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Marius Scheepers & Company Attorneys |
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Guidelines issued in terms of section 95 (8)5,
LRA as published in GN R942 in GG 23611 of THE
PURPOSE OF THIS DOCUMENT
1 Purpose This document
contains guidelines published by the Minister of Labour,
in consultation with Nedlac, that are to be applied
by the Registrar of Labour Relations in determining
whether an applicant for registration in terms of the Labour
Relations Act (LRA) is a genuine trade union or a genuine employers’ organisation. In terms of section 95 (7) of the Labour Relations Act, the Registrar may only register a
trade union or an employers’ organisation if the
Registrar is satisfied that it is a genuine trade union or a genuine
employers’ organisation. In addition, in terms
of section 106 (2A) of the LRA, the Registrar may cancel the registration of
a trade union or an employers’ organisation that is
not, or has ceased to function as, a genuine trade union or employers’ organisation, as the case may be. 2 Application These guidelines
deal separately with trade unions and employers’ organisations. 3 Approach In order to
determine whether an organisation is genuine, it
will be necessary for the Registrar to examine the actual operation of the organisation. In the case of an applicant, particular
attention will have to be paid to the manner in which the organisation
was established and formed. In the case of an existing organisation,
attention will have to be paid to its actual activities and functioning. In
evaluating whether a trade union or employer’s organisation
is genuine, the Registrar must take into account all relevant factors. 4 These guidelines are
not concerned with evaluating whether the constitution of a trade union or
employers’ organisation complies with section 95
(5) of the LRA. TRADE
UNIONS
5 The Definition of a trade union The LRA defines a
trade union as follows: ‘An association of
employees whose principal purpose is to regulate relations between employees
and employers, including any employers’ organisations.’ 6 Therefore, an organisation cannot be registered as a trade union or
continue to; operate as a registered trade union unless- (a) it is in fact an association of employees; (b) the principal purpose of the activities
is to regulate relations between its members and their employers (or
employers organisations representing those
employers). It will therefore be
necessary to raise and examine the actual process of forming a trade union,
its composition and membership and the activities it undertakes on behalf of
its members. These issues are examined in greater detail in this document. 7 Formation of a trade union The process followed
to form a trade union can give important indications as to whether an organisation is a genuine trade union. Key aspects of the
process that should be examined include- ·
the number of
founding members who attended the inaugural meeting(s) to establish the trade
union and who completed signed registers indicating their names and place of
work; ·
the means by
which the constitution of the trade union was drafted and adopted; ·
the election of an
executive committee or council of members and the election of office-bearers. The crucial issue that
must be addressed is whether the formation of a trade union involved
employees associating with one another to establish an organisation
to regulate relations with their employer(s). 8 Qualification for membership of a trade union In terms of section
95 (5) (b) of the LRA, the constitution of a trade union must prescribe the
qualifications for membership. There is no requirement in the LRA that a trade
union confine its membership to employees in a particular sector or sectors
of the economy or a particular geographical region. However, the failure to
place appropriate qualifications on membership may indicate, together with
other factors, that the trade union is not a genuine trade union. 9 Membership of a trade union The LRA does not create
any membership threshold that trade unions must meet to register.
Nevertheless, the size of the membership may be an indication that a trade
union is not a genuine trade union. It is legitimate for trade unions to
restrict their membership to small groups of workers; for instance, the
employees of one employer or within one bargaining unit or a small trade or
profession. However, an extremely small membership in relation to the number
of employees qualified to join, may indicate that the trade union is not a
genuine trade union. 10 When evaluating the
membership of a trade union, attention should be paid to its history. The
fact that the membership of a trade union with a long history of representing
its members’ interests has declined to small numbers is not an indication in
itself that it has ceased to be a genuine trade union. 11 The primary purpose of a
trade union is to regulate relations between employees and employers (or
employers’ organisations). In particular, this
includes the regulation of these relationships through collective bargaining.
A trade union will only be able to seek organisational
rights in terms of the LRA or demand collective bargaining where it recruits
members from the employees of particular workplaces or bargaining units. The
fact that a trade union has not sought to gain a critical mass of members in
any particular workplace or bargaining unit that would allow it to gain organisational rights may be an indication that the trade
union is not a genuine trade union. 12 In order to have a
primary purpose of regulating relations between employees and employers (or
employers’ organisations) a trade union must
recruit as members employees who are in employment.
