World Bank warns about too many labour rules

 

World banks warns SA on the labour laws and proposed amendments to labour laws.

ALISTAIR ANDERSON

Published: 2011/03/04 06:58:25 AM

WHILE the World Bank has not expressed an official opinion on the government’s proposed labour law amendments, the financial institution yesterday said SA must focus on strategies that created employment and ensured that skills were priced according to the economy’s needs.




The four bills, which were proposed last year, have met with resistance from business and civil society groups. Critics argue the bills will make South African labour legislation even more constraining than it already is , thereby deterring companies from hiring and from retaining people already in jobs.




"Foreign direct investment may suffer as a result of too many labour regulations," the bank’s vice- president for Africa, Obiageli Ezekwesili, said yesterday .




Ms Ezekwesili was speaking from Paris in an online feed about the launch of a new plan of support for Africa by the bank .




"With Africa facing an unprecedented opportunity to transform itself and improve the lives of its people, the World Bank is responding with a new, ambitious strategy that could help African economies take off, the way the economies of Asia did 30 years ago," she said.




According to a report that accompanied the plan’s launch, Africa’s economic growth over the past five years has not been accompanied by job creation for the 10- million young Africans who entered the labour force annually.




SA’s labour bills include amendments to the Labour Relations Act, Basic Conditions of Employment Act, Employment Equity Act and a new Employment Services Bill.








The Democratic Alliance has said the bills were badly drafted.




The South African Institute of Race Relations said yesterday it was concerned about proposed changes to how companies would be punished if they failed to comply with SA’s labour legislation.




Companies would face fines as high as 10% of their annual turnover . The institute also said that the bills had been drafted when government spokesman Jimmy Manyi was director-general of the Department of Labour .




Mr Manyi has been criticised for comments he made last year on an "overconcentration" of coloured people in the Western Cape.




Government Communication and Information Services deputy CEO Vusi Mona has apologised on Mr Manyi’s behalf. The African National Congress and Labour Minister Mildred Oliphant have also repudiated the comments.




But the institute maintained that Mr Manyi’s comments had influenced the drafting of the bills .




"Companies in the Western Cape would face enormous challenges if the proposed changes to the Employment Equity Act were signed into law," the institute said.




"Ironically, although Mr Manyi’s comments about coloured ‘overconcentration’ in the Western Cape have been repudiated by both the ANC and (National Planning) Minister (Trevor) Manuel, the bill has been approved by the Cabinet and is in line with Manyi’s thinking."


The institute said a Western Cape factory whose workforce now comprised 29,1% Africans, 54,8% coloureds, 0,5% Indians and 15,6% whites, would have to become 73,7% African, 10,9% coloured, 3,2% Indian, and 12,2% white.


This would mean many people would have to be laid off , said Anthea Jeffery, head of special research .












andersona@bdfm.co.za