By Jon Herskovitz
NEWCASTLE, South Africa, May 16 (Reuters) – It’s not
luxurious, but Goldfinch Garments, the Chinese-owned South
African factory where Sindisizwe Zwane works nine hours a day,
is far from a sweatshop: the ventilation is decent, the lighting
is good and basic safety measures are in place.
South Africa says its garment industry is better regulated
and workers are better paid than in ultra low-cost Asian
producers like Bangladesh, where the collapse of a factory
killed more than 1,100 people last month.
The ruling African National Congress (ANC) government, with
close links to labour unions, wants to go further by enforcing a
wage agreement that would guarantee Zwane and her co-workers a
raise.
But the garment industry has already lost three-quarters of
its jobs in the past decade as cheaper imports have flooded the
local market. Zwane, 28 and one of only two wage earners in a
family of 14 people, fears that efforts to win her a raise could
cost her livelihood.
“Of course I want more. I want a whole loaf of bread instead
of the half I am getting. But half a loaf is better than
nothing,” said Zwane. “If I lose the job, we lose everything.”
Zwane is one of about 250 workers at Goldfinch, one of a
cluster of clothing factories in the hardscrabble industrial
town of Newcastle, 260 km (160 miles) southeast of Johannesburg.
Goldfinch is spartan but appears safe and clean. The factory
has rows of sewing machines where a workforce of mostly women
spend hours stitching together clothes. Workers often bundle up
on colder days and some cover their faces with cloth to protect
them from dust.
Zwane can earn as much as about $220 per month, with her
income depending on how many orders come in.
The government-mandated minimum would guarantee her at least
$238 a month regardless of how many orders the factory received.
That compares with monthly minimums as low as $38.50 in
Bangladesh or $80 in Cambodia.
The government argues that if industry is allowed to skirt
centrally negotiated minimum wage rules, millions of black
workers will become locked into a lifetime of cheap labour
little different to apartheid.
UNCOMPETITIVE
Nearly two decades after the end of white rule, Africa’s
biggest economy still has millions of unskilled workers, nearly
40 percent of its population living on less than $5 a day and
half of adults out of work.
Employers blame an uncompetitive, low-skill, high-wage
economy with restrictive labour laws for keeping unemployment
high. Since 2000, real after-inflation wages in South Africa
have risen 53 percent, while productivity fell by 41 percent.
Labour laws place a heavy emphasis on collective bargaining
and allow the Labour Ministry to mediate between unions and
industry in a “Bargaining Council” to set minimum wages for
specific sectors, which apply across an entire industry.
Small and medium-sized companies like the Newcastle textile
firms complain that they are excluded from the negotiations and
compelled to adopt wages agreed to by large, well-funded firms
and big unions with political ties to the ruling ANC.
“The Bargaining Council system will ruin South Africa. The
wages are not linked to production,” said Alex Liu, a garment
maker who has been in South Africa for nearly 20 years and heads
the Newcastle Chinese Chamber of Commerce and Industry.
Newcastle has fared better than many parts of the country,
losing only half its clothing jobs in the past decade, largely
because its factories pay 10 to 50 percent below the Bargaining
Council minimum wage, drawing the ire of government and unions.
“It undermines job security in law-abiding companies,” said
Andre Kriel, general secretary of SACTWU textile union.
Liu, along with other garment makers who were not a part of
the talks, have taken the Labour Ministry, a major union and the
Bargaining Council to court, saying the wages forced upon them
are driving factories out of business.
The government says it wants to keep plants running: “It is
not the intention of the Bargaining Councils or the department
to ‘close down’ factories,” said Ian Macun, head of collective
bargaining at the Labour Ministry.
“On the other hand employers are obliged to comply with
applicable legislation.”
Loane Sharp, a labour expert at employment firm Adcorp, said
the system does seem to benefit bigger companies, who can use
the collective bargaining principle to hurt smaller competitors.
“In principle, those in the Bargaining Council are supposed
to work in the public interest. But in practical terms, the
participants gang up on small and medium-sized enterprises by
agreeing to wages that are unrealistic,” said Sharp.
South African textile wages are not only far higher than in
parts of Asia, they are also about double those in many other
African states. As South African factories have closed, new ones
have opened in Lesotho, Swaziland, Kenya and Mauritius.
“Our biggest competition is not Asia or Bangladesh. It is
neighbouring Lesotho and Swaziland,” Liu said.
Liu’s Wincool factory has tried to defuse the government
opposition by introducing a profit-sharing co-op system.
However, even Wincool was shrunk from 300 full-time jobs to 100.
“It’s better for a lot of people to have a little than
nothing at all,” said Joseph Kunene, a co-op member at the
factory. “But most people in Newcastle have nothing.”
