Date: 02/07/2003
Source: Department of Labour
Title: Mdladlana: Labour Law Conference 2003
ADDRESS BY MR MMS MDLADLANA, MINISTER OF LABOUR, MP, AT THE LABOUR LAW CONFERENCE, Sandton Convention Centre, 2 July 2003
THEME: THE CHANGING NATURE OF EMPLOYMENT
Master of ceremonies,
Distinguished delegates,
Ladies and gentlemen.
It gives me great pleasure to be with you on this momentous occasion of the Labour Law Conference 2003.
Hector Louw
Allow me to begin with a quote from an article by Mziwakhe Hlangani that appeared in The Star newspaper, on May Day this year:
"It never occurred to Hector Louw that work discrimination would catch up with him. Nine years after the democratic dispensation, he says, he still suffers discrimination at work and is made to feel he is a 'nothing' because he is a black temporary worker. His four-year work ordeal as a casual general assistant in a major retail store is similar to experiences of those who suffered under stringent pass laws.
Louw, who turns 23 today, earns between R275 and R425 a week, depending on the number of days he has worked. He often works odd hours (between 1pm and 6pm), weekends and even on public holidays when permanent staff members take time off.
He has no right to sick leave as a casual employee, no pension benefits and is not insured for injury on duty. He has no choice but to report to work anytime that he is required to, without the benefit of a transport allowance.
Louw could not continue with his education after he passed his matric. He had to help his mother maintain their modest Pimville home in Soweto. He is also financially contributing to the education of his two younger sisters."
I chose to begin with this quote because I felt that it adequately illustrates some of the realities and complexities of the focus of your deliberations in this conference, "the changing nature of employment".
The experience of Mziwakhe Hlangani's Hector Louw is the experience of thousands of other workers in our country. It is the experience, as our research has shown, of workers not only in the retail sector but also in agriculture, mining, construction, transport, services and other sectors of the economy.
Casualisation is a reality in our country. The term is generally used to also refer to part-time, temporary and seasonal work. In many sectors of our economy we are coming across evidence of a clear historical casualisation of employment, where all new jobs are now temporary or of a casual nature whereas this was not the case five or ten years ago.
I chose to begin with this quote because it highlights that some of the problems we found in the labour market in 1994, and sought to address through legislative and other interventions, are still there and could worsen as a result of the changing nature of employment. These include the inadequate protection for some low-wage earners, the extreme levels of inequality, and the existence of widespread poverty amongst some of those that are in employment. This is apart from other well-known problems such as the absence of social security and the non-compliance with occupational health and safety standards.
The growing precariousness and insecurity in the labour market is not only due to casualisation but also to what some have termed 'externalisation', which refers to outsourcing, subcontracting, home working, and the use of temporary employment services or labour brokers.
Hector Louw would be familiar with this phenomenon, as our research in companies within the retail sector has shown that many different labour brokers often operated in each store with different conditions of employment
I have no doubt that this year's Labour Law Conference discussions are timely and of interest to us, as policy makers, and the broader society as a whole. We need to understand the changing nature of employment and the challenge it poses for our vision of the labour market and the labour market regulatory framework that we have adopted. We believe that our approach to the changing nature of employment should be one that is mature and grounded on empirical evidence rather than be alarmist or reactionary in the face of fairly mild or non-substantial developments.
In this address to you I wish to briefly outline how we understand the changing nature of employment and its implications, and what the Department of Labour is doing or plans to do. It is my hope that you will find this humble contribution inspiring for the rest of your deliberations at this conference.
What is shaping the 'changing nature of employment'? It may be useful to begin by asking what exactly is shaping the changing nature of employment in our country today. I would like to focus on four possible drivers of the transformation of the world of work; the changing structure of our economy; globalisation; technological change; and the emergence of non-standard employment relationships.
Economists have a habit of telling us that the demand for labour is a "derived" demand and that the work that people do is a reflection of the goods and services that society produces. This certainly appears to be correct when we look at how the sectoral distribution of jobs in our economy has changed over time.
Our economy has been going through a process of structural change during the last few decades that has seen the GDP share of agriculture and mining, the primary sector, decline compared to the increasing share of services, the tertiary sector. Not surprisingly employment in mining and agriculture has declined significantly, in manufacturing the fall was less rapid, whilst the share of employment in services has actually increased.
