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					                                Report of the
               Employment Conditions
                    Commission

                    1 August 1998 – 31 March 2003



Publisher                       Department of Labour,
                                Private Bag X117
                                Pretoria
                                0001


Editing, layout and design,     Media Production Unit
photography, and distribution   Chief Directorate of Communication
                                Department of Labour


Website address                 www.labour.gov.za


Printer                         Formeset Printers


ISBN No                         0-621-35440-6




                                                                     Page i
Page i i
             Employment Conditions
                  Commission

                               Chairperson




                          Professor Evance Kalula


                                                         Commissioner
     Commissioner              Commissioner          representing Organised
representing Government   representing Government           Business




 Ms Debbie Budlender       Dr Zavareh Rustomjee        Mr Boetie Letsoela


     Commissioner                                        Commissioner
 representing Organised        Commissioner          representing Organised
   Business (alternate     representing Organised       Labour (alternate
        member)                    Labour                   member)




   Mr Kaiser Moyane        Mr Bheki Ntshalintshali   Mr Mdudusi Mbongwe


                                                                  Page iii
Page i v
Contents
Foreword                                                               1

Chapter One
Executive Summary                                                      2

Chapter Tw o
Employment Conditions Commission                                       4

Chapter Three
Making of sectoral determinations                                   6
  Contract Cleaning                                                 6
  Civil Engineering                                                 7
  Private Security Sector                                           8
  Clothing and Knitting                                             8
  Learnerships                                                      8
  Domestic Workers                                                  9
  Agriculture                                                      10
  Wholesale and Retail                                             11
  Small Business                                                   12
  Special Public Works Programmes                                  12

Chapter Four
Current investigations by the Commission                           13
  Taxi                                                             13
  Forestry                                                         14
  Hospitality                                                      14
  Maritime/Fishing                                                 14
  Children in the Performing Arts and Sporting Activities          15

Chapter Five
Setting norms and benchmarks for wage differentials                16

Chapter Six
Reduction of weekly working hours to a 40-hour working week        17

Chapter Seven
Secretariat of the Commission                                      18

Chapter Eight
Concluding remarks                                                 19

Appendix
  A: List of sectoral determinations published                     21
  B: List of current investigations                                22




                                                              Page v
Page v i
Foreword
The Employment Conditions Commission has pleasure in presenting this report
to the Minister of Labour. It is the first report of the Commission’s activities. It
covers the period 1 August 1998 to 31 March 2003.

The International Labour Organisation has identified social dialogue as a
springboard for its international programmes. This approach emphasises social
                                                                                       Professor Evance Kalula
dialogue as a fundamental principle on which to build healthy relationships and
also endorses it as an imperative for sound labour relations.

From a domestic perspective, the principle of social dialogue is not new to South Africa. In fact the first
transitional phase of the new South African democratic government was characterised by negotiation
involving all the key players within the political arena. The process also saw the establishment of NEDLAC,
a body established to promote social dialogue, which in itself was an indication of commitment to social
partnership.

Social dialogue is important for good governance. After all, this is a characteristic of a democratic society.
These principles of dialogue were the fundamental principles ultimately embraced by the Commission in
discharging its mandate. The Basic Conditions of Employment Act (BCEA) also requires public
participation, encouraging parties to talk to each other to resolve their differences rather than adopting
adversarial positions. Through public hearings the Commission was able to hear differing views and
afforded people an opportunity to state their side of the story. From this the Commission gained knowledge
and experience which were taken into consideration when the Commission gave advice to the Minister of
Labour.

Since its inception, the Commission has been involved in various challenging projects. These activities
include recommendations to the Minister on the enactment of sectoral determinations for vulnerable
workers, key among which were determinations for two of the most vulnerable sectors in the South African
labour market, namely domestic and agricultural workers.

The promulgation of these two sectoral determinations and many others is a symbol of our commitment to
the promotion of decent work and the protection of vulnerable workers. The Commission hopes that the
sectoral determinations will pave the way for continuing dialogue around other issues affecting vulnerable
workers. Hopefully through social dialogue, issues around social security and occupational health and
safety for vulnerable workers will feature prominently during these discussions. Most importantly, it is hoped
that they will be translated into tangible results.

The Commission wishes to thank our social partners who provided us with valuable insights into a host of
issues. It is through the commitment of our social partners to the principle of social dialogue and working
with a long-term vision that the Commission has achieved success during the period under review.

Finally, as Chairperson of the Commission, I would like to thank my fellow Commissioners for giving up
their valuable time to serve on the Commission and for the selfless way in which they have carried out their
responsibilities during their term in office. I would like to convey my thanks and gratitude to the secretariat
of the Commission, the Employment Standards Directorate, for the assistance and support they provided to
the Commission.


Professor Evance Kalula
Chairperson
Employment Conditions Commission




                                                                                                     Page 1
Chapter One
Executive Summary
The Employment Conditions Commission started its work in 1999 after the disbanding of its predecessor,
the Wage Board. The promulgation of the Basic Conditions of Employment Act, No 75 of 1997 (BCEA)
repealed the Wage Act of 1957 and thus also the Wage Board which was established in terms of the Wage
Act. The BCEA made provision for the establishment of the Employment Conditions Commission.

This is the second term of office of the Commission. The Commission was first established in 1998 and its
term of office expired in 2001, with the current Commission coming into office in 2002. Since its inception,
the Commission has made recommendations to the Minister of Labour on numerous issues relating to the
application of the BCEA. The following are some of the key achievements since its inception.

