PRESENTATION TO THE PORTFOLIO COMMITTEE

PRESENTATION TO THE PORTFOLIO COMMITTEE OVERSIGHT VISIT TO THE FISHING INDUSTRY AND SHELTERED EMPLOYMENT Department of Labour:

INTRODUCTION • During the Labour Portfolio committee fact finding mission the following issues were raised. • Seasonal employment contracts • Alternative employment during off season • Non compliance with employment equity legislation • Criteria for qualification for Unemployment Insurance Benefits • Non compliance with Occupational Health and Safety legislation • Skills Development with regards to the further development of seasonal workers and employers contribution to the schooling of the employees children Department of Labour:

Response by Department of Labour • The DOL officials conducted follow up visit to companies and met with Employers, employees and the Union representatives of (FAWU). • Contracts and collective agreements collected. • Employment Equity Reports and plans perused. • Occupational Health and Safety assessments was done. Department of Labour:

1. Seasonal employment contracts Findings: • Employment conditions are governed by collective agreement concluded between organised employers represented by the South African Pelagic Fish Processors Association, and organised labour represented by the Food and Allied Workers Union • This collective agreement sets the minimum conditions of employment in the fishing industry Department of Labour:

Seasonal employment contracts • The collective agreement was also extended to non parties. • The collective agreement allows for seasonal contract of employment, whereby employees are paid for actual hours worked and not entitled to payment if there is no production. Department of Labour:

Seasonal employment contracts • Fish harvesting takes place on a seasonal basis which is influence by amongst other things, weather, positioning of the moon, quotas and the availability of the fish. • The harvesting season generally comments from January to August. • Even though the harvesting season runs from January to October, there are different approaches in as far the employment contracting is concerned. • Some employers in the industry conclude employment contract with their workers which run for a period of twelve months while others have a contract which runs for the duration of the harvesting season (January to October). Department of Labour:

CONTINUED…….. • On perusing the contracts of employment and our interaction with the employers and unions, it was established that, in essence, the seasonal workers are required to be readily available all the time for processing of fish. • This therefore, implies that these workers are permanently on standby even though they are not remunerated for. • This practice is in contravention of the spirit of the provisions of the Basic Conditions of Employment relating to the regulating of hours of work Department of Labour:

Seasonal employment contracts • It was also established that employees are not compensated for being off sick even though they produce a certified medical certificate. • The understanding of the industry in as far as sick leave is concerned is not in compliance with the sick leave provisions in the Basic Conditions of Employment Act. • The Department has informed the employers that it will be recovering monies illegally deducted to the employees due to the incorrect application of the provisions of the BCEA. Department of Labour:

2. Alternative employment during off season • During the interaction between the Portfolio Committee and the workers, the issue of alternative employment during off season was raised. • On following up this matter, we found that employees are not entitled to seek alternative employment due to the unpredictability of the availability of the fish. Department of Labour:

CONTINUED….. • The Collective Agreement stipulates that the employer will provide off season subsistence allowance whereby workers concerned will be credited with 17% of their annual gross salary/wages to supplement benefits available from the UIF Act. • The intention is that the (UIF) plus the allowance is used to assist such workers during off season i.e. when fish canneries and lobster packing plants are not in operations. Department of Labour:

Alternative employment during off season • The practice in the industry is that this allowance is by choice (of employees) and is paid to the seasonal workers during the festive season (December). • During our interaction with the unions and the employers we have encouraged discussions on how seasonal workers could be engaged in other activities such as painting, gardening, general maintenance work. • This would go a long way in ensuring that seasonal workers continue to generate income even during off season. Department of Labour:

Non compliance with employment equity legislation During company visit: • It was established that all the companies have met their legal obligation in as far as submission of employment equity reports are concerned. • It was also established that they have plans in place to redress the inequalities related opportunities provided to previously disadvantaged individuals. • It was also established that none of the companies have actually achieved the employment equity targets as per their plans. • One company namely, Oceana Brands has been placed on DG Review. Department of Labour:

Action against non complying employers: • A process has been initiated to place those designated employers not complying under DG Review • The DG Review is a process that involve full analysis of the Employment Equity reports as submitted by Employers • DG Review Teams have been established to do the Analysis of submitted reports. Department of Labour:

