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NUMSA Submission to the PC Labour on the National Minimum Wage June 5 th 2015, Parliament RSA

This submission highlights the need for a national minimum wage in South Africa to address unemployment, inequality, and poverty. It emphasizes the importance of collective bargaining and restructuring the economy to ensure fair wages and better working conditions for all workers.

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NUMSA Submission to the PC Labour on the National Minimum Wage June 5 th 2015, Parliament RSA

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  1. NUMSA Submission to the PC Labouron the National Minimum WageJune 5th 2015, Parliament RSA

  2. Freedom Charter on work There Shall be Work and Security • Men and women of all races shall receive equal pay for equal work;
 • There shall be a forty-hour working week, a national minimum wage, paid annual leave, and sick leave for all workers, and maternity leave on full pay for all working mothers;

  3. Economic Context and the Need for the NMW • Unemployment (expanded) is 35% • More unemployed now than in 1994. • Unemployment getting worse, not better: • May 2008: 5.1 million. • May 2013: 7 million. • Gini coefficient amongst highest in world (0.63) • Over 20% living below the food poverty line R300 a month

  4. Bargaining Council system is not NMW • Bargaining councils cover just 9% of workforce • Minimum salaries differ depending on sector. • Mining, manufacturing, and public sector above R4,000 • Other sectors less than R3,000 • 70% of the workers have their salaries determined by employer only • Sectoral minimum wages are widely violated and extremely low; in reality workers are paid on average 35% less than legislated sectoral minimum wage; • 54% of workers either receive no regular wage increments or have wages determined solely by employers • Over the last 20 years, workers’ share of GDP has gone down, whilst owners of capital have become richer.

  5. The Bargaining Council System is not a NMW

  6. Vulnerable Workers Salaries in 2014

  7. The minimum wage must not become the maximum wage • We must avoid minimum wage becoming also maximum wage. • Struggle for NMW and struggle for living wage through improved collective bargaining arrangements are complementary. • Collective Bargaining will and must continue to improve the minimum wage in all sectors

  8. There shall be a forty-hour working week, a national minimum wage, paid annual leave, and sick leave for all workers, and maternity leave on full pay for all working mothers • Millions do not work a forty-hour working week • Millions do not enjoy paid annual leave, and sick leave • Millions of women do not enjoy maternity leave on full pay: • 24% work more than 48 hours a week. Average is 44 hours • Only 32% have medical aid • 43% have no paid maternity/paternity leave • 31% have no paid sick leave • 50% have no pension or retirement fund • 33% have no paid annual leave. • Here is the National Minimum Wage! • Not negotiable. • Fundamental requirement for millions of South African workers. • Full freedom and liberation must include a National minimum Wage

  9. The apartheid wage structure remains intact • In 2013, half SA workers received less than R3,033a month. • National average salary is R15,000 a month. • So half of all workers earn far less than the national average. • That is the apartheid wage structure: • Most workers earn very little • Small number earn a huge amount. • In 2010 median earnings of African worker R2,167 and white worker R9,500 • Manufacturing sector: • Average income of African worker R5,454 • Average income of white worker R21,817.

  10. Demand for National Minimum Wage is essential element in our struggle • Abolish super exploitative wage of majority of SA workers • Secure work and income security • Fight poverty which largely afflicts Black and African workers • Win income equality in a free and democratic South Africa • Secure collective bargaining rights for all SA workers • End child labour, compound labour, tot system and contract labour. • Abolish South African racist and apartheid colonial capitalism

  11. NMW must be part of fundamental restructuring of the SA economy • NMW cannot be seen in isolation from the rest of the economy. • SA economy cannot thrive in current form: remained fundamentally unchanged from apartheid colonial era. • We cannot continue to base our economy on extraction and export of raw minerals.

