to the arbitrator appointed by the council and request that the
arbitrator should be appointed by the CCMA.26 An arbitrator has broad powers,
including the power to impose a fine, ordering compliance with the council’s
agreement and making an order of costs.27
A bargaining council may ask the minister to appoint an agent to help it enforce any
collective agreement. The agent has wide powers, including being able to:
Subpoena witnesses to give evidence; subpoena a person in control of a relevant
book, document or object to produce the item and to answer questions; enter and
inspect premises at any reasonable time after having obtained Labour Court
authorisation to do so; examine, demand to see and seize any relevant book,
document or object on the premises after having obtained Labour
Court authorisation to do so; and retain any relevant book, document or object for a
reasonable period of time. A receipt must be issued for any item which is seized
24 Section 33A(1) of the LRA.25 In practice the arbitrators are drawn from a panel of independent third party neutrals who are elected by the parties to the council to serve in the councils dispute resolution panel for a fixed term.26 In terms of section 33A(c)(ii) the arbitrator appointed by the CCMA conducts the process under the auspices of the council, and not the CCMA.27 Section 33A(8) of the LRA.
10
and a subpoena issued by an agent must be signed by the director or acting
director of the commission for conciliation, mediation and arbitration.28 Any behavior
in these proceedings which would constitute contempt of court if it took place in a
court can be referred to the Labour Court for an appropriate order. The
consequence of section 33 and 33A is that bargaining councils may establish a
procedure for the compliance with bargaining council collective agreements.
Collective agreements of such bargaining councils may accordingly be enforced by
means of arbitration. It is required of a bargaining council to request the Minister of
Labour to appoint designated agents before this compliance procedure may be
used, and the arbitration procedure of section 33A to enforce compliance may be
resorted to.29
1 5 Where an employer fails to comply with a collective agreement
As referred to supra, industrial sectors generally contain bargaining councils
established in terms of section 27 of the LRA. Section 28 empowers the parties to
the bargaining council to draw up a collective agreement by which, in terms of
section 31, the parties to the council are bound by that collective agreement. 30 In
short, the collective agreement, drawn up and agreed to by the parties, prescribes
rules and regulations that apply to the industry in which the council has its scope
and jurisdiction.31
28 On a practical note, questions put to a person about a book, document or object are subject to the normal rules of a court of law.29 Prof A van de Walt and G van de Walt “Breach of a Collective Agreement Does the LRA provide a remedy in Section 24” 769-775.30 Of the LRA.31 See Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context ch 14.
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The agreements also state that employers must deduct the employees’ share from
their wages and pay it over, together with the employer’s portion, to the relevant
council. The council, in turn, must pay the money to the relevant funds for which the
deductions were made. Some employers fail to comply with the provisions of the
collective agreement for their industry with many of them failing to pay over
deductions to the council.32
An employer may deduct a pension fund contribution from the employee, but fail to
pay it over to the council. The employee then loses out on his benefits and could
bring a civil lawsuit or criminal charges against the employer.33
As mentioned supra, should an employer simply refuse to register with the council
or refuse to make the required contributions, he will be issued with a compliance
order. Should the employer fail to comply with such an order, the council will
declare a dispute with the errant employer and, in terms of section 33A of the LRA,
refer the matter to arbitration either through the CCMA or via the council’s panel of
arbitrators.
The errant employer is summoned to appear before the arbitrator to answer the
allegation of non-compliance with the collective agreement. At this forum the
employer must provide good reasons why he failed to comply. The arbitrator must
hear evidence from the employer and the council’s representative
before making an arbitration award.34
32 This is a breach of the collective agreement and could have severe criminal and civil results for the errant employer.33 The deduction of money from an employee’s wage for the undue enrichment of the employer is a criminal act, making the employer liable for criminal prosecution.34 The award normally includes an instruction to pay the outstanding money to the council, and to pay a fine for non-compliance, together with interest calculated on the outstanding money, as well as a costs order.
12
The employer must comply within 14 days of an award being made and if he
refuses, the council can enforce the award in terms of section 158 (1) (c) of the LRA
by having it made an Order of the Labour Court, as well as having a Writ of
Execution issued against the employer’s assets. Non-compliance with this court
order could mean contempt of court proceedings against him.