Criteria for qualification for Unemployment Insurance Benefits During the follow-up visit it was established: • That there is a wide spread perception that during off season, the seasonal workers did not qualify for Unemployment Insurance Fund benefits. • This perception has since been corrected and our office in Vredenburg is working closely with the employers to ensure that workers do get their benefits Department of Labour:

Non compliance with Occupational Health and Safety legislation The provisions of the Occupational Health and Safety Act are applicable to the fishing industry, albeit only limited to the processing of fish. During the follow-up visit: • It was established that in general, all employees are issued with personal protective equipment/clothing. This was also confirmed by both shop-stewards and workers. • DOL requested and obtained copies of the risk assessment reports from all companies. Department of Labour:

Non compliance with Occupational Health and Safety legislation • There were persistent complaints about the unsafe conditions in the “jetty area”. • On an earlier site visit, management informed the committee that no workers were in the “jetty” due to off-season shutdown. • However, during the proceedings, the workers informed the committee that the jetty area had been cordoned off on the morning before the committee’s arrival due to obvious unsafe and hazardous conditions. Our Findings: • It is a standard practice that when maintenance is done on the jetty, the area will be cordoned off as to prevent anyone from encroaching into the area. Department of Labour:

Non compliance with Occupational Health and Safety legislation Action taken: • In order to ensure compliance with the Occupational Health and Safety Act, contravention notices were issued with regards to the following: • Ventilation • Availability of first aid and first aiders • Bad housekeeping • Enforcement of use of the Personal Protective Equipment • Emergency and evacuation plans and procedures Department of Labour:

Skills Development with regards to the further development of seasonal workers and employers contribution to the schooling of the employees children Our Findings: • It was established that training is provided to the seasonal workers and that certificates are issued on completion of training. The union representatives and workers spoken to confirmed this. • It was also established that most companies provide assistance to seasonal workers children who want to further their studies. • The assistance is provided in a form of an interest free loan that is payable within twelve months. As part of the Social Corporate Responsibility, the companies have provided funding to the nearby schools for the transportation of school children. Department of Labour:

Skills Development with regards to the further development of seasonal workers and employers contribution to the schooling of the employees children • We also established that there are companies that have learnerships that also enable seasonal workers to become qualified artisans, boilermakers and painters. This was confirmed by the union and proof of beneficiaries was provided to DOL officials. Department of Labour:

Recommendations made by the Portfolio Committee relating to the Department of Labour: • Strengthening the Inspection and Enforcement Services in order to oversee enforcement compliance of occupational health and safety compliance • The Department, as part of its strategy to strengthen the enforcement capacity, has adopted the professionalization which will enable the Departmentto appoint specialists in areas of OHS, UI etc. Department of Labour:

Strengthening Institutional Capacity of Inspection and Enforcement Services • Inspectors have been categorized into Generalists, Principals and Specialists in line with the administered legislation. • Some inspectors have been subjected to an ILO Labour Inspection training. This programme will be rolled out to all provinces during the 2011/12 Financial year. • Competence based program is being developed for all Inspectors and an Induction program for newly recruited inspectors is also being implemented. Department of Labour:

CONTINUED… • Discussions with Institutions of Higher Learning, Universities of Pretoria & UNISA together with the Department of HE&T are underway to look at short learning programs, customized to our needs to improve inspector competencies and long term program towards a qualification. • National Treasury has made an allocation through the MTEF for DOL to appoint additional number of inspectors in the 2012/13 and 2013/14 outer years. Department of Labour:

Recommendations made by the Portfolio Committee relating to the Department of Labour: • “Investigate amendments to the Unemployment Insurance Fund Act to cater for seasonal workers in the fishing sector” Department of Labour:

