THE BLOG
01/02/2018 08:38 SAST | Updated 01/02/2018 08:39 SAST

SA's Labour-Broker System Does Not Favour Unemployed Youth

South Africa’s economic system can be said to discriminate against young people, because the youth are worse off than average in key respects.

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South Africa's economic system can be said to discriminate against young people, because the youth are worse off than average in key respects.

Youth unemployment, for example, averaged 51.95 percent over the past five years, compared to a general unemployment rate of around 27 percent. This discrimination is most intensely directed against black youth, with even black graduates two-thirds less likely to be employed than their white counterparts.

Current struggles by labour-brokered workers at multinational corporations such as Heineken, Simba Chips (owned by Pepsi) and Unilever are as much a part of youth resistance against this discrimination as student movements such as #FeesMustFall. What are the labour-brokered workers fighting for? And what does it mean for the youth?

Labour-brokered workers are fighting to become the permanent employees of these companies, instead of employees of labour brokers. They want the same job security, wages and benefits as the directly employed permanent workers doing similar work.

In other words, the labour-brokered workers want to put an end to the neoliberal approach adopted by almost all big companies, in which labour broking is used to undermine temporary workers and to treat workers as temporary while they are doing permanent work. As a consequence, workers are denied living wages, fair treatment and the right to collective bargaining.

There are signs of the beginnings of a mass movement of labour-brokered workers, which in the end will defeat the super-exploitation that is the substance of these neoliberal strategies.

Amendments to the Labour Relations Act that came into force in 2015 gave new energy to the struggles of labour-brokered workers.

The new rights embedded in these amendments gave these workers the right to permanent employment and equal treatment at their client companies after a period of three months. The struggles at the abovementioned companies are about employers using every possible means to avoid their legal obligations.

Despite this, there are signs of the beginnings of a mass movement of labour-brokered workers, which in the end will defeat the super-exploitation that is the substance of these neoliberal strategies. What are the implications for young people?

A 2014 report by economics researchers Haroon Bhorat, Aalia Cassim and Derek Yu notes that the labour-broker sector tended to employ a bigger proportion of youth than the rest of the economy.

Analysing data from the Quarterly Labour Force Survey up to 2014 by Stats SA, the authors conclude that youth employment by labour brokers grew at 6.3 percent between 1996 and 2014, which was more than three times the total growth in employment rate.

The authors further note that 70 percent of youth employed by labour brokers work in low- to medium-skilled jobs, and 60 percent of all labour-brokered workers were in permanent employment in 2014.

It is therefore wrong and misleading, reeking of a neoliberal agenda, to say that labour brokers offer young people a path to permanent employment.

The researchers conclude that labour brokers offer young people an important entry point into the labour market, as well as a route to permanent employment.

Leaving aside the first part of the conclusion, it is important to understand that the second is true in such a restricted sense as to be positively misleading. We need to place it in the context of the struggles of labour-brokered workers, to make sense of it.

If labour-brokered workers are in permanent employment with labour brokers, it does not mean they are now equal in terms of job security, pay and organisational rights as permanent workers directly employed by multinationals such as those mentioned above.

It means the opposite. Their relative precariousness, underpayment and marginalisation from collective bargaining have been made permanent. It is only when these companies directly employ them on equal terms to other permanents that we can say their specific super-exploitation has come to an end.

It is therefore wrong and misleading, reeking of a neoliberal agenda, to say that labour brokers offer young people a path to permanent employment. Instead, it is the struggles of labour-brokered workers for direct, permanent employment with client companies that hold out hope for such prospects for young people.