Thread Rating:
  • 0 Votes - 0 Average
  • 1
  • 2
  • 3
  • 4
  • 5
DIFFERENTIAL MINIMUM WAGE STRUCTURE:
Author Message
Cedric Offline
Administrator
*******

Posts: 108
Joined: Oct 2012
Reputation: 2
Post: #1
DIFFERENTIAL MINIMUM WAGE STRUCTURE:

Fifteen years ago I proposed a differential minimum wage structure but the influence of the Employer and Employee bodies were not ready to receive the concept.

As we approach the Wage Determination dead-line for the Western Cape farmers, we believe the time is appropriate for us to consider a differential minimum wage structure, where the size of the business, measured in units, income, or suitable measure, allows increased minimum wages as the size of the business increases.

I use the Security Guarding sector as an example as this sector impacts on every person in this country, many as employees, and the rest of us as users. The differential minimum wage structure can be applied to the Farm Labourers, Mining Industry, Domestic Workers, and every other sector.

INTRODUCTION:

Our traditional minimum wage structure results in a minimum wage applicable to the majority of employees, irrespective of the length of service. In the Security Industry example, you will find that a guard with twenty years experience will be receiving the same wage that an employee with two years experience.

Emerging SMME’s have no support in competing with the large established operator, who through Brand and size of operation has great advantages over the developing business.

How do we balance this in a society where we need to close the ever increasing wealth gap?

We introduce the “Differential Minimum Wage Structure”.

SMALL/EMERGING BUSINESS:

In terms of our ideology we consider that the Labour Department should exclude small businesses from minimum wage legislation. For the purposes of our proposals we attache the size levels to 50 in the manufacturing industry and 20 in the service industry.

SECURITY INDUSTRY EXAMPLE:

This example is based on the Private Security Industry Regulatory Authority, Illustrative Contract Pricing Structure (1 September 2011 - 31 August 2012) Area 1:

The example relates to a 12 hour shift period, ever night for an average night.

Grade D: Security Guard, Hourly Rate as per sectoral det. 6 = 12.11
At this rate the extended TOTAL DIRECT COST PER MONTH is R 6667.55.

Our proposal excludes the business that is less than 20 security guards, and uses the R 6667.55 from the level of 21 to 50 guards. (average 35 level).

The Differential Minimum Wage Structure increases from the level, proportionally on the size of the business, creating an industry structure where the employee can start in a small business and as they develop skills and experience, they have an industry with stepping stones to provide an employment opportunity that the employee can strive to achieve.
(On the Domestic front, this would be a start position in Westdene, and work towards the wealthy residential areas where the minimum wage will be much higher.)

INVITATION TO CONSIDER THE IMPACT:
(Straight line graph connects the value between those reflected)
Size of Business. ......... Ave: ..... Differential. ..... Total Month ..... Potential. ............. Recovery
Number of Guards: ..... Rate:. ....Hourly. ........................................ Selling Price. ....... .per
....................................................Cost:................. .............................Excl. Vat: ............guard:
.21 to 50......................... 35........12.11...................R 6 667..........R 7950 to R8350.......R 1283 +
51
81
111

141 to 170.....................125........12.97...................R 7 143
171
201
231

261 to 290.................... 275........ 13.84................. R 7 620
291
321

351 to 380....................365........ 14.49.................. R 7 976
381
411

441 to 470 ...................455 ........15.13 ..................R 8 334 ........ R 9650 to R 10 000..... R 1316 +
471
501


HOW WILL THIS IMPACT ON THE INDUSTRY??

1: THE USER:

In these stressful economic times the user will have the opportunity to select the price level that they can afford, in relation to their budget. In this process, the user will be in the position to assist in the transfer of economic empowerment to SMME’s.

2: THE EMPLOYERS:

Emerging entrepreneurs will find space to develop in the industry.
Small employers will be able to compete at a level where, with a fairly standard of recovery per guard, the small employer will be able to compete at a price where the USER and economy can benefit.