General Overview of the Fishing Sector • The Sector Profile indicate that the hake deep-sea trawl fishery sustains about 8 800 direct jobs along South Africa’s West and South East Cape coasts. Of these jobs, 90 % are held by persons from historically disadvantaged communities, whilst 40 % are held by women. • Working conditions in the hake deep-sea trawl are considered to be better than those that prevail in other fisheries. The majority of employees are employed ona full-time, year round basis, with fixed salaries and employment benefits. • Many of the larger deep-sea trawl fishing companies are registered with the “Proudly South African” campaign, which confirms their commitment to nation building initiatives and fair labour practices. • Since 1992, the “internal” transformation of the traditional companies and the entry of black-owned and managed companies have resulted in a significantly improved transformation profile in this fishery. • The medium-term fishing rights allocation records show that – - 74 % of the current participants are black-owned and managed - 42 % of right-holders are small and medium-sized enterprises - 25 % of the total allowable catch (TAC) is held by lack-owned companies which in 1992 was zero percent Department of Labour:

Fishing sector (land based) • With respect to land based fish processing, the labour legislative regime applies: (LRA, BCEA, EE, UI, CC, Skills, etc). Enforcement is thus the domain of our inspectorate. • Generally the standard working conditions for factory workers are better. Negotiated benefits include: - minimum hourly wage per worker category, hours of work, annual leave, sick leave and family responsibility leave entitlements and the provision of protective clothing. - Employers typically provide a discretionary annual bonus. - Workers have the option to join a contributory primary health care scheme. - Membership of a jointly funded retirement scheme is compulsory. Department of Labour:

Fishing sector (sea-based) With respect to sea-based activities: • Diverse employment relationships exist within the fishing industry (share fishermen, self-employed owners/skippers). The majority of workers are share fishermen or self-employed owners/skippers. • A different legislative regime (however diversified) applies here Department of Labour:

Legislative context (sea-based fishing) • Maritime Legislation Chapter 4 of the Merchant Shipping Act applies to all vessels. Chapter 4 is in serious need of amendment since it does not take into consideration the changing enforcement paradigm of the current labour legislation and with respect to conditions has not kept apace with changes in the labour regime. • Labour legislation The BCEA (sec 3(3)) excludes vessels at sea in respect of which the Merchant Shipping Act applies Department of Labour:

Fishing sector (sea based) • Bargaining council - A bargaining council has been established for fishers in South Africa and its agreement that sets conditions of employment and wages for fishers has been extended to non-parties. - The scope of Council covers fishers in the Deep-Sea and In-shore Bottom Trawl Sectors and the processing of fish on any vehicle or vessel at sea. The council agreement is closely aligned with the BCEA. - Amongst the agreed benefits are compulsory death and disability insurance payable by the employer, medical fund membership for all who wish to participate on a 50/50 contribution basis and a compulsory contributory sick benefit fund. The voluntary rawlermens’ Provident Fund (to which employers contribute 10 % of wages) provides the full range of benefits including funeral, disability, life insurance and retirement funding benefits. Department of Labour:

Fishing sector (sea based) • With respect to occupational health and safety as well as working and living conditions on vessels, the Merchant Shipping Act has kept abreast with changing demands. • Although South Africa is not a signatory to the Torremolinos Agreement (sets standards of construction and safety on ships) that was signed in Mexico, the standards that are set in various regulations as well as proposed changes to regulations for all vessels, especially vessels that are smaller than 24 gross tons, are much higher than the accepted world standards. • With respect to training and skills development, SAMSA and the Department of Transport has a number of accredited training courses and work closely with the Transport SETA (TETA) in developing learnerships and cadetships in the maritime sector. Department of Labour:

International Fishing Convention • The ILO adopted the Fishing convention in 2007 during the ILO labour conference in Geneva. • In pursuance to a possible early ratification process the DoL in conjunction with SAMSA have embarked on a broad consultation process with the aim of creating awareness as well as to identify particular areas of concern for the SA fishing Department of Labour:

Maritime legislation • The DoT has drafted an amendment Merchant Shipping Bill in order to align the Act with both the Maritime and Work in Fishing Convention of the ILO. This process is continuing. Department of Labour:

Fishing sector seasonal workers coverage • The Unemployment Insurance Act provides for: All workers working more than 24 hours a month (irrespective of how they are defined – seasonal, part time….) (under Section3(1)(a) are entitled to unemployment benefits in terms of the Unemployment Insurance Act . • The DOL will through its inspectorate division, strengthen compliance to these provisions in the Act. Department of Labour:

14 Thank you Department of Labour:

PRESENTATION TO THE PORTFOLIO COMMITTEE