CCMA & UIF 2019/20 Quarter 2 performance, with Deputy Minister

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Employment and Labour

04 March 2020
Chairperson: Ms M Dunjwa (ANC)
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Meeting Summary

The Deputy Minister noted that a National Minimum Wage Hotline was going to launched this week by the Department of Employment and Labour. She said South Africa finds itself on the verge of despair as it has to deal simultaneously with the coronavirus and the economic recession. It is a test of character for every citizen, however, the best economy is achieved by teamwork

The Committee was briefed by the Unemployment Insurance Fund (UIF) and the Commission for Conciliation, Mediation and Arbitration (CCMA) on their second quarterly performance. The UIF noted that benefits payments estimates increased so that in Quarter 2 it overspent by 146%. In 2017 the UIF Act was amended to improve benefits and the impact is evidenced in the current financial year. The budget was revised however unemployment claims keep on increasing.  The CCMA budget cut has caused it to have a decrease in the numbers of commissioners and had a huge negative impact. That will be evidenced in the coming quarters.

Members raised questions on the recession and the outbreak of the coronavirus; measures in place to help those dismissed; and the public outreach programme.

Meeting report

The Chairperson referred to the current news of recession in the country’s economic status. With the extra responsibility of employment in its mandate, an analysis is needed on the objectives of the Committee. Members were encouraged to best utilise resources made available following the Budget Speech from the Minister of Finance. Members were encouraged to read the budget speech to prepare for the budget vote. As difficult as it is,the Committee must leave a legacy behind to look back in 2024 and be proud of, but the hard work will have to start immediately.

The Deputy Minister of Employment and Labour, Ms Boitumelo Moloi, apologised in advance as she had to present the COIDA Amendment Bill to the Cabinet Committee. Apologies were noted from the Minister and the Director General who had been booked off sick. The Deputy Minister acknowledged the presence of the Acting Director General. She explained the COIDA Amendment Bill to finally include domestic workers was being tabled to the Cabinet Committee because the current Act excluded domestic workers. The Department of Employment and Labour (DEL) was taken to court by the daughter of a deceased domestic worker, with the help of a union for domestic workers. After working for twenty-two years for her employer, the partially blind lady died on duty. She fell in the swimming pool while cleaning windows and drowned. The daughter was offered R5000 by the employer. The High Court ruled that the legislation in place was invalid as it excluded domestic workers.  The case will be heard in Constitutional Court at the the end of March 2020 to confirm the invalidation of the legislation. It is a very important milestone for the Department, long overdue for the Act to cover invalidated workers.

There is potential political instability associated with economic distress which could lead to loss of confidence in the country.This economic vulnerability is what economists call the self-fulfilling speculative attack. Speculative attacks can be self-justifying and self-fulfilling. There is a need to bring back confidence to prevent forcing the country into following polices that would be extremely perverse. The success of every economy will always be based on sound economic policies and implementation with a great amount of discipline. The economic recovery document from the Treasury is trying to deal with current issues facing the country as it has entered its third recession since 1994. No amount of prepared speeches will rescue the economy more than fixing fundamentals like the President always says. It is unfortunate that this happens at a time when the current Committee is place.

State-owned enterprises are failing to recover. In a country where about 30 000 to 50 000 applications are received for an entry level advertised post even those with Masters degrees are applying – that is a crisis that cannot be downplayed. A platform has not been set aside by the Portfolio Committee to unpack matters of unemployment where concepts of work/employment and a South African definition of unemployment / employment need clarity. India has a large number of people registered as employed such as street vendors are registered as employers or employed. In South Africa, the self-employed and entrepreneurs are not registered as employed. The concept needs to be changed according to the International Labour Organisation Convention. The Committee is challenged to discuss such matters and advise Parliament as a much clearer definition is needed. The CCMA and UIF are more than capable to assist in dealing with fundamental issues. When the world is battling the spread of Coronavirus, South Africa finds itself on the verge of despair as it has to deal simultaneously with the virus and economic recession.

