Ucta seeks to stop closures
SMALL clothing businesses, adamant that they cannot afford to pay the minimum wage agreed at the industry bargaining council, have formed a new association to exert greater influence at the council and as an immediate priority, to avert the looming closure of hundreds of non-compliant firms.
The ReDress Consultancy’s Renato Palmi, who assisted in setting up the new United Clothing and Textiles Association (Ucta), said yesterday that the bargaining council’s plan to phase in the minimum wage was a “big concern”.
Ucta proposes that a qualified machinist should earn R280 a week in a non-metro area and R450 in a metro area. In terms of the National Bargaining Council for the Clothing Manufacturing Industry, the minimum weekly wage for a qualified machinist is between R451 and R522 in a town, and R740 in a city.
Ucta represents more than 300 companies in Newcastle, Durban, Isithebe and the Free State that employ more than 28000 people.
In December last year the bargaining council stipulated that companies must be at least 70 percent compliant with prescribed minimum wages by the end of March, 90 percent compliant by January next year and fully compliant by the end of April 2012.
But Palmi said man small companies could not afford the regulated wages and would not be able to meet the March deadline. The compliance order gave businesses insufficient time to comply, she(sic) added.
The bargaining council said it would attach the assists of businesses that failed t comply. The consequences would be closures or retrenchments.
“The key is to try to find a way to halt the deadline to save thousands of jobs and businesses,” Palmi said.
Alex Liu, the Chairman of the Newcastle Chinese Chamber of Commerce and interim vice-chairman of Ucta, said the intention was to legalise non-compliant companies without closures of job losses.
Liu said lower base wages would enable companies to introduce production incentives.
Johann Baard, the executive director of the Apparel Manufacturers of SA (Amsa), said Amsa agreed with Ucta’s aim to avoid the closure of companies and loss of jobs.
Amsa has agreed to phasing in compliance because members who were paying the minimum wage had been at a disadvantage. It has proposed that new entrants earn R450 a week, excluding benefits, in cities and R285 a week outside cities.
“If unions agree to this proposal 100 000 jobs could be created in the industry in 18 months,” said Baard. The Southern African Clothing and Textile Workers Union could not be contacted.
Written by Samantha Enslin-Payne
Business Report
Thursday, February, 24 2011
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