Media

Temporary employment services (TES) in South Africa are facing one of their biggest challenges to date with organised labour, in the form of the unions lobbying government to amend existing labour legislation that limits certain employment practices currently in place in the industry.

The worldwide trend over the past 30 years has been for the increasing role of TES in the labour market. South Africa has followed suit. The major advantage for businesses has been, and will continue to be, the flexibility that temporary staffing provides. This often translates directly into the bottom line of many organizations, especially during economic downturns, such as the one being experienced in South Africa at present. Government and parastatals are some of the largest users in SA.

There is tremendous pressure on the temporary side or our business right now because only approximately 23% of organizations providing TES, are registered with the department of labour or accredited with organizations such as the association of personnel service organisations of South Africa (APSO). The result is that many of these unregistered businesses operate using unethical and unregulated practices, which not only gives the entire industry a bad name, but also raises the ire of the unions, who blame the entire industry.

What we as an industry need to do is speak with one voice. We must have a self-regulated industry, where accredited, professional recruitment agencies monitor and uphold legislation and procedures. This protects both the employee and employer. It will also obviate the need for government to introduce new labour legislation. We believe that although current labour laws provide enough checks and balances to protect all parties concerned, we still have to root out all non-compliant ‘rebels’. The current proposed draft APSO code of best practice and ethics with a whole section dedicated to TES is most welcome. It provides for compliance with labour legislation the provision of contracts of employment aligned to statute, possession of an IRP 30 certificate and the making of all the required statutory deductions. The draft also provides for proof of compliance needing to be submitted to APSO.

The formation of the confederation of associations in the private employment sector (CAPES) in 2002 was a huge step in the right direction, as it provides the industry including TES, with a forum for all stakeholders and labour brokers to discuss common issues and find solutions where problem areas are encountered. The main objective of CAPES is to obtain a statutory right to regulate the industry, which will be accompanied by the ability to impose severe sanctions on private employment agencies that are in contravention of either the law or ethics.

CAPES has an important role to play as a representative of the estimated Rl8 billion per annum labour broking industry, including

TES. The organisation is well positioned to have its voice heard in government and will be able to make certain representations on future labour legislation. It needs to be acknowledged that the current global and local trend for a-typical employment brings so many real advantages to both employment providers and seekers. A-typical employment means non-standard forms of employment such as part time or temporary employment or via a temporary employment service (TES).

What is clear is that labour brokers play a significant role in the employment sector, with an average of 410 000 temporary workers employed in South Africa every day. All stakeholders need to be realistic about the current economic situation. The majority of the youth in this country are unemployed; there is also a serious skills shortage; there is ignorance of existing law to prevent abuses; and factual evidence is sometimes not taken into account when calls for change are made in the temporary employment sector by organised labour. The TES industry is already burdened with liability as the labour broker providing assignees with employment, does so in terms of the Labour Relations Act, the Employment Equity Act, Skills Development Act, UIF Act and Compensation for Occupational Injuries and Diseases Act. In situations of unfair dismissal, the unions wish to make clients jointly and severally liable.

Local labour brokers with an interest in TES are now rallying to prevent a reversal of the global trend towards temporary staff numbering 30-40% of the total workforce. Companies with fixed costs are hardest hit in an economic downturn, such as the one experienced currently. Being flexible with staffing, which is one of the largest businesses overheads, makes economic sense. In this way the peaks and troughs of business can be better managed. It is important to take cognisance of the European example, where countries that encouraged a flexible staffing model, have flourished, and this has also correlated with increased competitiveness and higher productivity levels. Furthermore, temporary employees very often acquire new skills. A sizeable number of temps convert to permanent positions of employment both here and globally.

The way forward is to protect the interests of all parties by permitting them to have an influence in various spheres of government as well as in NEDLAC, looking at the strategic advantage of BBBEE and finally positioning for flexibility. However, CAPES should resist the double bargaining attempts by organised labour to the current legislation, much of which is still only in its infancy.

There is no doubt that the verification process for BBBEE has been tightened up and new BBBEE legislation places additional responsibilities on our industry.lt also needs to be recognized that many TES businesses have upper tier scorecard ratings and currently make a significant contribution towards transformation, employment equity, the skills levy and on social investment aside from the employment opportunities created.

Existing dismissal legislation already includes a category where employees are deemed dismissed when they “reasonably expected” their employer to renew a fixed-term contract on the same or similar terms. In order to avoid any misunderstanding there should be an adequate induction, provisions in the employment contract spelling out the nature of the service, and the caution that the relationship with a TES may involve periods of unemployment. lf we act in a unified way, promote our image, comply with all the current labour law and introduce a strong self-regulatory system, our TES industry should successfully counteract the threat of wholesale labour law changes.

Published: People Dynamics, Feb 2009, Volume 27 No. 2

By: Nritika Singh and Steve Katz