3: THE EMPLOYEES:

The employees will have an industry where they will have a stepping stone into the larger groups, offering 20% and more to the earning. This will motivate a skills development and potential recommendations through the USERS of their service.

4: THE SECTOR:

The sector will establish a level of stability by providing the senior employee group and opportunity to earn more than the entry level employee.
This structure will also open the doors for employees to become entrepreneurs.

All future wage determinations will be linked to the straight line graph to maintain this relation ship and structure.

ECONOMIC FREEDOM CHARTER IDEOLOGY:

The Economic Freedom Charter’s ideology is to create an environment where through introducing new concepts into the various sectors of our economy, we transfer wealth to those who were previously excluded from our economy.

This Differential Minimum Wage Structure, will change the face of all our industries, creating an environment where the income potential to the employees, and SMME’s, will allow for abilities, skills, and experience to be rewarded.

INVITATION:

South Africa is invited to consider this principle, we need to debate the concept, and we need to find the basis for how we establish a concept where we change the equal minimum wage into a structure where those with skills and experience can benefit.

Trusting that you will find this concept of value.

We will drive this concept within the larger community, and will appreciate an opportunity to discuss the concept with the Labour Department.

Your faithfully,

Cedric de la Harpe:
Founder: Economic Freedom Charter:



11-29-2012 10:29 AM
Visit this user's website Find all posts by this user
charles.h Offline
Administrator
*******

Posts: 1
Joined: Nov 2012
Reputation: 0
Post: #2
RE: DIFFERENTIAL MINIMUM WAGE STRUCTURE:
Good morning Cedric ,
I salute your positive initiative and effort to address and redress the damages of
the past and the present . I heard your interview on Radio SAFM this morning and
it is obvious a lot more smart work will have to be done by many more people in
order to improve the destiny of South Africa and its people .
Some of the work will entail drastic measures , which may introduce a reference
point from which we the people of South Africa can use to advance our future .
I take the liberty of enclosing a resume of a thesis which I wrote in 2008 at the
beginning of the Global Economic Recession , which may still be relevant today
depending on how the “ jury ” perceives the need for radical action .

PROPOSAL for COUNTERACTING the ECONOMIC RECESSION

This serves without prejudice and in good faith to start a constructive debate about the possibilities of reducing job losses altogether , where the partnership between government , employees and employers can be reinforced with a number of sacrifices from all the parties .

This debate must find ways to fast track the following proposals ;
1) Everybody in the formal sector both public and private from top down will take a cut in their salaries and wages on a sliding scale , ( debatable 25 % to 10 % ) with the following provisions ;
a) No more retrenchments unless it is voluntary
b) The cost of everything that has a salary or wage component must be reduced to correspond with the salary and wage reduction – this should reduce cost of living and make prices competitive on the global platform stimulating more business , eventually creating more jobs .
c) Municipal Rates must be revised and reduced to correspond with present market value .
d) Interest Rates must be reduced and competitive
with International Standards .
2) Procurement must be South Africa based unless it cannot be supplied from South Africa , example some machinery and specialized items .
South Africa should focus on value adding businesses and industries instead of exporting all the resources to countries which supply South Africa with finished products . example The Steel Industry could provide 500,000 to 1,000,000 jobs over a period .
3) Financial Institutions with Government backing should implement faster platforms to provide the capital to Companies which need or want to upgrade their technology in order to make their employees more productive with a consistent quality . Note this cannot be used to reduce employment , but rather redeployment due to “ up-skilling ” in accordance with the upgraded technology , which has to be equivalent to the technology used by our global competitors .
4) The Skill Development Program needs to be revised and controlled by both industry and labour so that skills pursued and obtained are valid with regards to the developing industry and economy .
5) Service delivery and infrastructure ( Escom included ) has to be accelerated to reach first world country standards in order to attract foreign capital for manufacturing – sustainable job creation .
6) There should be a moratorium on strikes for a certain period example 3 years , since this proposal will have far reaching consequences and will take probably three years to deliver a better economic condition in South Africa .
7) Rural and Agricultural Development has to be intensified including better land and environmental management in order to assure preservation of natural resources and improved food security .

