SALARY INCREASES AND WAGE NEGOTIATIONS

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1 WEEKLY INDUSTRIAL RELATIONS UPDATE Sunday 22 November 2015 This and previous editions of the Weekly IR Update are also available at SALARY INCREASES AND WAGE NEGOTIATIONS Du Toit Agri and Fawu Fresh fruit producer Du Toit Agri has reacted strongly to strike action by members of the Food and Allied Workers Union (Fawu) at its Ceres-based packing operations, who are in dispute over pay and working conditions. However the company insists the union is not complying with previously negotiated agreements. They say media release issued by the union is littered with misinformation and is an attempt to mislead the public. Strike at SAA ground handling service provider suspended A pending strike last Monday by members of the National Transport Movement (NTM) at handling company Swissport, operating at OR Tambo airport, was suspended. However, baggage handlers started a slow-strike, work to rule this morning. Swissport provides ground services to SA Airways (SAA). The suspension was agreed upon pending an appeal hearing at the Johannesburg Labour Court on Thursday. The union earlier downed tools in September demanding a minimum monthly salary of R11,000. Salaries apparently start from R2,500. Meanwhile, Swissport has undertaken a membership verification process with NTM under the auspices of the CCMA. The findings found that the union s membership level of 42.5% (1,004 members) failed to meet the company s required 45 % level. Gauteng community health workers unpaid for months Community health workers (CHWs) in Soweto have still not been paid despite an assurance by Gauteng health MEC Qedani Mahlangu some weeks ago. However, according to the Democratic Alliance, 70 CHWs at the Chiawelo Community Health Centre who expected to be paid more than a week ago were left out of pocket when this did not happen.

2 2 The CHWs were recruited in mid-august and were promised R3,500 a month. They have continued to work despite being owed three months salary. Their work includes providing home-based care, delivering medicines to house-bound patients, and going door-to-door to assess the health status of households. National minimum wage Deputy President Cyril Ramaphosa is due to conduct bilateral meetings with National Economic Development and Labour Council (Nedlac) members this week, after business and labour agreed to accelerate work towards the setting of a national minimum wage. A technical task team within Nedlac, which Ramaphosa chairs, met with the council on Saturday and recommitted to the process. Concurrently, Parliament has been conducting its own process of public hearings and debate over a national minimum wage. Pay increase for domestic workers from 1 December Domestic workers will receive a pay increase from 1 December. In terms of the Domestic Sectoral Determination, an employee that works more than 27 hours in Area A should be paid not less than an hourly rate of R11.44, while an employee that works less than 27 hours in Area A should be paid not less than an hourly rate of R An employee working more than 27 hours in Area B should be paid a minimum of R10.23 an hour, while an employee working less than 27 hours in Area B should not be paid not less than R12.07 an hour. Area A refers to large metropolitan municipalities and built up areas and suburbs, while Area B is all other municipalities. Sunday Times staff in revolt over cancelled bonuses The Tiso Blackstar Group is facing a revolt over pay by staff at the Sunday Times and The Times, its sister publication, due to non-payment of annual bonuses. Employees at the weekly and daily newspapers demanded that their cancelled bonus be reinstated and pay be raised by at least 8% in a letter sent to management on 13 November. A response was demanded by 20 November. CEO Andrew Bonamour said staff didn t meet criteria for bonuses. Tiso Blackstar this year completed its acquisition of Times Media Group, which owns the two newspapers, as well as Business Day and the Financial Mail. According to Bonamour, the Sunday Times profits has slumped 42% and circulation has dropped to 320,000 from more than 400,000. Cosatu and Provident fund reform