1 6 Section 23(4) of the LRA
Section 23(4) of the LRA provides that:
“Unless the collective agreement provides otherwise, any party to a collective
agreement that is concluded for an indefinite period may terminate the agreement
by giving reasonable notice to the other parties.”
An employer will only be entitled to cancel a collective agreement concluded for an
indefinite period on reasonable notice to the employee party.35 In determining what
a reasonable notice period is will be dependent on each individual case. The
Labour Appeal Court has held that a three months’ notice period was reasonable.36
1 7 Minister of Safety and Security v Safety and Security Sectoral Bargaining
Council (2010) 6 BLLR 594 LAC (hereafter Minister of Safety and Security)
The Labour Appeal Court (LAC) has determined, considered and curtailed the
application of section 24 as evidenced in the judgment of Minister of Safety and
Security.
Facts:
35 TAWUSA & Alliance comprising of STEMCWU v Anglo Platinum (2009) 5 BLLR 506 (LC).36 Edgars Consolidated Stores Ltd v FEDCRAW (2004) 7 BLLR 649 (LAC).
13
For the sake of brevity, the facts and background may be summarrised as follows:
The employee, a member of the South African Police Service (SAPS) requested a
transfer from her office in Zwelitsha to Mount Road in Port Elizabeth. The Regional
Commissioner turned down the transfer and the employee thereafter referred a
dispute in terms of section 24 of the LRA to the Safety and Security Sectoral
Bargaining Council (SSSBC). At arbitration, the employee contended that SAPS
breached a collective agreement and failed to give proper or any consideration to
the employee’s interests.37 The arbitrator found in favour of the employee and
concluded that the Regional Commissioner acted illogically and irrationally and
accordingly his decision was invalid ab initio. The arbitration award was taken on
review to the Labour Court, but was essentially dismissed.38
LAC Judgment
SAPS appealed against this judgment to the Labour Appeal Court and argued that
the arbitrator lacked jurisdiction to determine the original dispute or, in other words,
they questioned whether the dispute had been correctly classified as a dispute
concerning the interpretation or application of a collective agreement as envisaged
in section 24 of the LRA.
SAPS further contended that, although the dispute was referred as a dispute
concerning the interpretation and application of a collective agreement, the real or
true issue before the arbitrator was in fact the “fairness” of the decision taken by the
Regional Commissioner to refuse the employee’s application for a transfer.
37 In casu the categorization of the dispute as a dispute about the interpretation and application of a collective agreement as envisaged in section 24 of the LRA was not placed in dispute at the arbitration proceedings38 The Labour Court corrected the award only to the extent that the arbitrator had declared the decision void ab initio, the rest of the award was not set aside.
14
The court distinguished between a main dispute and an issue in dispute and
concluded that the dispute before the arbitrator in casu was the fairness of the
decision of the Regional Commissioner to refuse the request of the employee to be
transferred. The court accordingly concluded that the arbitrator had no jurisdiction
to deal with the refusal to transfer the employee as a dispute concerning the
interpretation and application of a collective agreement envisaged in section 24 of
the LRA. The appeal was accordingly upheld and the arbitration award was
consequently set aside. Learned authors such as van der Walt and van der Walt
contend that prior to the judgment supra, section 24 of the LRA adequately
provided for the resolution of interpretation disputes of collective agreements or, in
other words, the section adequately provided for application about whether or not a
collective application applies to a particular set of facts or circumstances.39
Furthermore, in the event of a breach or non-compliance with a bargaining council
agreement, such non-compliance may be referred to arbitration in terms of section
33A of the LRA, if the Minister of Labour has appointed a designated agent (s) upon
request of the bargaining council as envisaged in section 33A. Such a remedy is
not available in the case of breach of collective agreements not concluded at a
bargaining council, or bargaining council agreements where the council has not
requested the appointment of a designated agent or agents, or such request was
refused by the Minister of Labour.40
39 Van der Walt and Van der Walt “Breach of Collective Agreements: Does the PRA provide a remedy in Section 24? - Minister of Safety and Security Sectoral Bargaining Council (2010) 6 BLLR 594 LAC 2011 32.3 Obiter 769.40 Ibid.
