Labour Policy Digest A publication of the Chamber of Mines of South Africa December 2008 Contents Main article IRS Activities and the Year Ahead... 1 3 Topical issues Labour Courts... 3 Global Economic Situation: Impact on the Mining Industry... 4 NUM Protest March on Transformation Issues... 4 Section 77 Notice on Food Prices... 5 NEDLAC Annual Summit... 5 Employees Injured on Duty Before 1 July 2008... 5 Chamber s Annual General Meeting... 5 6 IRS Activities and the Year Ahead While central negotiations on wages and conditions of service did not take place in 2008, the Chamber s IRS has had a busy year. Of importance have been the processes to implement the large number of agreements emanating from the 2007 negotiations for gold and coal. Good progress has been made with these and the Chamber has recently sent a comprehensive implementation report to the unions. Contributors Frans Barker Elize Strydom Corinna Gardner Mailing List If you would like your name to be added to the Labour Policy Digest circulation list, e-mail your details to pmartins@bullion.org.za. The provisions relating to salaries and conditions have been implemented. Other issues, however, require longer-term processes before being brought into effect. A good deal of preparatory work on the issue of a mining museum and monuments to recognise the contribution of mineworkers to the South African economy has been undertaken, including a scoping exercise by international experts. A joint Task Team with the unions has been established and has met on two occasions. It will continue its deliberations in
the new year. Similarly, much work has been done regarding the integration of the MDA and TEBA Development. Both organisations have expressed the desire to merge and are currently in the process of finalising a due diligence exercise that has been undertaken by independent auditors. Attention has also been given to updating both the gold and coal Core Conditions Codes for miners and artisans. During 2008, IRS has also been kept busy with discussions on the bargaining council. While agreement has been reached that the discussions will first focus on gold and coal, meetings have also taken place for non- Chamber member mining companies, contractors and for companies in the diamond and platinum sectors. The Chamber, on behalf of the unions and the SA Association of Mining Contracting Companies, also commissioned a survey on mining contracting companies in South Africa. Amongst others, IRS has also been involved in issues relating to power supply, health and safety, the future of the Labour Courts, the appointment of Judges to the Labour Courts, accommodation and housing standards, the review of the social plan, social security and retirement reform and local and rural development. IRS Officials have represented employers at BUSA and in the Labour Market Chamber of NEDLAC. The Industrial Relations Adviser has also represented South African employers in the Application of Standards Committee of the International Labour Organisation. 2009 looks set to bring with it many challenges, not least of which will be the review of wages and conditions of service in both the gold and coal sectors. The review will take place against a backdrop of weak economic conditions, high interest rates, rising costs and falling commodity prices. The expectations of the unions, and their members, will have to be carefully balanced with the need for the companies to remain productive in a difficult economy. Negotiations to establish the bargaining council are on-going, with gold and coal leading the way. Once significant progress has been made with gold and coal, the discussions will be extended to other commodities. Agreement has already been reached that mining contractors will be part of the bargaining council, housed in a separate sub-council. 2009 will see serious attention being given to a constitution for the bargaining council. Of particular importance are the recognition criteria for both unions and employers and also the exemptions procedures. Once agreement has been reached on a constitution, the parties will apply to the Department of Labour s Registrar of Labour Relations to register the council. The registration process includes the publication of a notice in the Government Gazette and the demarcation of the area and sector of the council by the NEDLAC Demarcation Committee. The Registrar will also consider whether or not the applicants are sufficiently representative of the sector to establish a bargaining council. If the registration process is successful, the bargaining council will then be established and staff appointed. Another very important issue that will be dealt with in 2009 is the review of the Broad-Based Socio-Economic Empowerment Charter for the South African Mining Industry. The commitments outlined in the Charter are in pursuit of a shared vision of a globally 2
