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Cablegate: South Africa: October 2007 Labor Notes

VZCZCXRO1698
RR RUEHBZ RUEHDU RUEHMR RUEHRN
DE RUEHJO #0312/01 3121544
ZNR UUUUU ZZH
R 081544Z NOV 07
FM AMCONSUL JOHANNESBURG
TO RUEHC/SECSTATE WASHDC 6029
INFO RUEHC/DEPT OF LABOR WASHINGTON DC
RUCNSAD/SADC COLLECTIVE
RUEHJO/AMCONSUL JOHANNESBURG 2780

UNCLAS SECTION 01 OF 02 JOHANNESBURG 000312

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: ELAB EMIN ECON SF
SUBJECT: SOUTH AFRICA: OCTOBER 2007 LABOR NOTES


JOHANNESBU 00000312 001.2 OF 002


1. Summary: Trade Union Federation COSATU has called ongoing
food price inflation a "crisis" that threatens workers and
called for a change in economic and monetary policy. A
Constitutional Court decision to reinstate a fired security
guard who was dismissed for failure to carry out his duties is
likely to convince employers to continue outsourcing and use of
labor brokers, with a depressing impact on formal employment.
Trade union federation CONSAWU has sued to join the National
Economic Development and Labor Council (NEDLAC). Continuing
fatalities in South Africa's mining sector have prompted
Minister of Minerals and Energy Bulyewa Sonjica to close 10
mines for unsafe working conditions. The National Union of
Mineworkers has applied for permission to conduct a strike over
this issue; no date has yet been set. The labor minister has
put several sectoral training authorities into
administration/receivership. End Summary.

COSATU Worries about Food Price Inflation
--------------------------------------------- --------------------

2. Describing food price inflation as a "crisis", COSATU called
for changes in economic policy and no more interest rate
increases by the Reserve Bank. In an October 29 statement,
COSATU noted that food price inflation reached 16 percent in
September, up from an August level of 15.4 percent.
Agricultural price increases climbed to 24.4 percent. COSATU
said the wage increases demanded by its members were "extremely
modest" and that even workers who had won such increases were
now once again experiencing a drop in their living standards.
COSATU said the situation for the poor and unemployed was
getting "desperate." The federation also urged the government
to confirm whether or not profiteering was taking place and
called on the Reserve Bank not to raise interest rates.

Constitutional Court Reinstates Dismissed Worker
--------------------------------------------- --------------
----------------

3. South Africa's highest court reinstated a security guard
dismissed from a Rustenberg platinum Mine in an October 5
verdict. The security guard, who had been fired for his
failure to adhere to established search procedures at the
platinum mine, appealed his dismissal to the Commission on
Conciliation, Mediation and Arbitration, which found that no
dishonesty was involved and reinstated him with three months
compensation. The case then went to court, with the employer's
right to fire upheld in a verdict issued by the Supreme Court of
Appeal, which was overturned by the Constitutional Court which
decided that the CCMA commissioner did not have to defer to the
employer but had to judge whether the employer reached a fair
decision.

4. Comment: The World Bank and business interests have argued
that labor inflexibility hampers South Africa's competitiveness.
Dismissals are an area most employers find enormously
burdensome, as warnings and formal disciplinary hearings abound.
The Constitutional Court decision will make employers even
more leery about firing, and therefore even more unwilling to
hire, in a country with a 25.5 percent official unemployment
rate. Trade unionists, in private conversations, have described
the procedural safeguards as needed to deter abuse of workers
and racism. One employment consultant put the cost to the South
African economy of dismissal procedures at R14 billion. The
Constitutional Court decision will protect workers but will not
help South Africa's unemployed. End Comment.

Trade Union Federation Sues to Join NEDLAC
--------------------------------------------- --------------------

5. One of South Africa' smaller trade union federations finally
sued the National Economic Development and Labor Council for
stalling on recognition and inclusion in its Labor Chamber.
The Confederation of South African Workers Unions (CONSAWU)
claims 21 affiliates and is dominated by trade union Solidarity,
which represents primarily skilled white workers. Solidarity
has made headlines by questioning the need for affirmative
action, and ascribing South Africa's skills shortages to this
and other government policies. The government is required to
submit labor legislation and other legislation impacting
economic development to NEDLAC, where organized labor, business,
and civil society can comment on it in a quadripartite forum.
NEDLAC, which includes federations COSATU, FEDUSA and NACTU
among its members, has so far not admitted COSAWA. At issue is
whether NEDLAC can apply a membership benchmark even though the
legislation that created NEDLAC does not include this standard.

Viva Bokke Viva
-----------------------
6. South Africa's sporting madness was evident when its
largest trade union federation COSATU issued two press releases
on its Rugby team, the Springboks. COSATU not only wished the
team well on its way to the final showdown with England on

JOHANNESBU 00000312 002.2 OF 002


October 20 in Paris, but also issued another press release
warmly congratulating the team for bringing home the Rugby world
cup after their win. A variety of opinion-makers have called
for racial integration of SA rugby teams; the Springboks have
two colored members but no black team members. COSATU's
membership is predominantly black so their explicit support for
the Rugby team was a triumph of sporting over racial solidarity.


Labor Minister Places SETAs under Administration
--------------------------------------------- --------------
---------------

7. South African businesses contribute one percent of payroll
towards skills training, into one of 24 Sectoral Education and
Training Authorities (SETAs), which provide training to workers
and entrants in a particular sector, as part of a broad strategy
to address South Africa's skills shortage. The SETAs fall
under the authority of the Labor Minister, though they are
administered by a mixture of industry, labor and policy leaders.
Labor Minister Membathsi Mdladlana placed the Media
Advertising Publishing Printing and Packaging SETA under
administration this month, also suspending its board, for
financial and other irregularities. The Transport SETA has
also been in serious financial difficulties, as its Chairman is
facing legal charges in connection with alleged kickbacks
received for investing SETA funds in Fidentia Asset Management's
funds. In addition to the transport SETA, the SETAs in the
energy and local government sectors are also close to
suspension. Minister Mdladlana has said the capacity of social
partners was an issue in implementing the National Skills
Development Strategy.

Minister closes 10 Mines for Unsafe Working Conditions, NUM
Threatens Strike
--------------------------------------------- --------------
--------------------------------------------- -----------

8. Minister of Minerals and Energy Bulyewa Sonjica closed ten
mines in mid-October due to concerns about unsafe working
conditions. Gold, platinum and coal mines were affected. In
addition to the widely-publicized September 28 accident at
Harmony Gold's Elandsrand Mine, which trapped 3200 miners about
2km depth, several miners have died recently due to rock-bursts
at a variety of mines, including DRD Gold's Blyvooruitzicht mine
and AngloPlatininum's Rustenburg operations. The National Union
of Mineworkers has applied for permission to strike over safety
issues, but has not yet set a date. On October 31, two miners
were killed at Goldfield's Kloof Mine and two were killed at
Marula Platinum on October 23 in incidents involving explosives.
Three more miners died in unrelated accidents in early
November, including two at Anglo-Gold Ashanti's deep Tautona
mine and one in Exxaro's coal mines. The second miner was a
member of trade union Solidarity, which has so far not joined in
the safety debate.
COFFMAN

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