  12. Restructure the economy • Nationalization • Lower interest rates • Preferential financing for chosen industries which apply the National Minimum Wage • Limiting financial market speculation • Stopping companies from illegally exporting profit, estimated currently at between 10% and 20% of GDP • Radical wealth redistribution

  13. Need National Wage Policy • Abolish apartheid wage gap • Abolishing all conditions which impede development of trade unions and rights of all workers: • To organize in trade unions • To bargain for wages and conditions of employment • To strike • Wage policy must be part of new post-apartheid, non-capitalist growth path and industrial strategy for full employment. • Industrial strategy must focus on: • Job creation in sectors with higher wages • Growth in sectors that can contribute to increased domestic demand and benefit from it.

  14. Essence of National Minimum Wage • Rooted in egalitarian society • Majority needs Africans, not minority profit, determine economic and social policies. • Abolish the colonial status, in economy and society, of Black and African working class.

  15. NMW must be part of comprehensive social security system • Objective to lift large numbers of South Africans out of poverty • To achieve objective NMW must be linked to other measures to deal with inequality, poverty and unemployment. • Must be part of comprehensive social security system, including: • Grant or living allowance for unemployed • Improved retirement contribution by employers • Improved UIF contribution by employers • Improved quality service delivery by the state in transport, housing, education & health

  16. The correlation between rising food prices in relation to income have plunged people into poverty • The General Household Survey (GHS 2013) shows that increases in food prices have worsened the threat of hunger for people living in poverty • From Feb 2013 to Feb 2014, the commodity prices of maize increased by 50% in the short to median term, increasing food insecurity • Food prices have almost doubled and salary prices are not keeping up to these increases • As prices become more volatile, vulnerable households find their consumption decisions affected by higher prices in the markets and reduce spending power • Having a decent wage ultimately determines peoples access to food and food security

  17. NMW creates jobs • Capital says that NMW will destroy jobs. In fact: This is nonsense. • In Brazil, between 2003 and 2010, NMW increased by 81%. 17 million formal sector jobs created. • In Uruguay, between 2003 and 2014, reduction in unemployment when minimum wages radically increased. • In SA, a UCT study found that increased minimum wages from Sectoral Determinations led to increase in employment • In 2009 in UK, Low Pay Commission found that NMW had no significant negative effect on employment. Named “the most successful government policy of the last 30 years”. • In 2009, a study of 64 minimum-wage studies around the world showed no bad effects from NMW. •  NMW causes economy to grow, which increases jobs.

  18. NMW must have teeth • Law must be comprehensive: • Include enforcement • Ensure no exemptions • Ensure no job losses • Adjust upwards existing sectoral determinations; no downward variation

  19. Our demands • Declare National Minimum Wage now. No 5 year investigation • Dynamic and mobile NMW adjusted upwards for inflation and cost of living • National Wage Policy to abolish apartheid wage gap, combat income inequalities, remove impediments to collective bargaining and all trade union rights. • Immediately abolish labourbrokering, child labour, compound labour and all abusive, super exploitative labour practices. • Guarantee a 40 hour working week and ensure compliance. • Ensure that men and women of all races earn equal pay for work of equal value. • Stop and withdraw from all current efforts to water down trade union rights and essentialisesections of the working class. • Guarantee paid annual leave and sick leave for all workers, and maternity leave on full pay for all working mothers.

  20. Our direction • Destroy current SA economic foundation, dominated by imperialism and run by white monopoly capitalism and their parasitic black allies. • Radical destruction of current growth path and replacement with socialist, democratically owned, controlled and managed economy • Socialism is the only way out of the historic and current South African human and environmental crisis.

  21. The way forward for the working class • We are participating in these hearings so that the voice of the working class is heard • History teaches that the working class will always be victims unless they learn to see class interests. • In our demands we have sought to unearth the true class intentions and origins on the NMW • It is time to unite working class behind demand for NMW and all demands of Freedom Charter. • The real struggle for the national minimum wage will not be won in public hearings. It will be won by the working class in action, on the streets, united in its demands.

  22. A luta continua!

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