SAFTU condemns construction bosses for saying R20 an hour is “too high”

The South African Federation of Trade Unions is shocked, though not surprised, at the article in Business Report on 9 May 2018, which quotes a construction industry employer, Gerald Ndlovu, saying that the proposed national minimum wage (NMW) is “too high for the construction industry” and that employers “should be exempt from paying it”.

This remark confirms everything that SAFTU has said about the contemptuous attitude of many South African employers towards the workers they exploit. If they think that even the pitifully low proposed R20 an hour is “too high”, it means they want to continue paying wages that condemn their workers to even more abject poverty than those who will get the R20.

Ndlovu is quoted as warning of “a looming crisis in the multibillion-rand sector if the proposed R20 an hour national minimum wage (NMW) is implemented”.

His comments help to explain why South Africa was ranked bottom of 137 countries in the Co-Operation in Labour-Employer Relations Index of the 2017/18 World Economic Forum Global Competitive Report. Labour unrest and prolonged protests in the economy were cited as reasons for this poor showing.

Even Ndlovu himself warns that “the contentious NMW might cause further unrest among the country’s workforce, with labour relations already at an all-time low”. Faced with an employer like him workers will not just be restless but up in arms when they hear that he thinks even R20 an hour is “too high”.

His attitude is particularly outrageous given that construction workers toil for long hours in all weathers, doing one of the most difficult and dangerous jobs. For that reason alone they should not just be paid the NMW but a lot more.

Their employers can certainly afford it. The construction industry was among sectors, which showed growth last year, contributing an average of 3.9% to the country’s gross domestic product.

It is an industry highly monopolized by the ‘big seven’ companies - WBHO, Raubex, Murray & Roberts, Aveng, Group Five, Basil Read and Stefanutti Stocks. 

The only reason why their profits are not as high as they would otherwise have been is that 15 major construction firms are still paying off a fine of a collective R1.46-billion imposed by the Competition Commission for “rampant” collusive tendering related to projects concluded between 2006 and 2011.

WBHO was fined R311.29-million for 11 projects, Murray & Roberts R309.05-million for 17 projects, Stefanutti Stocks R306.89-million for 21 projects, and Aveng, R306.57-million for 17 projects.

Yet in the financial year to June 2016 Murray & Roberts paid its CEO, Henry Laas, R14.7m, including R6.4m in bonuses, even as the construction group’s operating profit declined for the third year in a row, and executives failed fully to meet a number of targets to unlock short-term bonuses.

Peter Bennett, the group’s head of oil and gas, was paid even more - R17.6m, which is R1.47m a month and R8 380 an hour. His company says R20 is too high for its workers, when Bennett was earning that amount in 2.3 seconds!

The statement by Ndlovu encapsulates everything that is wrong with not just the construction industry but South Africa as a whole. It explains how we have become the world’s most unequal society, in which big, monopolized companies make huge profits from, quite literally, the sweat of their workers, who are paid a pittance for a job where they risk injury or even death every working day.

SAFTU has also noted with dismay the trend well underway in our beloved country for white monopoly capital to increasingly use black faces to justify and maintain the status quo. The captains of industry, who remain largely white males, are hardly on the media these days for obvious reasons. They have employed a strategy to hire black faces to justify the poverty of the black majority. SAFTU will as a matter of principle not engage these hired black faces but will demand to talk to directly to the owners of capital. 

SAFTU is more determined than ever to campaign for a decent living minimum wage of R12 500 for all workers.

Statement issued by Zwelinzima Vavi, SAFTU General Secretary, 9 May 2018