15
In the light of the different interpretations of the word “application” it was submitted
that, in order to achieve certainty, section 24 of the LRA be amended so as to
include disputes about “compliance” in addition to disputes about the
“interpretation” or “application” of a collective agreement. 41 Such an amendment, it
was successfully argued, will have the effect of granting an enforcement opportunity
of collective agreements in terms of section 24 in instances where section 33A does
not apply. Compliance with collective agreements by means of arbitration will
thereby be assured.
41 Van der Walt and Van der Walt “Breach of Collective Agreements: Does the PRA provide a remedy in Section 24? - Minister of Safety and Security Sectoral Bargaining Council (2010) 6 BLLR 594 LAC 2011 32.3 Obiter 772.
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2 Question B
Generally speaking, the Labour Relations Act 66 of 1995 (hereafter the LRA)
provides for registration of trade unions and employer organisations with the
Department of Labour. Registered unions are guaranteed organisational rights if
they can prove that they are “representative” and collective agreements between
registered trade unions and registered employers organisations are binding on
members.42
Bargaining council agreements are largely substantive agreements dealing with
wages and conditions of service but may also contain procedural items such as job
evaluations, grading systems and disciplinary procedures.43 Usually, the substantive
items in the agreements are wage rates which are renegotiated yearly. While the
Labour Relations Act of 1956 provided that industrial councils could deal with
certain specific matters, the Labour Relations Act of 1995 is mute on the subject.
Nonetheless, matters dealt with in the 1956 Act are still dealt with by the councils in
present day.44 Bargaining council agreements may contain a host of regulations
which may include, but are not limited to, hours of work, maximum working hours
per week and payment for overtime.45
42 Budlender Industrial relations and collective bargaining: Trends and developments in South Africa DIALOGUE (2009) 1 55 9; The binding effect of collective agreements are not limited to members as explained in Question A supra; see also section 23 of the LRA entitled Legal effect of collective agreements.43 Du Doit, Godfrey, Cooper, Giles, Cohen, Conradie and Steenkamp Labour Relations Law 6ed (2015) 320.44 These include but are not limited to: wage and salary scales, grading systems, piecework rates, payment to council levies, pension, insurance and sick fund contributions, provision for closed shop, prohibitions on contract work.45 Du Doit, Godfrey, Cooper, Giles, Cohen, Conradie and Steenkamp Labour Relations Law 6ed (2015) 230.
17
It has been suggested that because these agreements deal with the regulation of
substantive conditions they may be regarded as basic-condition regulations for
particular industries or sectors and once gazetted, they supersede for instance the
Basic Conditions of Employment Act.46 Needless to say that because the
application of the agreements are general, they lack specificity with regards to
acute issues and circumstances. Moreover, they do not provide for employee
participation in the decision making function, however, employers are free to offer
wage rates and conditions which are more favourable than those agreed upon.47
2 1 Extension of Collective Agreements concluded in Bargaining Councils
Section 32 of the LRA regulates the extension of a collective agreement concluded
in the bargaining council to non - parties. Du Toit et al refers to both a mandatory
and discretionary extension of bargaining council agreements.48 Since one of the
main purposes of a centralised bargaining forum is to establish uniformity, section
32(1) allows the bargaining council to request the Minister of Labour, in writing, to
extend a collective agreement concluded in the council to any non-parties that are
within its registered scope and that are identified in the written request if one or
more registered trade unions whose members constitute the majority of the
members of the trade unions that are party to the bargaining council vote in favour
of the extension and one or more registered employers' organisations, whose
members employ the majority of the employees employed by the members of the
46 To the extent of the core conditions of the Basic Conditions of Employment Act; Bendix Industrial Relations in South Africa 10th ed (2010) 288.47 Du Doit et al Labour Relations Law 320.48 Ibid.
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employers' organisations that are party to the bargaining council, vote in favour of
the extension.49
Once the Minister has received the request for extension from the bargaining
council, the Minister must, within 60 days of receiving the request, extend the
collective agreement if the requirements listed in Section 32(2) have been met.
