The nature atypical employment and implications for the industrial relations framework in South Africa: A Wits case study. Introduction
In the advent of the new democratic dispensation, South Africa adopted the Growth, Employment and Redistribution (GEAR) policy; this policy is based on neoliberal principles such as privatization, trade liberalization, borderless trade, deregulation, minimal state intervention etc. It is through this policy that local workers and businesses find themselves in competition with the rest of the world, and for this reason businesses have adopted the ideology of flexibilization as a strategy to stay competent and to ensure maximum profits. The adoption of this neoliberal policy contributed to a shift in the nature of employment. According to Theron (2003) there has been a significant increase in atypical employment since the adoption of GEAR. This paper will critically define what is meant by atypical employment. This paper will also explain how and why there has been a significant increase in atypical forms of work in South Africa, and growing levels of unemployment, externalization, and self-employment.
This paper will also critically discuss the implications that atypical forms of work have on the South African industrial relations framework. In addition to the above this paper will critically analyze outsourcing at the University of the Witwatersrand (Wits) to illustrate and elaborate on the challenges faced by the South African industrial relations framework. This paper will also argue that the South African industrial relations system has done nothing so far to mediate conflicts and problems that arise from atypical forms of work.
Atypical employment in South Africa:
What is meant by atypical employment?
According to Theron (2003) atypical employment refers to employment that is not usual or employment that is the direct opposite of typical employment. Typical employment or Standard Employment Relationship (SER) as known in South Africa refers to employment regulated and protected by law and union representatives Theron (2003). According to Theron (2003) SER is considered as the ideal and normative type of work. SER refers to decent work; a permanent full-time employment contract; where the employee is directly employed by a single firm; with regular working hours (normally eight hours per weekday) and regular benefits (a salary, bonuses, perhaps medical aid and pension fund etc.); protection against dismissals and unfair treatment etc.; and the identity of duties, the employment relationship and workplace environment. Under SER employment is mainly regulated by the Labour Relations Act no. 55 of 1995 and the Basic Conditions of Employment Act no. 75 of 1997. Atypical work according to Theron (2003) is defined as short fixed-term work with a duration of less than six months; it is Temporary Employment Services (TES) work; it is very short part-time work for less than 24 hours a month.
Atypical employment is almost the opposite of SER. Atypical employment refers to a different way of employment; it is a shift in ideology toward flexibilization Theron (2003). According to Theron (2003) is in direct relation to flexibilization. Flexibilization according to Horwitz (1995) is broadly defined by four elements namely functional, numerical, temporal and wage flexibility. Functional flexibility refers to the ability of workers to perform a number of tasks (multi-tasking); Numerical flexibility refers to the size and structure in which the task will be performed, whether services will be externalized, casaulized, informationalized or sub-contracted etc.; temporal flexibility refers to the pattern of work, whether it will be in shifts, part-time, seasonal or home based; and wage flexibility refers to a shift from a uniform type of pay to a more individualized type of pay that is normally based on performance etc.
Therefore examples of atypical or flexible types of work will be outsource workers, security guards, cleaners, construction workers etc. all ran by Temporary Employment Services (TES). According to Valodia (2000) atypical work also includes work done outside the formal economy – in the informal economy. Atypical forms of work in the informal economy refer to self-employment, street trading, and home based work. Atypical work is commonly defined by a triangular relationship between a company, a labour broker and workers working for the labour broker. In this triangular relationship the company outsources a service to the labour broker or the TES. The TES renders the service through their employees. Here the company signs a commercial contract with the TES, and the TES signs an employment contract with the workers.
Why has there been a significant increase in atypical forms of work in South
Africa? And how do we explain the growing levels of unemployment, externalization, and self-employment? According to Theron (2003) the implementation of the GEAR policy in South Africa made it easier for employees adopt new strategies to compete with the global market. Atypical work is a just a result of the employer’s strategy to lastingly reduce the permanent workforce; hence, the need to maximize flexibility because employment is unregulated and makes it easier to dismiss the worker if he/she is not performing, and this strategy is also in place in search for cheaper alternatives because of the increasing levels of competition and market pressures.