3 3 Threats and political pressure have prompted Parliament s standing committee on finance to delay a vote to restrict direct access to retirement savings. The proposal, brought by the Treasury, will eventually force the annuitisation of two-thirds of provident fund assets on retirement. The issue has over the past two years pitted the Treasury against labour federation Cosatu as a result of which the proposal s introduction was delayed from 1 March this year to 1 March next year. Cosatu has said it is preparing a campaign against the Treasury, and should the proposal proceed next year it would affect how the federation would campaign for the ruling ANC ahead of the 2016 local elections, due to take place in the first half of the year. It was decided that the vote in the standing committee on finance would be held over in order to seek consensus with those opposed to the reform proposal. Cosatu has argued that the reform should await the release of a discussion paper on comprehensive social reform, but the Treasury says this is not necessary because the proposal is not in conflict with the paper s proposals. RETRENCHMENTS AND RESTRUCTURING Possible job cuts in manufacturing in 2016 Nearly half of all manufacturing firms are looking at cutting jobs over the next year according to results of the Manufacturing Circle s third quarter survey. The majority of participants in the survey fall in the small- to medium-firms category. According to the survey, 26% and 28% of firms planned to increase employment during the coming 3 months and 12 months, respectively. However it also showed that 33% and 45% of employers in the sector were planning to cut their labour force in 3 months and 12 months time, respectively. The survey also found that business confidence in the sector was low with the majority of respondents expressing a lack of confidence in business conditions. The volatile exchange rate, labour unrest, rigid labour laws, the current drought and Eskom s perceived inability to provide a reliable electricity supply were cited as contributing factors. Birchwood workers reinstated 50 of the 139 workers retrenched by Birchwood Hotel in Boksburg have been reinstated, but they will only resume their duties in January next year. An agreement was reached by the SA Commercial, Catering and Allied Workers Union (Saccawu) and the hotel after a 2-month picket outside the premises. Saccawu shop steward Thulile Mosoana indicated that workers at the hotel had agreed to donate money to the 50 workers to sustain them over the Christmas season. Group Five job cuts

4 4 Group Five said it has to continue with retrenchments because of continued pressure in the local construction market, particularly in the civil engineering environment. In its financial year to June, the company retrenched 2,500 employees to reduce its workforce, including limited duration contract employees, from 4,400 to about 1,900. Chief Executive Eric Vemer said that the markets had remained weaker for longer than expected and the group had to take more costs out since June through retrenchments, the number of which will be released with the February interim financial results. Proposed restructuring of SA Police Service It emerged on Wednesday before Parliament s police portfolio committee that a major restructuring of the SA Police Service (SAPS) is in the making. This will involve splitting recently merged divisions, removing crime intelligence from direct accountability to the national commissioner, and establishing a new management intervention structure to deal with problems at provincial and station levels. Acting national police commissioner Lieutenant-General Khomotso Phahlane indicated that the current structure was too expensive in that the previously created divisions required a lieutenant-general in charge, two major-generals and more offices, adding that the proposal is aimed at improving efficiency and effectiveness. The proposals are effectively the third restructuring in five years from JOB CREATION BMW s R6bn boost for Rosslyn BMW said the R6 billion investment - among the automotive industry s biggest yet in South Africa - would be channelled towards its existing plant at Rosslyn. The company indicated it was reaffirming its commitment to the country with the investment, by pumping money and resources into its Rosslyn plant. The investment will enable the Rosslyn plant to produce the next generation of the BMW X3, which will be sold locally and exported to various countries across the world. INDUSTRIAL ACTION AND DEMONSTRATIONS Popcru march The Police and Prisons Civil Rights Union (Popcru) staged a national march against police murders in Pretoria on Friday and took their demands to the police minister, the acting police commissioner and the justice minister police minister. Its demands include armoured patrol vehicles and the establishment of a unit dedicated to police killings. Parliament strike

5 5 Talks between Parliament and the National Education Health and Allied Workers' Union (Nehawu) to end the strike over performance bonuses were on track on Thursday. The strike, which commenced on 6 November over whether bonuses should be calculated on one month's salary or a year's total package, was suspended earlier in the week. On Tuesday, Parliament acceded in principle to the workers' interpretation of how the bonuses should be calculated, with a task team established to work out the details. The union reported back to members on Friday. TRANSFORMATION Mines must execute social and labour plans Platinum mining groups have been warned to walk the talk on commitments made in their social and labour plans (SLPs) or risk reputational damage. This is according to political risk analysts The Paternoster Group, whose members include former Lonmin CEO Ian Farmer and UCT academic and analyst Richard Calland. The report analyses the findings of the Farlam commission of inquiry that investigated the deaths of 44 people during a strike at Lonmin (Marikana) in August The Paternoster report draws attention to the commission s finding on Lonmin s failure to build houses in terms of its SLP (having a SLP is a legal prerequisite for securing a mining licence). Lonmin committed to building 5,500 houses for its migrant employees, but at the time of the strike had built three. Lonmin is not alone in its lack of progress, says Paternoster and quotes from the mineral resources department s mining charter assessment report, which indicated that in May only 55% of mining rights holders had met targets for housing or living conditions. Solidarity s equity case against DCS Trade union Solidarity s 10-year fight to have the employment equity plan of the Department of Correctional Services (DCS) invalidated comes before the Constitutional Court on Wednesday. The case will be a litmus test on whether regional demographics may be considered when making appointments, especially in the Western Cape and KwaZulu-Natal. The provinces are majority black, with one having the former having a large coloured majority and the other a significant Indian presence. Solidarity is bringing the case to the court on behalf of 10 members employed by the DCS in the Western Cape who were overlooked for promotion as their race and/or gender were considered "overrepresented" in the department and their appointment would have been out of step with its equity plan. The case has been before the Labour Court and the Labour Appeal Court, which found the DCS s plan to be defective as it failed to take account of regional demographics. Despite this, Solidarity wants the Constitutional Court to also rule on the matter.