● Sectoral determinations published for vulnerable workers
The Minister requested the Commission to conduct investigations into appropriate conditions of
employment and minimum wages for workers in certain sectors with a view to making sectoral
determinations for those sectors. Since 1999 the Commission has conducted extensive investigations into
eight sectors which were deemed to be vulnerable.

Based on the recommendations of the Commission, the Minister established sectoral determinations for the
following sectors: small business, contract cleaning, civil engineering, private security, clothing and knitting,
learnerships, domestic workers, agricultural workers and wholesale and retail.

● Promotion of social dialogue
As part of the investigations into making sectoral determinations, the Commission held public hearings
nationwide and obtained views from representatives of business, labour, civil society, academics and other
interested parties on various issues around wages and conditions of employment. Through these hearings,
the Commission was able to hear differing views and afforded people an opportunity to put forward their
views. From this, the Commission gained a wealth of knowledge and experience which was always
considered in the advice the Commission gave to the Minister.

● Study visit
Shortly after coming into office, members of the Commission expressed a wish to be trained on issues
around minimum wage fixing so as to enable them to do their job well. In September 1999 members of the
Commission and members of the secretariat went on a study tour to the headquarters of the International
Labour Organisation (ILO) in Geneva and to the Low Pay Commission in the United Kingdom.

The purpose of the study tour was to provide training and information to members of the Commission to
assist them in carrying out their tasks. In addition, it was intended that the tour should enable members to
gain awareness of the setting of minimum wages internationally by other statutory bodies working on
minimum wage fixing.

The Commission looked at international trends and best practices on many issues but mainly around
setting standards around wages, working time and what the current thinking was on other labour market
issues. The study was hailed as a success as the Commission had an opportunity to learn from the
experiences of the International Labour Organisation (ILO) and the Low Pay Commission in developing its
own approach to minimum wage and standard setting in South Africa.

● Wage differentials
In terms of the Employment Equity Act, No 55 of 1998, the Commission is required to consider norms and
benchmarks for income differentials. The Commission contracted a research institution to do research on
wage differentials by extracting information on wages and wage differentials by sector, geographical area,
race, gender, occupation and skills levels from information provided by employers on the EEA4 form in
terms of the Employment Equity Act. The report also made recommendations around the revision of the
EEA4 form. The secretariats of the Employment Conditions Commission and the Commission on



Page 2
Employment Equity are in the process of taking forward proposals on a new EEA4 form.

● Input on the Programme of Action for the Eradication of Child Labour
The Department is in the process of developing a National Programme of Action on the Eradication of Child
Labour and the Commission has been involved in this process.

● Input on the amendments to the BCEA
When the Department was effecting amendments to the BCEA, the Commission was consulted and made
input on issues around the format of inspectors’ forms and also on the remuneration schedule.

● Report on progress on reduction of weekly hours to a 40-hour working week
Schedule 1 of the BCEA requires the Department to report on efforts made towards the reduction of weekly
working hours to a 40-hour working week. A report of the findings of a study on the arrangement of working
time and the reduction of hours of work was released by the Department in conjunction with the
Commission on 17 October 2000. In terms of the BCEA the Department must report to Parliament and to
the National Economic Development and Labour Council (NEDLAC) about progress made in this regard. In
order to facilitate the reporting process, a reporting format is being developed to determine the type of
information to be provided by the various stakeholders in this regard.

●   Promulgation of a sectoral determination for learnerships in accordance with the Skills
    Development Act
Section 18(4) of the Skills Development Act, No 97 of 1998 (SDA) makes provision for the Minister, on the
advice of the Commission, to establish a sectoral determination for learners in learnerships. The
Commission made recommendations to the Minister around conditions of employment and the payment of
a learner allowance for learners entering into learnerships. The Minister accepted the recommendations by
the Commission and a sectoral determination for learnerships was published in June 2001.




                                                                                                Page 3
Chapter Two
Employment Conditions
Commission
Composition of the Commission

The Employment Conditions Commission is an independent statutory body established in terms of Chapter
9 of the Basic Conditions of Employment Act, No 75 of 1997.

The Minister in consultation with NEDLAC appoints the Commissioners. The Commission consists of five
members, two members representing organised business and organised labour respectively, and three
members who are knowledgeable about the labour market and conditions of employment, including the
conditions of employment of vulnerable and unorganised workers. The Minister determines the terms of
office of members of the Commission, which may not be more than three years.

A Chairperson heads the Commission and the Department’s Employment Standards Directorate renders
secretariat support to the Commission in carrying out its duties.

The first Commission was appointed in 1998, and consisted of Edwin Molahlehi as chairperson, Evance
Kalula and Debbie Budlender as government appointees, Aubrey Tshalata as business representative, and
Basheer Waglay as labour representative. Tony Ehrenreich replaced Basheer Waglay as labour
representative mid-way through the term of office when Basheer Waglay became a judge in the Labour
Court. The term of the first Commission came to an end in 2002.

The current Commission has held office since 2002. Its members are Evance Kalula as chairperson,
Debbie Budlender and Savareh Rustomjee as government appointees, Bheki Ntshalintshali as organised
labour representative, and Boetie Letsoela as organised business representative. Two alternate members
were appointed during 2003 to represent organised business and organised labour if the principal members
are unable to attend. These are Kaiser Moyane for organised business and Mdudusi Mbongwe for
organised labour.