Hence, many companies make use of outsourcing in effort to shift risk and responsibility onto the workers; this is another reason why work has become temporary, casual and insecure. Workers under atypical employment are usually not protected by labour law, nor by social security and union representatives. Workers under atypical employment find it extremely difficult to identify their real employer. The expansion or increase in atypical forms of work is also driven by capitalist greed to make more money – to obtain maximum productivity and maximum profits. Many firms seek cheap labour; where they have no responsibility over the workers; where they do not have to pay annual bonuses or pay rises; where they do not have to contribute to other benefits like medical aid schemes, pension funds, holiday rights, maternity or paternity benefits and payments. This is also a strategy to cut human resource costs.
The expansion in atypical forms of labour is also driven by capitalists’ desire to fully control workers. Many companies make use of atypical labour because it is not regulated by law and not protected by trade unions. Workers in atypical work are denied a lot of rights at work including the right to join a trade union or to establish a trade union; workers are also denied the right to collectively bargain with their employers. This makes it easier for employers to dismiss the workers when their performance is not satisfactory to their desires. Under atypical work the workers’ assignments and functions are always tailormade and changed at any time.
The increase in atypical forms of work causes an increase in unemployment because more and more businesses are adopting atypical work as a strategy to keep production costs low, and because of this many workers get retrenched and replaced by casual or sub-contracted labour. Hence, there is a higher risk for unemployment and underdevelopment as companies no longer have responsibility over workers and leaves no space or funds for skills development. Some however, argues that atypical work creates more employment, but creates more social risks such as increases in poverty.
What challenges does atypical employment pose to the traditional industrial relations framework? For Theron (2003) and Valodia (2000) atypical employment poses a number of challenges to the traditional industrial relations system in South Africa. Firstly, there are concerns in employment security where the employee is faced with job insecurity and has an uncertain future within the workplace. This poses a threat to individual growth based on skill and knowledge within the workplace. The employee might have considered that specific job as a career, however, because he/she is uncertain about his position in this workplace makes it impossible for him/her. Workers are constantly faced with uncertain working hours and employers continuously demand for employees’ total availability. Workers here are also constantly faced with verbal abuse and discrimination.
In SER the freedom from unfair dismissal is the cornerstone of the labour legislation and this normally extends to most workers, however, under atypical employment it is difficult to enforce. Secondly, there are concerns in the organization of employees as it is extremely difficult to organize atypical employees because there is a lack of an explicit contract – there is no employment relationship. It becomes difficult to organize because there are too many parties to negotiate with and it becomes unclear for the employees as to which employer is responsible for them; full-time permanent employees can also be hostile to contract workers because in many times separate workforces are created with each having different interests. Sometimes atypical workers do not really see the immediate value in joining a union and most of the time atypical workers are scared to join unions because of the fear of losing their jobs. And because there is less bargaining power, it is difficult to organize these workers. However, atypical workers seek to draw power symbolically; their power to organize and raise their concerns about their working conditions is drawn from outside the labour relationship between them and the TES. Thirdly, there are concerns within skills development.
The majority of atypical workers in South Africa is highly low-skilled and semi-skilled and demands skills development. According to Theron (2003) skills development is part of the labour relations system; full-time permanent employers are taxed and a fund is set up to educate and train employees. In atypical work, there is less access to a company based further training and education; poor or absolutely no training involved, and because of job insecurity and uncertainty about ones position in the workplace, there is not much or no career development. Fourthly, there are concerns for the broader society. Because atypical workers are poorly paid, they do not spend much money in shops so the pay less taxes and therefore contributing less to the pension fund system of the country. Since education is one of the key issues that government seeks to address, workers under atypical employment get less education and training. With the increase in atypical forms of work comes the increase in social risks such as poverty during working life and retirement; a risk of a shortage of skilled labour.
The above mentioned raises concerns about the South African industrial relations system; it seems that South Africa has a labour relations system for the labour it wants and not for the labour force it has. Like any other system, the changes in the labour relations system have always been as a consequence to unrest and conflict between forces. And there are many controversies within the system. Many would agree that an increase in atypical forms of employment means more and more people are getting employed, however, these are not decent jobs as workers are denied a lot of rights that permanent full-time employees would normally get. Since atypical work is becoming something common in the industrial relations system, why do we still call it atypical? Surely some changes can be made to the system to accommodate these workers.
Wits and outsourcing:
According to Nkosi (2011) Wits started outsourcing work in 2000, starting off with cleaning, catering and maintenance. When outsourcing was implemented about 600 workers plus was retrenched and plus-minus 250 workers were re-employed, however, those that were re-employed were faced with drastic reduction in wages and their benefits were eliminated. According to Nkosi (2011) wages dropped form R 2 227 per month to R1 200, in addition, all benefits were cut. This was a strategy of the university to reduce their responsibility over workers. Nkosi (2011) Also states in the article that Wits also segregated the workers from the rest of the university; as they forced workers to use one entrance to access and exit the university, this according to Nkosi (2011) was a strategy to keep the workers from interacting with the students and other stuff members.
Here we can clearly see that management wants full control over the workers and fear that through the interaction with students and other staff members workers might draw power or get support to raise their grievances to the university. However, managements attempt to prevent the interaction between workers and students, Student Representative Councils (SRC) and other academic associations failed. According to students at the university embarked on a hunger strike, in support of the outsource workers – Royale Mnandi workers that refused to abide by the decision made by the company to redeploy them as they felt comfortable at Wits. This is a sign that workers drew symbolic power from the different student associations and academic associations like the SRC, the South African Students’ Congress (SASCO) and other political platforms. According to a report drafted by the decision of the University Management Association (UMA) to outsource work was strongly opposed by collectives such as the National Education Health and Allied Workers Union (NEHAWU); the SRC and the postgraduate association; and by SASCO. According to this report UMA decided to outsource work because it would save the university about R3 million (m) over five years. UMA also claimed that outsourcing would create career opportunities and would create employment stability.
However, these claims were strongly criticized by academics. Wits academics stated that these claims were biased and poorly argued. Academics argues that outsourcing is not to the benefit of the workers but to management only as it weakened unions and the ability to collectively bargain; outsourcing as a form of atypical work also reduced the wages of workers, so how is it to the benefit of the workers. Academics instead claimed that this will only reproduce the legacy of apartheid; as UMA segregates and exploits the workers. The report also claims that when Wits enforced outsourcing, NEHAWU lost almost half of its members on campus; and other unions that organized among atypical employment like WWSC were extremely weakened. According to the report there were also allegations that management and other staff members discriminated against the workers; workers were verbally abused as racist remarks were made by senior staff members.
To maintain control over workers, UMA banned workers from organizing on campus; they were banned from having meeting to discuss their grievances. UMA argued that workers are not their responsibility, but the responsibility of TES. UMA argued that they were only in a business contract with the TES and expected the TES to render services in return for a payment. According to the report TES are against workers that belong to unions; workers were issued warnings for attending meetings and rallies organized by the WWSC. The report also states that workers were not allowed to occupy public spaces and to use educational facilities on campus; they were not allowed to be at the library lawns for instance; and also not allowed to use the libraries and computer labs. According to also protested about wages, saying that the R1 800 they is not enough to take care of their families; this is not enough to make a decent living, they want an approximate increase of 42% meaning that they want to earn a minimum wage of R4 300 per month. According to the UMA wanted to replace the TESs Supercare and Carovone cleaning services with new companies. However, workers expressed anger over this decision seeing that their contract will end in June 2013.
Conflict management however, claimed that Supercare and Carovone workers will retain their jobs under the management of a new TES company. WWSC also made a claim that, however, these workers will be interviewed for the job. Currently Wits is still sub-contacting work to TES. Wits is still in a triangular labour relations relationship with a number of outsourcing companies. According to the new Vice-Chancellor Professor Adam Habib had a meeting with about 400 workers and expressed sympathy towards the workers regarding the outsourcing issue. Professor Habib said that he would have loved to reverse outsourcing, but he is not willing to take the risk, claiming that it will cause chaos to the industrial relations system within Wits.