However, Section 32(5) confers the minister with discretion to extend a collective
agreement if (1) the parties to the bargaining council are sufficiently represented
within the registered scope of the bargaining council and (2A) the Minister is of the
view that a failure to extend the agreement will undermine collective bargaining at a
sectoral level or the public service as a whole.50
The Minister must then satisfy herself that parties voting in favour of the request for
extension represent the majority of employers and trade-union members, the
majority of employees within the scope of the extended agreement are members of
trade unions, the members of employer’s organisations employ the majority of
employees, the non-parties fall within the council’s scope, the council has an
effective procedure to deal with applications within 30 days by non-parties for
exemptions from the agreement, the agreement makes provision for an
independent body to hear and decide within 30 days any appeal brought against
the refusal of a non-party’s application for exemption or the withdrawal of such an
exemption, the agreement must contain fair criteria promoting the primary objects of
the LRA which must be applied by the independent body and lastly, the terms of the
agreement must not discriminate against non-parties.51
49 Section 32(1)(a)-(b) of the LRA.50 See Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context ch 14.51 Section 32(3) of the LRA.
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2 2 Arguments for and against Extensions
Smaller employers argue that the extension of bargaining council agreements
bestows unwarranted powers of control and is contrary to the principle of freedom
of association.52 Smaller enterprises further argue that the agreements contain
provisions and levies that if complied with, threatens their economic viability and
existence. Employers and employees may object to these levies, yet are still
compelled to pay. Bendix states that the original purpose of extending agreements
was to prevent exploitation of non-unionised employees by establishing minimum
levels of wages and service conditions.53 Moreover, since legislation such as the
Basic Conditions of Employment Act now fills part of that lacuna, the minimum
wage-levels set by councils dominated by large employers are inaccurate54 and
renders the potential for certain agreements superfluous. While the author noted
supra appears skeptical in part, a robust argument is made. Basson et al however
maintains that small employers benefit from bargaining councils’ agreements as it
prevents unwarranted competition between same sized enterprises by
standardising production costs of goods.55 Cheadle points out more advantages,
inter alia that it is less costly than bargaining at every workplace; employers who
are bound to pay the same wage will have to compete by being more productive
and not compete by lowering wages; and that strikes are less often organised at
sectoral level.56
52 Bendix Industrial Relations in South Africa (2010) 29553 Ibid. 54 See Bendix Industrial Relations in South Africa (2010) 295. 55 Basson et al Essential Labour Law 299.56 Calitz “The Extension of Collective Agreements to Non-Parties” 2015 SAMLJ 27 1 1-31
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2 3 The Constitutionality of Extension of Bargaining Council Agreements57
Much ink has been spilt on authorising the extension of bargaining council
agreements to non-parties. The constitutionality of section 32 has previously been
unsuccessfully challenged by employers where an extended agreement prohibited
employers from making use of employees of temporary employment services
(labour brokers).58 In terms of the principle of constitutional avoidance, the court
succinctly held that the employers could not rely directly on the Constitution if they
can claim in terms of the LRA. The court then rightly pointed out that the applicants
could not rely on section 186(2) of the LRA dealing with unfair labour practices,
since the LRA does not provide for redress for the unfairness resulting from an
extension of a bargaining council agreement.59
Section 23(5) of the South African Constitution's Bill of Rights states that "every
trade union, employers' organisation and employer has the right to engage in
collective bargaining." Collective bargaining is cast as a right and the LRA provides
the organisational framework in terms of which that right is to be exercised. 60
According to Cheadle the right is composed of three elements: the freedom to
57 Since the amendments to s 32 have been adopted, the effect of National Employers’ Association of South Africa and Others (NEASA) v Minister of Labour and Others (2013) 34 ILJ 1556 (LC) and Valuline CC and Others v The Minister of Labour and Others (2013) 34 ILJ 1404 (KZP) judgments will be cancelled, as the requirements for the extension would be deemed to have been satisfied by the s 49 certificate of the Registrar; see also Calitz “The Extension of Collective Agreements to Non-Parties” 2015 SAMLJ 27 1 1-3158 Confederation of Associations in the Private Employment Sector andOthers v Motor Industry Bargaining Council (GPD) Case No. 464761/2011 (27 November 2013).59 Confederation of Associations in the Private Employment Sector andOthers v Motor Industry Bargaining Council (GPD) Case No. 464761/2011 (27 November 2013) at 28; see also Calitz “The Extension of Collective Agreements to Non-Parties” 2015 SAMLJ 27 1 1-31.60 Currie and De Waal The Bill of Rights Handbook 6ed (2014) 516.
