South Africa’s centralised collective bargaining system is at a critical “turning point”, with the sustainability of the current model being widely questioned in light of growing opposition to the extension of wage settlements to non-parties to the negotiations.

Steel and Engineering Industries Federation of Southern Africa operations director Lucio Trentini reports that the recently concluded three-year wage deal is likely to be contested by non-parties, despite the fact that the settlement included a commitment from employers and unions to discuss the future format and structure of collective bargaining in the sector.

“Should this legal action succeed, the industrial-relations consequences could be extremely serious,” Trentini warned during a panel discussion at the 2017 Metals and Engineering Indaba, held in Johannesburg.

Bowmans partner Graham Damant added that collective bargaining was a constitutionally enshrine right and was, therefore, unlikely to be dislodged. However, he said recent legal attacks on the binding nature of settlements to non-parties were indicative that the system would need to change.

The outcome of a recent court ruling setting aside the Free Market Foundation’s challenge to the constitutionality of binding non-parties to settlements could prove far-reaching, Damant said. The ruling elevated the agreements to the status of an administrative action, which meant they could now be contested on the basis of rationality and reasonableness. Hitherto, most legal objections had been technical or procedural in nature.

National Union of Metalworkers of South Africa general-secretary Irvin Jim lambasted those employer organisations that continually objected to collectively negotiated agreements. He argued, too, that a mechanism already existed to offer exemptions where firms could show that being bound to the deal would lead to business distress or job losses.

The real problem, Jim asserted, lay not with collective bargaining, but with government’s failure to champion manufacturing and to foster industrialisation. He also lambasted “conservative employers”, who wanted to entrench a system of “super exploitation”.

Likewise, Solidarity general-secretary Gideon du Plessis pointed to the broader environmental issues as the catalyst for the current backlash against collective bargaining. He argued that the post-Marikana labour-relations environment was characterised by a new, more disruptive culture, which had the potential to undermine collective bargaining.

Du Plessis also highlighted a change in the atmosphere enveloping employer bodies, where the previous tradition of collegiality and relative unity had given way to tension and animosity.

Department of Labour chief director Thembinkosi Mkalipi emphasised the point, saying that the main threat to centralised collective bargaining in the metals and engineering sector was the current rivalry between Seifsa and the National Employers Association of South Africa.

“In this sector, if you look at it, the major trade unions are still intact and the relationship between trade unions is not affecting the operation of the bargaining council. The real issue is the fight between employer organisations for control over the bargaining council. As government, there is nothing we can do – we can’t legislate for friendship and cooperation,” Mkalipi said.

However, government remained strongly in favour of collective bargaining and would be tabling amendments to the Labour Relations Act in the coming weeks; some of the changes were designed specifically to deal with the ongoing technical attacks to extending collective agreements to non-parties.

Trentini cautioned that without a viable alternative model that was acceptable to all stakeholders the labour-relations climate would remain problematic. However, any immediate collapsing of the current model would only result in “instability, uncertainty and industrial-relations chaos”.

Article: Engineering News