The Commission of Conciliation, Mediation and Arbitration (CCMA) has ordered a textile company in KwaZulu-Natal to pay a R17million fine for noncompliance with the wage provisions of the National Textile Bargaining Council.
Labour law experts believe this is one of the highest fines imposed on a non-compliant employer.
The order was made in an arbitration award issued by CCMA commissioner Jabulani Ngwane, following an arbitration hearing held on June 10 at the Durban offices of the CCMA.
The arbitration award was released last Tuesday.
Ngwane found the company, Tai Yuen Textiles in Mooi River, guilty of a wage underpayment for 393 employees from February 12 last year to April 27 this year, amounting to R11,5million.
He also ruled that the company had unlawfully failed to pay provident fund contributions.
He ordered it to pay almost R1million in unpaid employer provident fund contributions.
The company was also ordered to pay the workers more than R1million in unpaid annual bonuses as well as to pay arrear bargaining council levies of R49000 and the union's HIV-Aids levy of just over R2000.
The company was ordered to pay more than R5million in interest for all the under- and nonpayments.
Company chief executive Ho-Chi Cheng said the company would appeal against the fine.
"Our representative dealing with this is overseas now.
"We will appeal against the fine. We think it is unfair and ridiculous," he said.
Economic expert Bonke Dumisa said the fine was "huge" and sends out a clear message to those who break the law.
"Locals in the textile industry are battling because they cannot afford to compete with outside investors. It should be welcomed and not seen as negative.
"If the laws are broken companies must be held accountable," he said.
The Southern African Clothing & Textile Workers Union (Sactwu) said it had taken note of this "important" arbitration award and would engage the company on the matter, if need be.
"Sactwu also calls for continued strong action against non-compliant employers who flout our country's laws by not granting workers the rights and benefits which accrue for collective agreements legitimately negotiated in terms of the Labour Relations Act," said Sactwu deputy general secretary Andre Kriel.