The Commission endorses the principle of social dialogue as an imperative for sound relations and the
fundamental principle on which to build healthy relationships in the labour market. Accordingly, in carrying
out its mandate the Commission strives to encourage collective bargaining and ‘self-determination’ and thus
take into account agreements reached by stakeholders in the industry. However, because the Commission
is providing advice in respect of sectors which are not well organised, it is necessary for the Commission to
exercise judgement as to whether the agreements reached take into account issues such as the
vulnerability of workers and the ability of the employers to carry on their businesses successfully and the
sustainability of the sector as a whole.

Powers and functions of the Commission

The powers and functions of the Commission are set out in Chapter 9 of the Basic Conditions of
Employment Act.

The Commission is tasked with advising the Minister on matters concerning the BCEA. These include,
amongst others, making sectoral determinations in terms of Chapter 8 of the BCEA and monitoring trends
in collective bargaining for their possible impact on the BCEA. In addition, the Commission has to advise
the Minister and the Minister for Social Development on child labour and the Minister for Public Service and
Administration on matters concerning basic conditions of employment in the Public Service.

The Commission’s advice to the Minister is delivered in the form of a written report. Ideally, members of the
Commission endeavor to prepare a unanimous report to the Minister based on their deliberations.
However, if the members are not able to reach unanimity, each member is entitled to have their dissenting


Page 4
views reflected in the report.

Study tour on minimum wage fixing

In 1999, shortly after coming into office, members of the Commission and some members of the secretariat
went on a study tour to the ILO headquarters in Geneva and to the Low Pay Commission in the United
Kingdom.

The purpose of the study tour was to provide training and information to members of the Commission to
assist them in carrying out their tasks. In addition, it was intended that the tour should enable members to
gain awareness of the setting of minimum wages internationally.

The following issues were highlighted as focus points for discussion during the study tour:

Comparative experience

●   minimum wage and standard setting
●   providing protection for atypical workers

Current thinking on labour market policy in relation to:

●   The relationship between minimum wage setting and employment
●   Reduction of working hours and employment creation
●   Achieving balance between security and flexibility

Best practices

●   Arrangement of working time
●   Conditions for female workers, including maternity provisions and arrangement of working time.

Valuable lessons learnt from the study tour are that the process of setting minimum wages should be an
informed decision that should be based on extensive research prior to the recommendation to get an
indication of what the situation is on the ground. This approach is followed by the Commission in its own
investigations into making sectoral determinations as extensive research is conducted in the affected
sectors on issues like wage levels, extent of regulation within the sector, conditions of employment etc.

The study tour was hailed as a success and the following comments were received from the Commission
and the Department’s officials on the study tour:

“The trip was extremely well organised. Virtually all the people with whom we had appointments were well
worth seeing and dealt with material related directly to our mandate. We received a lot of useful material
and made many contacts that could prove extremely useful in the future. I am personally much more aware
of the wide ambit of our mandate.”
- Debbie Budlender, Commissioner.

“Valuable information was gained. It has helped me get a good picture of current international thinking on
minimum wages. The meetings helped the ECC and the Department’s participants to reflect on their roles
and challenges.”
 – Lisa Seftel, Department of Labour.




                                                                                                   Page 5
Chapter Three
Making of sectoral
determinations
Chapter eight of the BCEA makes provision for the making of sectoral determinations for vulnerable
workers. Before making a sectoral determination for a particular sector, the Minister must direct the
Director-General of the Department to conduct the necessary investigation into that sector to enable the
Commission to carry out its duties. The findings of the investigation by the Department must be in a report
to be presented to the Commission for its consideration.

In advising the Minister, the Commission is required to consider certain criteria, which are set out in Section
54(3) of the BCEA. The criteria include the following:

●   the ability of employers to carry out their business successfully
●   the alleviation of poverty
●   the cost of living
●   the likely impact of any proposed condition of employment or minimum wages on current employment or
    the creation of employment
●   the operation of small, medium or micro-enterprises and new enterprises
●   wage differentials and inequality
●   the possible impact of any proposed conditions of employment on the health, safety and welfare of
    workers in the sector concerned
●   any other information made available to the Commission.

The Commission may hold public hearings at which members of the public are able to make
representations on whatever matter the Commission is considering.

Since its inception, the Commission has made recommendations to the Minister in respect of sectoral
determinations for workers in a range of particularly vulnerable sectors. Workers are deemed to be
vulnerable for various reasons for example:

●   the high levels of worker exploitation within the sector
●   low levels of worker organisation or absence of trade unions within the sector
●   exclusion of workers from the BCEA or other wage regulating mechanisms.

Below are short summaries of sectoral determinations concluded by the previous and current Employment
Conditions Commission between 1 August 1998 and 31 March 2003.

Contract Cleaning

The Contract Cleaning Sector covers between 65 000 and 75 000 workers.

The sector has no national bargaining council, but has a regional bargaining council in KwaZulu-Natal.
Unions are not representative and this is one of the main barriers preventing the sector from establishing a
national bargaining council. However, there is a National Bargaining Forum consisting of the National
Contract Cleaning Association (NCCA) and trade unions, which was formed in 1994. The NCCA has a
membership of approximately 275 employers and the trade unions involved represent approximately 22 000
workers. The South African Transport and Allied Workers Union (SATAWU) is the biggest worker
organisation within the National Bargaining Forum.

The sector is labour intensive and 80% of costs are related to wages, transport and consumables.
Competition is based on fixed contract rates resulting in a very competitive sector where the cutting of costs
of contracts, often at the expense of wage rates, is a regular phenomenon.


Page 6
      The Contract Cleaning Sector covers between 65 000 and 75 000 workers.


