We have been here before. The third major public-service strike since 1994 is upon us. During the first major public-service strike since democracy, in 1999, trade unions suffered a significant defeat with government’s unilateral implementation of wages. But in 2007, public-service unions turned the tables on government conducting an unprecedented strike, and building an unlikely coalition with departments responsible for frontline service delivery. This resulted in the introduction of occupational specific dispensations (OSD) that put new occupational classifications, promotions and grading systems in place.
Transformative bargaining
In 1999 and 2007, there was the promise that the crises occasioned by national strikes would create the opportunity for long-run reforms in the public service. Sadly, in both instances this has not been the case. Will it, however, be “third time lucky” following this strike — with a better deal both for transforming service delivery as well as increasing employment in the public service?
The concept of using collective bargaining for wider ends is commonplace in labour relations. In South Africa, the historic strikes in the mining sector and the introduction of skills development in the metal sector’s bargaining are widely regarded as examples of meeting wider ends. The public service would thus be a very apt candidate for conducting what is called “transformative bargaining”.
The concept, which has survived various iterations over the years, implies a two-fold commitment to bargaining from parties.
First, that negotiating parties share a common commitment to transform public services through social dialogue. With the majority of public-service unions in alliance with the African National Congress, and a stronger relationship between Cosatu and the Independent Labour Caucus at a political level, there have been strong prospects for developing a shared vision. Even the ideological stances and policy approaches of parties are not a major barrier to effective social dialogue, despite heated disagreements on privatisation.
Second, that policy choices require leadership. Increasing employment in the public service is an important example of implementing a difficult policy choice. In the current dispute, government has argued that it has no additional funds to increase both salaries and employment at the same time. The position of government thus presents a stark set of choices, which is exactly what spurs militancy in the public service.
Yet, there are well-developed proposals in the public domain that provide a range of options to introduce reforms that support long-term and service-delivery oriented “employment creation” in the public service, while also providing salary increases. For example, government could introduce a lower level of jobs to ease the burden on professionals in the public sector, while at same time, creating employment for a new generation of currently unemployed people. This could include increasing the number of teaching assistants and clerical support in schools to free up teachers to concentrate on teaching while support staff deal with administration and other functions. This new category of workers, while earning entry-level salaries, could use this opportunity to gain much-needed work experience as well improve their qualifications.
Putting employment on the agenda
The proposals would ask of trade unions to factor in “employment creation” in developing their negotiations strategy. Importantly, the proposals are not small, with some going as far as proposing the creation of a quarter of a million new jobs within five years, and with costs requiring only moderate changes to baseline estimates. These proposals — with varying detail between various approaches — ultimately ask of our society to meet both the objectives of providing workers a living wage while at the same time increasing employment, especially for young workers.
Yet, government has not tabled any of these proposals during this salary round. Had it done so, the effect on bargaining would be nothing short of groundbreaking, shifting from haggling over percentages to debating and costing a developmental role for the government and public-service unions.
This approach promises a great deal: a labour-absorbing public service, better salaries, improved performance, less corruption and a professional public service. Why then have we not moved in this direction? In the parlance of negotiators in the public service, it has to do with “cowboy bargaining”. By this it is meant that both parties adopt extremely strident and unrealistic initial positions, which not only sets in motion an adversarial stance, but more importantly lacks a wider policy framework.
For government, this reflects the absence of leadership in developing policies to refocus bargaining on a developmental agenda. Doing this would require that government carefully unpacks a long-term reform programme in the public service, outside of the collective-bargaining process.
In some senses, it may replicate the processes developed after the democratic breakthrough that integrated the apartheid public service, and sought to bring about the reorientation of the public service to a development mandate. The entire policy package that served us in making the transition towards an integrated and democratic public service is now in need of urgent review to ensure that public services play a developmental role by widening opportunities and equalising outcomes, especially for the poor. Sadly, government has much to do to reach this ideal.
The lack of a coherent message from government was demonstrated with the introduction of the OSD. The OSD provides for much-needed reviews of salary scales, provides career paths that keep excellent public servants at the coal face, and introduces internships as part of a major shake-up of public-service employment. The process of the OSD was driven by service-delivery departments, especially the health and education departments. The process led to a much-needed review of teachers’ and nurses’ salaries as well as other smaller sectors.
