As we enter 2015 and the new year we also welcome a new batch of freshly matriculated workers into the economy.  Unfortunately, the majority of these work seekers do not have maths or science.  We see many reports commenting on the lack of proper education and we understand that the workplace and the environment have become more and more complex and is being mechanised at an enormous rate.  The value of the matriculation certificate in South Africa is close to nil and it really requires the job seekers to try to obtain tertiary education.  Unfortunately, our government has not seen the reality of this.

We all know that the amendments to the Labour Law were gazetted on the 1st January 2015 and although our law will only become really operative on the 1st April 2015 (this is not an April Fool’s joke).

These amendments are harsh and will certainly change the workplace environment.  The two most important concepts are equal work for equal pay and the fact that any employee longer than three months no matter what the contract says is deemed to be permanent.

We note that NUMSA has applied to change the scope of its agreement allowing it to recruit across the board.  This signals the future demise of Cosatu.  This week we also saw a call by Cosatu to distance itself from the Communist Party.  This follows hot on the heels of the distancing between Cosatu and the ANC.

The only real good news is the price of the petrol, which has come down and is destined to come down further in the next few months.  This good news is not of our making but is internationally a boost in the arm for the various economies.

Our understanding is that the Department of Labour are hurriedly trying to educate its workforce about the amendment to the Labour Law but our understanding is that the budget for the inspectorate has not increased at all.  We also see that the Commission for Conciliation Mediation and Arbitration (CCMA) is expecting much more cases this year than last year and they are also in the process of training more commissioners.  Thankfully, the CCMA’s budget has increased and hopefully this training will translate into a business friendly environment.

I’ve spoken to many of the inspectors from the Department of Labour who tell us about the poor working conditions and the lack of tools to enable them to do their jobs.  For instance most of the inspectorate don’t get proper vehicles and those that need to get to factories and processing plants in the harsh environment don’t have 4 x 4 vehicles.  This in essence means that the majority of the workforce are never reached by the inspectorate.

Over and above all the labour problems, we are internationally facing a downturn in the first world economies, which in turn will affect the rand, which has already lost 30% over the last eighteen months.

We can expect wage demands this year and in excess of 10% but my prediction is that most of the settlements will be around about 5 to 7%.