THE clothing industry’s collective wage bargaining agreement is no "cosy club" of big business, trade unions and government who manipulate wage levels to ruin small companies, South African Clothing and Textile Workers Union general secretary Andre Kriel said on Monday.
The clothing industry bargaining council’s efforts to stamp out a practice by some employers to pay lower than the minimum wage may result in thousands of job losses, compounding South Africa’s already high unemployment rate.
Last month five small clothing companies from Newcastle and the United Clothing and Textile Association challenged a government decision to extend the collective bargaining agreement in the Pietermaritzburg high court. If it fails, many clothing companies may have to close because they cannot pay the minimum wage.
A report released by the Centre for Development Enterprise (CDE), at about the same time as the court challenge, noted that "a minimum wage compliance drive and resulting job losses … illustrates how … labour market institutions and industrial policies can create an unholy coalition of the state, a trade union and metro-based relatively capital intensive employers, whose actions can inflict massive job destroying structural adjustment on a labour intensive industry."
Mr Kriel said the centre’s report "presents a completely biased and depressing perception of the clothing industry".
He said in a statement that there were no government representatives in the bargaining council.
He noted that 87% of companies that were members of associations belonging to the bargaining council were small and medium enterprises, and the union represented 85% of those workers.
Mr Kriel said the bargaining council was holding writs of execution against 297 factories that were not compliant with the collective agreement. Some 5,500 jobs may be lost if those factories were closed.
Many of the 297 companies had taken steps to become compliant, Mr Kriel said.
"Others deliberately refuse. Their illegality cannot be allowed to continue. It causes job losses in law-abiding workplaces," he said.
Clothing industry starting wages in Durban, Cape Town and Johannesburg were lower than the R525 weekly wage recently prescribed for farm workers.
"Wages are bitterly low. How low can you go?" asked Mr Kriel when responding to claims that high wages were a cause of job losses in the clothing industry.
In Durban the starting minimum wage for a machinist was R364,10 per week, in Cape Town it was R446,50, while in Johannesburg it was R360,40.
Mr Kriel said the bargaining council had been "monsterised" as a cause of wage noncompliance, yet it was the council which had inherited noncompliance in some areas such as Newcastle in 2002, when its scope was expanded to cover non-metropolitan areas.