These agreements were reached at the sector-level bargaining chambers that focus on health, education and safety and security. The review and subsequent agreements had financial implications, while government signed salary agreements which also had fiscal costs.
However, the combination of decisions at a sector level on OSD and those at the central bargaining level on salaries, were not coordinated. This led to the current budget position, with Finance Minister Pravin Gordhan pointing out the hard reality of the future affordability of high salary increases. Yet, at a deeper level, it also indicates significant policy incoherence in government, between demands at a sector level with those at the central level.
Policy coherence
This is not to suggest incompetence by government negotiators, but rather that policy contradictions were not ironed out nor were careful policy choices made at the cabinet level. Shop stewards across the unions summarise this well with some bravado in saying “we cannot be blamed if government did not do its calculations”.
During this bargaining round, government’s strategy has been confusing and misleading.
Government was reluctant to admit early on that there was a dispute, keeping unions’ hopes alive by continuously asking for more time. Yet, when strike action was initiated, it moved quickly to finalise its offer. Government negotiators will argue that they have tried to avert a strike but what they inadvertently did was to provide the impetus for worker militancy.
The trade unions themselves need to be more introspective. Though the salary demands from unions are not excessive, they need to be viewed against salary adjustments due to the OSD. Having a three-year retrospective perspective on salaries could have provided the basis for arriving at a settlement.
Pragmatic consensus
Surprisingly, this pragmatic concession has a precedent after the 2007 strike. Despite the strong mobilisation, unions pushed for an increase slightly above inflation to accommodate future adjustments in the OSD. But with government moving quickly towards unilateral implementation in the current strike, the prospects for a pragmatic resolution have receded. But even under these conditions, trade unions need to exercise their power to advance a broader reform process in the public service.
Ironically, both parties have tried to refocus bargaining through participating in the Public Service Summit. They have also engaged in a series of social dialogue processes guided by ideals of “mutual gains bargaining” and even in some instances a “developmental compact”.
These important initial steps should not be discounted for future public policy but neither the government nor the unions can point towards tangible results from these processes, despite some significant path-finding agreements on principles.
In the cut-and-thrust of salary negotiations the tangible nature of agreements matters. The worrying factor is that earlier progress in the areas of performance and resourcing the public service might be undone during this acrimonious salary round.
The reality is that without reaching these wider agreements quickly, we can anticipate the fourth major public-service strike sooner rather than later. Descending into an adversarial bargaining stance over a longer period of time would set back the reform process in the public service at precisely the moment when significant improvements are needed.
Reaching this wider agreement requires a commitment to building the public service to meet the developmental challenges that we face. For these reasons, a speedy resolution to the public-service strike must be found, while strengthening social dialogue processes.
Sadly, for now it seems that the cowboys are in charge, and yes, we have been here before.
This article first appeared on the SACSIS website.
Indeed, no serious negotiations have been taking place.
The government has lost face, while the workers have lost sympathy. A “no win” situation for both parties with the nation the biggest looser.
My conclusion? This is not about salaries and other remuneration elements. The battle is about “who controls the ANC within the tripartite alliance”.
The unions are still hanging in there because the spoils within the alliance are bigger for the union leaders then they will ever be outside the alliance.
The role of the workers? Just canon fodder as foot soldiers in most wars.
The anger of the workers has very little to do with government’s offer. Rather, it is related to the wasteful and exorbitant lifestyles of the ministers etc.
Minister Baloyi this weekend clearly argued that Mercedes Benz cars are tools of his trade!
PS: The OSD in Health has been a MONUMENTAL failure. Nurses and porters are collectively bargaining for what they think doctors should earn…what a joke!
Your rather fullsome argument forget the third and primary party to this public strike mess, the private sector, who pays the bill. All the fancy evalutations, negotiations for perks and more salary somehow seem to add up more to job creation, affirmative action and ANC market share than service delivery. The public service and the government seem to have forgotten who they are working for and what they are supposed to be doing.