It is a test of character for every citizen, however, the best economy is achieved by teamwork. On 6 March 2020 the DEL with the endorsement of the Minister, is launching a National Minimum Wage Hotline. On Friday 7 March the DEL will be leading programmes in the Eastern Cape, meeting with employers in East London and Cofimvaba. A commitment was made to the Portfolio Committee that when such events occur, invites must always be extended to Members of the Portfolio Committee who might be deployed in such areas and will have the opportunity to access the work of the DEL. Members who think the meeting will enhance accountability and Committee oversight are invited to attend. The UIF Commissioner will also be inviting Members for the oversight of the Labour Activation Programme that was launched on 24 February 2020. The Deputy Minister stressed that she received an email following the Compensation Fund presentation about compensation complaints that were reported. DEL has responded and forwarded all the information to the Compensation Commissioner to follow up. In due course the Commissioner will respond directly to the Member as pressure for progress is put on such cases. She concluded by thanking the Chairperson for always being tough on her department and hoped that Members learnt something from the previous meeting with the Compensation Fund and are in the process of improving services of all entities.

The Chairperson stated that during discussion Members will reflect on some of the issues that have been raised by the Deputy Minister.

Unemployment Insurance Fund (UIF) Quarter 2 performance
Mr Teboho Maruping, UIF Commissioner, stated that, it is worrying that the country is facing challenges. Starting on slide 20, because slide 1-19 refers to the mandate of the UIF which was discussed in the Committee workshop. The internal audit report shows the performance information which was conducted by internal auditors with evidence provided. There was an achievement of 12 out of 15 targets and an alignment of management performance was showcased in the presentation showing a comparison from last year. Last year in Q1 63% was achieved with 73% this year. Q2 was 63% last year and 80% this year with an improvement of 17%. 15 targets had been broken down in detail as the Committee had requested in the previous meeting. The presentation includes the numbers behind the percentages. The vacancy rate was below 10%. When a level 6 or 7 position is advertised, the Deputy Minister noted that the number of applications would reach about 50 000 including applicants who have Honours and Masters degrees whilst the position requires only matric. For that reason, it takes time to process the applications received.

The three non-achieved targets for Quarter 2 were:
- Integrated Claims Management System (ICMS) Phase1 implemented: The contract with the previous service provider ended soon after dropping some of the reports.  The termination of the contract was permitted to avoid incurring irregular expenditure. The complexity of the solution was undermined at the time because UIF is a different set up. A new service provider has been appointed and is busy developing the system, so that by September this year, a solution would have been developed.
- In Quarter 2, 20 000 UIF beneficiaries provided with learning opportunities: The number of learners and some training programmes have been dialed down. Learners must be trained into employment. The target for the quarter has been missed to review the programme and assess if the programmes provide employment opportunities for trained learners.
- The third missed target was Training Lay off Schemes (TLS) processed on receipt of recommendation ruling by Single Adjudication Committee for approval by the delegated authority within specified time frames. The main cause of delay was the 2008 scheme structure that was used. UIF provided work schemes whilst the Sector for Education and Training Authority (SETA) provided training intervention. The two were interlinked such that a work scheme would not be paid without starting with the training programme and vice versa, unless there was an agreement with the work scheme. Some of the SETAs did not include TLS in the budget, therefore UIF had to negotiate an additional budget, hence delay was caused as Single Adjudication Committees meet every quarter. As DEL is dealing with training programmes, an intervention is provided as the training programme cannot occur independently. The work subsidy and the training programme can occur simultaneously because not every company requires a package of training subsidy, salaries and work subsidies. A company may require one factor or both or can intervene separately on two items.

Ninety per cent of UIF claims were processed within 15 days in Quarter 2 which was 4% above target. Gauteng processed around 15 000 applications followed by KZN and Western Cape. The briefing looked at the top five sectors driving UIF benefits, the age categories and claim reason. This is linked to recession which makes unemployment worse as more people are employed via contract or seasonally as opposed to permanent employment such as the agriculture and construction sectors. 4% of claimants have above matric qualifications whilst 29% have matric and below. That means that 67% of claimants have below matric qualifications and this reflects a lack of skills problem among the youth. This aligns with the priorities that the President had previously unpacked which includes skills development. The industry sectors most affected were shown according to province, gender and age. The food industry and professional services are driven by females. 60% of claimants in the Agricultural sector is women and they are losing jobs so is the Banking sector where 57% were females. 47% of females and 53% of males are affected by unemployment (see  presentation).