The fact that a significant proportion of a trade union’s membership
only become members after the termination of their employment is an
indication, together with other factors, that the trade union is not a
genuine trade union. 13 Activities of the trade union A trade union may seek to regulate relations between
its members and their employers and employers’ organisations
by- (a) seeking and/or obtaining organisational
rights in terms of chapter 3 of the LRA; (b) seeking and/or obtaining recognition from employers as the
collective bargaining representative of its members; (c) submitting and negotiating in respect of
demands on behalf of their members for approved wages and working conditions. 14 Failure to engage in
these activities does not in itself indicate that a trade union is not a
genuine trade union. There may be reasons why a trade union had not succeeded
in gaining organisational rights or obtaining
recognition. These may include difficulties in recruiting members and hostility
from employers. However, the failure to seek to obtain organisational
rights or recognition is a strong indication that the trade union is not a
genuine trade union as these rights provide the basic platform for
representing members’ interests. 15 It is a legitimate
function of a trade union to seek to resolve grievances on behalf of its
members, including those who have been dismissed, and it can be expected that
all genuine trade unions would undertake activities in this regard. However,
the fact that a trade union’s activities solely, or to a large extent,
consist of referring disputes and cases on behalf of its members to the CCMA,
the 16 A trade union may only be registered and continue to
operate as a registered trade union if it is independent. In terms of section
95 (2), a trade union is not independent if it is under the direct or
indirect control of any employer or employers’ organisation
and is not free of interference or influence of any kind from any employer or
employers’ organisation. Factors that would
indicate that a trade union is not independent are- (a) that any of the officials or office-bearers of a trade union are
also officials or office-bearers of an employers’ organisation; (b) that the trade union operates from the same premises or shares
facilities with an employers’ organisation; (c) an employer assisted with the formation
of the trade union or that the trade union operates as a ‘sweetheart’ union
(i.e. a trade union that exists to further the interests of the employer or
to undermine independent trade unions). 17 Association of employees A trade union must
be an association of employees. Indicators that a trade union is an
association of employees are- (a) the establishment and effective functioning of branches; (b) the holding of regular meetings of members; (c) the election of shop stewards or other trade union
representatives in workplaces; (d) the election of members as
office-bearers. 18 Association not for gain In terms of section
95 (5) (a) of the LRA a trade union must state in its constitution that it is
an association not for gain. The purpose of this requirement is to prevent
trade unions from being used as vehicles for enriching individuals or as a
cover for profit-making businesses. In evaluating whether a trade union is a
genuine trade union, it is important to examine the actual financial
operation of the trade union. Among the factors that may indicate that a
trade union is operating in fact for the gain of certain individuals are the
following: (a) Unrealistically high salaries and allowances are paid to the
officials, office-bearers or employees of the trade union. (b) Interest-free or low interest loans are made to officials,
office-bearers or employees, and those loans are not repaid. (c) Family members of office-bearers or officials are employed by the
trade unions. (d) Income earned by the trade union is not used for the benefit of
the organisation and its members but is paid out to
officials, office-bearers or employees. 19 It must be borne in mind
that it is not inappropriate for trade unions to pay competitive salaries to
attract competent and qualified officials and employees. Likewise, there may
be circumstances in which established trade unions may decide to provide
loans on favourable terms to their officials,
office-bearers or employees. 20 Usually the major source
of revenue for trade unions is a subscription usually paid on a monthly
basis. In general terms this will be a flat rate payment or a payment
expressed as a percentage of the members’ income. Trade unions may have other
sources of income, such as investments. 21 The financial
arrangements made with members of a trade union on behalf of whom litigation,
particularly dismissal disputes, is instituted, is an indication of whether
the trade union may not be a genuine trade union or may be operating as an
association for gain. Where a trade union charges its purported members a
substantial proportion of the settlement reached in disputes, this may be an
indication that the trade union is not a genuine trade union. This does not
mean that it is not appropriate for genuine trade unions to require members
to make realistic contributions to the costs of bringing cases on their
behalf. However, the fact that a member is required to pay a substantial
percentage of the settlement to the union, would be
a strong indication that the organisation is not a
genuine trade union. 22 Federation affiliations The fact that a trade union is affiliated to a
federation of trade unions, the other members of which are genuine trade
unions, is an indicator that the trade union is a genuine trade union. EMPLOYERS’
ORGANISATIONS
23 Definition of an employers’ organisation The LRA defines an
employers’ organisation as follows: ‘Any number of employers
associated together for the purpose, whether by itself or with other