21
bargain collectively; the right of one of the parties in the bargaining process to
exercise economic power against the opposing party (by a strike or lock-out); and
the possibility that the right imposes a duty to bargain collectively on both employer
and employee.61 The right and the exercise of the right may be threatened by the
extension of collective agreements to non-parties amounting to an imposition of a
standard as opposed to a standard arrived at through collective bargaining. 62
While it may be argued that by promoting sectoral bargaining the legislature is
limiting the right to engage in collective bargaining at plant level, according to Du
Toit et al section 23(5) of the Constitution does not spell out the level of bargaining
it protects.63 Moreover, the section64 further provides that national legislation may be
enacted to regulate collective bargaining to the extent that any limitation must
comply with section 36(1) of the Constitution. The learned authors’ further point out
that due to many ILO member states supporting centralised bargaining in some or
other form, any possible limitation of the right contained in the Constitution cannot
be said to be unjustifiable.65
More specifically, in discussing the constitutionality of section 32 of the LRA, the
following factors should be considered as reasonable and justifiable limitations of
the rights contained in the Constitution:
61 Currie and De Waal The Bill of Rights Handbook 6ed (2014) 516; see also H Cheadle Labour Relations in Cheadle et al South African Constitutional Law: The Bill of Rights 2002 365.62 Currie and De Waal The Bill of Rights Handbook 6ed (2014) 516; see also H Cheadle Labour Relations in Cheadle et al South African Constitutional Law: The Bill of Rights 2002 365.63 Du Doit et al Labour Relations Law 326.64 Section 23(5) of the Constitution.65 Du Doit et al Labour Relations Law 326.
22
The extension of collective agreements is essential for the promotion of sectoral
collective bargaining which is a legitimate purpose of the LRA. If extensions are not
permitted centralised bargaining would be impossible unless every single employer
and employee within a sector belonged to employers’ organisations or trade unions
negotiate at sectoral level;66
Article 5(1) of Recommendations 91 of 1951of the ILO endorses extensions of
collective agreements and provides that “where appropriate…measure should be
taken to extend the application …of a collective agreement to all employers and
workers included within the industrial and territorial scope of the agreement”;
Section 32 of the LRA is in harmony with the constitutional framework and is
consistent with the extension of collective agreements to employees who are not
members to a majority trade union;67
And finally, employers who are unable to comply with an extended agreement may
apply for complete or partial exemption which in turn amounts to a removal of any
employers’ rights that may be limited.68
In summation, when determining the constitutionality of the extension of bargaining
council collective agreements the following should also be kept in mind. First, the
66 Ibid.67 Du Doit et al Labour Relations Law 326.68 The cumbersome process and unfair criteria that can be encountered when appealing against the decision of a bargaining council have been noted where an employer applied for an exemption in 2008 from a bargaining council, which decision was taken on review and ultimately decided in 2013. Calitz points out that the purpose for applying for an exemption was because the employer could not afford to pay the outstanding levies which needed to be paid before an exemption is granted; see Calitz “The Extension of Collective Agreements to Non-Parties” 2015 SAMLJ 27 1 1-31.
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Minister can only extend the binding force of a collective agreement if certain
requirements are met.69 Second, a collective agreement may not be made binding
on others who were not party to the negotiations and agreement unless further
requirements have been met.70 Third, the section also prevents the Minister from
extending the agreement to other workers and employers in a sector if the parties to
the bargaining council are not sufficiently representative within the registered scope
of the bargaining council and if the Minister is satisfied that failure to extend the
agreement may undermine collective bargaining at sectorial level or in the public
service as a whole.71
Cheadle points out that we can distinguish a range of rights and obligations in the
right to bargain collectively, all of which are given effect by the LRA, and endorses
the finding that there is no general constitutional duty to bargain.72
Addressing the constitutionality of the LRA's provision for the extension of
bargaining council agreements to cover non-parties, he submits that this is a
justifiable limitation of the right to engage in collective bargaining. Interestingly,
bargaining councils are in decline and endangered by government's intention to
exempt smaller enterprises from centralised bargaining. In support of Cheadle,
69 De Vos “The Free Market Foundation’s Quixotic Venture” (dated 2013-03-07) http://constitutionallyspeaking.co.za/2013/03/07/ (accessed 2015-09-07); The requirements are that the members of the majority trade union vote in favour of the extension and if the employers’ organisations, whose members employ the majority of the employees that are party to the bargaining council, vote in favour of the extension70 The requirements are that the majority of all the employees who will be bound by the extended collective are members of the trade unions that are parties to the bargaining council and if the employers’ organisations who are parties to the bargaining council agreement will employ the majority of all the employees who are bound by the extended collective agreement.71 De Vos “The Free Market Foundation’s Quixotic Venture” (dated 2013-03-07) http://constitutionallyspeaking.co.za/2013/03/07/ (accessed 2015-09-07)72 H Cheadle Labour Relations in Cheadle et al South African Constitutional Law: The Bill of Rights 2002 365.
