Temporary Employment Services in South Africa

1
Temporary Employment Services in South
Africa Submission to the Parliamentary Portfolio
Committee on Labour 26 August 2009
2
Business Unitys position

• Labour broking must be seen in the context of
  South Africas national priorities
• 4.1 million South Africans cannot find work
• 1.5 million South Africans have given up hope of
  finding work
• South Africa is currently experiencing the
  highest rate of job losses since 1991
• Labour brokers are pivotal facilitators and
  enablers of employment
• they are a speedy means of access to properly
  recruited employees
• they facilitate temporary and permanent
  employment, especially for unemployed youth
• they facilitate skills development, especially
  for school-leavers who cannot get work experience
• Some forms of labour broking can give rise to
  abuse, and BUSA does not support such practices
• However Do the proposed regulations strengthen
  what is positive,
• and eradicate what is negative?

3
Contract employment around the world
Extent of Contract Employment in OECD Countries
Growth of Contract Employment in OECD Countries
4
South African contract employment statistics
Contract employment by sector
Contract employment vs. Sector volatility
5
Just plain wrong DoLs model of employment
patterns
6
The national importance of the labour broking
industry
7
The national importance of the labour broking
industry
No. Services Provided Outcome Reported Benefit
1 Recruitment services Continuous availability of large numbers of qualified candidates (i.e. competent, skilled and/or experienced) at market-related wages Reduced recruitment lead times training success rates Improved fit and customer service
2 Training services Continuous competency development for entry-level, intermediate and experienced employees Reduced competency gaps Improved customer service
3 Payroll services Outsourced payroll and related administration (timesheets, absenteeism, etc.) Reduced unit costs due to scale Reduced management and administrative burden
4 Attendance management services Controlled absenteeism Just-in-time replacement of absent employees Proactive planning and initiatives calendar Reduced absenteeism Reduced absenteeism-related customer service crunches, improved adherence, less disruption of customer service
5 Performance management services Retention of high achievers Recognition of consistent performers Improvement or exit of low achievers Improved on-the-job performance and productivity Reduced staff costs, and improved customer service
6 Scheduling and rostering services Dynamic adjustment of staffing levels to match business volumes Improved customer service during peak periods Reduced staff costs during valley periods, maximum productivity when shifted optimally
7 Career management services Multi-skilled and up-skilled employees that can be cross utilised or progressed based on personalized career paths Reduced training costs Reduced ongoing recruitment costs High on-the-job performance High employee retention
8 Labour relations services Risk mitigation through defensibility and standardization of labour practices Managerial support, especially related to on-the-job performance
9 Workforce optimization services Optimization of labour costs through advanced analytics, software, technology, and other methods Increased performance and productivity Reduced total staff costs Increased employee tenure and retention
8
Legislative and regulatory options

• Business has grave concerns about the Dept. of
  Labours Discussion Document tabled at NEDLAC
• The proposed regulations have been hastily
  developed using little or no industry data
• The proposed regulations have not considered
  international research and options
• The proposed regulations have not considered
  unintended consequences
• The proposed regulations have not considered
  enforcement mechanisms
• The proposed regulations impose a heavy penalty
  on compliant operators and make it
• likely that underground operators and associated
  abuse will increase
• Business Unitys position in summary
• Existing laws and regulations are sufficient to
  address abuses
• Enforcement is lacking and specific enforcement
  institutions need to be bolstered
• Partial or piecemeal regulation will give rise
  to unintended consequences
• A co-regulatory/co-determination framework is
  the only workable option