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    ©), Work restructuring and the future . of labour in South Africa Sakhela Bublungu and Eddie Webster é Introduction | The workplace in South Africa is being restructured under the impact of 2 complex, diverse and often contradictory range of pressures that could bbe described as a triple transition — with political, economic and social dimensions. Ifthe apartheid workplace regime was essentially the organisation of exclusion and inclusion on the basis of race, the triple transition has consisted of contested processes of reordering the lines of inclusion and exclusion in post-apartheid South Aftica In the core workplaces of apartheid, the workplace regime consisted of a racially oppressive order derived from South Africas settler-colonial history. Like other spheres of society, the workplace was a site of racial domination buttressed by racial segregation, and by racist discourses and practices in which the distribution of occupations, sill, incomes and power was racially defined. ‘These structures and practices generated intense racial identity, tension and conflict. While these features were definitive for the apartheid workplace regime, its characteristics did not end there. They extended to hierarchical and authoritarian management styles, extremely adversarial industrial relations, lack of skills ~ indeed, suppression of skills ~ and numerous production inefficiencies that sprang from the conflicts, hierarchies, social distances and antagonisms that characterised a workplace with roots in the social relations of setler colonialism and unfiee labour (von Holdt 2003). The transition from authoritarianism to democracy has created a host of new democratic and social rights for workers, trade unions and citizens, and | generated at the same time an intense contestation over these rights. The social | transition from apartheid to a post-colonial order has impelled profound Buhlungu S$. & Webster, €. 2006. ‘Weve Restructuring aud the ne of lalow mn Guts Mri) m, © Buble J Denel 2 Souall ©) Lutebman (el) Stelead He’ Notion) South Aficg 2005-2006) Cape TOA, AERC Fess 4 PP. A4E- 264, WORK RESTRUCTURING AND THE FUTURE OF LABOUR processes of redistribution of power and access to resources, occupations and skis, together with intense struggles over these. However, the most significant challenge facing the workplace has been the transition from a domestically-oriented economy to amore globally integrated one. This has led to wide-ranging forms of corporate restructuring effectively {integrating companies into more globalised corporate and production structures. For example, BMW (South Aftica) is increasingly incorporated jnto the parent company’s global production and marketing operations, “AngloGold has moved its head office offshore, and Telkom has been partially privatised to a Malaysian-US consortium (a fate which was avoided by Spoornet only through trade union resistance). ‘This chapter brings together data derived from two separate research projects undertaken by the Sociology of Work Unit (SWOP) over the past decade, ‘The first project is a set of studies analysing work restructuring under the impact of the triple transition.* The second project is a longitudinal survey of Congress of South African Trade Unions (Cosatu) members conducted in 1994, 1998 and 2004 on their attitudes towards democracy. This chapter is divided into four parts. Part | identifies the trends in the complex process of ‘workplace restructuring in post-apartheid South Africa. In Part 2 we explore the changing composition of the workforce, drawing on our longitudinal study of Cosata members. In Part 3 we examine changing management and labour relations and we identify four distinct workplace strategies drawn from the work-restructuring project. Finally, in Part 4 we examine the implications of these changes in the workplace for the future of the labour movement. We conclude by suggesting that the two research projects are intimately connected in thatthe restructuring is not only profoundly changing the future of labour, it is also having a destructive impact on society which cannot but have @ profound impact on the prospects for social reproduction. The reorganisation of the lines of inclusion and exclusion in South African society is producing ‘an enclave of development in a sea of poverty and social stagnation. Corporate and work restructuring Domestic corporate restructuring is also proceeding rapidly, often intertwined with processes of internationalisation or increased international pressure 219 STATE OF THE NATION 2005-2006 in the domestic market. Shoprite, for example, is the product of sever mergers and a growing concentration in the retail sector, as well a¢ 4 growing regionalisation through its