Globalisation or the integration of our economies, and the associated increases in investment and capital flows, movements of goods and services, and people, are also widely acknowledged to contribute to the changing nature of employment.
This it is able to do through, for example, the competitive pressures placed on firms and how they have responded in how they utilise their labour. Many workers have become concerned about employment becoming less stable or 'protected' under globalisation, as multinationals become almost stateless enterprises that show little concern for workers and communities moving their production from one country to another, in search of reduced production costs and less regulatory restraints, the so-called 'race to the bottom' that many of you would be familiar with.
Technological progress and changes that make it possible to replace humans with machines, and reshape production through new forms of industrial organisation, and relocation of production platforms, is contributing to changes in the nature of employment but these will be more pronounced as a possible impact of technological innovations with respect to information and communication technologies (ICTs).
Some have argued that these innovations will affect where employment is located, in what industries and occupations, the nature of the employment relationship, skill requirements and their distribution, the organisation of work, and human resource and industrial relations practices.
The emergence of non-standard employment relationships is perhaps for us the biggest explanation for the changing nature of employment in our country today.
As labour lawyers, sociologists, economists and members of other social sciences, you can further debate the usefulness of the concepts of "standard" vs. "non-standard" or "typical" vs. "atypical" employment relationships.
In our use of the term "non-standard" employment relationships we merely wish to highlight that gone are the days when having a 'job' meant that:
-You were employed full-time
-You worked on the premises of your employer
-You had reason to believe that your job was secure for a considerable period of time
Today much employment, especially that which could be classified under 'casualisation' or 'externalisation', differs from what we have stated. It is 'atypical' or 'non-standard'.
Self-employment and employment in the informal economy, which are becoming more pronounced in our labour market, could also be considered as part of the non-standard employment relationship.
As part of the emergence of the non-standard employment relationship, there is an increasing fuzziness about who is an employee and who is an independent subcontractor. Many workers are employees but you tend to find them without the protection of an employment relationship, or they are self-employed but indications are that they were 'pushed' into self-employment.
The case of 'triangular' employment relationships (e.g. labour brokers or temporary employment services) is also one that is emerging in importance in our country but has been given little attention before. Our labour market regulatory framework should be able to clarify, where the work or services of the worker are provided to a third party: who the employer is, what rights the worker have, and who is responsible for them.
Implications of the changing nature of employment
The story of Hector Louw provides a stark reminder of the potentially negative consequences of the changing nature of employment, particularly the emergence of non-standard employment relationships. There is considerable evidence that many other non-standard employment relationships are characterised by low wages, lack of job security or opportunities for training and development, and even lack of safety at the workplace.
However, it needs to be recognised also that there are those workers who choose non-standard employment relationships because of the flexibility it gives to them, as they can also have time for their families, if married or raising children. For these individuals, even jobs with low pay and of uncertain duration would provide a useful source of supplementary income.
At the firm level we must also recognise that there are those firms that wish to comply with existing labour laws but would adopt the path of casualisation for various reasons, such as reducing labour costs, to cover overtime hours and extraordinary shift hours and to allow for relatively easy deployment of labour.
Through our amendments to the BCEA and the LRA, which I know you will discuss extensively in your deliberations at the conference, we have tried to address some of the legal uncertainties with regard to flexibility in how employers structure the employment relationship.
Through our sectoral determinations, such as the one we established for the sector in which Hector Louw works, we are attempting to protect even the most marginalized and vulnerable of workers.
Conclusion
Chairperson,
When the ANC government came to power in 1994, it inherited a labour market characterised by chronic unemployment, adversarial labour relations, racially skewed earnings, and lack of skills amongst workers. They also found a labour market regulatory framework that was fragmented and did little to enhance efficiency and employment.
We rose to the challenge to embark on a programme to transform this labour market, to ensure that it met the needs of a competitive and equitable economy.
The changing nature of employment necessitates that we be vigilant so that the improved efficiency of our labour market is not threatened by the lack of protection for a new group of workers.
In line with our overall approach to labour market regulation, we will continue to explore some of the challenges posed by the changing nature of employment, particularly the emergence of non-standard employment relationships.
Our emphasis will continue to be to address these issues through social dialogue. Together with our social partners we need to find the possible 'optimal' combination between employment stability and employment flexibility that is needed to generate the desirable levels of productivity and security in the labour market.
We wish you every success in your deliberations.