UIF Quarter 2 expenditure report
Ms Fezeka Puzi, UIF CFO, presented the Quarter 2 expenditure report and the audit action plan.

Programme 1 underspent by 63%. Main reason for underspending is the vacancies that are at 8% and money had been allocated for performance bonuses. Stricter rules have been put in place for awarding of bonuses – for example only staff that exceed expectations are awarded.

Programme 2 spending of 146% was caused by unemployment benefits paid to beneficiaries. In 2017 the UIF Act was amended to improve benefits and the impact is evidenced in the current financial year. The budget was increased in line with actuarial valuations in terms of the history of claimants. However current unemployment claims keep on increasing. The Labour Action Programme (LAP) shows an underspend. The main reason is that some training providers are not complying with the Memorandum of Agreement (MOA) and there are delays in the payments of the tranches. When non-compliance is detected payments are not processed until the MOA conditions are met. Total expenditure for Q2 was R9.4 billion and overspent by R1.5 billion and this was corrected in Q3 because the budget was reviewed and have since improved. Goods and services was underspent because of cost containment measures. On Capex, as indicated earlier, mainly it is delays in finalizing the ICT projects so improvement is expected in Q3.

Temporary Employer/Employee Relief Scheme (TERS)
The UIF Commissioner said that R101 million was used to save companies that were on the verge of shutting down.  It cost R30 000 to save a job. That may look very expensive, but it is nothing compared to creating a new job which cost about R250 000, because the economy is not aiding in creating new jobs. Therefore, it is better to keep people employed taking into account the level of skills and nature of work. The Temporary Employer/Employee Relief Scheme helped in saving 27 entities that were on the verge of shutting down.  Companies where the DEL has intervened and names, sectors and locations were provided to show transparency to the Committee. Out of the 27, the majority of the companies deal with manufacturing and textiles with 12 in manufacturing and 7 in textile clothing industry.

Training of the Unemployed
The Committee had previously requested more information about the training of the unemployed. A list was provided of a breakdown of the institutions and the nature of training.  The Department would love to take the Committee on a visit to see some of the projects that have been implemented. Slide 102 has the breakdown: 13 000 females and 7 000 males with more than half young people in training. Projects are directed to the youths, keeping in mind people who are connected to UIF (see full presentation)

Discussion
Mr M Bagraim (DA) said that the presentation is evidence of a lot of work done. He raised the point that the online system is always off-line and he get complaints all the time. It is just a system problem as opposed to problems in the institution and he asked that Members be informed of the measures in place as it was mentioned that getting a better ICT service provider was in process. DEL should be expecting mass retrenchments and dismissals from the civil service following the Budget Speech. Is it ready and does it have enough finances for UIF payouts? Coronavirus is creating lots of retrenchments and countries like China are giving people nothing – is DEL ready to deal with such a challenge? Why did the Department wait 25 years to have the Compensation for Occupational Injuries and Diseases Act (COIDA) amended to cover domestic workers and why did it take a court case to force it to react? Why did the Department appeal to the Constitutional Court when it lost the case? As the recession will put pressure on DEL, interactions with unions show that Training Layoff Schemes were never favoured. The majority number of people who claim benefits are contract workers. The reality is that as much as the government spends time to outlaw short term employment contracts in the name of creating employment, that is leaving more people unemployed after a short period of time when the contract period is over.

Mr N Hinana (DA) said a public outreach programme is essential to educate communities on the processes in place following loss of employment. In the Western Cape in particular where people work for 1 to 3 days per week, when dismissed they do not have the knowledge of what to do. Others are injured at work or dismissed because of poor health. Entities where claims have been processed has been shown, but the main area of focus should on the permanently employed. These companies that have been there for ages and employees of those companies are unaware of the procedures in place. Race is always omitted from the statistics. Race is a fundamental factor which must be unpacked but must not be divorced from gender.