purposes, of regulating relations between employers and employees or trade
unions’. 24 Therefore, an organisation cannot be registered as an employers’ organisation or continue to operate as a registered
employers’ organisation unless- (a) the employers who are members of the organisation
have in fact associated together; (b) the purposes for which they have
associated together include regulating relations between employers and
employees or trade unions. 25 It will therefore be
necessary to examine the actual process of forming an employers’ organisation as well as its composition and membership
and the activities it undertakes on behalf of its members. 26 Formation of an employers’ organisation The process followed to form an employers’ organisation can give important indications as to whether
the employers who are members of the organisation
have associated together. The key aspect of the process that should be
examined include- ·
the number
and/or size of the founding members who attended the inaugural meeting to
establish the employers’ organisation; ·
the means by
which the constitution of the employers’ organisation
was drafted and adopted; ·
the election of
executive committee or council members and the election of office-bearers. 27 The crucial issue that
must be addressed is whether the formation involved employers associating with
one another to establish an employers’ organisation. 28 Qualification for membership of an employers’ organisation In terms of section 95 (5) (b) of the LRA, the
constitution of an employers’ organisation must set
out the qualifications for admission to membership. There is no requirement
in the LRA that an employers’ organisation should
confine its membership to employers in a particular sector or sectors of the
economy or a particular geographical region. However the failure to place
appropriate qualifications on membership may be an indication, together with
other factors which are discussed below, that the employers’ organisation is not a genuine employers’ organisation. Where an employers’ organisation
has extremely wide qualifications for membership, it is appropriate to
consider whether its members are in reality associating with each other for
the purpose of regulating relations between themselves and their employees or
the trade unions. 29 Membership of an employers’ organisation The LRA does not
create any membership threshold that employers’ organisations
must meet to register. Nevertheless, the size of the membership (in terms of
number of employers or number of employees employed by them) may be an
indication that the employers’ organisation is not
a genuine employers’ organisation. It is legitimate
for employers’ organisations to restrict their
membership to employers in small sectors of the economy. 30 Activities of an employers’ organisation The operation of an
employers’ organisation must involve employers
associating with one another, inter alia, for the
purpose of regulating relations between themselves and their employees or the
trade unions to which the employees belong. This would be the case where the
employer members meet together for the purposes of jointly engaging in
collective bargaining with trade unions. The fact that the activities of the
employers’ organisation consist largely or solely
of individual consultations between the employers who are members and
officials of the employers’ organisation, would be
an indication that the employers’ organisation is
not a genuine employers’ organisation. 31 The fact that an
employer’s organisation is under the direct or
indirect control of a trade union is an indication that it is not a genuine
employers’ organisation. Factors that would
indicate that the employers’ organisation is under
the control of a trade union are- (a) that any of the officials or office-bearers of the employers’ organisation are officials or office-bearers of a trade
union; (b) that the employers’ organisation
operates from the same premises and shares facilities with a trade union. 32 Association not for gain In terms of section
95 (5) (a) of the LRA an employers’ organisation must
state in its constitution that it is an association not for gain. The purpose
of this requirement is to prevent employers’ organisations
from being used as vehicles for enriching individuals or as a cover for
profit-making in business. In evaluating whether an employers’ organisation is a genuine employers’ organisation,
it is important to examine its actual financial operation. Among the factors
that may indicate that an employers’ organisation
is in fact operating for the gain of individuals are the following: (a) Unrealistically high salaries or allowances are paid to the
officials, office-bearers or employees of the employers’ organisation. (b) Interest free or low interest loans are made to officials,
office-bearers or employees, and those loans are not repaid. (c) Family members of office-bearers or officials are employed by the
employers’ organisation. (d) Income earned by the employers’ organisation
is not used for the benefit of the organisation and
its members but is paid out to officials, office-bearers or employees. 33 It must be borne in mind
that it is not inappropriate for employers’ organisations
to pay competitive salaries to competent and qualified officials and
employees. Likewise, there may be circumstances in which established employers’
organisations may decide to provide loans and favourable terms to their officials, office-bearers or
employees. 34 Usually the major source of revenue for employers’ organisations is likely to be a subscription paid on a regular basis. The financial arrangements made with members of an employers’ organisation in respect of litigation, particularly dismissal disputes, may be an indicator whether the employers’ organisation is in fact operating for the gain of certain individuals. |