The first sectoral determination for the Contract Cleaning Sector was published on 14 May 1999 and it
addressed conditions of employment and wages. The 1999 determination prescribed wages for two years,
and the wage increase was set at 8% in the first year and 7% in the second year.

The second determination was published on 27 August 2002. This determination revised the minimum
wages for another year, but did not change other conditions of employment.

The Commission also advised the Minister to establish a provident fund for the Contract Cleaning Sector
which was established in 2001.

Civil Engineering

The Civil Engineering Sector used to be governed by Wage Determination 480: Civil Engineering, South
Africa, which regulated conditions of employment in the sector.

The main role players in the Civil Engineering Sector are the South African Federation of Civil Engineering
Contractors (SAFCEC) representing employers, and the Building and Construction Allied Workers Union
(BCAWU), Construction Allied Workers Union (CAWU) and National Union of Mineworkers (NUM)
representing workers. These parties have formed a collective bargaining unit, which is referred to as the
National Bargaining Forum. This forum is, however, not necessarily representative of the sector as a
whole.

In making recommendations on conditions of employment for the sector, the Commission referred to both
Wage Determination 480 and the collective agreement struck between SAFCEC, BCAWU and CAWU in
June 2000.

The conditions of employment in the sectoral determination to a large extent mirror the standards contained
in the BCEA. The sectoral determination has special provisions around inclement weather and annual
shutdowns. The determination also allows averaging of hours of work over a four-month period on condition
that workers or unions agree to it in writing.

Wages for this sector were set over a three-year period and came up for review in 2003.




                                                                                                  Page 7
Private Security Sector

The Private Security Sector is one of the few that has enjoyed continued growth over recent years despite
job losses in other sectors. On the other hand, the sector has been associated with a fragile and
sometimes explosive industrial relations climate with intensive national and regional strike activities at
various points during this period.

There are several employer and worker organisations within the Private Security Sector. These two groups
have attempted to establish a bargaining council, but the initiative has been hampered by lack of
representivity on both sides, as well as the non-registration of employer parties. Delays in establishing a
bargaining council and in implementing a provident fund and the lack of agreement between the parties on
appropriate wages are among the issues that have affected labour stability within the sector. The clauses
within the BCEA providing for a phased reduction in maximum hours, also made it more difficult to provide
for increases in wages while taking account of employer concerns around profitability.

The Commission has made recommendations several times in respect of the Private Security Sector. The
sector was previously regulated by sectoral determination no 3, which was promulgated on 25 February
2000 but has since been superseded by sectoral determination no 6. The sector was regulated by sectoral
determination no 6, which was promulgated on 30 November 2001, at the end of the period covered by this
report. The minimum wages provided for in the determinations have been implemented in tandem with a
reduction of hours in line with the BCEA. In April 2000 hours of work were reduced from 60 hours to 55
hours, in April 2001 to 55 hours, and in April 2002 to 45 hours. In its report of February 2002 on its
investigation, the Commission recommended that a review take place in one year around the issues of
hours of work and wages.

The Commission also advised the Minister in respect of a provident fund for the sector. Both parties
eventually agreed to appoint an administrator. However, employers have subsequently thwarted
implementation of the provident fund.

Clothing and Knitting

The Wage Board did a partial investigation into the clothing and knitting sector during 1996/97. The main
focus was to extend the scope of the wage determination to include the former Transkei, Bophuthatswana,
Venda and Ciskei (TBVC) areas. Amendments in this respect were published on 20 June 1997.

During the partial investigation, the Wage Board realised that a full investigation into the sector was
necessary. In particular, the wages for the sector had not been reviewed since March 1994. This placed
workers not covered by a bargaining council agreement or collective agreement at a disadvantage as
employers are under no obligation to increase wages in the absence of a review. The Commission
therefore took over this investigation in 2000.

The Commission recommended that all the provisions in the sectoral determination be aligned with the
BCEA save for a few provisions which have been varied to take into account the specific needs of the
sector.

The Commission used the wages prescribed by the Bargaining Council for the Clothing Industry (Natal) in
November 1998 and the Knitting Industry Bargaining Council (Northern Areas) agreement of 1999, adjusted
for inflation, as benchmarks in recommending wage levels for the sectoral determination.

Learnerships

Section 18(4) of the Skills Development Act, No 97 of 1998 (SDA) makes provision for the Minister to
establish a sectoral determination for learners. The SDA makes provision for two types of learners. The first
category of learners consists of those who were employed by the employer party to the learnership
agreement when the learnership agreement was entered into. The conditions of employment for the
employed learners are not affected by the learnership agreement and no determination is therefore
necessary.

The second category consists of learners who were not employed by the employer party to the learnership
agreement when the learnership agreement was entered into. These learners are referred to as section


Page 8
In its recommendations, the Commission sought to ensure that learners enjoy most of the basic conditions a worker is
entitled to in order to ensure that learners are accorded protection and are not left vulnerable.

18(2) learners. It is these learners who were provided for in the sectoral determination promulgated on 15
June 2001.

In its recommendations, the Commission sought to ensure that learners enjoy most of the basic conditions
a worker is entitled to in order to ensure that learners are accorded protection and are not left vulnerable.
Most of the conditions of employment were thus in line with the BCEA. On the other hand, the Commission
sought to ensure that employers are encouraged to take on as many people as possible as learners without
exploiting learners or displacing those who are already employed.