expansion into the rest of Attica ang ‘internationalisation into India. In a shift that reflects global trends in market and corporate restructuring, several sectors are characterised by the shift of control over products and production from manufacturing companies ¢g large retail chains. Thus, in the wine industry producers find they have to tailor their products and production strategies to the requirements of the Powerful retail chains in overseas and domestic markets, placing increasing pressure on consistency, quality, price and volume. In similar fashion, ig order to ensure co-ordination, the large supermarkets and retail clothing chains which dominate the South African market are increasingly organising the production of garments while at the same time driving process of fragmentation, subcontracting and homeworking in response to cheap imports. Similar processes are under way in the footwear sector. Virtually all private sector enterprises are operating in increasingly competitive, cost-conscious and quality-conscious markets, both international and domestic. Indeed, enterprises can be divided into those that have (relatively) successfully integrated into global markets or production networks and those that are confined to domestic markets. The latter find themselves under assault by cheap, high-quality goods manufactured by multinationals, Decause they lack the capital base and capacity to break into international markets themselves and compete globally. However, the relationship of state-sector workplaces to the market is more contradictory. Publie hospitals are insulated to some extent from the market; however, they draw their skilled staff from a global market and equipment and supplies are sourced from globally competitive suppliers. For example, South African nurses are constantly being attracted to better paid jobs in the North and the Middle East. However, market forces do constrain the options of public hospitals to ‘the extent that private-sector hospitals have secured the revenue from private- sector medical-aid patients, and to the extent that government's conservative fiscal policies limit funding, Similarly, Spoornet is somewhat insulated from ‘the pressure to maximise profits, although market competition from private- sector road hauliers is eroding its customer base. Telkom, in contrast, has been dominated by the profit drive since its partial privatisation. Although there has been competition from cellular and, increasingly, Internet-driven : WORK RESTRUCTURING AND THE FUTURE OF LABOUR , technologies, Telkom has been able to retain its fixed-line market monopoly ~ indeed, the pursuit of profit has stiffened its resistance to government attempts to liberalise the market. Overall, these trends tend to reduce the autonomy of South African companies~ and of the state — whether with respect to workplace strategies or to national developmental goals such as domestic capital accumulation, job creation or product innovation. Indeed, this reduction in autonomy should be regarded as an important feature of the post-apartheid workplace regime. ‘Meanwhile, the restructuring of work results in the emergence of three zones in the labour market. Firstly, there is the core, which is occupied by skilled permanent workers who enjoy relatively high wages, benefits, good working conditions and job security. Secondly, there is the non-core zone occupied by semi-skilled and non-skilled workers in precarious jobs who earn low wages, enjoy no benefits, work under poor conditions and have little or no job security. Finally, there is the periphery, which is occupied by those in the informal sector and the unemployed. South Africa's unemployment rate has steadily increased from 1 912 471 in 1990 (unemployment rate of 15.91 per cent) to 4 789 582 in 2002 (unemployment rate of 30.51 per cent) (UNDP 2003). Significantly, in- formal employment has increased from 1 742 754 in 1990 to 3 545 284 in 2002 (UNDP 2003). A major contributing factor to the growth of informal employment is the growing number of women who seek employment in the labour market. ‘Another change worth mentioning at this point is the changing nature and location of the workplace itself, While the typical industrial workplace still exists, the last 30 years have seen the emergence of other kinds of workplaces located in different geographical spaces. Thus, while for some the large factory or mine remains the main place of employment and work, the street, the backyard of cone’s house or the shade under a big tree have emerged as workplaces in their own right. As we shall see later, this change in the nature and location of the ‘workplace in the context ofthe economic transition has serious implications for the future of working people, both organised and unorganised, “To