NUMSA commemorates the 100 year anniversary of the Russian Revolution

On the Shopfloor: Hollow companies steal from workers

30 June 2004, Posted in News

The practice of labour brokers receiving money for their services but not passing relevant monies on to bargaining councils, could be halted after the Motor Industries Bargaining Council (Mibco) successfully forced the liquidation of Namandla, a labour broker operating in Johannesburg .

The labour broker owed the council more than R1million. Most of this was money that had been deducted from workers’ wages for council levies and for workers’ pension and provident funds.

“Since 1998 we have battled over the issue of labour brokers,” says Themba Mkhabela, one of Numsa’s motor bargaining representatives in Wits Central West region.

“When labour brokers started, many did not even respect the labour laws,” says Mkhabela. “They would dismiss workers without giving them a proper hearing and were not paying according to the prescribed minimum rate.”

Despite reporting them to the bargaining councils and getting inspectors to enforce the agreement, some still did not comply.

Initially some of the employers did not support Numsa on the issue. But when the labour brokers started to owe the bargaining council huge amounts of money, “then the employers realised that they needed to support us on this,” Mkhabela says.

According to Johannes Bam, regional secretary of Mibco’s Highveld region, labour brokers are often used in establishments that need labour for short periods of time.

However, more recently, Bam says, “owners of service stations don’t want to be hassled with the employment of staff. They get the labour broker to take over the responsibility and then they just pay the labour broker for their services.”

He says about 66 companies of about 7000 companies in the region are making use of labour brokers.

Bam also warns that often labour brokers hire workers, get them working, and then fire them before registering them with the relevant Bargaining Council. This prevents these workers from accessing their pension or provident fund monies and leave pay.

But companies using labour brokers had better be careful. Bam says that they have identified all labour brokers and are keeping a watchful eye over their payment patterns.

The motor main agreement says that the company that uses a labour broker’s services is “jointly and severally liable for monies due to the council and money due to workers”, says Bam.

If the labour broker is not paying across the monies deducted, Bam says Mibco will not hesitate to lay criminal charges on the petrol station owners to recoup the amounts owing.

Looking at Mibco’s records, it means that some petrol station owners could be liable for amounts exceeding R50 000!

How do I know if I am employed by a labour broker?

It is difficult to tell. But if the name of the employer on your payslip is different from the name of the business where you work, you could be employed by a labour broker. Also check with workers that have worked in the business for a long time. Sometimes they know who is employed by a labour broker.

How can I protect myself if I am employed by a labour broker?

Keep all your pay slips. Your pay slip is your proof that you have worked for that employer. It is your ticket to get paid unemployment benefits and any other payments due to you. If you don’t get payslips, contact your union office or the nearest Department of Labour office. The law says every worker must receive a pay slip.

Check if they are deducting money for pension and provident fund and council levies on your pay slip. In terms of the motor agreement, every motor company must deduct these monies from your pay slip.

If they are deducting, go to your nearest union office and ask them to check if the company that pays you your wages is paying your money to the Bargaining Council.

If they are not, then ask your organiser to sort the problem out.

The law says that even if the labour broker is not paying the money to the council, then the company where you work must pay that money.