Operations Director at SEIFSA
The past, present and future of collective bargaining in the South African metals and engineering sector
The South African metals and engineering sector in many respects mirrors the dramatic political changes that took place in South Africa as the country transitioned from apartheid to democracy. The history of industrial relations in the metals and engineering sector is a violent one initially based on total exclusion and eventual reluctant participation, to today’s reality in which labour is an important stakeholder in reviving the fortunes of the sector.
As South Africa continues to struggle both domestically and internationally to reach the economic levels required to provide the necessary impetus to growth and job creation, employers continue to view organized labour with a suspicious eye and question their bona fides on the back of the most violent strikes and acts of violence last seen in the 1970s.
What does the industrial relations and collective bargaining future, therefore, hold? Can business and labour find a way to bargain in good faith and put the interests of the sector ahead of their own?
As collective bargaining continues to come under the spotlight, can the negotiating partners move beyond the adversarial win-lose collective bargaining model, to a model that focuses on joint problem solving and win-win outcomes founded in a collaborative spirit of co-operation?
The role of bargaining councils in facilitating collective bargaining, economic growth and transformation
The Metal and Engineering Industries Bargaining Council (MEIBC) is one of the oldest and biggest bargaining councils in South Africa. Founded by organised labour and SEIFSA in the early 1940s, the MEIBC has stood for many years as the benchmark bargaining council.
Under the most challenging of circumstances, the bargaining council facilitated organized collective bargaining between labour and business that saw the introduction of unmatched social security benefit fund agreements covering pension, provident, death, disability, sick leave and maternity leave benefits and, most importantly, fair and decent terms and conditions of employment.
However, as international and domestic market conditions have increasingly worsened, bargaining councils and participants therein have increasingly come under fire and been criticized, rightly or wrongly, as being the cause of much of the economic hardships being experienced by many employers, especially small business owners.
Critics of the bargaining council system hold the bargaining council responsible for many of the short-comings being witnessed in the South African labour market today. Is this criticism justified? Is the bargaining council an outdated institution that has no room in modern-day South Africa struggling to come to terms with globalization?
Alternatively, is there still room for bargaining councils and can the bargaining council system play a part in contributing to the discourse on how South Africans collectively grow the economy and contribute to the transformation challenges facing the country?
AN ALTERNATIVE COLLECTIVE BARGAINING MODEL/S TO THE ONE-SIZE-FITS-ALL PARADIGM IN THE METALS AND ENGINEERING SECTOR
Over the past two decades manufacturing’s contribution to the economy has been declining. The metals and engineering sector has seen massive and painful structural changes. Notwithstanding the fact that, during the course of the 2011 and 2014 rounds of industry wage negotiations, SEIFSA focused extensively on these significant challenges, little has been forthcoming and the need to create and sustain competitive manufacturing capability in the domestic and global markets remains as pressing as ever.
The violence, intimidation and unacceptable criminal acts surrounding strikes are not being adequately dealt with through amendments to the labour laws or the criminal justice system.
All this has culminated in a view among employers in the industry that the centralized collective bargaining founded on the one-size-fits-all model is no longer economically viable.
THE EMERGENCE OF A SECTORALLY-BASED COLLECTIVE BARGAINING MODEL IN THE METALS AND ENGINEERING SECTOR
The emergence of a sectorally-based collective bargaining model in the metals and engineering sector will require a high degree of co-ordination and co-operation both within the affiliated SEIFSA associations and across different employer associations.
This approach will need to be strategically positioned and motivated to organized labour on the basis that, firstly, any move towards a sectoralised collective bargaining framework will not undermine collective bargaining within a given sector (for instance, by employers signaling that they would be prepared to support the extension of agreements within a given sector) and, more importantly, the proposition that moving towards a sectorally-based collective bargaining model offers the best opportunity for business and labour to work collaboratively together in the interests of job security, job creation and growth in a given sub-sector.
What is being sought is a win-win approach for all stakeholders. What is the likelihood of this approach finding favour with organised labour and, more importantly, what would be the consequences if this approach were to fail?
The introduction of flexible working time arrangements in an industry agreement
As pressure mounted on employers to introduce a 40-hour work week in the industry, employers and trade unions at national level agreed that as a trade-off to agreeing to the principle of a 40-hour work week, management and workers at company level would be encouraged to adopt a flexible approach to the arrangement of their actual working hours.
The intention of this voluntary arrangement operating within the confines of an industry bargaining council agreement was to enable employers to achieve the same – or improved – levels of output over the shorter working week, while allowing employees greater freedom in the determination of their working hours.
The agreed flexible working time options available for voluntary implementation at company level include: annualised working time; the working of one unpaid additional hour each week during the year in order to qualify for an additional five days’ paid annual leave at the end of the year; the introduction of continuous shift systems operating at ordinary rates over weekends; the implementation of a compressed working week; and/or any other flexible working time arrangements agreed upon between workers and management at company level.
The possible effects of abolishing the current collective bargaining model
From many an employer’s perspective, the future of collective bargaining has been called into question for a number of reasons. These range from the fact that industrial action related to collective bargaining has become protracted and so violent that businesses now feel that they reach agreements under pressure and are subsequently saddled with unaffordable wage increases.
Employers who survive a round of collective bargaining and the consequent violence, damage to property and intimidation are left reeling and immediately question the system, with some quickly arriving at the conclusion that the outcome would be far better if the current system were abolished.
What is not thought about, questioned or discussed nearly enough is the cause of the violence, damage to property and intimidation and what should replace the current system.
One thing is for certain: if any replacement to the current system is to endure and stand the test of time, it will require buy-in and commitment from all stakeholders. That means that acknowledgement needs to be given to the fact that, from an employee’s perspective, strike action is no longer just about bread and butter issues; rather, it is a symptom of deeper underlying socio-economic issues.
About Mr Lucio Trentini
Mr Trentini is currently the Operations Director at SEIFSA. Having joined the Federation in 1990, he has gained extensive experience in the metals and engineering sector, but particularly in the centralised collective bargaining and industrial relations processes that take place at national level between employers, trade unions and Government. He has developed sound working relationships with the employer and trade union leaders in the sector and has earned the trust of all the key stakeholders.
Mr Trentini holds a BA degree in Economics and Industrial Psychology from the University of the Witswatersrand; a Post-Graduate Diploma in Management from the Wit’s Business School. He also holds an Expert Negotiator Certificate from the University of Pretoria’s Gordon Institute of Business Science.
Mr Trentini represents employers in the metals and engineering sector on various institutions and Statutory Bodies, including the Metals and Engineering Industry Bargaining Council (MEIBC), Metal Industry Benefit Funds Administrators (MIBFA), Business Unity SA and NEDLAC. He is also a member of the Management Committee Member of the MEIBC, a SEIFSA Executive Director and a member of the Boards of the CCMA and MIBFA and an employer representative on the Labour Market Chamber of NEDLAC.
Mr Trentini has presented papers at various conferences, both locally and internationally. Most recently, he presented a paper on the extension of collective agreements at the ILO in Geneva and participated in a BUSA study group to Japan tostudy the Japanese Industrial Relations System. He has also participated in an employer and trade union delegations to study industrial relations systems in Germany, France and Belgium.
In addition, Mr Trentini has commented on the state of industrial relations in the metals and engineering sector through television and radio interviews. He has been quoted in South Africa’s major publications such as Business Day, Business Report and City Press.
He has also been interviewed on South Africa’s major television networks such as SABC, eNCA and BDTV, among others, and has been heard on SAFM, Power FM and Classic FM, among other radio stations.