Don’t try to lock unions out of the negotiating process
Alan Fine Business Day 16 August 1990.
“While government and the ANC have moved decisively to downgrade levels of physical and rhetorical conflict, relationships between government and the ANC’s trade union ally Cosatu are as tense and mistrustful as they have ever been.
The new political mood created by the signing of the Pretoria Minute has already filtered through to lower levels of both government and the mass democratic movement.
Consumer boycotts in several southern and eastern Transvaal towns were resolved through negotiation within days of the August 6 agreement. There is even optimism that the five-year-old Soweto rent boycott could end soon.
The horrific violence of the past 10 days at Kagiso, Sebokeng, Tokoza, Katlehong, Vosloorus and Port Elizabeth makes it obvious the new mood has not permeated through the country. But, at least, the solution was and is seen in terms of negotiation between the parties involved.
This is not so in the economic and financial sphere – a position highlighted last week by Finance Minister Barend du Plessis. In a speech in the President’s Council, Du Plessis attacked “unreasonable” union demands which, by making labour less productive, were undermining confidence in the economy.
Rhetorical warfare, the Ministry of Finance seems to believe, is the best way of countering labour upheavals.
This is doubly ironic because, not so long ago, it had become almost a cliche to hold up the labour relations arena as an example of all that was desirable about negotiation. Du Plessis’s speech was just the tip of the iceberg. While government is ready and willing to negotiate away a great deal of its power through a new constitution, there is a marked hesitancy about changing labour law through a similar process.
It is understood President F W de Klerk recently told a group of businessmen he believed they were conceding too much to organised labour in the Cosatu/Nactu/Saccola accord- a perception which would help explain delays in translating the accord into law.
Now the Manpower Department has begun drafting a new Bill to replace that proposed a few months ago by the National Manpower Commission based on the accord.
Manpower director-general Joel Fourie says the new Bill will be designed to attain the greatest possible consensus. However, unions and employers, and some NMC members having been disappointed too often in their dealings with the department, are awaiting the new Bill with a great deal of trepidation.
Some members of the business community believe De Klerk is supported in (or influenced towards) his view by Cabinet members like Du Plessis, Administration and Economic Co-ordination Minister Wim de Villiers, and, to a lesser extent, Manpower Minister Eli Louw.
De Villiers has a reputation among some of the negotiating parties for having a hostile attitude towards organised labour, apparently influenced by a difficult meeting with Cosatu a few months ago on the privatisation question. He is believed to be particularly hostile towards centralised bargaining.
None of this is to suggest that the hostility (also shared by business leaders weary of strikes and confrontations) is either irrational or unexpected. This year has been a difficult one in terms of tough wage disputes and levels of strike action. (It is, however, worth putting it in perspective. Now that the main mining industry negotiations have been successfully completed, final strike figures for 1990 are likely to be way below those for 1987 even if a full scale engineering sector strike occurs. By the end of July this year, 1,9-million man-days had been lost to strikes. The total for 1987 was 9-million.)
The drain on business confidence caused by strikes has been exacerbated by the general state of instability around the country attributed to the opening up of the political process since February 2.
Overall, the picture is one of anarchy and chaos – not a good recipe for confidence.
But political change is probably only a small part of the explanation for the high levels of unrest. JCI economist Ronnie Bethlehem uses a simple graphical display to show the major part of the explanation is simply the recession. In the mid-’70s, late early ’80s, and the mid-’80s, social unrest and increased union militancy was an invariable byproduct of recession.
Today most economists accept that tight monetary policies, and induced recession, are a necessary part of the cure for our economic ills. But everyone needs to expect and accept that this medicine has drastic side effects.
There is no denying that union attitudes and policies are a hindrance to the twin government policies of financial conservatism to fight inflation and economic liberalisation (including privatisation and deregulation) as the other main ingredient of a growth strategy.
The emerging danger is that a section of the Cabinet appears to believe this problem can be fought by taking on the unions in an adversarial contest. Perhaps they should be reminded that it was a similar view on how to deal with aggressive unions in 1987 that spawned the 1988 Labour Relations Amendment Act.
That strategy not only failed miserably, its consequences are still being felt, not least through the threatened work stayaway planned by Cosatu for October 8 to 10.
If government’s adversarial strategy failed during an era of political repression, how much more certain is failure in a period of political liberalisation? The whole point of the De Klerk era is recognition that conflict is best dealt with through negotiation.
As Bobby Godsell of Anglo American and employer federation Saccola puts it:
‘If you want the unions to moderate their wage demands now to protect the value of workers’ wages in the future, you need to do it jointly. Government should be involving Cosatu and Nactu in the formulation of national economic policy.”
An arrangement along the lines suggested by Godsell would facilitate the economic debate between organised business, labour and government. All interest groups have now developed positions on the key questions. It is now time to begin testing these against argument from the other side.
Let Cosatu explain the relationship between high wages, new technology and employment – whether it sees a period of a high rate of mechanisation and low employment growth as a necessary part of the growth path. Let government explain how privatisation and some forms of deregulation will be in the interests of all, rather than of certain interest groups. Let business and government explain why it complains to workers about low productivity while everyone knows productivity is almost entirely a function of the state of the economy, of management and of production systems – a management responsibility.
It need not end there. The Pretoria Minute provides for the establishment of “mechanisms of communication” between government and the ANC to allow public grievances “to be addressed peacefully and in good time, avoiding conflict”. The parties say the issues to be addressed in these forums are largely socioeconomic ones.
It happens that through their day-to-day work the unions have developed far more expertise than the ANC on matters like housing, health care and retirement and other benefits. Yet, unless they are invited in by the ANC (a development which would militate against the development of an independent union movement) the unions will not be involved. If there is going to be any hope of setting national economic objectives and developing growth strategies supported by all economic players who otherwise have the ability to thwart them, these need to be determined jointly.”