Is NEDLAC successfully balancing unemployment reduction and employment security?

The acronym NEDLAC stands for the National Economic Development and Labour Council. This is a high level forum where, amongst other things, legislation regarding labour and economic development issues is debated and formed in preparation for enactment in Parliament. This body therefore has a major responsibility to arrive at proposals for legislation that will promote economic development and a healthy labour economy.


 The parties represented at NEDLAC include Government, labour unions, business and community. Their deliberations aim to achieve goals such as legal protection for workers,and reversing unemployment. However, two key factors bedevilling the success of this forum are: the severe conflicts between the above two goals of NEDLAC and the hugely disparate agendas of groups represented on the forum.

The two goals of protection of employee rights on the one hand, and of reversing unemployment on the other hand, need not necessarily be conflicting goals. However, in the current South African situation they do seriously conflict with each other. This because, the more the unions and government conspire to tighten up labour laws in the ‘interests of employee welfare’, the more employers are reluctant to employ people in South Africa.


Despite the havoc that state capture and Covid have wreaked on employment in South Africa, the NEDLAC parties are still nowhere close to finding common ground on these issues.


The current labour laws impose strong impediments to termination of employment for operational, misconduct and poor performance reasons. The law thus provides limited flexibility for employers and imposes very heavy obligations on them. Again, the more that employers suffer under this yoke the more reluctant they are to employ people. Thus, the very laws that are designed to protect employees have the effect of reducing their employability. The burden of the labour law yoke is felt all the more by smaller employers who do not have the resources to manage the labour law burden, but who represent the great majority of businesses in South Africa.


Business owners and aspirant business owners, in response to this problem are: 

  • Cutting back on existing labour;
  • Resisting the need to hire people;
  • Turning to mechanisation and artificial intelligence;
  • Looking for non-labour intensive opportunities;
  • Keeping their businesses small;
  • Closing their factories and moving them to other countries, thus exporting South African jobs;
  • Choosing not to open new businesses here; and
  • In the case of potential foreign investors, (with a few exceptions) finding other countries, in which to do business.


Those few foreign businesses, such as Wallmart that are willing to open up here, are not always welcomed by the unions.


All of this shows that strong elements in the labour movement do not see job creation as the number one priority for South Africa. Ironically, our government is well aware of the serious damage that our labour laws are doing to the creation of jobs. This is proven by the admission by former Minister Trevor Manuel, who said that our labour laws are hampering the creation of employment.


State capture and Covid have exacerbated the problem greatly but the government continues to make false promises in its State of the Nation Addresses. There appears to be no vaccine against the inability of our so called leaders to manage South Africa out of its crisis.


At the same time the government is making it very easy for foreign workers from certain neighbouring states to work in SA, which reduces job opportunities for South Africans even more. When South Africans complain they are criticised and labelled as xenophobic.


New legislation keeps tightening the screws on employers.

For example: 

  • Fixed-term employees are able to take employers to CCMA if they have a reasonable expectation of being offered permanent employment; 
  • Businesses have the primary legal responsibility for the rights of people placed with them by temporary employment agencies and labour brokers; and
  •  Minimum wages increase regularly.


The conclusion: instead of developing a vaccine against unemployment, our so called leaders are spreading the disease.


BY   lvan lsraelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on (011) 888-7944 or 0828522973 or on e-mail address: [email protected].

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