Ms A Zuma (ANC) said that provinces that fail to achieve the targets such as Gauteng and Limpopo raises eyebrows - that means that the head office is also under-performing. The Committee must intervene with oversight visits to see indeed if work is being done. The projects assisting youths in all provinces are not followed up after the training of the youths to see if they are still functioning.

Dr M Cardo (DA) said that in the 2019 audit report, the Auditor General was unable to find adequate evidence in the UIF financial report to substantiate figures. The UIF also failed to take disciplinary measures against officials who permitted irregular expenditure of about R56 million. There are 13 confirmed cases of irregular expenditure. The question is what time period do the 10 cases currently under investigation amounting to R12 million refer to. Do the figures for the 13 confirmed cases and 10 cases under investigation include the R86 million mentioned last year in the Auditor General report? Has any disciplinary measures been taken in the 13 cases of irregular expenditure and if so what has been done? Has the SAA business rescue practitioners approached UIF about the possibility of using the R100 billion surplus to fund retrenchments and if so what are the details? Cosatu had proposed to put together PIC money, Development Bank money and UIF money to cover 50% of Eskom R450 billion in debt. Has UIF been in contact with Cosatu or the Finance Ministry about this eventuality and if so what are the details?

The Chairperson said that questions about business rescue will be submitted at the end of March 2020 and there are procedures in place to be respected and followed.

Mr X Ngwezi (IPF) note that R1.5 billion was overspent and later addressed in the adjustment budget. Does UIF have enough funds to take it through to the end of the current financial year? Are the many applications causing a delay in filling those positions, DEL must use internal resources to fast track the entire process.

The Chairperson mentioned that an overview of gender and age was presented but people with disabilities are excluded and a reflection on that would make a difference.

Mr S Mdabe (ANC) said the Committee together with DEL must dedicate time to discuss the current challenges in the economy especially after the Statistics SA report. There is need to understand the impact of that feedback. When it comes to fruitless and wasteful expenditure there is no detail and no measures put in place except to say that it is monitored by the Office of the Commissioner - clarity is needed. The irregular expenditure will have a negative audit impact if it is not dealt with timeously - what measures are in place to deal with that?

Responses by the UIF Commissioner
The system is on and offline and at this stage with 95% availability. The issue is being addressed to avoid offline periods at peak times as the data centre has moved to SITA. Hopefully when the USSD and an application is launched together with free WIFI, pressure will be reduced. In terms of the recession and the virus, the actuarial evaluation allows the budget to stretch and there is a reserve available should retrenchments increase. About R43 billion was put aside specifically for that. Actuarial evaluation was done prior to the annual budget. The Acting Director General will respond on domestic workers. On the Temporary Employer/Employee Relief Scheme, one cannot speak for organized labour, but can speak about what UIF has done to date. It has managed to bring organized labour on board because there was no comprehension and communication of concepts. The Scheme is improving the process and a meeting on the subject was conducted in Western Cape yesterday.

DEL is aware that there is not enough communication in the communities. On Saturday there is a mission to go to Eastern Cape and buses are made available to reach long distance communities. It is not enough, but something is being done. The Head of Communications have been engaged with for platforms of communication to reach communities. Race and people with disabilities were not deliberately omitted from the statistics but were not accessed. Figures will be available in the next report.

In areas that have missed targets, the main area of concern is Limpopo. The province has missed targets for two successive quarters. Usually when a target is missed in Q1 there is a rapid response team that comes to aid. It has been sent to Limpopo and improvement has since been evidenced in Q2 and Q3. On the 6 March he is going to Limpopo to assess measures put in place and a huge improvement is expected in the coming year. The Director General had also engaged with Limpopo on improvement. Irregular expenditure is a debatable matter, with or without evidence. The issue at hand for the Auditor General was consequence management. Evidence was provided for each item of irregular expenditure and there was justification on why the department did not deal with it at the time. There was an engagement with the DEL legal team and corporate services team and the advice was that there was no need for disciplinary action. When it comes to disciplinary action, usually the person accused will have to justify the reason for not facing disciplinary action. Upon consideration, the corporate services proposed that no one should be disciplined because there was a justification. The case was taken under review and a report is expected in the coming week advising if there is any need for further discipline and that constitutes the main part of irregular expenditure. It is at R101 million and with the case of R86 million in question taking up most of it.

