Johannesburg - A South African court ruled small textile factories owned by Chinese and Taiwanese families in Newcastle, in the eastern KwaZulu-Natal province, are exempt from National Bargaining Council agreements on wages.
A group of five Taiwanese-owned companies and the United Clothing and Textile Association, which represents some producers, asked the Pietermaritzburg High Court to set aside minimum wages set by the council and extended across the industry.
The factories that aren’t members of the council can hold separate talks with their workers on pay levels, Judge Piet Koen said in a written ruling today.
The companies threatened to cut jobs or close down the factories if they were forced to abide by national labour regulations, including minimum wages.
The ruling may make it easier for small textile companies to afford more workers, while reducing the pay of those in employment.
“We want to return the power of negotiation to the shop floor,” Alex Lui, president of the Newcastle Chinese Chamber of Business, said in an interview.
“We don’t want wages set by some organisation based in Johannesburg that treats all employers the same whether they are large and small.”
Less than half of employees in the clothing industry are represented by the National Bargaining Council, Koen said in the ruling. - Bloomberg News