sum up, the trends identified in this section suggest that work and ‘workplaces in post-apartheid South Africa are undergoing a complex process a 2s STATE OF THE NATION 2005-2006 of restructuring, which is producing a work order with the following three features: + Areduction of autonomy in the context of an increasingly competitive and ‘cost-conscious domestic and international market; + The differentiation of the world of work into three zones (the core, the ‘non-core and the periphery) through processes of reordering the lines of variable inclusion and exclusion of South African citizens, + Theworkplace itself is being redefined in fundamental ways as employment now takes place outside traditional geographical locations. ‘The state has facilitated many of these processes of corporate and matket restructuring through liberalising trade and capital markets, fiscal conservatism and restructuring state enterprises through privatisation. It has also extended labour rights to previously excluded workers and deepened worker rights at enterprise and national level In particular, it has constitutionalised the right to strike and established institutions and procedures that curb the power ‘of management to act unilaterally. These changes have led to criticisms by employers that the labour market is too rigid and led to calls for greater flexibility. These contradictory interventions have imposed new pressures, constraints and opportunities on workplaces, managers, workers and trade unionists. Importantly, changes at the level of the workplace also impact on the household and the reproduction of labour. In her research on labour market flexibility in the retail sector, Kenny (2001) found that changing patterns of employment in the workplace impact on households themselves. In the retail sector, cashiers are increasingly being employed on a casual basis, and the employment function of shelf-packers (or merchandisers) is subcontracted out to suppliers. In Kenny's survey questionnaires, a number of questions were asked that related to the quality of life of employees such as access to type of housing, electricity, water and decent sanitation, Whether there was @ permanent job in the household was the only consistent predictor as to whether households had access to these services * Those households tended to live in formal housing, whilst households with access to only casual jobs — in some cases more than one casual job — generally lived in informal settlements. Pointing to the longer-term social consequences of this, Kenny summarised her findings as follows: WORK RESTRUCTURING AND THE FUTURE OF LABOUR [Fllexibility not only stratifies workers on the shopfloor... [Households that are supported by a casual wage alone are more likely to have lower standards of living... T]hese very households face diminished future opportunities for their members. Theit members have fewer resources to invest in job search efforts and networking, and fewer resources to put into means of self- provisioning that may supplement their poor wages...In the longer term, far from enabling households to hang on, dependence ‘on meagre, marginal jobs will erode working-class households? economic positions and diminish the likelihood of these workers getting more sustainable jobs. Tenure in shrinking ‘good job’ pool can lead to a labour market. (2001: 104) Before examining these pressures we now turn to an exploration of the changing composition of the unionised workforce, taking Cosatu as a case study (Bublungu 2005). ‘The changing composition of the workforce Our data suggest that restructuring is profoundly changing the composition of unionised workers. Increasingly, union members are concentrated in the diminishing core of permanent, full-time employment relations, leaving the non-core and the periphery without an organised voice. Furthermore, those in permanent employment are increasingly better educated and more skilled than their predecessors. ‘The structure of the black workforce has been changing consistently over the last three decades (Hindson & Crankshaw 1990). A feature of this change has been the decline of the unskilled stratum and the growth of the semi-skilled and skilled strata. This change resulted in the retrenchment of thousands of unskilled workers, thus giving rise toa division between ‘the relatively privileged employed workers and the impoverished unemployed workers’ (Hindson & Crankshaw 1990: 26). According to Crankshaw (1994), this was achieved through the fragmentation of skilled trades into semi-skilled occupations in which black workers could be employed. The militant unions of the 1980s and carly 1990s drew substantial support from the employed and semi-skilled category of workers, many of whom occupied leading positions in the unions. 