There is only so much tax money to go around, unless the private sector grows and/or the average level of education increases. There is a good reason to strike which is not considered at present: The immense difference between salaries at the top and bottom. Go on strike for the top to earn less, not for the bottom to earn more.
Then, the current situation where the public sector and government earns more than the private sector can surely easily be proved to be unsustainable and can only lead to national debt, which, obviously, the private sector will pay for, including the unnecessary expense of the finance fees on the loans. It is time to get real and face the facts, this government and its public sector is a burden the private sector can no longer afford, a luxury that delivers where little service.
@Benzol – Precisely.
I thoroughly agree with you on the entry-level jobs matter, but I have noticed a trend in South Africa that tends to make it less than pragmatic. Ten, 15 or 20 years down the line, the same people are sitting in the same entry-level jobs, with nowhere promotable to go and no thought of educating themselves and moving on. By which time, they strike because they are not earning enough to feed, clothe and school a wife or two and a child or few.
The dream of a waste collector is the same salary as a medically-degreed intern.
Entry-level jobs should become just that: three-year contracts that will then expire to allow new entry-levels in and get some of our youth off the streets. No wonder there are no jobs for youngsters. Their parents and grandparents are still in them.
For all South Africa’s disadvantages, it has never been impossible for the ambitious to learn more about something. Difficult, perhaps, but not impossible, especially when a single person has a salary coming in. What’s missing is the ambition…
Moreover, the functions of unions used to include training young people to perform a professional, competent service. The fees of union members helped do exactly that. No more. Nowadays the unions only come up for fresh air to negotiate terms and salary increases. So where do those fees end up now?
@X-cepting: “The immense difference between salaries at the top and bottom. Go on strike for the top to earn less, not for the bottom to earn more.”
In “new economics”, we promote establishing a fixed link between the highest and lowest pay package in any organisation. SA has reportedly the highest discrepancy between the (very) poor and the (very) rich as expressed in the PI coefficient.
If unions would convince their members to put pressure on negotiators in public and private sector to address this, one could see a constructive debate emerging.
A further issue to be negotiated would be an inflation related pay rise as a standard annual procedure.
Any other pay rise should be related to a rise in productivity to prevent remuneration to become inflationary only.
As it stands, parties on both side have lost all credibility in what they call “negotiations”, showing no skills and no effort to be constructive in their engagement.
Thanks for the comments and reading.
@ Benzol – The negotiations needs a major refocus, and needs to focus on providing public service and creating jobs.
@ statesdoc – agreed. Patrick Bond has a good article arguing this point. In fact, if someone goes through the government budget carefully the money can be found to settle this strike.
Docters do need a voice in setting salaries. As far as I can tell that voice is being heard. I wonder how this important voice can be further amplified?
@ X cepting – A strike for the top to earn less! What an interesting idea. The point about the ineffectiveness of the public service resonates not only in the private sector, but in communities. We have a major problem in performance and productivity in the public service, and that is what we should be focussing on.
@ MLH – The proposals I have worked on for entry level positions provide oppourtunities for upward mobility. However, you do make a valid point – once in formal employment you have to grab the oppourtunity. There is some debate on whether workers at lower levels reach “glass ceilings” or not.
The money spent on the WC tickets by the government departments could have been spent on the increase of the government employees rather than for the enjoyment of their bosses.
There are other expenses that could have indicated government’s compassion, had they been avoided. Even if these would have amounted to nought, it would have indicated the necessary good faith on the part of government, rather than attempting to confuse the employer’s offer.
A fairly good piece, but mistaken in an important sense.
Firstly, these are among the best-paid unionised workers in the country. Much of the sympathy orchestrated for these workers in 2007 (apart from the anti-Mbeki angle, which was significant) came out of class solidarity. This is weaker now, but the point is also that these are not working-class people. They’re bourgeoisie like the readers of this blog.
Putting employment on the agenda would be a welcome development; it’s been off the agenda since 2005 or so. However, obviously increasing the proportion of state spending on the salaries of already-employed, middle-class workers means reducing the amount of cash available to hire new workers.