When it comes to business rescue for Eskom and SAA, it is premature to know the current status of the processes in place. It is wise to let those processes unfold to have tangible information. On 1 January 2019 the budget for the year had already been processed and there are funds reserved in the previous year. Budgets are reviewed in September, August is submissions. Therefore, the UIF is comfortable about meeting its obligations.

Response from the UIF CFO
To second the Commissioner, there are enough UIF funds available, the actuarial evaluation was done looking at the next 10 years and will be able to cover all the liabilities, therefore, the Fund is solvent. To answer Mr Cardo on irregular expenditure, of the R107 million, R86 million is due to be accessed over the period of three years. The remaining balance was with different companies. The main challenge was contract management where a contract was exceeded by 15% without getting approval from National Treasury. Controls have put in place to ensure that if there is a need to exceed a contact by more than a permittable limit, National Treasury is consulted prior to the variance being exceeded. On the time it takes for disciplinary measures to take place, the range is about 3 to 9 months. Some cases have been finalised but the department was not satisfied by the outcome and for that reason they were referred back for further investigation to reach a logical conclusion.

When it comes to fruitless expenditure, about R75 million is due to licences paid to the system. Licences were paid but implementation was delayed hence it is called fruitless expenditure. Implementation is now in place and new service provider will be also in place together with the investigation for fruitless expenditure. After the UIF Amendment Act approval in 2017, payouts only began in 2019 and the budgeting was aligned to ensure that beneficiaries are paid for arrears and in the next financial year – future liabilities are taken into account.

The Commissioner mentioned that about 70% of the beneficiaries do not have the necessary skills. The training received is entrusted and a responsibility given and trainees are monitored in the workplace environment for a period of 12 months. No monitoring has been done beyond that. However, an assessment in being conducted to see the results.

DEL Acting Director General, Mr Virgil Seafield, noted that the law allows a limited duration contract, and a number for contract work does not reflect the number of claims. Those contracts are in place where it is logical for example in the agricultural sector therefore there is an extension to the claim process. The exclusion of domestic workers in the Act is being dealt with urgently and has been accentuated by the ILO Convention on domestic workers and gave rise to the amendments. The Bill is waiting for approval in Parliament. The Constitutional Court case is a practicality and should be followed through whether domestic workers are covered by the current legislation or not. DEL is more than willing to have domestic workers covered. When it comes toTemporary Relief Schemes and the notion that unions are not in favour of it. There has been structural problems especially departmentally in its application and response, hopefully the objective will be met in future.

The Chairperson expressed her concern that Statistics SA includes 15 year old children in the unemployment range. The age group falls under minors and as much as Stats SA deals with monitoring and evaluation, that needs to be addressed to them and looked at.

Mr Seafield replied that DEL was already engaging with Stats SA on the definition of unemployment and employment because it uses the ILO definition.

The Chairperson mentioned that public awareness must be raised about the basic conditions of employment. The language used in the awareness campaign must be relevant to the parties concerned.

Commission for Conciliation, Mediation and Arbitration (CCMA) Quarter 2 performance
The CCMA Director, Mr Cameron Marajane, stated that the CCMA is confronted by challenging legal questions about domestic work and the national minimum wage. Retrenchments among domestic workers is expected to rise because of the affordability of minimum wage by employers. Domestic workers need to be educated on their rights under the Basic Conditions of Employment Act, especially s185 and s186. S189(3) mentions that for meaningful engagement, all information must be made available and that includes financial statements. Domestic work is very crucial and like any employment, it falls under the labour market and is also affected by retrenchments. CCMA offers training for domestic workers, but because of the nature of work, attendance is a challenge. Members were encouraged to be exemplary to their domestic workers and comply with the Basic Conditions of Employment Act because Ubuntu still plays a bigger role. The circumstances under which the CCMA and the Portfolio Committee operates calls for a different type of leadership where best results must be achieved with fewer resources.