competitive mining industry that draws on the human and financial resources of all South Africa s people and offers real benefits to all South Africans. The review of the Charter will assess how much progress has been made by the mining companies in meeting the Charter s commitments. The Chamber has already begun preparing for the review and has commissioned an outside consultant to prepare a report based on information provided by the companies. This report will be discussed by the CEOs of the mining companies very early in 2009. Other issues that will feature prominently on the broader IRS agenda next year will be atypical forms of employment and the government s proposals regarding social security and retirement reform. These issues will be addressed through BUSA and in tripartite negotiations in NEDLAC. Labour Courts The Director-General of the Department of Justice and Constitutional Development recently invited NEDLAC to enter into discussions with the department on its discussion document entitled Single Judiciary Integration of the Labour Appeal Court and the Labour Court into the Supreme Court of Appeal and the High Court Respectively. A meeting to discuss this document took place on 23 September 2009. The department proposed the following arrangements regarding the Labour Courts: the Labour Appeal Court to be folded into the Supreme Court of Appeal; the Labour Court to be folded into the High Court; the current Labour Court judges to become High Court judges; there will be a list of Supreme Court of Appeal and High Court judges with expertise in labour law matters and only they will be given such matters to adjudicate; the social partners will be "involved" and will "participate" in the nomination of judges to be on the list; decisions of the High Court on labour matters will have national application; and the participation of union representatives and employer representatives in court proceedings will be preserved. The NEDLAC representatives have welcomed the department s proposal that the composition of the Judicial Services Commission will include NEDLAC. Support was also given for the proposal to fold the Labour Appeal Court into the Supreme Court of Appeal. However, the NEDLAC representatives were not in favour of the proposal to fold the Labour Court into the High Court. Instead, they proposed that the Labour Court become a division of the High Court with its decisions having national application. The Director-General has indicated that the department will consider this proposal and has undertaken to include it in the department s discussion document as a possible option. The Director-General is currently awaiting a paper from the Chief Justice on the issue of the apex court as this will have an impact on the future structuring of all the courts. Once he has received this paper, the Director-General will arrange a meeting between NEDLAC and the Minister of Justice and Constitutional Development further to discuss the future of the Labour Courts. 3
Global Economic Situation: Impact on the Mining Industry On 1 December 2008 the Department of Minerals and Energy (DME) hosted a highlevel meeting of stakeholders in the mining industry to discuss the global economic situation and the impact it could have on mining, both internationally and in South Africa. It has been agreed to establish a Task Team, to be convened by the DME, that will have 20 days to formulate recommendations to address the current situation. It will also consider proposals on longer-term issues regarding the future of mining in South Africa and certain policy issues. NUM Protest March on Transformation Issues with the MQA, appoint consultants to conduct a skills audit; apply recognition of prior learning; with the MQA and labour, identify 15 000 engineering helpers / assistants and artisan aides to be trained as artisans; remove all barriers to employees becoming functionally literate and numerate; implement the Employment Equity Act affirmative action provisions with commitment and honesty ; do away with Fanagalo; conduct a study to determine the number of black women in senior positions in comparison to white women; remove the barriers to the employment of women, such as functional capacity and pregnancy regulations ; appoint senior managers to expedite hostel conversions; provide low cost housing options; finalise ESOPs; and implement the Mining Charter. On 4 October 2008 the NUM marched to the Chamber in protest against the lack of transformation in the industry. The NUM particularly highlighted skills development, affirmative action, the employment of women and the elimination of discrimination on the grounds of race, disability and gender. In a memorandum handed to the Chamber, the NUM demanded that the Chamber and its members: Demands were also made of the MQA, the Department of Labour and the Department of Education. The NUM has warned that failure to address its demands could result in severe mass action by no later than October 2009. The Chamber has responded in detail to the NUM s memorandum and has made policy proposals for joint solutions and joint engagement on a number of issues. reconsider their representation on transformational structures such as the MQA; 4