The determination specifies that learners be paid an allowance rather than a wage, and the minimum
allowance is set at a rate equivalent to a percentage of the annual wage paid by an employer for a qualified
person at the given level of the National Qualifications Framework (NQF). The rate depends both on the
NQF level of the learnership and on the number of credits already attained towards this qualification. The
minimum learner allowance payable is R120 per week.

Domestic Workers

Domestic workers in South Africa were not protected by labour laws until 1993, when the BCEA was
extended to cover them. The BCEA provided protection in terms of conditions of work such as working
hours, leave, and dismissal. It did not, however, provide for a minimum wage.

In September 2002, a sectoral determination for domestic workers was promulgated which provided for
minimum wages as well as for some special conditions suitable for the situation of these workers. For
example, while the determination follows the BCEA in respect of most conditions, it has special provisions
in terms of allowances for night and standby work, for extra family responsibility leave, and for
accommodation.

The definition of domestic workers in the determination includes gardeners, drivers and domestic workers
employed in private households. It excludes domestic workers on commercial farms as they are covered by
the determination for agricultural workers.

The domestic worker determination demarcated the country into two categories of geographical area on the



                                                                                                          Page 9
basis of average household income within different municipal areas as recorded in the 1996 census. For
those municipal areas with an average annual household income of R27 000 or more per year, the
minimum wage was set at the equivalent of R800 per month. For those with an average household income
below R27 000 the minimum wage was set at the equivalent of R650 per month.

The determination sets the minimum as an hourly rather than monthly wage. This was done to cater for the
fact that many domestic workers are not employed on a full-time basis. They may, for example, work only
half-day, or they may work for different employers on different days. The hourly rate also helps to avoid the
disemployment effects of a minimum wage. Where, for example, an employer feels unable to pay the
minimum for the number of hours that the worker worked previously, the number of hours can be reduced
without reducing the minimum hourly rate of the worker, but allowing the worker more free time in which to
do other income-earning activity.




   The definition of domestic workers in the determination includes gardeners, drivers and domestic workers
   employed in private households. It excludes domestic workers on commercial farms as they are covered by the
   determination for agricultural workers.

Agriculture

Agricultural workers, like domestic workers, were excluded from most labour laws during the apartheid
years. In 1993, the BCEA was extended to cover agricultural workers.

The report of the Department recorded that the average cash wage in agriculture in 1996 was R419 per
month. Farm workers earned the lowest wages among those formally employed in the country. About a
quarter of remuneration was paid in kind. Further, the benefits accruing to permanent workers often
depended on the gender of the worker, with female farm workers earning less in terms of cash as well as
in-kind benefits. Some form of policy intervention was clearly needed to address the situation.

The wages for the Agricultural Sector laid down in terms of the sectoral determination were based on
similar principles to those used for the domestic worker determination. Area A covers municipalities in which
the average household income was more than R27 000 per month in Census ‘96, whereas Area B contains
those municipalities where the average household income was less than R27 000. The determination
states that farm workers working more than 27 hours a week should be paid a rate of R800 per month in
area A and R650 per month in Area B. The wages for part-time or seasonal workers should be calculated
on an hourly basis.


Page 10
    Farm workers earned the lowest wages among those formally employed in the country.


With regard to conditions of employment, the following issues around payment were regulated in a way,
which took into consideration the specific circumstances of the sector:

●    payment in kind
●    sick leave and medical certificates
●    working time, including extension of hours of work and work on Sundays
●    night work
●    termination of employment.

Wholesale and Retail

The Wholesale and Retail Sector is one of the largest employers in South Africa, and is also one of the
most rapid changing sectors in the country.

Unlike most other sectors where jobs have been declining over the past ten years, employment levels in
retail have been increasing, both in the formal and informal sector. However, growth in employment is
occurring mainly through non-standard employment arrangements like casual work, part-time work and
franchising. Such forms of employment have increased insecurity, threatening the working standards of all
workers, including those in full-time employment.

Previously, the retail sector was governed by Wage Determination 478, which excluded the former
Transkei, Bophuthatswana, Venda and Ciskei (TBVC) areas, small enterprises and newly established
employers that had not been in business for longer than two years.

In December 2002 a sectoral determination was promulgated which covers all workers in the Wholesale
and Retail Sector, including workers who were previously excluded from the scope of Wage Determination
478. The determination made special provisions for reduced wages for employers who were previously
excluded from wage determination 478. These employers were allowed to reduce the stipulated minimum
wages by 30% in the first year, 20% in the second year and 10% in the third year.

The new sectoral determination did away with the concept of casual workers. Instead, it makes provision


                                                                                                 Page 11
for the employment and remuneration of part time workers on an hourly basis.
With regard to wages, the country was demarcated into three areas on the basis of the average household
income recorded for the municipal area concerned in Census ’96. The three areas were as follows:

A – average income greater than R24 000 per annum
B – average income between R12 000 and R24 000 per annum
C – average income less than R12 000 per annum.

Wages were set for entry-level, and full-time workers.

Small Business

In 1998 the Minister established a Ministerial Task Team to look at the making of a ministerial determination
for firms employing less than 10 workers.

The task team recommended that a ministerial determination be made for employers employing less than
10 workers. It recommended that the determination vary four conditions of employment contained in the
BCEA as follows:

●   allowing a maximum of 15 hours overtime per week
●   providing for an overtime rate of time and a third rather than time and a half
●   providing for 21 days leave including family responsibility leave
●   averaging hours of work by agreement with appropriate protection against abuse of workers.

The task team recommended further that the small business determination could be superseded where a
bargaining council agreement, collective agreement or sectoral determination exist.

