Amy Musgrave
Group Labour Editor
The social compact that accompanied South Africa’s negotiated revolution in 1994 has never been under greater strain and scrutiny in the past 20 years.
The tension is even evident in the socio-economic institutions set up post-1994 to promote social cohesion through negotiation and mutually beneficial settlement of our society’s problems.
Nedlac, the government, labour and business negotiating chamber which was set up to help ensure meaningful consensus on socio-economic policy, is probably the most important of these. It has also taken the most strain from the gradual unraveling of the post-1994 bargain.
While the successes of Nedlac in helping steer a young democratic South Africa in the right direction cannot be denied, the trust deficit between labour, business, the government and civil society, the four interlocutors in Nedlac, is expanding fast.
There are several reasons for the hostility, much of which centre on the poor performance of the economy. Because growth is stagnant, the economic pie which is essentially divvied up at Nedlac has not kept pace with the growing demand on it.
Other contributors are that social partners cannot agree on a shared vision to take the country forward, other than that growth must include job creation on a larger scale.
The economy has also done little to close the gap between the rich and the poor. Research of the country’s top 50 companies reveals that a low-wage earner will have to work 267 years to make what a chief executive does in one year, and 15 years to match the pay of an executive director. To add racial fuel to the inequality fire, the economy is still largely in the hands of a small group of white men.
The ANC and the state have not helped. The neo-liberal trajectory of economic policy of the past 20 years has led to labour growing more bitter, and business more bolshie in what it demands of the state. These policies have done this without coming even close to delivering the growth, employment and developmental goals they promised.
An example of growing business obstructionism is the stance of the National Employers Association of SA (Neasa), which is refusing to give workers in the metal and engineering sector an increase agreed to by the sector’s bargaining council more than a month ago, claiming it cannot afford it.
At the same time it is calling for an end to collective bargaining which it believes prolongs strikes. Neasa’s recent moves are essentially an ideologically driven frontal assault on the institutions of redistribution in a country where the median wage is still below R3 000 a month.
On the labour side of the equation, there is little doubt that strikes have grown longer, more bitter and marked by violence as worker demands have become more strident.
According to Deputy President Cyril Ramaphosa, workplace animosity over the past two years has resulted in longer strikes. This year alone the country had a five-month-long strike on the platinum belt and then a month-long strike in the metal and engineering sector, which has still not been adequately resolved as some companies are locking out workers who refuse to accept a lower pay increase.
At Nedlac, labour is questioning its reasons for participating in the forum if the government does not consult it on policy and laws, some of which have been anti-worker. Some in the business world question the relevance of an institution that does not grant them direct access to government leaders at the highest levels, when they can have this through direct lobbying.
Nedlac’s community constituency, which comprises civil society and NGOs, is only allowed to participate in the development chamber of Nedlac, although it is meant to be an equal partner.
This results in the absurd situation in which communities such as those living on the platinum belt, and who are therefore directly affected by mining, have limited say in policy-making that could change the way platinum companies operate in their backyards.
And while the government should be the guarantor of the model of social dialogue represented by Nedlac, it has often been accused of not taking the institution seriously. The national Treasury bypassed the organisation to ensure that the Employment Tax Incentive Bill, otherwise known as the youth wage subsidy, would become law. Labour is vehemently opposed to the legislation, which it believes encourages bosses to displace older workers in favour of younger, less experienced ones in order to receive tax concessions.
Although these concerns have not yet materialised, it has emerged that labour brokers, another bugbear for labour, are reportedly receiving the lion’s share of the tax rebates under the act, without creating any new jobs for youths.
The latest example, at least as far as labour is concerned, is the government’s attempts to make changes to retirement savings with little consultation. Unions have warned they will embark on mass strikes if there is not a moratorium on the changes and they have the full backing of the community constituency.
This rift between the social partners, and the retirement reforms were the focal points of most of the speeches and discussions at Nedlac’s annual summit earlier this month. While there have been calls for Nedlac to be dissolved, with some arguing social dialogue takes too long and our problems need less talk and more action, the forum’s constituencies are largely in agreement that it has to stay.
Jabu Mabusa, who is the president of Business Unity SA and spoke on behalf of the business constituency, has called for a high-level meeting to look at Nedlac’s relevance, but since then other business leaders have come out in support of the forum. The most prominent voice in support was Raymond Parsons, former convener for business at Nedlac.
Nedlac’s executive director, Alistair Smith, agrees there should be a review, but that it should focus on how Nedlac functions. He told the summit the challenge was how social partners could move from the current “extreme polarisation” in labour relations.
While many, especially from the business sector, opposition parties and conservative civil society groups have blamed current labour laws for the hostilities, Smith and Ramaphosa have warned that amending labour legislation is not the silver bullet to easing tension.
Instead there should be a commitment to resisting quick fixes and building the capacity of Nedlac to deal with issues in a more thoroughgoing manner. One of the criticisms of its functioning currently is that the government’s participants are too junior and cannot make decisions without extensive and constant consultation with their principals.
“It seems apparent that many of our recent upheavals have less to do with the specific design of laws or institutions and more to do with capacity, conduct and commitment of the social actors involved,” Smith says in Nedlac’s annual report.
So what is the way forward?
Much will be at stake at a labour relations indaba under the auspices of Nedlac in November.
While those attending the Nedlac summit were civil and committed to social dialogue, the November meeting could be very different. It is meant to look at how to improve the current labour relations environment, including considering the divisive proposals to change the labour laws.
Some suggestions include introducing a ballot to ascertain how many people want to down tools at a company, and forced arbitration after a strike has gone on for a certain amount of time or if it turns violent.
Labour is adamant it will not give up any of its hard-won gains, while business and some in government are keen to see changes to the labour laws so that strikes, such as the one in the platinum sector, are a thing of the past.
Already unions are angry with Ramaphosa, who is likely to be a key figure at the indaba, for his perceived backing for legislative changes.
The meeting will be a true test of how committed South Africa’s social partners are to improving the current situation. But no matter how keen they may be to revamp the country’s social pact, a poorly performing economy will remain the monkey on South Africa’s back.