Labour reforms to rock media

On 17 December 2010, the Department of Labour published various amendments to the Labour Relations Act of 1995 (the Bill). The Bill seeks to avoid exploitation of workers, ensure decent work for all workers, as well as to protect the employment relationship. Further, the Bill intends to introduce provisions to regulate contract work, sub-contracting, outsourcing and labour broking.

The main proposed amendments intend to require employers to recruit employees on a permanent basis, unless there is a valid reason to employ personnel on a short-term or temporary basis.

Vulnerable workers to receive protection

According to the explanatory memorandum to the Bill, the legislature intends to ensure that vulnerable categories of workers receive adequate protection and are employed in conditions of decent work. It is proposed that this amendment shall only apply to employees who are below a threshold set by the minister of labour. As a result, the amendment will not impact on the use of fixed-term contracts with respect to managerial and other senior employees.

Another controversial proposed amendment is the intention by the legislature to exclude employees earning more than the prescribed threshold from referring their labour disputes to the CCMA. The minister of labour shall publish regulations to exclude employees earning a prescribed remuneration from utilising the CCMA. This move, according to the Bill, will ensure that vulnerable employees are not prejudiced because of delays caused by the volume of complaints from employees who can afford to approach the courts.

Implications for the media, broadcasting market

In order to fully understand the implications of the proposed amendments, it is critical to scan the media and broadcasting labour market. The SABC employs over 3000 personnel across the nine provinces. A significant number of radio presenters and TV news anchors are either employed as freelancers or on a short-term fixed contract.

The public broadcaster has with respect to several well-reported labour disputes terminated freelancers' contracts or did not renew those contracts without detailed and convincing reasons. Further, some positions are on freelance basis without clear reasons. A complicating factor for the public broadcaster shall apply to personnel who hold multiple freelance and short-term positions with different salaries.

If the Bill is approved this status quo shall have to change with serious consequences to the employees involved. Due to the increased local content requirements imposed by the regulator ICASA, the SABC staff head count ballooned, with a number of freelancers and short-tem employees being added to the public broadcaster payroll. The local content requirements partially led to the SABC financial crisis and the closure or liquidation of more than 200 production companies and retrenchments emanating thereof.

Revising budgetary requirements

Freelancers and short-term employees generally do not receive benefits such as medical aid, pension or training from their employers. If the Labour Relations Amendment Bill is approved by parliament and enacted by the president in its current form, the SABC and other media houses, particularly newspapers and magazines, shall be required to revise their budgetary requirements to take into account benefits such as medical aid and pension.

The impact of the Bill on employers shall be to conduct a skills audit and business re-engineering process, to assess critical skills needed to conduct the business, and do a cost-cutting measure by restructuring and reducing staff complement. It is within this context that the proposed amendment that will require employers to employ personnel on a permanent basis, will shake employers like the SABC, as the labour reforms will require programming departments of stations like Metro FM and 5FM, to take a long -term view when conceptualising their programming strategies, formulating the presenters line-up and negotiating presenters' contracts.

Broadcasters and other media houses business models survive on employing staff on short-term or freelance contracts due to reliance on sometimes unpredictable advertising revenue. With many broadcasters and media companies still recovering from the economic recession and declining advertising revenue, while the amendments will have benefits to employees' job security, employers will be forced to take a critical look at the kind of employees they want to recruit and retain.

It will therefore need new business strategies for the proposed labour reforms not to choke the broadcasting and media sectors. Public comments on the proposed amendment close on the Thursday, 17 February 2011.