After investigation, the Commission made the following recommendations in respect of variation:

●   A maximum of 15 hours overtime may be worked
●   The rate of overtime should be the same as prescribed by the BCEA, which is time and a half
●   Up to two days family responsibility leave may be offset against annual leave
●   Averaging of hours of work should be allowed with provision for basic protection against abuse.

The Commission agreed with the recommendation of the Task Team that the small business determination
could be superseded if there was a bargaining council, collective agreement or sectoral determination.

The Commission also recommended that the determination should only be applicable in the sectors which
both a NTSIKA report and the Ministerial Task Team had indicated would experience particular difficulty,
namely: accommodation and catering trade, enterprises employing less than five workers, general dealers,
security services, transport companies and service stations employing less than 10 workers.

The Minister did not accept all the recommendations of the Commission. On 5 November 1999 a sectoral
determination was promulgated with provisions as recommended by the Task Team.

Special Public Works Programmes

The ECC was consulted on a ministerial determination and conditions of work for Special Public Works
Programmes by the Employment Standards Directorate and the ECC supported it. The notice in terms of
section 87(2) of the Basic Conditions of Employment Act, 1997 was published on 25 January 2002, in
Government Gazette No 23045, No. R.64.




Page 12
Chapter Four
Current investigations by the
Commission
In addition to the above, the Commission has been requested by the Minister to make recommendations
around possible sectoral determinations for further sectors that are deemed vulnerable. As of 31 March
2003 the Commission had started investigations into the following sectors, but these investigations are at
various stages, but not at the completed stage yet:

Taxi

Soon after the 1994 elections, the government took the first steps in democratising the mini-bus taxi sector.
The Minister of Transport, initiated the formation of a National Taxi Task Team (NTTT) in November 1994.
One of the recommendations of the NTTT was the need to improve labour relations in the taxi industry.
Subsequently, the Department of Transport embarked on further initiatives of democratising the industry,
including encouraging the formation of Provincial Taxi Councils and, eventually, the South African National
Taxi Council.




       With regard to improving labour relations, in 2000 the Minister ordered an investigation into the Taxi
       Sector.



With regard to improving labour relations, in 2000 the Minister ordered an investigation into the Taxi Sector.
The investigation is intended to look at current conditions of employment and wages payable within the
sector with a view to making a sectoral determination for this sector.

The notice announcing the investigation by the Department was published under Government Notice
No R1046 in Government Gazette No. 20413 of 3 September 1999.




                                                                                                                Page 13
Forestry

In 2000 the Department of Water Affairs and Forestry (DWAF) approached the Department to conduct an
investigation into the Forestry Sector with a view to making a sectoral determination to set minimum wages
and appropriate conditions of employment for the sector. DWAF was particularly concerned that workers
working for contractors of the forestry corporations and/or resident on land owned by these corporations
might have been adversely affected by outsourcing arrangements.

The Department has subsequently commissioned research into the conditions of forestry workers. This
investigation will cover the entire South African Forestry Sector, excluding the processing of timber
products.

The notice announcing the investigation by the Department of Labour was published under Government
Notice No R1124 in Government Gazette No 22822 of 16 November 2001.

Hospitality

The investigation into the Hospitality Sector was initiated by the Wage Board. In 1999, on dissolution of the
Wage Board, this investigation was handed over to the Commission.

The first part of the investigation required the Commission to consider the feasibility of combining four
existing wage determinations with a view to having a single wage determination for the Hospitality Sector.
The wage determinations that were to be part of this investigation are the following:

(i) Wage determination 479: Accommodation Establishment Trade, Certain Areas
(ii Wage determination 461: Catering Trade, Certain Areas
(iii) Wage determination 457: Hotel Trade, Certain Areas
(iv) Wage determination 477: The Trade of Letting of Flats or Rooms, Certain Areas.

As part of its investigation, the Commission conducted public hearings in several provinces on this issue.
During the hearings, concerns were raised around various issues including the lack of a clear definition of
the sector. In order to address these concerns, the Minister extended the definition of the term hospitality
and also extended the investigation to the whole of South Africa.

The new terms of reference were published in Government Gazette No 20968 of 17 March 2000 under
Government Notice No R229.

Maritime/Fishing

Most workers in the Fishing Sector are not covered by the BCEA. The sector is partly covered by the
Merchant Shipping Act 57 of 1951 which makes provision for seamen to have contracts of employment
stipulating their working conditions.

The Fishing Sector currently has various subsectors that each have their own conditions of employment.

In order to ensure that workers within the Fishing Sector are not left vulnerable clearly some type of
intervention was required. It is for this reason that the Department initiated the process of investigating the
sector with a view to making a sectoral determination for this sector.

However subsequent to the announcement of the investigation, it emerged that the employer body and the
trade unions within the sector had applied for the registration of a bargaining council. In 2001 the Registrar
of Bargaining Councils approved the registration of the bargaining council for this sector.

The parties also submitted an agreement for the Minister to publish in the Government Gasette. It is hoped
that once the scope of the bargaining council has been extended to all parties, it may not be necessary to
make a sectoral determination for this sector. However if this move to include non-parties to the bargaining
council is not successful, the Commission will proceed with this investigation covering the subsectors that
are not covered by this agreement.

The terms of reference for this investigation were published on 27 July 2001 under Government Notice


Page 14
No R686.