Meanwhile, 250 000 jobs created over 5 years is peanuts. We’re losing 50 000 jobs a quarter this year; we lost 80 000 a month last year. The fact is that there is a huge socio-economic crisis which COSATU’s actions are making worse. The Zuma government is not improving the situation. But in fact, Mr. Hassen, it is hard to see that either side in this conflict is pushing for goals which serve the national interest.
Meanwhile the unemployed masses look on in wonderment! When THEY decide to strike THEN we all need to worry!
@Ebrahim Khalil – I agree with the inflationary increase and also that the problem with service delivery lies in performance and productivty but would add a lack of real skills and education to the problems. The public sector do not have competition and as far as I am concerned should not need or have unions who negotiates salary increases and bonuses as if it is a right. The only way one can get a public servant to be productive is to make them work for pertformance bonuses and perks which is firmly tied to actual, audited and planned performanmce. This planning is also lacking, it seems, and a govt function, i.o.w the guys who earn those incredibly high salaries for ostensibly precisely that reason. As someone commented, a fish rot from the head. It does not help anyone to give them positions they have not earned, all it does is lower national productivity standards and consequently our country’s competitiveness on the global market. This obviously drives inflation to a large extent.
TRADE UNIONS
A precedent and a warning on what is happening in SA is when in Britain in the 1970s a public poll was taken asking who had the greater power – the then Labour Prime Minister or Arthur Scargill, who was the Chairman of the national Trade Union Council that was calling for national strikes. The power of Scargill was roundly acknowledged which was determined by his being the chairman of largest Transport and General Workers Union, whose single vote could influence both the TUC policies and those of the then Labour Party that relied on them for their financial support and votes. In turn, the strength of the TUC unions to bypass parliament lay in its ‘constituencies’, which are calculated in millions, whereas MPs only have an average of 35 000.
@ tottie – and the expensive hotels and cars! You simpy cannot spend lavishly and expect everyone to go into a corner.
@ creator – 250 000 jobs in the public service is still something. The point being that we need a couple of initiatives to get to the huge number of jobs that we need. On another point -Personally, I think the public service unions – like every other union – constructs their relevance through struggle. Having won good gains in terms of salary it then becomes important to retain a commitment to the broader working class, especially on wider public policy issues.
@ john- just finished an article along those lines. Should be on the sacsis website soon.
@ X cepting – I disagree with some of the detail of you argument. However, the overall conclusion is 100% correct in my opinion – we need a public service reform programme that incentivises performance especially at frontline service delivery institutions.
@ benzol – this PI coefficient looks interesting. Any links? Books?
What we need is a social contract between the employed and unemployed. Unions, business and government should formulate an agreement which ties salary increases to the unemployment figure. If unemployment rises salaries should be adjusted downwards and vice versa. Of course, the ideal solution to the unemployment problem would be to disband unions and allow market forces to determine salaries, but it is obviously politically unfeasible. A social contract at least would make clear the stark impact of unionised workers’ selfish demands on the unemployed of this country.
Thanks for the comments
@ Anthony – Interesting observation. I guess unions had better keep talking to society.
@ Robard – Agree we need some sort of agreement between big business, big unions and huge government if unemployment is to be reduced. However, I doubt an agreement that links wages to unemployment in the manner you suggest, would raise incomes for poor or even increase employment.
“@ benzol – this PI coefficient looks interesting. Any links? Books?”
Apologies, got my fingers twisted wrong way around. Was referring to Gini coefficient (often referred to as GI).
See: http://en.wikipedia.org/wiki/Gini_coefficient (for the mathematics) and/or
http://en.wikipedia.org/wiki/Economic_inequality (for a narrative on the subject of Economic inequality)
For new economics: http://en.wikipedia.org/wiki/New_Economics_Foundation
which has a branch in SA under SANE.
Hope you come right on the issues.
@ benzol – thanks for the links. always interested in getting simpler ways of explaining complex things.
You may want to check out a manual I wrote a few years back as well, it covers most of the poverty and inequality measures. Here is the link
Going to read up on New Economics. Have had a couple of fleeting engagements with the ideas, but nothing too serious.