I thank you
Issued by the Department of Labour, 2 July 2003
Source: Department of Labour
Title: Mdladlana: Labour Law Conference 2003
ADDRESS BY MR MMS MDLADLANA, MINISTER OF LABOUR, MP, AT THE LABOUR LAW CONFERENCE, Sandton Convention Centre, 2 July 2003
THEME: THE CHANGING NATURE OF EMPLOYMENT
Master of ceremonies,
Distinguished delegates,
Ladies and gentlemen.
It gives me great pleasure to be with you on this momentous occasion of the Labour Law Conference 2003.
Hector Louw
Allow me to begin with a quote from an article by Mziwakhe Hlangani that appeared in The Star newspaper, on May Day this year:
"It never occurred to Hector Louw that work discrimination would catch up with him. Nine years after the democratic dispensation, he says, he still suffers discrimination at work and is made to feel he is a 'nothing' because he is a black temporary worker. His four-year work ordeal as a casual general assistant in a major retail store is similar to experiences of those who suffered under stringent pass laws.
Louw, who turns 23 today, earns between R275 and R425 a week, depending on the number of days he has worked. He often works odd hours (between 1pm and 6pm), weekends and even on public holidays when permanent staff members take time off.
He has no right to sick leave as a casual employee, no pension benefits and is not insured for injury on duty. He has no choice but to report to work anytime that he is required to, without the benefit of a transport allowance.
Louw could not continue with his education after he passed his matric. He had to help his mother maintain their modest Pimville home in Soweto. He is also financially contributing to the education of his two younger sisters."
I chose to begin with this quote because I felt that it adequately illustrates some of the realities and complexities of the focus of your deliberations in this conference, "the changing nature of employment".
The experience of Mziwakhe Hlangani's Hector Louw is the experience of thousands of other workers in our country. It is the experience, as our research has shown, of workers not only in the retail sector but also in agriculture, mining, construction, transport, services and other sectors of the economy.
Casualisation is a reality in our country. The term is generally used to also refer to part-time, temporary and seasonal work. In many sectors of our economy we are coming across evidence of a clear historical casualisation of employment, where all new jobs are now temporary or of a casual nature whereas this was not the case five or ten years ago.
I chose to begin with this quote because it highlights that some of the problems we found in the labour market in 1994, and sought to address through legislative and other interventions, are still there and could worsen as a result of the changing nature of employment. These include the inadequate protection for some low-wage earners, the extreme levels of inequality, and the existence of widespread poverty amongst some of those that are in employment. This is apart from other well-known problems such as the absence of social security and the non-compliance with occupational health and safety standards.
The growing precariousness and insecurity in the labour market is not only due to casualisation but also to what some have termed 'externalisation', which refers to outsourcing, subcontracting, home working, and the use of temporary employment services or labour brokers.
Hector Louw would be familiar with this phenomenon, as our research in companies within the retail sector has shown that many different labour brokers often operated in each store with different conditions of employment
I have no doubt that this year's Labour Law Conference discussions are timely and of interest to us, as policy makers, and the broader society as a whole. We need to understand the changing nature of employment and the challenge it poses for our vision of the labour market and the labour market regulatory framework that we have adopted. We believe that our approach to the changing nature of employment should be one that is mature and grounded on empirical evidence rather than be alarmist or reactionary in the face of fairly mild or non-substantial developments.
In this address to you I wish to briefly outline how we understand the changing nature of employment and its implications, and what the Department of Labour is doing or plans to do. It is my hope that you will find this humble contribution inspiring for the rest of your deliberations at this conference.
What is shaping the 'changing nature of employment'? It may be useful to begin by asking what exactly is shaping the changing nature of employment in our country today. I would like to focus on four possible drivers of the transformation of the world of work; the changing structure of our economy; globalisation; technological change; and the emergence of non-standard employment relationships.
Economists have a habit of telling us that the demand for labour is a "derived" demand and that the work that people do is a reflection of the goods and services that society produces. This certainly appears to be correct when we look at how the sectoral distribution of jobs in our economy has changed over time.
Our economy has been going through a process of structural change during the last few decades that has seen the GDP share of agriculture and mining, the primary sector, decline compared to the increasing share of services, the tertiary sector. Not surprisingly employment in mining and agriculture has declined significantly, in manufacturing the fall was less rapid, whilst the share of employment in services has actually increased.