Children in the Performing Arts and Sporting Activities

In line with the Constitution, sections 43-48 of the BCEA prohibit the employment of children below the age
of 15. Contravention of these provisions of the BCEA is punishable by a fine or imprisonment. However,
Section 50(2) of the BCEA allows the Minister to vary section 43 to allow for the employment of children
engaged in the performance of advertising, sports, artistic and other cultural activities.




    The Minister ordered an investigation in accordance with section 50(2) of the BCEA into conditions of
    employment for children involved in the performing arts.


The Minister ordered an investigation in accordance with section 50(2) of the BCEA into conditions of
employment for children involved in the performing arts. The Department presented its findings to the
Commission in this regard. The Commission has since provided the Minister with recommendations in
respect of a sectoral determination for children in the performing arts.

The terms of reference for this investigation were published in the major national newspapers on 7 July
1999.




                                                                                                            Page 15
Chapter Five
Setting norms and benchmarks
for wage differentials
In terms of the Employment Equity Act, No 55 of 1998, the Commission is required to consider norms and
benchmarks and advise the Minister in respect of income differentials.

The Commission, in conjunction with the Department, contracted a research institution to do research on
wage differentials by extracting information on wages and wage differentials by sector, geographical area,
race, gender, occupation and skill levels from information provided by employers on the EEA4 form in terms
of the Employment Equity Act. The researcher also drew out relevant patterns from the labour force survey
conducted by Statistics South Africa.

The final report identified some of the underlying factors contributing towards wage differentials, in
particular differentials in respect of race and gender. The research report included recommendations
around the revision of the EEA4 form if it is to allow for accurate analyses of income differentials.

The secretariats of the Employment Conditions Commission and Commission on Employment Equity are in
the process of taking forward proposals on a new EEA4 form.




Page 16
Chapter Six
Reduction of weekly working
hours to a 40-hour working week
Schedule I of the BCEA requires the Minister, in consultation with the Commission, to conduct an
investigation into how the reduction of weekly working hours to a level of 40 working hours per week may
be achieved.

The Department must, after consultation with the Commission, monitor and review progress made in
reducing working hours and publish a report every two years on the progress made. The reports must be
tabled at NEDLAC and in Parliament by the Minister.

The initial report on the reduction of working hours to 40 hours per week was released by the Department
at a press conference on 17 October 2000. It was also presented to the Parliamentary Portfolio Committee
on Labour on 1 November 2000 and was tabled in the Labour Market Chamber of NEDLAC for discussion
in 2001.

The report reviewed the present situation in South Africa, identified sectors, companies or workplaces
where steps had been taken to reduce weekly working hours to a 40-hour working week and reported on
lessons and trends. The report also looked at comparative international experience. It concluded that a
40-hour working week can only be achieved to the benefit of workers and the economy under certain
circumstances. The most important of these include the following:

●   A reduction in income inequality and poverty
●   Increased skills levels
●   Improved job security for all workers
●   Reduced crime and improved public transport.

The report also identified the conditions under which a 40-hour working week can most favourably be
implemented. In order to enable the Department to report back to Parliament and other constituencies on
progress made towards the reduction of weekly working hours, a reporting format has to be developed that
will prescribe the information that will be required from different parties. The Department has
commissioned further research on this issue.




                                                                                                Page 17
Chapter Seven
Secretariat of the Commission
The BCEA requires the Minister to provide the Commission with staff that will assist the Commission in
carrying out its duties and to also provide technical support to the Commission.

The secretariat of the Commission is located within the Employment Standards Directorate, which is a
subprogramme within the Labour Relations Programme of the Department. The Directorate is responsible
for setting minimum wages and enforcing basic conditions of employment as set out in the BCEA. The
Directorate is divided into two Subdirectorates: BCEA Administration and Standard Setting.

The Subdirectorate Standard Setting acts as the secretariat of the Commission. In terms of the Ministry of
Labour’s Fifteen Point Programme of Action, the objective of the Directorate is to consolidate, advocate and
enforce basic conditions of employment to protect particularly vulnerable workers. The Directorate has as
its target audience those unorganised workers who do not belong to any unions or worker organisations.

In carrying out its mandate to protect vulnerable workers, the Directorate interacts with stakeholders such
as employer organisations, trade unions, research institutions, government departments, academic
institutions and interested groups. However, the Directorate mainly relies on the public to make input on its
investigations and to approach it on any matters relating to the BCEA.




Page 18
Chapter Eight
Concluding remarks
As indicated at the beginning of this report, the Commission is committed to the principle of social dialogue
and transparency in its dealings with the public.

This report is not only intended to inform the public about the work of the Commission, but also to stimulate
debate on other issues such as the enforcement and monitoring of minimum standards and other issues
relating to the BCEA. The effectiveness of the enforcement and monitoring systems of the Department will
serve as a measure to the Commission of both the soundness of the standards set by the Commission and
the effectiveness of the Department’s enforcement measures.

A crucial aspect of social dialogue is the sharing of information. It is crucial that information on minimum
wages is disseminated to the people most affected. There are various ways that the Department has
adopted to promote advocacy around minimum wages. It is hoped that this report will be seen as the
Commission’s contribution to the dissemination of information to the public.

Resumè of current ECC members

Prof Evance Kalula, Chairperson

Prof Evance Kalula is chairperson of the Commission. He is Professor of Law (Employment Law and Social
Security) in the Commercial Law Department of the University of Cape Town. He is Director of both the
School for Advanced Legal Studies (the postgraduate programme), and the Institute of Development and
Labour Law.