6 6 Transformation in aviation sector The SA aviation industry has drawn flak over the slow pace of transformation as it has a meagre compliment of 1,343 black pilots out of an overall pool of more than 17,000 pilots practicing in the country. Costs and a decrease in the demand for pilots have been blamed as the primary factors. Speaking in the wake of the release of pilot statistics by the SA Civil Aviation Authority (SACAA), the SA Transport and Allied Workers Union (Satawu) insisted that the time had come for the industry to transform. We have been fighting for transformation in this industry. It is not just bad with pilots, it s even worse in the technical departments. You only find black people as general workers, said Satawu s Mathew Ramosie. INTERNAL UNION AFFAIRS Cosatu general secretary One of the items on the agenda at trade union federation Cosatu s national conference next week will be the election of a general secretary to replace Zwelinzima Vavi. Acting general secretary Bheki Ntshalintshali is a likely contender, though his bid is unlikely to be smooth sailing. Not only was Ntshalintshali Vavi s deputy, there are also questions about his abilities as a leader. There is also strong lobbying for second deputy president Zingiswa Losi to become the first woman to take over the powerful general secretary position. A dark horse is Cosatu s regional secretary in North West, Solly Phetoe, who could get massive support from Vavi s supporters in Cosatu, though this could be to his detriment. Cosatu membership down by many thousands According to a draft report to be presented at the congress, the federation s membership has dropped by 324,835 to million in the last three years. In November 2014, Cosatu expelled its biggest affiliate, the National Union of Metalworkers of SA (Numsa), which at the time had 320,000 members. Since Numsa's expulsion, Cosatu has admitted as an affiliate the Liberated Metalworkers Union of SA (Limusa), with 7,771 members. Currently the National Education Health and Allied Workers' Union (Nehawu) is Cosatu s biggest union with 277,317 members, followed by the National Union of Mineworkers (NUM) with 270,649, the SA Democratic Teachers Union (Sadtu) with 248,556, the Police and Prisons Civil Rights Union (Popcru) with 154,008 and the SA Transport and Allied Workers' Union (Satawu) with152,254. With the exception of the NUM and Satawu, all of the above are public service unions. The NUM has seen a big drop in membership numbers since the formation of the Association of Mineworkers and Construction Union (Amcu). The report indicated that the

7 7 NUM has lost 39,733 members since 2012, though this figure is considered to be unusually conservative. ILLEGAL MINING Illegal mining Illegal mining in the Ekurhuleni region is beyond the metro s control, according to mayor Mondli Gungubele. The bodies of 11 suspected zama zamas (illegal miners) were found piled up in a mine shaft in New Modder, near Benoni, on Tuesday, following a number of murders in the nearby Angelo informal settlement in suspected zama zama turf wars. Though the police presence had been increased in the metro, it has yielded little in the way of results as almost all crimes related to illegal mining happened underground and largely out of sight, according to observers. The growth in illegal mining could be attributed to the combination of a difficult socioeconomic climate and limited law enforcement resources, the Chamber of Mines said in October.

WEEKLY INDUSTRIAL RELATIONS UPDATE

WEEKLY INDUSTRIAL RELATIONS UPDATE Sunday 4 October 2015 This and previous editions of the Weekly IR Update are also available at http://www.masimongrs.com/ Issues covered: Headlines: Chamber of Mines: