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A number of countries have adopted an approach to the regulation of agency work that restricts TES to operating only in specified categories of work. Typically such categories are by their nature temporary or of short duration. These include:

Short-term contracts of a specified duration39

Substitutes for employees when workers are absent due to illness, vacation, training or leave

Placements for specified periods to meet fluctuations in demand for labour (including seasonal work) or to cope with emergency situations.

In some countries, labour brokers may operate only at the higher end of the labour market, acting as an intermediary for workers with specialised skills.

In these circumstances, the outsourcing of the recruitment and administrative function offers considerable flexibility and savings. It also permits employees who desire this sort of flexibility to work on an ongoing basis by performing a series of short-tem placements.

Under this approach, agency work is prohibited unless it is expressly permitted. This requires administrative determination of categories of work in which agency work is permitted. Bargaining council agreements and sectoral determinations could contain provisions indicating what forms of agency work are permitted in the relevant sectors. The Minister could have the power to issue notices authorising agencies to provide workers in respect of specific categories of work.

Bargaining Councils could play an important role under this approach (certain sectors already have Bargaining Council agreements that include specific clauses relating to the use of TES).40

RISKS

A restriction on TES in specific categories of work may run into various verification problems. Clear regulations would need to be developed, in consultation with affected industries, to ensure clarity about when TES may or may not be used. The approach would require a range of demarcations

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No recommendation is made at this stage as to the maximum duration for work to be classified as “temporary”.

40

In August 2010, following an eight day strike in the motor manufacturing industry, the Automobile Manufacturers Employers Organisation (Ameo) and Numsa reached a deal in terms of which the use of labour brokers in the car manufacturing industry would be discontinued by January 2011. Pre-exisitng agreements would be permitted to run the course but could not be renewed.

between different types of work in which TES is or is not permitted, which may give rise to disputes and litigation over the interpretation of definitions and boundaries. There would also need to be a mechanism for applications to the Minister or another regulatory authority to permit TES to operate in emerging sectors.

V.

Triangular Employment Relationships: Organisational Rights and Collective

Bargaining

PROBLEM STATEMENT

Atypical workers, including TES workers, tend to have very low levels of unionisation. Employees placed by TES (as well as many employees in situations of outsourcing and sub-contracting) face challenges exercising their organisational rights and engaging collective bargaining, because they are required to engage with the agency as the employer, rather than the client company, which, in the case of longer term placements, is effectively their place of work. Intervention is required to enable TES employees to effectively exercise their organisational rights and engage in collective bargaining in respect of both the TES and the client for whom they work.

STATUS QUO

All employees have the right to join a union and to participate in the union’s lawful activities. Registered trade unions are able to obtain statutory organisational rights provided they obtain sufficient representation among employees in a particular workplace.

Unionisation levels are, however, very low in cyclical sectors, and among TES employees. This pattern is reflected at the global level – on average less than three percent of temporary workers belong to a union.

Unions find it difficult to recruit temporary workers to union membership and to retain them during periods of non-placement, when they are not earning and cannot pay membership fees. It is difficult for unions to represent these workers and to bargain on their behalf.

In terms of section 12 of the LRA trade unions that are sufficiently representative are able to gain access to the employer’s workplace (subject to reasonable conditions) to recruit members and serve the interests of their members. This provision assumes that it is the employer who controls the workplace. However, unions have difficulty accessing employees placed by a TES at their workplace as the ‘workplace’ is controlled by the client company rather than the agency who is their employer in terms of section 198 of the LRA. This is also the case with many other workers in outsourced arrangements or who work in workplaces that are situated on the premises of another. Temporary workers also, by their nature, move around a great deal. Mechanisms are needed to enable improved access to agency, temporary workers and outsourced workers by unions.

A number of bargaining councils have sought to regulate the operation of TES within their sectors. However, increases in TES have had a negative impact on trade union representativeness. The non- extension of agreements exacerbates the potential for exploitation of placed employees because of the absence of minimum wages for non party employers within the bargaining council’s registered scope.

There are documented cases of agencies and client companies undermining agency workers rights to participate in union activities. These include provisions in agency contracts that workers may not join unions and/or may not participate in strike action, and dismissal or transfer of agency workers from the client company when such workers are seen to be engaged in union activities. Outsourcing arrangements may include similar provisions.

DEPARTMENT OF LABOUR PROPOSED AMENDMENT

One provision in the Bills explicitly seeks to facilitate the organisation of vulnerable workers. This is the proposed section 55(4) (o) of the BCEA which would permit sectoral determinations to set a threshold of representativeness for a registered trade union to have the organisational rights of access to workplaces and deduction of trade union subscriptions for all workplaces covered by the sectoral determination.

Other proposed amendments to organisational rights provisions include amending the definition of the workplace to accommodate the circumstances of atypical workers. The Minister would be able to take the presence of atypical workers into account when extending collective bargaining agreements in respect of bargaining councils.

The policy document tabled by the Department of Labour at NEDLAC in 2009 proposed additional amendments to facilitate trade union organisation among atypical workers, in particular workers placed by TESs. These proposals are not reflected in the Bills because of the proposal to repeal section 198.

ALTERNATIVE OPTIONS

I) VOLUNTARY AGREEMENTS

Effective voluntary mechanisms could be developed to ensure proper organisational rights and collective bargaining rights. A possible model is the FEDUSA-CAPES Memorandum of Understanding (MOU)41, which aims to enable parties to establish proper bargaining arrangements, and expedited dispute resolution mechanisms to cover TES workers. The MOU also provides for the establishment of call centres, which would enable unions to access potential members from the TES databases. It is however yet to be seen how the MOU will operate in practice.

41

The Federation of Unions of South Africa (FEDUSA) and the Confederation of Associations in the Private Employment Sector (CAPES) have signed a Memorandum of Understanding (MOU)

RISKS

Voluntary mechanisms are not a substitute for an appropriate regulatory structure and would not deal with the problem of abuse by agencies and clients who seek to use non-standard work as a basis for disguising employment or to exploit workers. The scope for collective agreements to provide a basis for protecting atypical workers is further minimised by the low level of trade union membership among these groups of workers.