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Labour laws are not such a hindrance to business - report

By unknown | Oct 24, 2006 | COMMENTS [ 0 ]

Phumza Macanda

Phumza Macanda

South Africa's labour laws are not as constrictive as larger firms have been implying, a study by the United Nations Development Programme (UNDP) has revealed.

According to the study, only 30 percent of companies have been affected by "labour inflexibility", said Robert Pollin, co-author of the report.

"We're not saying that labour market rigidities have had no effect at all, but we are saying that about 70 percent of businesses say that labour laws have not affected their decisions at all. They've had minimal effect," said Pollin.

The study's findings are contrary to widespread criticism that South Africa's rigid labour laws are making it difficult for companies to hire and fire workers.

The government met with labour and private sector representatives at two roundtable discussions in May and June to discuss the reforms to some aspects of the law, but both meetings ended in disagreement.

According to workplace dispute settlement company Tokiso, South Africa's labour laws are not an obstacle to creating employment. Tokiso chief executive Tanya Venter said though "some restrictions could certainly be relaxed", it was not as hard to hire and fire as was generally believed.

The UNDP report noted that the target to halve unemployment by 2014 was unrealistic under the current situation.

"To halve unemployment by 2014 business must grow at a significantly faster rate and that growth must be focused more on hiring people and less on buying new machines," said Pollin.


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