Globalisation or the integration of our economies, and the associated increases in investment and capital flows, movements of goods and services, and people, are also widely acknowledged to contribute to the changing nature of employment.
This it is able to do through, for example, the competitive pressures placed on firms and how they have responded in how they utilise their labour. Many workers have become concerned about employment becoming less stable or 'protected' under globalisation, as multinationals become almost stateless enterprises that show little concern for workers and communities moving their production from one country to another, in search of reduced production costs and less regulatory restraints, the so-called 'race to the bottom' that many of you would be familiar with.
Technological progress and changes that make it possible to replace humans with machines, and reshape production through new forms of industrial organisation, and relocation of production platforms, is contributing to changes in the nature of employment but these will be more pronounced as a possible impact of technological innovations with respect to information and communication technologies (ICTs).
Some have argued that these innovations will affect where employment is located, in what industries and occupations, the nature of the employment relationship, skill requirements and their distribution, the organisation of work, and human resource and industrial relations practices.
The emergence of non-standard employment relationships is perhaps for us the biggest explanation for the changing nature of employment in our country today.
As labour lawyers, sociologists, economists and members of other social sciences, you can further debate the usefulness of the concepts of "standard" vs. "non-standard" or "typical" vs. "atypical" employment relationships.
In our use of the term "non-standard" employment relationships we merely wish to highlight that gone are the days when having a 'job' meant that:
-You were employed full-time
-You worked on the premises of your employer
-You had reason to believe that your job was secure for a considerable period of time
Today much employment, especially that which could be classified under 'casualisation' or 'externalisation', differs from what we have stated. It is 'atypical' or 'non-standard'.
Self-employment and employment in the informal economy, which are becoming more pronounced in our labour market, could also be considered as part of the non-standard employment relationship.
As part of the emergence of the non-standard employment relationship, there is an increasing fuzziness about who is an employee and who is an independent subcontractor. Many workers are employees but you tend to find them without the protection of an employment relationship, or they are self-employed but indications are that they were 'pushed' into self-employment.
The case of 'triangular' employment relationships (e.g. labour brokers or temporary employment services) is also one that is emerging in importance in our country but has been given little attention before. Our labour market regulatory framework should be able to clarify, where the work or services of the worker are provided to a third party: who the employer is, what rights the worker have, and who is responsible for them.
Implications of the changing nature of employment
The story of Hector Louw provides a stark reminder of the potentially negative consequences of the changing nature of employment, particularly the emergence of non-standard employment relationships. There is considerable evidence that many other non-standard employment relationships are characterised by low wages, lack of job security or opportunities for training and development, and even lack of safety at the workplace.
However, it needs to be recognised also that there are those workers who choose non-standard employment relationships because of the flexibility it gives to them, as they can also have time for their families, if married or raising children. For these individuals, even jobs with low pay and of uncertain duration would provide a useful source of supplementary income.
At the firm level we must also recognise that there are those firms that wish to comply with existing labour laws but would adopt the path of casualisation for various reasons, such as reducing labour costs, to cover overtime hours and extraordinary shift hours and to allow for relatively easy deployment of labour.
Through our amendments to the BCEA and the LRA, which I know you will discuss extensively in your deliberations at the conference, we have tried to address some of the legal uncertainties with regard to flexibility in how employers structure the employment relationship.
Through our sectoral determinations, such as the one we established for the sector in which Hector Louw works, we are attempting to protect even the most marginalized and vulnerable of workers.
Conclusion
Chairperson,
When the ANC government came to power in 1994, it inherited a labour market characterised by chronic unemployment, adversarial labour relations, racially skewed earnings, and lack of skills amongst workers. They also found a labour market regulatory framework that was fragmented and did little to enhance efficiency and employment.
We rose to the challenge to embark on a programme to transform this labour market, to ensure that it met the needs of a competitive and equitable economy.
The changing nature of employment necessitates that we be vigilant so that the improved efficiency of our labour market is not threatened by the lack of protection for a new group of workers.
In line with our overall approach to labour market regulation, we will continue to explore some of the challenges posed by the changing nature of employment, particularly the emergence of non-standard employment relationships.
Our emphasis will continue to be to address these issues through social dialogue. Together with our social partners we need to find the possible 'optimal' combination between employment stability and employment flexibility that is needed to generate the desirable levels of productivity and security in the labour market.
We wish you every success in your deliberations.
I thank you
Issued by the Department of Labour, 2 July 2003
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