Welcome to Sunny South Africa, the land of Entrepreneurship – NOT

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Once you cut through the noise, there are some indisputable facts about the economic world we now inhabit. Old style jobs are disappearing at the rate horses fell to the side when cars started to be manufactured en masse. Big businesses are shamelessly investing in technology to replace people. Economies are growing again, but not creating jobs. And as meritocracy becomes the norm, trade unions are growing ever weaker. Those are realities not just in SA but worldwide. And from everything we know, the only way out of a potential mess of massive unemployment sparking social unrest is through stimulating entrepreneurship – encouraging the creation of small businesses on a level never before seen. But when you listen to our CNBC Africa interview with Gerhard Papenfus, whose organisation represents small and medium sized enterprises, in South Africa the structures appear designed to do exactly the opposite of what is urgently required. And instead of addressing these inequities, the responsible Cabinet Minister is forcefully supporting the status quo. Whether that’s for political expediency or her genuine inability to appreciate the complexity of the new reality is for you to decide. Papenfus says he has tried to explain the logic. So now he has been taking to the courts. And winning. – AH 

ALEC HOGG:   The Metal and Engineering Industry Bargaining Council (MEIBC) is the largest bargaining council in South Africa.  Joining us now in the studio is Gerhard Papenfus, Chief Executive of NEASA, to discuss what he believes is the industry illegally obtaining a Bargaining Council Agreement.  Those are quite strong words, Gerhard.  What’s happening here…illegal Bargaining Agreements?  You’re obviously pretty irritated.

GERHARD PAPENFUS:  Oh, yes.  Just a bit of history:  in 2011, the Bargaining Council – meaning the employers and trade unions/some employers and trade unions – entered into a three-year agreement.  Just prior to that, our organisation launched a dispute against the MEIBC on the basis of the unconstitutionality of the MEIBC in terms of their own constitution.  We alerted the Minister to that in repetitive communication.  She ignored that, and extended that agreement – a completely unconstitutional illegal agreement.  She extended it in September of 2011.  We went to court on an urgent basis and we lost.  The court wasn’t interested.  They said it’s nothing serious.  ‘You can have an alternative remedy.  There’s too much paper around here’.  There were 30 lawyers in court that day.  The agreement was then extended and enforced. We took that agreement, went to a Labour Court on a review basis, and we won.  Just going back a bit again, two days after we got the judgment in the urgent application – where the judge turned down our application – we started with the arbitration.  On the second day of the arbitration, all the parties that denied had unconstitutionality admitted it.

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