This proposal is in a nutshell the essence of our debate .

Now , I would like to propose an idea with a capitalistic head and a socialistic heart which goes as follows ;
Everybody employed in the formal sector may be eligible ( they would have to prove themselves according to a transparent bench mark ) to buy in shares from there company in which they are employed through their effort and work over a certain time , after which they could derive the potential
benefits .
They would all have to engage in a program which would inform them and test their comprehension of the system , how an economy and a business works to be sustainable and of course the obligations and benefits of being a shareholder so that the employee understands that he is beholden to himself the shareholder and its board .
This concept may be the answer to the call for Nationalization and could even promote more Privatisation of state institutions because everybody
would have an educated stake in the fortunes of South Africa .
My principles have always followed the idea that nobody can work for
me , they can only work for themselves and their family , but they work with me in a Company to try to make a profit so that they can enjoy its fruits through bonuses , better facilities and better social support which ultimately is paid by their collective effort .
Furthermore , I insist that all those employees who “ enjoy ” some form of employment at the moment must be involved in a community project or program while there are enough unemployed people who can volunteer their time and services to “ improve ” their communities .
For example I teach mathematics voluntarily ( for free ) at night and on weekends , without neglecting my family – I balance or manage my time
such that others can benefit from my love for Mathematics .

Best regards ,
Charles .
11-30-2012 12:50 PM
Find all posts by this user
Cedric Offline
Administrator
*******

Posts: 108
Joined: Oct 2012
Reputation: 2
Post: #3
RE: DIFFERENTIAL MINIMUM WAGE STRUCTURE:
Hi Charles,
Your contribution is motivating.
I will tweet and invite debate.
Regards

Cedric

12-01-2012 07:00 AM
Visit this user's website Find all posts by this user
Corruptiongone Offline
Junior Member
**

Posts: 2
Joined: Dec 2012
Reputation: 0
Post: #4
RE: DIFFERENTIAL MINIMUM WAGE STRUCTURE:
Hi Cedric,

Thank you for the category, CORRUPTION: I will prepare a thread.

May I first respond to this thread?

1: Cedric proposals; Absolutely brilliant:
But how will you answer to the industry that tell you that they can't afford to pay more?
And how do your respond to the industry that will tell you that your suggestion on no wage control on the small employer is unfair competition.

2: Charles proposals; Very good; but:-
Aimed to protecting and stabilizing the unrest in the informal sector, through a balance that is good on paper, but difficult to see.

Cedric, I would suggest that you look at Charles proposal, though and contribution what we need in order to debate. but rather than debating the entire proposal under this very important DIFFERENTIAL MINIMUM WAGE STRUCTURE, we take item for item and debate under a relevant category, if necessary, creating a specific category.

Charles, your understanding of what needs to be debated could take the lead.
FH
12-02-2012 07:52 AM
Find all posts by this user
Cedric Offline
Administrator
*******

Posts: 108
Joined: Oct 2012
Reputation: 2
Post: #5
RE: DIFFERENTIAL MINIMUM WAGE STRUCTURE:
Hi FH,
Thanks.
I have been waiting for the first question about why they can't pay more, thanks for the question.
As a perpetual small player in the industry, the Industrial / Security Council always set the minimum wage at a level that the small player could just afford in theory, "If we set it any higher, it would create un-employment".
If the existing min wage structures were based on the large player, they would have introduced the differential wage structure fifteen years back, to cater for the small player.
Let us use the domestic workers minimum wage for example. If our wealthy residents in the Houghton and Sandton areas set the min wage at a level that those residents could afford, they would have introduced the differential for the residents of Westdene to protect the potential un-employed.