Section 77 Notice on Food Prices Both COSATU and FEDUSA served section 77 notices on NEDLAC citing high food prices as the reason for the proposed protest action. Subsequently, a Task Team on food prices was established to consider the issues giving rise to the possible protest action. The Task Team has now concluded its deliberations and has released its final report. The section 77 Standing Committee has deemed the matter to have been considered in terms of the Labour Relations Act. This means that the unions are entitled to serve a section 77 (1)(d) notice on NEDLAC giving 14 days notice of their intention to proceed with protest action. NEDLAC Annual Summit NEDLAC s annual summit took place on 2 December 2008 at the CSIR Conference Centre, Pretoria. The theme of the summit was Globalisation, Growth and Social Justice: The Role of Social Dialogue. Addresses were delivered by Business, Community and Labour. The keynote address was delivered by President Motlanthe. The address on behalf of labour was given by Mr Z Vavi. In his address he expressed concern about the large number of retrenchment notices that have been issued, a continued movement towards casualisation of jobs and a significant increase in food and electricity prices which has dramatically increased the cost of living for workers. He also conveyed the expectation of workers that the government will put more pro-poor social measures in place during the course of next year. Employees Injured on Duty Before 1 July 2008 The Minister of Labour has published Notice 1158 in Government Gazette Number 31535 of 31 October 2008. The Notice invites all employees who were injured on duty before 1 July 2008 but refused payment of compensation on the grounds that they were not receiving active medical treatment to contact the nearest Department of Labour office to have their claims reviewed. Chamber s Annual General Meeting Mr Sipho Nkosi was re-elected as President of the Chamber of Mines at the 118 th Chamber AGM held on 4 November 2008. In addition, Mr Robbie Lazare was re-elected Vice President. Mr David Noko was also elected Vice President to replace Dr Vincent Maphai who will be leaving BHP Billiton and therefore was not available for re-election. In his address, Mr Nkosi sketched out the difficult environment in which the mining industry operated during 2008, which saw South Africa losing its status as the world s biggest gold producer to China due to declining grades, the power crisis and safety-related mining stoppages. Touching on the global financial turbulence that took place in the past several weeks, Mr Nkosi also noted that South Africa is confronted by many of the same 5
challenges being experienced elsewhere in the world. Among the most commanding of these were the challenge of the six Ps, namely, people, procurement, power, permits, projects and politics. He indicated that these challenges are current inhibiting factors to operational success and in our context it is the responsibility of major stakeholders to work collectively to overcome these issues so that transformation, a robust mining sector and strong global companies can be established and sustained. On the issue of safety, Mr Nkosi said the safety of mining industry employees is lodged at the very highest level on the operational and strategic agendas of companies that are members of the Chamber. During the month of August, chief executives of Chamber member companies met over two days to apply their minds to the manner in which a culture of health and safety can be strengthened and how working environments can effectively be made safer and healthier. Endorsing the target of zero harm and the milestones that have been agreed with tripartite partners to achieve this objective, the chief executives also acknowledged the principle that safety is a core value that must always take precedence over production. Mr Nkosi said while the Chamber and its members are not opposed to legal provisions aimed at preventing serious or repeated transgressions of safety requirements, the industry, as represented by the Chamber, has difficulty in the attempted introduction of legislation that fails to comply with the Constitution and has the potential of creating the unintended consequences of causing the loss of invaluable skills and thus inhibiting performance in a fiercely competitive international arena. He said that the Mine Health and Safety Amendment Bill, currently before the National Council of Provinces, contains two sections which, should they be implemented, will have the unintended consequence of causing the South African mining industry to lose the services of a considerable number of highly skilled managerial and supervisory employees as many will choose to export their skills to somewhere else in the world where they are not faced with the threat of imprisonment and inflationary fines for events over which they have no realistic control. He advised the AGM that legal advice taken by the Chamber from Senior Counsel indicates that the proposed new provisions in the Mine Health and Safety Amendment Bill are unconstitutional. Efforts to have them appropriately amended, or deleted, are actively being pursued. Mr Nkosi also dealt with the electricity crisis, saying that the likelihood of ESKOM finding itself in a position sometime in the near future where it is forced to reduce or curtail electricity supply to customers has prompted the Chamber to demand the development of a protocol for handling electricity supply emergencies so that the events that took place in January 2008 will not be repeated. He also outlined the contribution of the mining sector to the South African economy. 6