Government has threatened to ban labour brokers after the next election. The claim is made that the system lowers the wages of workers and encourages casual work.
Labour Minister Membathisi Mdladlana first made the call when he was campaigning in Langa in December last year. Mdladlana told residents that the ANC plans to ban labour brokers after the next election.
According to a report in the Sowetan, Mdladlana told a small group of residents that a vote for the ANC would mean that ban would be implemented after the next election.
“Labour brokers are not doing our workers a service. “People who are employed by labour brokers have no pensions, no benefits — in the end they are just dumped,” the Sowetan quoted Mdladlana as saying.
There was strong support for the call by labour federation Cosatu.
“Labour broking is a form of human trafficking,” Cosatu spokesperson Patrick Craven said in a statement.
“These companies ‘sell’ the labour of workers to the highest bidder and then pay them the lowest possible wage, often in cash with no deductions for tax or UIF, let alone any benefits. The broker then pockets the difference as his or her profit. It is an extreme form of free-market capitalism which reduces workers to commodities that can be traded for profit, just as if they were meat or vegetables”.
“Legislation clearly states that the ‘employer’ is whoever actually pays the workers’ wages, i.e. the broker, who thus should obliged to comply with all an employer’s statutory obligations to the workers. Often in practice, however, the broker and the company to which they supply the workers, each try to dodge their responsibility to contribute to tax, UIF, provident funds, medical aids, health and safety compliance, skills development, etc by claiming that it is the other’s responsibility”.
Opposition parties claim that if broker are banned then 500 000 jobs will be at risk. That’s the number of people who are currently working through labour brokers.
Would these jobs really fall away, or would the clients have to employ the workers directly? Are workers better off with labour brokers who can provide them with UIF, training opportunities and work experience.
Like many industries there are big differences between the top and the bottom. The larger brokers, or temporary employment services (TES) as they prefer to be called, keep things above board. But for each of those there are many hundreds of smaller operations where unemployment insurance isn’t paid and workers have no security.
What the labour brokers/TES companies provide is flexibility — the ability to hire and fire employees as needed. This is what business wants, and exactly what government and unions are trying to avoid.
Interesting article and very relevant for me. I work for a labour broker, fortunately one of the above-board companies. They are very professional and I have no real complaints about the way they treat me. However, they don’t offer medical aid or retirement benefits and they don’t pay for training – I pay for all of that out of my own pocket. On the plus side, I get 70% of what they charge the client so the salary is pretty good.
I think there is a place for reputable labour brokers; those who pay their contract employees a fair salary and who work closely with the client to monitor performance and issues. In my experience, companies will renew contracts with less hassle if the labour broker is hands-on and ensures as few problems as possible for the client.
Labour brokers are just using people, i dont think they are really care about our needs, they just want us to make money for them, they dont care about us coz we end up having nothing our wages are not good as u expect and we dont have any rights,and even da supervisors takes an advantage of dat they treat us like donkeys because we r contracts and if u talk they will tell u that they gonna replace u anytime because u r nothing but a contract, and what i have experienced is that contracts are not regarded as humanbeings they harder than permanents, and how can we join unions bcoz we are not allowed to do so.
want to become apartner
Good article. as in any industry there are reputable companies and some that are less so. I work for a LB on the management side and our company pays workers at a higher rate than is required by the client as well as the law. there is a misconception amongst the workers and supervisors on the ground that contract workers can be disposed of as and when required. This is rubbish and they have every right a permanent employee has including freedom of association to unions, leave entitlement, UIF and all others specified by the Basic conditions of Employment act. The only difference is that the contract is more “term or project Specific” and not necessarily “open-ended”.
We do employ casual workers on an ad-hoc basis to fill in for contractors who are on leave, sick, suspended etc. this is to ensure production is maintained. It also provides some relief to unemployed workers in the form of a few days pay. These temps are fully engaged on the payroll and not simply paid in cash.
If anyone is exploiting the workers it is our unions who are politically aligned and are pushing their own agendas. Our legal system is sofisticated enough in terms of our labour law that we no longer require these unions. Do they refund workers union dues when they are on strike and receiving no pay? absolute power corrupts… absolutely!