Centralised bargaining as a minimum wage fixing mechanism

Abstract

The purpose of this dissertation is to consider whether centralised bargaining, through bargaining councils, is a suitable mechanism for determining minimum wages in South Africa. In addressing this issue, the minimum wage fixing mechanisms currently available in South Africa, the impact they have on the labour markets and whether there is a need for reformation of our labour laws relating to the setting of minimum wages will be considered. The dissertation focuses on the various philosophical perspectives on labour law, the international development of collective labour law, international wage-fixing mechanisms and the development of South African labour law from the Industrial Conciliations Act 11 of 1924 to the current Labour Relations Act 66 of 1995. The current levels of collective bargaining available in South African, focusing on the establishment and functioning of bargaining councils, the extension of and exemption from collective agreements, as well as the use of collective bargaining to set minimum wages are discussed. The advantages and disadvantages of our current minimum wage fixing mechanisms are also discussed. For the purpose of comparison, reference is also made to wage fixing though sectoral determinations, although the focus of the dissertation is on collective labour law. In the international comparison, the development and functioning of the Australian and French wage-setting regulations are discussed, as well as policies that could be considered for application in South Africa. Collective bargaining, and in particular centralised collective bargaining, plays a significant role in South African labour law. Since South Africa does not have a national minimum wage, centralised bargaining remains the main form of fixing minimum wages, apart from sectoral determinations. In the conclusion and recommendations, possible solutions to the shortcomings in our centralised ii bargaining system, as well as alternative means of setting minimum wages are considered.