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writer submits that this is gratuitous, given that there is already provision for
exemptions from bargaining council agreements.73
3 Question C
73 H Cheadle Labour Relations in Cheadle et al South African Constitutional Law: The Bill of Rights 2002 365.
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Strikes, all too often accompanied by violence, are common in essential services in
South Africa. Section 23(2) of the Constitution of the Republic of South Africa, 1996
and Chapter IV of the Labour Relations Act74 (hereafter the LRA) seek to
comprehensively regulate industrial action. While in most countries, industrial action
in essential services is restricted, strikes and lock-outs in South Africa have been
prohibited.75 In analysing the success of Minimum Service Agreement’s in the
South African context phrases such as ‘strike’, ‘essential services’, ‘essential
services committee’ and ‘minimum service agreements’ will be unpacked before
dealing with whether it is practical in South Africa to have certain employees strike
and not get paid, while others work and get paid. Challenges and proposed
solutions will be addressed throughout this assignment.
The definition of strike in the LRA is defined as follows:
“the partial or complete concerted refusal to work, or the retardation or obstruction of
work, by persons who are or have been employed by the same employer or by
different employers, for the purpose of remedying a grievance or resolving a dispute
in respect of any matter of mutual interest between employer and employee, and
every reference to "work" in this definition includes overtime work, whether it is
voluntary or compulsory”76
The right to strike is a constitutional right afforded to all employees however, the
LRA does contemplate restrictions on the right to strike in respect of those
74 66 of 1995 (Hereafter the LRA)75 Section 65 (1)(d) of the LRA.76 Section 213 of the LRA.
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employees who are engaged in essential services.77 From a practical perspective
striking, as a physical act, has seen individuals being thrown out of trains, trucks
and drivers/occupants burnt, dustbins and dirt emptied in streets, libraries and
property damaged, streets barricaded , councillors and members of public and
non-striking workers killed.
3 1 Essential Services
The LRA contains a broad definition of ‘essential services’ in accordance with the
ILO approach and creates a specialised body, the Essential Services Committee
(ESC) which oversees all aspects of essential services.78 Our law requires essential
services to be restrictively interpreted, and this means, that it is the service which is
essential, not the industry or the institution within which the service falls. 79 Only
those employees who are truly performing an essential service, may be prohibited
from striking and essential and non-essential service workers may be found working
side by side in the same institution.80
The LRA defines an essential service as
“ (a) a service the interruption of which endangers the life, personal safety or health
of the whole or any part of the population;
(b) the Parliamentary service;
(c) the South African Police Services”81
3 2 Essential Services Committee (ESC)
77 See Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context ch 14.78 Du Doit, Godfrey, Cooper, Giles, Cohen, Conradie and Steenkamp Labour Relations Law 6ed (2015) 373; see section 70 of the LRA.79 See Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context ch 14.80 SAPS v POPCRU (2010) 12 BLLR 1263 (LAC); (2010) 31 ILJ 2844 (LAC).81 Section 213 of the LRA.
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An essential services committee is established in terms of Section 70 of the LRA
and its primary mandate is to conduct investigations as to whether or not the whole
or a part of any service is an essential service.82 Moreover, the committee
concludes Minimum Service Agreements (MSA) for designated services and ratify
Bargaining Council Collective Agreements that provide for the maintenance of
Minimum Services83 while handling disputes on whether services are essential.