With regard to the removal of restrictions on the small, below 20 in service industry, and below 50 in the manufacturing industry, only a perpetual small player, understanding the difficulty to survive under the restrictions and regulation would understand the need to make space for the emerging entrepreneur.

Any challenge to the differential minimum wage structure by the big players, will only confirm the need to release the pressure on emerging entrepreneurs.

And in turn, release the pressure on inflation.

Thanks C

12-02-2012 10:33 AM
Visit this user's website Find all posts by this user
Cedric Offline
Administrator
*******

Posts: 108
Joined: Oct 2012
Reputation: 2
Post: #6
RE: DIFFERENTIAL MINIMUM WAGE STRUCTURE:
This reply is taken from a direct email from Charles:

Differential wage structures seem to make sense and would have to be tested in the different manufacturing categories
to promote sustainability and “ fair ” competition .
At the moment the pool of available “ labour ” is far greater than existing jobs which will not change if we do not look for wholesale job creation in our stronger sections of our economy .
We need to assess where are our strengths which can absorb more job creation programs with the minimum amount of input , which could be done in chapters as we become more sophisticated .
We also need to look and learn at some of the other successful countries who may have started more or less where we are now . There are many examples .

Best regards:

Charles

12-03-2012 06:15 AM
Visit this user's website Find all posts by this user
Cedric Offline
Administrator
*******

Posts: 108
Joined: Oct 2012
Reputation: 2
Post: #7
RE: DIFFERENTIAL MINIMUM WAGE STRUCTURE:
Hi Charles,

I have had years to discussions, debate and conflict in various industries, and I have little doubt that the min wage is set just above what the small employer can afford.

If we look at the domestic worker, the rate is based on the employer at the lower end of the income structure.
If any min wage was set at the upper level, those at the top level would have implemented a Differential Min Wage Structure in reverse of my proposal.

"Fair Competition" is an concept that means different things to different people.

Where does the 'labour-broker' system that operates outside all of the labour control restrictions fit into the system. In the mining conflict, there are allegations that Labour-Brokers are being paid R 12500 and the miners R 5000???

In my Security Industry example, where does this fair competition 'break-point' rest?

The USER would like to pay the minimum, I know of many contract that operate at R4500 to R 5000 per month per guard.
According to the control body, if you complied with all min requirements, you can't provide a service for less than R 10 000 per guard.

The USER will use a small, supposedly, 'fly-by-night' operator at between R 5000 and R 7 500 per month due to financial constraints.
These operators are only fly-by-nights because the big operators target this business by indirectly threatening the USER and using the control system to make the small guy disappear.

If I owned a property that required four guards to secure, I would rather use a small black business and pay between R 5000 and R 7500 per guard.

How do we cater for the accommodation of 'labour pool'??

To start with we need to target the existing products being sold through the conglomerates.

It is maybe crazy, the easiest example that I have is the hundreds of black woman who over the years sold shirts, dresses, and other clothing / sewing items.
They have been squeezed out.

Imagine if all clothing departments stores allowed hawker tables outside their shop fronts, selling this type of product?

We will have people who were working, and sharing a bit of the conglomerate profits.

Slowly our manufacturing potential will grow, slowly we will edge into the Chinese product market, and slowly we will develop South Africa as the economic giant of Africa.

Thanks for your support, please take lead in any organizations that we can start talking to.

Presently I am driving this movement, the tourism empowerment program and trying to stay alive.

We owe friends of our in KZN a visit so will try ti get to you soon, but if you are in JHB, please shout.

Regards


Cedric

12-03-2012 10:42 AM
Visit this user's website Find all posts by this user


Forum Jump:


User(s) browsing this thread: 1 Guest(s)

Contact Us | Economic Freedom Charter | Return to Top | Return to Content | Lite (Archive) Mode | RSS Syndication