He regularly serves as consultant to various organisations in Southern Africa, including the ILO, the
Friedrich Ebert Stiftung (FES) and the Southern African Development Community (SADC) secretariat. He
served on the former Independent Mediation Service of South Africa (IMSSA) panel, and currently serves
on the Arbitration and Mediation Service of South Africa (AMSSA).

Prof Kalula also serves on numerous editorial boards of academic and professional journals.

Ms Debbie Budlender, representing Government

Ms Debbie Budlender is a specialist researcher with the Community Agency for Social Enquiry (C A S E), a
non-governmental organisation working in the area of social policy research. Debbie has worked for
C A S E since 1988. Previous employment includes administrative and research work for trade unions, and
research for the university-based Southern African Labour and Development Research Unit at the time of
the Second Carnegie Enquiry into Poverty. Between 1997 and 2002, Ms Budlender was seconded to
Statistics South Africa, where she worked mainly on gender, labour, poverty and children’s issues.

Dr Zavareh Rustomjee, representing Government

Dr Zavareh Rustomjee is currently Director of Southern Africa Energy, BHP Billiton plc. He was previously a
special advisor to the Minister of Trade and Industry. Savareh has assisted the Minister of Minerals and
Energy on projects relating to state-owned enterprises involved in liquid fuel, petrochemical and gas
industries and associated policy matters.

Dr Rustomjee is a former Director-General of the Department of Trade and Industry (DTI). Before this he
worked as a researcher into trade and industrial policy and coordinated the ANC Department of Economic
Planning’s Trade and Industry Desk. Between 1980-1988, Zavareh accumulated nine years of professional
work experience in South African industry, including the petroleum, industrial gas and process plant design
and contracting sectors.




                                                                                                     Page 19
Mr Boetie Letsoela: representing Organised Business

Mr Boetie Letsoela’s current involvement includes Crownhill Energy (Pty) Ltd, International Specialised
Vehicle Services (ISVS), Tshewolo Communications managing member, Council Member of the National
African Federated Chamber of Commerce (NAFCOC), and National Productivity Institute (NPI) board
member. Mr Letsoela has served on a range of different committees and task teams. For example, he
served on the Ministerial Committee of the Ministry of Transport into the taxi industry National Taxi Task
Team] (NTTT) and the Liquid Fuel Task Force. He has also represented organised business in many
international fact-finding missions abroad. He was formerly Secretary-General of the Long-Distance Taxi
Association.

Mr Bheki Ntshalintshali: representing Organised Labour

Mr Bheki Ntshalintshali is currently the Deputy General-Secretary of the Congress of South African Trade
Unions (COSATU). He previously worked for the Chemical and Industrial Workers Union (CIWUSA) of
South Africa as an organiser. He was later elected to Assistant General-Secretary of the same union.

Mr Ntahlintshali went to Oxford University between 1995 and 1996 where he studied labour law, industrial
relations and economics. On his return from the United Kingdom, he was appointed National Collective
Bargaining Coordinator of CIWUSA and remained in this post until he was recruited by COSATU as its
Organising Secretary.

Mr Kaiser Moyane, representing Organised Business (alternate member)

Mr Kaiser Moyane is currently Chief Consultant, Labour Relations at SANLAM. He previously worked as an
attorney for Bowman-Gillfilan Inc. He also serves as one of the business representatives on the Labour
Market Chamber of NEDLAC.

Mr Mdudusi Mbongwe, representing Organised Labour (alternate member)

Mr Mdudusi Mbongwe is currently the Deputy General-Secretary of the South African Commercial Catering
and Allied Workers Union (SACCAWU), a position he has held since 1999. He was previously the Regional
Secretary of SACCAWU for the Wits region. He represents SACCAWU on the COSATU Central Executive
Committee and, in the past, has represented SACCAWU on the Regional Executive Committee.




Page 20
Appendix A
List of sectoral determinations
published

No.   Sectoral Determination            Date published         v.
                                                           G o v. Gasette No. Date for Review

      Small Business                    5 November 1999    No. 20587
      (Ministerial determination)

      Special Public Works Programmes   25 January 2002    No. 23045
      (Ministerial determination)
 1.   Contract Cleaning Sector          14 May 1999      Vol. 407 No. 20064
      Amended                           16 November 2001 Vol. 437 No. 22836
 2.   Civil Engineering Sector          2 March 2001       Vol. 429 No. 22103 March 2003


 3.   Private Security Sector           25 February 2001   Vol. 437 No. 22873
      Amended                           30 March 2001      Vol. 429 No. 22175
 4.   Clothing and Knitting Sector      13 October 2000    Vol. 424 No. 21643
      Amended                           5 April 2002       Vol. 442 No. 23306
 5.   Learnerships                      15 June 2001       Vol. 432 No. 22370


 6.   Private Security Sector           30 November 2001 Vol. 437 No. 22873


 7.   Domestic Workers Sector           15 August 2002     Vol. 446 No. 23732


 8.   Farm Workers Sector               2 December 2002    Vol. 450 No. 24114


 9.   Wholesale and Retail Sector       19 December 2002 Vol. 450 No. 24207




                                                                                      Page 21
Appendix B
List of current investigations

           Sector                v.
                             G o v. Gasette No.           v.
                                                      G o v. Notice No.      Date Published
Taxi                      No. 20413                R1046                  3 September 1999

Forestry                  No 22822                 R1124                  16 November 2001

Hospitality               No. 20968                R205                   19 February 1999
                                                   R229                   17 March 2000

Fishing                                            R686                   27 July 2001

Children in the Performing Terms of reference
Arts                       published in national
                           newspapers on 7 July
                           1999.




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