The existing Labour Laws are far reaching, but the present structures in government do not have the strength to enforce these laws. It does not matter how advanced our statutes are but lack of enforcement will always lead to the unethical taking advantage. Strict prosecution of those who break the law would be sufficient to protect the rights of the workers, along with some amendments to the present legislation. But a ban on legitimate and responsible Labour Brokers is not the answer.

In President Zuma’s state of the nation address last year  he called for “common ground” to be found on this issue. I am sure that President Zuma can see the creation of jobs as vital to the success of South Africa and understand the role that Labour Brokers play in this. So why the turn around by the ruling Party? Is this just political posturing ahead of elections next year? Are the ANC putting party political aspirations ahead of job creation and business?Will President Zuma stand his ground and continue his call for “common ground” ahead of political pressure from his party and alliance partners?

There is irrefutable evidence that Labour Brokers contribute to decent work in South Africa. A recent study showed that 43% of labour brokers’ staff find permanent employment within 12 months. One in four jobs created since 1994 have been filled by a brokerage. In the face of this evidence Unions still accuse Labour Brokers of being “Modern Day Slave Traders”.

Lets not forget that  the banning of Labour Brokers would mean a loss of Tax income as well. SARS charges the VAT to the Brokers client at 14% on top of the salary earned by staff. So the Treasury puts  Millions of Rands in its pocket every day as a result of Labour Broking; not to mention the income tax.

The Hospitality and Tourism Industry is a leading employer in South Africa. Let’s look at a simple example?  Have the Unions considered how the life and livelihood of a casual banqueting waiter will be affected by a banning of Labour Brokers?

For a banqueting waiter to earn a reasonable living out of his skill he needs to find work at a number of establishments. Hotels, conference centres and venues have a high demand for skills but on an irregular basis. So, for our waiter to get a reasonable monthly income he would need to get regular work at perhaps 6 or 7 establishments. This would normally give him an average of 5 days work in a week, 195 hours a month.

A Labour Broker (Temporary Employment Service or TES) represents the interests of our waiter and through the one organisation is able to get bookings at a number of different establishment. Filling up his week and co-ordinating his working diary. He is represented as a professional waiter in the market place.

Question is, if TES’ were banned how is he going to be able to co-ordinate his time with all the different establishments to get a full months work?  Truth is he cannot, it would be logistically impossible and he would be left scraping around town trying to convince dozens of venues to use his skills

 Let’s talk about money. TES’ are in it for the bucks like any business. They have a very small mark up on their services based on the hourly salary of the worker. The TES has to supply large numbers of staff for the business to be profitable. This means that they need to constantly look for more work for their staff to make profit. More business for the TES equals more jobs, and more working hours for our banqueting waiter.


To attract the best skills a TES needs to pay the worker better than a competitor. So naturally TES’ are constantly negotiating staff salary levels with their clients. The higher the rate the better the skills and the more cash per hour our banqueting waiter gets. Most TES’ in the hospitality industry pay well above legislated minimum wage.

For the TES to provide a better service they need to train. TES’ are one of the highest users of the Skills Development Levy in South Africa. Training is what the client wants, this is free to the client and free to our banqueting waiter.

What other benefits does our banqueting waiter get from being represented by a TES or Labour Broker :

  • Transport is very expensive and due to go up. A good TES will normally have its own safe well maintained vehicles that will transport staff if working late free of charge.
  • It’s hard for an individual to negotiate better terms like, working hours, meals on duty, 13th Cheque, performance bonus. The TES does this effectively. Happy staff equal better service and a happy client, leading to more work for our banqueting waiter.
  • All statutory deductions and contributions are made by a responsible TES.  Leave pay, sick pay, family responsibility leave, Workman’s Comp and UIF for example. How would these be accumulated if our banqueting waiter was employed by dozens of different establishments? How would the Government get its UIF, Workman’s Comp, Skills Development Levy and Employee’s Tax?
  • A responsible TES regards their staff with the same rights as a permanent employee and recognises the right of the individual to join a trades unions.They are treated with fairness in all disciplinary actions and are not dismissed at will 
  • The TES can negotiate benefits such as Funeral, Death and Disability and Provident Fund  Cover and Medical Aid on a group basis passing on cheaper and better cover to the staff.
  • Our Banqueting Waiter Will always get paid for his hours worked plus overtime, even if the client does not pay the TES.


So, ANC and COSATU think again. Call for better legislation and enforcement. Not a ban. Not unless you have no regard for the worker in the hospitality sector and other industries that are cyclical in nature. Think carefully with a cool head and logic. This is a time to consider the worker, not only your political future. To quote Mr Vavi, “There is no greater honour than to serve the working class” of this I cannot disagree.

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