It is clear that the industrial relations system in South Africa is faced with some serious challenges from short-term risks such as low wages, medium-term risks such as the lower degree of employment stability and less access to company based further training and education; and long-term risks such as increasing risks for old-age poverty etc. It is also clear that Wits wants less responsibility over workers, to decrease the bargaining power of unions and to make more structural changes towards the service industry.
What is the South African industrial relations system doing to mediate the conflicts and problems that arise from atypical work? The South Africa industrial relations system therefore is not well suited to mediate conflicts and problems that arise from atypical work. According to “…high levels of conflict have traditionally affected the South African industrial relations system, with militant working class organisations opposed to employers and the state. A widespread culture of worker resistance encompassed both the struggle for worker control of production and popular mobilization for democracy. However, this legacy of confrontation has gradually come to be regarded by the new democratic state as increasingly dysfunctional for the restructuring of South African capitalism in relation to global competition.”
And the system is still struggling to mediate conflicts and problems arising from atypical forms of employment, instead problems are escalating and getting worse. This might become difficult to mediate in the future. Unions are still struggling to organize these workers, atypical forms of employment in South Africa has been going on for years now and there is also a concern as to whether the type of employment should be regarded as atypical. A strong industrial relations framework is characterized by the ability of workers within the system to collectively organize and to collectively bargain with the respective management; It is characterized by successful outcomes of collective bargaining. It is evident that in the case of Wits the industrial relations framework has failed.
When outsourcing was implemented in 2000, it became extremely difficult for unions to organize the workers. Unions that represented the workers such as SSWC tried by all means to collectively bargain, but instead they lost their power to bargain with management. We as mentioned earlier, even NEHAWU lost half of its membership in the advent of outsourcing. It is also quite evident that workers have lost their rights in the process; workers are now unprotected by law and by unions, and this poses a threat to their job security and their position within the workplace. Even though the Supercare and the Carovone workers retained their positions as workers sub-contracted by Wits, they are still exploited and still do not know where and to whom to address their grievances to.
Professor Habib remains adamant that outsourcing will not be reversed soon, if ever, because it will just result into chaos. These workers are still prohibited from doing certain things like going to the library and occupying certain spaces on campus like the library lawns. This is not fair and it is regarded as ill-treatment toward the workers. Despite efforts of the SRC, SASCO, WWSC and other organizations to help the workers to get satisfied treatment from the university, workers still work under poor conditions and walk away every month with low wages; a wage that is nothing for some; a wage that is not proper to make decent living. Since the industrial relations system cannot change its culture, but its behaviour it is extremely important to motivate the workforce to be more productive as it might increase employment security of the workers altogether there must be consensus between parties in the triangular relationship.
There must be a culture of communication; parties must constantly share information and consult with one another. As for unions, they must open membership to all employees and avoid the different categories of work. Union must thereafter set specific sections to deal with specific issues. Hence, they must grant full union rights to all workers that join. Unions must also encourage workers to participate in every union activity and they must by all means educate their members about atypical employment. Unions must also engage in solidarity platforms with other unions both internationally and locally because atypical work is a global problem. Unions must also engage in public campaigns, am sure if this can be done, there will be better outcomes in the industrial relations system.
The South Africa labour relations framework must not only focus on what it wants labour to be, but it must also focus on what labour workforce it has. Surely if there are conflicts and unrest in the labour relations system, amendments are made to the LRA. The South African industrial relations system has been at unrest for almost two decades not, policy and law makers must start considering to amend the LRA to accommodate an increase in atypical forms of labour.
This paper critically discussed what is meant by atypical employment. The paper also provided an explanation as to how and why atypical employment has increased in South Africa and together with growing levels of unemployment, externalization, and self-employment. This paper also provided the different ways in which atypical work has present challenges to the South African industrial relations framework. This paper used the University of the Witwatersrand as a case study to critically analyze the challenges within the industrial relations framework. This paper also argued that the industrial relations system in South Africa failed to mediate the conflicts and problems that arise from the increase in atypical forms of work; the paper argues that along with the rise in atypical forms of where there is an escalation of challenges and issues.
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