Needless to say the net effect of designation is to limit the right to strike.
3 3 Minimum Service Agreements
The LRA does not define a minimum service, but it is generally understood to be a
minimum service of an essential service or in other words the ambit of an essential
service is reduced to a minimum service. Put differently, ‘minimum service’ refers to
those specific activities which are indispensable for the preservation of life, personal
safety and health through the provision of a service that has been designated
essential.84 The effect of determining minimum services is that only those services
are regarded as essential and made subject to a compulsory dispute resolution
procedure.85 Du Toit et al uses the example of the intensive care unit (ICU) in a
hospital being regarded as a minimum service, while the office administration staff
of the same hospital may be excluded.86 The consequence is that industrial action
within the administration staff will be permissible.87 The LRA contemplates the
82 Section 71 of the LRA.83 Section 72 of the LRA.84 Section 72(3) of the LRA.85 Section 72(3) of the LRA.86 A minimum service agreement can contain the following detail: whether the service is essential in its entirety or only partially essential; whether the service is essential at reduced service levels; the minimum number of employees required to continue working during a strike, either expressed as a number or a percentage of the current workforce; the type of services which must be continued during strike action;minimum service levels associated with various functions and duties to be performed during strike action;waiver of a right to engage replacement labour to provide services in excess of the minimum services.87 Du Doit, Labour Relations Law 376.
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determination of essential services by collective agreement which must be ratified
by a panel of the ESC.
Section 72 of the LRA entitled Minimum Service Agreements states the following:
“The essential service committee may ratify any collective agreement
that provides for the maintenance or minimum services in a service
designated as an essential service, in which case:
(a) the agreed minimum services are to be regarded as an essential
service in respect of the employer and its employees; and
(b) the provisions of section 74 do not apply”.
One of the major obstacles in South Africa has been the inability of employers and
trade unions within essential services to conclude a collective agreement to be
ratified by the ESC.88 Legislation has attempted to overcome this obstacle by
adopting a two-pronged approach. Firstly, a panel of the ESC may order parties to
negotiate a minimum services agreement within a specified period of time, failing
which, permit either party to refer the matter to the Commission for Conciliation
Mediation and Arbitrations (CCMA) or bargaining council for arbitration.89 Secondly,
where the parties fail to conclude a collective agreement or, if same is not ratified,
the panel may itself determine the minimum services.90
3 4 Analysis, Challenges and Proposals
It is not entirely clear why any union would want to designate a minimum service as
it can seldom serve worker interests to have a service designated as such. The
88 Du Doit Labour Relations Law 377.89 Section 72(1)(a) and 72(1)(b) of the LRA.90 Section 72(2) of the LRA.
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right to strike would only apply to the workers who are non-essential, meaning that
a limited number of workers who are not needed to keep the essential service
running effectively would strike on behalf of the non-strikers. This would obviously
put very little pressure on the employer to settle and a strike would in all likelihood
fail. The fundamental right to strike is based on the functional importance of strikes
to collective bargaining and with an ineffectual strike, collective bargaining may
amount to collective begging.91
It may appear to make sense for workers to ballot in favour of interest arbitration as
otherwise they would have no alternative to their right to strike other than to hope
that the non-minimum service workers would have sufficient leverage while striking
to win benefits for them.92 According to Brand the prospect of this would, in most
cases, be very slim.93 Should they ballot in favour of arbitration then one has to ask
what the purpose would have been of determining a minimum service in the first
place, because in the absence of such a determination the parties would have a
right to interest arbitration in any event.94
Surprisingly to date, no minimum service agreement has been ratified by the ESC.
The reason for this may be twofold. The first is that very few minimum service
agreements have been negotiated as trade unions appear to have been
unenthusiastic about validating strike action that has the effect of dividing the
91 Brand “Essential Services and the Implications of Minimum Service Agreements in the Public Service” BLRC 2013 7.92 See Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context ch 14.93 Brand “Essential Services and the Implications of Minimum Service Agreements in the Public Service” BLRC 2013 7.94 Ibid.
