Draft Labour Bill: More anti-jobs legislation in the name of a planned economy
The Democratic Alliance (DA) views the draft Employment Services Bill and its explanatory memorandum, recently leaked in the media and currently being tabled before cabinet, as an ominous indication of an ANC shift towards the implementation of aspects of a planned economy. The DA believes it will hamper job creation and represents another attempt to centralise control ahead of promoting entrepreneurship and investment. The provisions detailed in the Bill would see the creation of more administrative layers and bureaucracy for South African firms trying to remain flexible and internationally competitive. It's ossification of what should be a fluid labour market will be totally out of step with the highly flexible and ever-changing labour needs of private industry.
The draft legislation, supposedly currently being studied by several cabinet committees, was reportedly sent for a regulatory impact assessment in advance of it being served formally before cabinet or Nedlac for debate and approval. The DA believes it should be sent back to the labour department for a complete rewrite and certain key clauses need to be removed as they are completely unworkable.
The DA has identified 3 key problematic, and indeed potentially devastating, aspects of the Bill:
1. The establishment of public employment services
The Bill makes it the Department's responsibility to ‘provide public employment services free of charge in a manner that is open and accessible to members of the public'.
What the Department conveniently omits to mention, is that it has already initiated a system that conducts this function, namely the Employment Services South Africa (ESSA) project, a grossly under-utilized system seldom used by the private sector as a preferred source to find work-seekers.
2. Reporting on vacancies and filling of positions
Private employers would have to report and notify the Department of any new vacancies or new positions in their establishment within 14 working days after the position has become vacant. The Bill then affords the Minister the power to prescribe how employers must notify the Public Employment Service of all vacancies, going so far as to detail a technocratic list of requirements the Minister may impose on firms in this requirement. An employer is given the extra administrative burden of having to provide written reasons within 14 days to the Director-General as to why any departmentally preferred candidate with the required profiles could not be appointed.
3. Private employment Agencies
The bill would effectively limit the functions of the crucial Temporary Employment Agencies (TEA) in South Africa. The Bill only recognizes the service of recruiting work-seekers on behalf of another firm, however, states that, "no private employment agency may offer intermediary services to any employer without a lawful licence".
The ANC's insistence on altering and meddling with a private sector system which works, and facilitates around 2 million jobs per annum, in a country where their other economic polices are not providing enough jobs, is concerning.
Taken together, these measures would turn the Department of Labour into one massive labour broker and employment agency, and severely restrict the free market with regards to employment assistance in South Africa. The Question must be asked: Why does government want to compete with private enterprise? Government departments in South Africa are notoriously inefficient and the DoL is a prime example of poor service delivery. The current employment assistance offered by the department of labour is a case in point. It comes nowhere near to the efficiencies of the private sector and places a far lower percentage of registered work seekers than most private agencies are able to.
This Bill has been drafted in an ill-considered manner, and ignores many of the economic realities firms face in their need to remain competitive and flexible. If this Bill is passed into law, it will damage the jobs market and make it virtually impossible to hire workers on a temporary or contract basis in South Africa in future. Many of its far-reaching provisions must be removed and the document as a whole needs to be redrafted if the South African economy is not to be plunged into another recession, this time of the ANC's making. I will be submitting parliamentary questions to ascertain who was tasked with the drafting of this Bill, and whether the stakeholders it will affect were consulted in the drafting of it.
Statement issued by Ian Ollis, MP, Democratic Alliance deputy shadow minister of labour, August 17 2010
Click here to sign up to receive our free daily headline email newsletter
