FMF Book
Summary
Labour legislation, which may be appropriate for regulating relations between large employers and employees represented by large trade unions, is wholly inappropriate for regulating relations between small employers and their employees. The legislation imposes an excessive burden on small employers, especially employers who are illiterate or not literate in the languages in which the laws are written. As small businesses offer the main avenue of employment for the young, unskilled or otherwise disadvantaged, there is usually an above-average labour turnover in such businesses.
Not unexpectedly, by far the largest volume of cases coming before the Commission for Conciliation, Mediation and Arbitration (CCMA) involves small businesses, and most of those are for alleged wrongful dismissals. The unwillingness of small employers to take risks in employing people who may later turn out to be unsuitable or unaffordable is consequently understandable, particularly when there is a prospect of having to contend with disputes about the fairness of dismissals being referred to arbitration by a bargaining or statutory council (or the CCMA, if a party to the dispute falls outside such a council’s registered scope), and dismissed employees might be represented by a highly qualified trade union official who has detailed knowledge of the labour laws. In the event that a dispute about the fairness of a dismissal is referred to the Labour Court, the employer will have to contend with the dismissed employee’s labour lawyer.
All disincentives to job creation should be swept away in order to reduce the numbers of the unemployed and increase economic growth. Demand for labour from small businesses offers the greatest potential for reducing unemployment. But small employers will avoid employing people if they face the possibility of being involved in perpetual disputes with their employees, of having to spend hours of their time in arbitration or the Labour Court, and having to pay high fees to labour lawyers.
If government wishes to achieve its economic growth targets, it can do no better than to release the entrepreneurial energy of small employers, combined with the rapid absorption of the unemployed, to achieve an acceleration in economic growth. This desirable result can be achieved by increasing the fluidity at the bottom end of the labour market. This requires exempting small employers from all inappropriate legislation and regulations.
“Small employers” in this entry refers to small employers as may be defined for purposes of granting exemption from the application of particular legislation. It is envisaged that small employers would be defined by reference to number of employees, turnover, capital employed or a combination of these factors. It is also envisaged that statutory definitions of “small employers” would differ for different exemptions.
- Allow employees, after counselling by officials of the Department of Labour, to enter into written “customised contracts” with small employers in which they waive some of their statutory entitlements under certain specified sections of the Labour Relations Act and the Basic Conditions of Employment Act, such agreements to be recorded by the Department.
- Recognise the right of small employers to freedom of association as well as disassociation by exempting them from the provisions of the Labour Relations Act which interfere with that right.
- Exempt small employers from section 10 of the Labour Relations Act, thereby restoring the burden of proof to the person making an allegation regarding the conduct of another person.
- Exempt small employers from the requirements of section 16 of the Labour Relations Act relating to disclosure of information.
- Exempt small employers who are non-parties to collective agreements from extension of those agreements.
- Automatically exempt small employers from sectoral determinations promulgated in terms of section 44 of the Labour Relations Act read with section 54 of the Basic Conditions of Employment Act.
- If wider exemptions have not been granted, exempt small employers and their employees from the provisions relating to strikes and lock-outs.
- Withdraw the allowance of employees employed by small employers to take part in work stoppages for the purpose of promoting or defending the economic interests of others in general.
- Allow a short form of arbitration for small employers in place of the existing dispute resolution procedures required for the resolution of disputes under the auspices of the CCMA.
- Allow small employers to be represented by experts in labour law in conciliation proceedings held in terms of section 135 of the Labour Relations Act if the employer is not a member of an employers’ organisation and if the employee is being represented by a member of a trade union.
- Set a ceiling of two months’ salary on compensation that may be awarded in terms of section 194 of the Labour Relations Act against small employers in the event of a finding against the employer.
- Exempt small employers who employ temporary employees through a labour broker from section 198(4) of the Labour Relations Act which imposes joint liability on the labour broker and client if the labour broker contravenes the Basic Conditions of Employment Act or a collective agreement.
- Provide for the exemption of small employers from the application of Chapter II (regulation of working time—sections 6 to 18) of the Basic Conditions of Employment Act, 1997.
- Exempt small employers from section 20(11) of the Basic Conditions of Employment Act which prohibits an employer from paying an employee for leave not taken.
- Exempt small businesses from the National Minimum Wage Act, 2018.
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