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workforce between those who must continue to work and get paid95 and those who
are allowed to strike. Adhering to the “no work no pay” principle, the latter would
then endure the full effects of the strike where it hurts the most – their back
pocket.96 At the risk of repeating the introductory paragraph, the reader is reminded
that “striking, as a physical act, has seen individuals being thrown out of trains,
trucks and drivers/occupants burnt, dustbins and dirt emptied in streets, libraries
and property damaged, streets barricaded , councilors and members of public and
none striking workers killed.”97 In South Africa’s toughened collective bargaining
arena, it is submitted that the reluctance of unions in validating strike action is
understandable when considering the aforegoing. There is however a tactical side
to trade unions preferring to pursue strike action across the entire bargaining unit
which includes essential service workers as this increases the pressure upon the
employer and so enables both essential and non-essential service workers to
leverage greater benefit from the strike.
Equally strategic, employers have also appeared not to have considered it
important to pursue the conclusion of minimum service agreements as in their
absence a larger proportion of public sector workers are precluded from striking.
According to Brand, once strikes have started public sector employers have shown
little willingness or ability to prevent strike action by essential service workers.98
95 Due to the fact that they are employed in essential services.96 Referring to their salaries or pay packets97 See introduction paragraph supra.98 Brand “Essential Services and the Implications of Minimum Service Agreements in the Public Service” BLRC 2013 7.
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The second reason why the ESC has not ratified any minimum service agreements
is that it has not been satisfied that the agreements would ensure the proper
maintenance of the essential service during a strike as ensuring no disruption is no
simple task in the South African context.99
It must be emphasised that if either party really wanted to conclude a minimum
service agreement it is entitled to make a proposal to the other side and if
negotiation fails, then the LRA and the bargaining council constitutions require that
the dispute (over the terms of the minimum service agreement to be concluded)
may be referred to conciliation100 and failing that to interest arbitration. The award of
the interest arbitrator would then have to be ratified by the ESC before coming into
effect. Notwithstanding complaints by some unions about the absence of minimum
service agreements, none of them has made use of the procedures available to
them in law to force conclusion minimum service agreements.101
From the aforegoing it appears apparent that South Arica has the legislative means
at its disposal yet little if any is fully utilised. The strike option appears empty and
inappropriate as a real solution to disputes in essential services especially where
certain employees strike and do not get paid, while others work and get paid.
99 Ibid.100Section 72(1)(a) and 72(1)(b) of the LRA.101 As at 2013; see Brand “Essential Services and the Implications of Minimum Service Agreements in the Public Service” BLRC 2013 9.
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BIBLIOGRAPHY
LEGISLATION
Basic Conditions of Employment Act 75 of 1997
Employment of Educators Act 76 of 1998
Labour Relations Act 28 of 1956
Labour Relations Act 66 of 1995
The Constitution of the Republic of South Africa, 1996
BOOKS
Basson, Christianson, Dekker, Garbers, le Roux, Mischeke and Strydom Essential
Labour Law 5ed (2009) Labour Law Publications Centurian
Bendix Industrial Relations in South Africa (2010) Juta & Co Claremont
Currie and De Waal The Bill of Rights Handbook 6ed (2014) Juta & Co Cape Town
33
Du Doit, Godfrey, Cooper, Giles, Cohen, Conradie and Steenkamp Labour Relations
Law 6ed (2015) Lexis Nexis Durban.
Govindjee and Vranken (eds) Introduction to Human Rights Law (2009) LexisNexis
Durban
Grogan Workplace Law 10ed (2009) Juta & Co Claremont
Martin and Law A Dictionary of Law 5ed (2002) Oxford New York
Rycroft and Jordaan A Guide to South African Labour Law 1992 2ed Juta & Co
Claremont
Van der Walt, Le Roux and Govindjee (eds) Labour Law in Context (2012) Pearson
JOURNAL ARTICLES
Brand “Essential Services and the Implications of Minimum Service Agreements in
the Public Service” BLRC 2013
Bhorat and van der Westhuizen “A Synthesis of Current Issues in the Labour
Regulatory Environment” 2008 DRPU 1
Calitz “The Extension of Collective Agreements to Non-Parties” 2015 SAMLJ 27 1
1-31
34
Van der Walt and Van der Walt “Breach of Collective Agreements: Does the PRA
provide a remedy in Section 24? - Minister of Safety and Security Sectoral