In Q2 three targets were not achieved due to cancellations by parties at short notice and it became too late to proceed for the quarter. The target is achieved by parties coming to training, and if respondents cancel, the target is not achieved. The budget cut had an impact on performance and the timing for the training was not the best as it was in December. That is an admission on behalf of the team, and better results could have been achieved. However, cancellations occurred and targets were not achieved. Interventions have been put in place to ensure that the target is reached by the end of the financial year.

The budget cut has caused the CCMA to have a decrease in the numbers of commissioners and had a huge negative impact. That will be evidenced in the coming quarters. Social justice and service to the people come first, hence the CCMA commissioner mediates on cases sometimes to ease the pressure off the team. The CFO is however unable to help as that is not her field of expertise. A case must be conciliated and mediated within 30 days before it goes to arbitration. If that does not happen, at arbitration, with the consent of the relevant parties, a case can be conciliated. There is no prejudice at all because the standard is that cases must be heard within that period. It is not achieved because it is a matter of high performance from the institution.

By law, when the case is concluded, commissioners must ensure that an award is rendered to parties within 14 days. commissioners do not wait until the last day as there are internal systems in place. When the commissioner issues an award, on day 10 it goes through scrutiny where validation and authentication is conducted to see if it is an enforcement award. Corrections will be made if needed and on day 13, it is released to parties. It is merely a system issue. The struggle and challenge is ICT's case investment. commissioners should be increased but it is not possible due to the R30 million budget cut. This will also be evidenced when the budget is presented to the Committee. The strain on the CCMA is the increase in s189 cases and that has negative effect on performance.

The CCMA took 23 days to deal with conciliation cases as compared to the legislated target of 30 days. It will be problematic in the future taking into account the number of resources and an increase in cases. Part-time commissioners are sourced as the CCMA cannot afford more full time commissioners. Capacitation training and assessment are conducted to educate the public of their rights. A new approach is in place due to the new budget. Some leased offices have been closed down because it cannot afford to pay the costs.

Pre-conciliation will be conducted and that happens telephonically to cater for parties who struggle with transport to reach to the hearing venue. That is compatible with the principles of social justice. Outreach services are conducted to raise awareness to educate the public of their rights. Most cases that fall under s189 are not large scale and the difference with s189A is that the latter focuses on large scale dismissal. In Quarter 2, people who were on the verge of losing jobs were about 22 558 and through facilitation about 9 500 jobs were saved, but the figure could be bigger with better resources. There is no evidence for s189 because s189 retrenchments are not reported as they are unlike s189A, they are not within the range of the CCMA. However, it must be made clear that s189 also does have retrenchments. A target of 35% was set for s189A facilitation and in turn 42% was achieved. It was indeed a proud moment, as it translated directly to a triple crisis because one job saved equates to a family and a whole lot of responsibilities saved. If the challenges associated with a recession  are to be alleviated, that is a function that should get more resources because it goes directly to principles of social justice in line with the relevant legislation. About 78% of strikes were settled with 36 out of 46 having been intervened in and resolved. It is important because labour peace must be achieved and an engagement with parties provide better solutions. There is no target on the annual performance plan, but a statutory objective of the CCMA to intervene in terms of the amended s150 of the Labour Act. Labour peace, economic development and protection of workers have been achieved.

The Employment Equity Act connects directly to the Constitution because it is the brain-child of the Section 9 of the Constitution which is also referred to as the equality clause. The CCMA has a special panel as well as highly trained people to conduct work and that is emphasised in the Preamble. In conclusion the overall problem that needs serious integration and a collaboration is award enforcement especially when it comes to farm and domestic workers. Effectiveness of the legislation is seen in the outcomes being executed. Through its legal department, the CCMA had intended to create an enforcement vision. Four people in different regions are conducting enforcement duties. This effectiveness depends on the Labour Court to where cases are referred. It is unfair for cases to spend 3-5 years without being concluded. When the relief is not found, parties come back to CCMA and end up being sent to the pro bono Labour Court. It is not logical to have thousands of worker awards lingering unenforced and as much as resources are limited, there must be a way to resolve that. Limited budget has an impact on performance and a prioritization and assessment needs to be conducted and the report in Q2 will be different because of that. The elevation of the role of language and culture in dispute resolution and a plan to make a historic achievement is to open a CCMA office in the townships. Parties reach an agreement more quickly and easily when the language of choice is used. All 11 official languages should be used. Some of the cases fail to be resolved due to the language barrier.

