Hon Speaker, before the Department of Labour can establish a sectoral determination for any sector, the Employment Conditions Commission, ECC, conducts public hearings, as the standard practice, to listen to employers and workers in regard to their conditions and the impact that the minimum wage will have on the sector.
The agricultural sector was no exception to this approach. The ECC invited both employers and workers to make representations. During the public hearings the employers raised what they considered to be the impact that the minimum wage would have on them. Similarly, the workers raised issues relating to their current exposure to low wages and the rampant exploitation that they are subjected to in the sector.
As the Minister of Labour I have the responsibility to listen to both parties and strike a balance between the diverse interests of those parties, also taking into account the socioeconomic interests of the country, including possible job losses. The investigation did not show any negative impact on jobs, and I took comfort from the fact that those employers who genuinely cannot afford the new rates will have recourse in the form of exemptions.
The actual average wage prior to the introduction of the new determination varied from one employer to the other and from one province to the other. The information collected through the public hearings showed that the levels of wages they were paid in the sector were without doubt far from being ethically acceptable.
The hon member should know that the minimum wage is not determined in a vacuum. There are considerations which are taken into account prior to the introduction of a minimum wage, like the ability of the employer to continue to do business and the vulnerability of workers, which may include, amongst other things, their living standards.
For employers that cannot comply with certain provisions of our labour laws, the Basic Conditions of Employment Act of 1997 provides for the variation of certain conditions of employment, including wages where employers cannot afford the payment of such wages. Thank you. [Applause.]
Speaker, I thank the hon Minister for her reply. Minister, I actually tried to get a question as to the merits or demerits of the sectoral determination. I realise that that is your business. I am just interested in the consequences. If one looks at the sectoral trend of agriculture and labour in this country over the last decade, it's truly atrocious. We have lost approximately 330 000 jobs in the last decade. Agriculture's contribution in regard to total employment was about 8% and it is now under 5%. Its contribution to the gross domestic product has dropped to 2%. We therefore have a real problem in agriculture and job creation.
I know the Minister is not the Minister of Agriculture, but she is still a Minister in government and this government is committed to creating jobs. Therefore, I suppose my follow-up question will be: Apart from the exemptions process alluded to, is there anything else that can be done by your department, hon Minister, to help improve labour absorption within the agricultural sector?
Speaker, there are different programmes in the department. For example, when it comes to seasonal workers, we have discussed the matter with the farmers and said that they can approach the Commission for Conciliation, Mediation and Arbitration for the training layoff schemes they can use. There are also different programmes in the Department of Agriculture that have support funding for farmers.
At the same time we must not assume, when we have decided on the sectoral determination, that the farmers can't afford it. I say this precisely because the majority of the farmers, particularly in Limpopo, have raised the issue that instead of paying the current sectoral determination of R105 per day, they would rather pay that to foreign nationals. Therefore, you cannot say that they can't afford it.
It is the attitude of some of the farmers when they are responding to that that I want to mention, and this includes those that have applied for exemptions. They didn't give us the documents that were required. As we speak, we have refused 480 farmers because they didn't submit the documents that they were supposed to submit. That shows that they can afford to pay the workers according to the sectoral determination. Thank you.
Hon Speaker, Minister, thank you very much for the response. I have a couple of things to mention. The controversy around the setting of the minimum wage continues to simmer with both sides, the farm workers and the farmers, quite unhappy. The farm workers are saying that R105 is not enough and the employers are saying that that it is too much and it will lead to bankruptcy. A question regarding the emerging farmers is this. How many of the people who applied for exemption are emerging farmers, and how many of these applications have been approved? Given that this dispensation has been in place for a couple of months, and people who have applied for exemption are paying their employees a previously agreed amount, if they are refused exemption, will the workers be back-paid? If so, what impact will that have on the farmers? Thank you. [Applause.]
Speaker, in regard to the number of farmers that were granted exemption, there were only 86, and there were 480 who were refused exemption. About 585 applications were referred back to the farmers because they didn't submit supporting documents.
When those who have applied are refused exemptions, they have to pay the farm workers the difference as from the date of the implementation of the sectoral determination.
Also, regarding those that have been given the exemptions, we did that because they had agreements with the workers, where the workers had signed and agreed on how much would be paid to them for a certain period of time and when that package would be reviewed. This was also based on a projection by the farmer himself of the period of time after which that farmer would be able to pay the workers according to the sectoral determination. Thank you. [Applause.]
Hon Speaker, hon Minister, we should not get tired of protecting vulnerable workers, those who are farm workers, because the wage determination deals with the minimum wage, which means the least you can pay these particular workers.
Regarding the issue of unemployment in the agricultural industry, I would like to know whether your department has investigated how many workers have lost their jobs as a result of mechanisation in the agricultural industry?
Speaker, of course I agree with the member that I will not get tired of protecting the vulnerable workers, because that is the policy of the ANC. [Applause.]
In regard to the second question, we have sent the report to the National Economic Development and Labour Council, Nedlac, for both the public hearings and also the research that was done in order for Nedlac to discuss that particular report and come up with a proposal. The reason we have sent the report to Nedlac is because the employers, the workers and the government are represented there. I will await that report and after that we will share the report and the recommendations with the hon member. Thank you.
Hon Speaker, Minister, we all acknowledge the fundamental fact that sectoral determinations are there to protect vulnerable workers. My follow-up question is in relation to those farmers who have applied for exemption, which resulted in their coming to a point where their applications were not successful, and in relation to the loss of jobs, which we view as a response to the applications that were not successful. What does the department intend to do in order to avoid a situation where, because an application has been refused, workers are being dismissed? Thank you.
I thank the hon member for his question. Hon Speaker, at present we have not yet been given the number of jobs that have been lost.
However, as I have outlined, we as a department are ready, as we have the programme of the training layoff schemes. I believe that the farmers, together with us as a department, will need to share that information and we will also need to take the farmers on board regarding how they can implement that programme. I believe that immediately we have the information regarding that - because they have to prove that they really can't afford it - we will share that idea with the hon members as well. For now, I can say ...
... abakakabikhona abantu asebelahlekelwe imisebenzi. [... no one has lost their job yet.]
Thank you very much, hon Speaker.
Background checks for prospective board members and senior officials
197. Mrs J D Kilian (Cope) asked the Minister of Communications:
Whether the appointment of board members to entities reporting to her, as well as senior officials in her department, are subjected to background checks and vetting prior to confirmation or appointment to ensure that the credibility of the institutions is not undermined?