CCMA Quarter 2 expenditure report
Ms Kedibone Mashaakgomo mentioned that there was a variance of only 2% which was not spent for the quarter. The main issue on spending emanates from case disbursement which is a core method for delivery. CCMA uses human resources to deliver its mandate using both full time and part time commissioners. Part time commissioners costs are contained and there has been an increase due to the number of cases reported. The work that the CCMA is supposed to conduct and the available resources do not correspond and that puts a strain on it.

Of the 2018/2019 audit findings, nine have been resolved and seven are still being addressed. Implementing the internal control finding was not resolved on compliance with the BEE certificate. This has been addressed in the current financial year.

Discussion
Mr Bagraim said that CCMA staff are overworked with no breaks and are failing to cope with the amount of work. They are  working beyond 5pm with four or five arbitrations a day. That puts pressure on dismissed people when it comes to gathering witnesses. Is it possible to request an oversight visit to engage with the staff. The referrals received were about 200 000 cases in the previous financial year.  The numbers are increasing and without extra money, how will that work? In that case, when people call for enquiries, advice should be given telephonically. Cases which are not disputes could be solved by perhaps amending the legislation, and that might cut down on the pressure. There has been a call by Cosatu to have a look at the cases involving minimum wage claims because cases end up going to Labour Court. Cases that go to Labour Court take two to three years to be concluded mostly because they are not judicial but technical decisions.

Dr N Nkabane (ANC) asked about the overall performance of the Commission in Q2 when compared to  2017/18 there has been a decline of 63%. What measures are put in place to address that? When it comes to the capacity building intervention, nine were expected and seven achieved, so are there no financial implications due to preparation expenses incurred. When will the remaining audit finding be resolved and what are the hindrances? There must be an action plan for monitoring, considering the time frame. Do the outreach programmes on labour rights education include rural residents? What happens if fewer than 50 workers are retrenched as Section 189A only covers large scale dismissals?

Mr Mdabe asked what are the real issues around professional services sector?

Mr Hinana noted that the Director expected a 10% decrease in reported cases because of the increase in the minimum wage, but instead the number had increased threefold. How do you deal with the problem when there is a such a queue, what is the alternative solution?

The Chairperson requested that CCMA should provide the number of cases that are awaiting to be heard at the Labour Court. Each province has a Labour Court and information of sectors that are affected in terms of awards must be provided. Generalisations must be stopped and work should be done to correct any defects. Whoever is not keen to do the work should be exposed. When the public is listening to Members debating, facts must be extracted and that information should be provided before the Committee conducts the budget vote. Awards to workers should be enforced.

Response
The CCMA Director, Mr Marajane, replied that not only is the staff overworked, but the executives as well. The objectives of the CCMA is put before anything else. In pursuit of performance, staff cannot be sick or complain about fatigue at work, because the long queues keep the staff going. When a claimant comes to CCMA all they have is hope. It is already difficult for some people who are employed to last a whole month with a salary, what about the dismissed? If a job is lost, everything depending on it is also gone. Complaining about fatigue is nothing compared to the results that will be achieved. It is not ideal to postpone hearings as some people struggle with transport fares, with some walking to the hearing venue. Achieving social justice drives staff. In pursuit of that mandate, staff wellness is affected. It is even worse now with commissioners mediating for more than four cases. Due to cost containment, the issue is being reviewed and roll call put in place especially in Johannesburg where a commissioner is given one case but with four cases to his name. This promotes competence by solving disputes without allowing arbitration so some of the cases are delayed because on the day the commissioner is unable cover all of them. The institution tries not to send anyone back. The plan was to invest on technology to make the processes easier, but there are no resources and the institution is not coping. Gate keeping is a good idea, but some cases need to have evidence presented before the commissioner and that means hiring more commissioners which CCMA cannot currently afford.

Minimum wage is an economic legislation intended to create a living wage. It is not constitutionally correct to review and delay a case and that should be revised. An internal review system that does not go to Labour Court must be created. Research found that two or more countries have that measure in place. Taking a case on review where someone who is owed R2000 is not logical as they will have to wait three years for the money to be paid with some people dying waiting for justice, while others give up. Minimum wage and awards disputes must not be resolved at Labour Court. Making a provision in the rules is ultra vires because that will be providing regulation that is not in the statute. Section 145 of the Labour Relations Act supports the review of arbitration awards. To achieve what is needed, legislation must be reformed. An example is the case of Spar where an award was issued and Spar was notified to pay R12 million because it did not pay minimum wage. It was sent to Labour Court and all the beneficiaries will wait three to five years. In that case beneficiaries will have to get back pay and future payments, but at the moment, the matter is stagnant pending Labour Court. The Portfolio Committee must consider legal reforms to address minimum wage.

CCMA does not miss targets, annually two targets are presented. Some targets are corrected quarterly. It may reflect like a drop because of that, but some get carried over to be corrected at the end of the year. That is the formula in place. Cost recovery is part of the survival method which avoids fruitless and wasteful expenditure. There are no incidents of fruitless expenditure in Q2. Moving forward, a proposal will be made to the Department that instead of hiring venues and spending money, a partnership with state entities must be created to use state buildings as venues to reduce unnecessary expenditure.

On the audit finding on the BEE certificate, this has been corrected and complied with. Vulnerable workers are the first priority in the campaigns taken to every province and evidence will be provided in the next meeting. However, accessibility is problematic; with budget cuts, it will be difficult to reach out. A relationship has been sought with AgriSA to discuss accessibility of funds for enforcement of awards and training purposes. Other entities such as the UIF and Compensation Fund must comply with an integrated approach. Retrenchments cases that are below s189A requirements are not referred to the CCMA unless it is an ordinary dispute where a person reports unfair dismissal. The approach is that in terms of s189A dismissals below the threshold requirements "of more than 50 employees" are happening, but there has to be a system to capture the data. The CCMA does not have resources to tackle this.

The business professional services sector has the highest number of referrals because others go to the bargaining council. That should be reported to the Portfolio Committee to have a balance on who has the most referrals. The CCMA is currently dealing with the board of a bargaining council as it does not want to provide information about state entities who do not refer to the CCMA. If they do not cooperate, the matter will be escalated. A dispute that involves minimum wage is not a legal dispute as it is a matter of complying with the law. In preliminary stages, a non-commissioner will be involved, but if a decision has to be made, then a commissioner is involved. Basic conditions of employment and minimum wage cases are on the rise and the CCMA is not coping with the pressure. The worst scenario would be rejecting cases because of the pressure and it looks like the institution is heading towards that direction.

The CCMA will do its best in engaging with old cases pending Labour Court after an award has been issued. To get an accurate report one has to engage with the Labour Court files and in most cases, workers disappear. The CCMA does not have jurisdiction once an award has been issued. There is no collaboration between important entities to enforce the values of the Constitution: the Labour Court, CCMA, UIF and the Department of Justice and the Constitutional Court.  The CCMA must be able to track an award that has been sent to Labour Court to see if it really goes through or dies on the way. The IT system will link with the Labour Court and will link with the case management system. The institution will end up having systems in place, but other institutions that are interlinked with the institution do not have the relevant data so there is rupture between CCMA and the Labour Court.

The Chairperson mentioned that it is a good motive to see that questions raised centre on positively changing the lives of the people. The public is ignorant not because of choice but due to brutal structures that were in place, and an outreach programme is a wise idea as people do not have enough information about the steps to take. This can be done through local newspapers and community radio stations. Language should be emphasised and people should not be apologetic about their language of choice. It is not only the responsibility of Department alone but also for MPs public representatives to empower the nation.

The Chairperson took Members through the Committee Programme and the Committee approved it. On 13 March oversight will be conducted in Pretoria for the whole day at the Compensation Fund. In week 8 there will be a briefing by Statistics South Africa and the Financial and Fiscal Commission and any outstanding quarterly reports.

Meeting was adjourned.
 

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