255 =| a STATE OF THE NATION 2005-2006 4 Survey of Cosatu shop stewards conducted in 1991 (Pityana& Orkin 1992) also showed thet although just over half of these shop stewards occupit unskilled and semi-skilled postions, a significant proportion (44%) occugied skilled, supervisory and clerical positions. Similarly, the results of ont longitudinal study of Cosatu membership (1994, 1998 and 2004) suggest thar ‘this trend has been deepening during the last ten years. One of the most significant findings of our longitudinal survey is the gone concerning the security or insecurity of tenure for Cosatu members Unfortunately there is no longitudinal comparative data as this question wan included for the first time in 2004, Nevertheless, the new data enable us each certain conclusions regarding Cosatu. Table 10.1 shows that 92 per cent of Cosatu members are in permanent ful-time jobs. Not only does this projet Cosatu members as privileged relative tothe growing army ofthe unemployed and those workers in precarious employment and the informal sector, t slso Suggests thatthe federation has filed to make headway in onganising beyond the diminishing core workforce in fulltime permanent jobs ‘Table 10.1 Security ofjob tenure of Cosatu members, 2004 Nature of conteact Respondents Fxed-teem contact (temporary) parttime ‘ 192%) | ‘xed-term contrac temporary) flltime 30 (5%) Permanent contrat, part-time 11m) Permanent coateac fll-sime 04 0256) Source SWOP ec. 2008 ‘The implication of these findings is that in future Cosatu and other unions could find themselves increasingly isolated from the rest of the working clase, Particularly from the new movements formed to mobilise against the effects of economic liberalisation on the working poor and the unemployed. Furthermore, the Cosatu survey shows a steady decline of unskilled (and even semi-skilled) workers in the federation occurring at the same time as the steady increase in skilled and supervisory categories of workers, This shows & continuation of the trend noted by Hindson & Crankshaw (1990) in their study of the changing structure of the workforce in the period 19651985, But these results also reflect the impact successful public-sector unionisation WORK RESTRUCTURING AND THE FUTURE OF LABOUR, has had on the composition of Cosatu’s membership. In recent years Cosatu's public-sector membership has been estimated to constitute one-third of the total membership (Buhlungu 2001). Table 10.2 gives a breakdown of the {ederation’s membership by occupational position. “able 10.2 Occupational category of satu members surveyed as defined by the company (Occupational category 1998 1998 2004 Unkle 190 (3056) 118 (1956) 81 2%) Semishled 193 (30%) 223 (35%) 168 (25%) Skea 135 (2194) 192 (20%6) 275 2%) Supervitory 25 (4%) 31 6H) 4 6%) Cleric 64 (10%) a 5 0%) omer 32 (5%) 21 0%) 3B GM) Source SOF et 1994 1998, 2006 It should be noted that the responses in this table are based on the official designation of workers’ positions (as defined by management), and not on the workers’ view of how their positions should be graded or designated. ‘The Cosatu members’ survey shows that since 1998 there are proportionately fewer union members under the age of 36. At the same time, the 36-45 age cohort seems to have increased significantly over the last five years. The age profile of Cosattu members as shown in Table 10.3 seems to be a function of recent trends in the labour market. For example, few young workers have been absorbed into formal permanent employment in recent years. Reflecting ona similar finding in the 1994 leg of the study, Ginsburg, Webster, Southall, ‘Wood, Bublungu, Maree, Cherry, Haines and Klerck (1995) argued that it reflected ‘greatly diminished employment opportunities’ and that ‘people in the formal economy would be less inclined to even temporarily leave their jobs, while those entering the labour market for the first time would be most unlikely to gain formal employment’ (1995: 13). What is also striking is the Grop in the 26-35 age group, which is the age cohort most likely to be affected by HIV/AIDS. 255 256 xv STATE OF THE NATION 2005-2006 Table 10.3 Age profile of Cosaru members 1994, 1998 ard 2004 agn 1996 1998 2004 1825 19 G%) 36 (6%) 37 (6%) 26.35 246 (38%) 233 (37%) 198 (30%) 36-45 219 (049) 226 (3594) 239 (40%) 46-55, 1s (2196) 123 (185) 130 20%) 56-65 26 (46) 21 Gm) 29 (456) oe _ - 2 (0%) Sours SWOP e194 1998204 ‘The last ten years have seen ¢ remarkable improvement in the educational levels ‘of Cosatu members. Table 10.4 shows that while the proportion of those with ¢cucationa levels up to, and including, Standard 8 dropped from a high of 6 per cent in 1994 to the present 36 per cent, the proportion of those with Standard 9 and above increased dramatically from 35 per cent in 1995 to 64 per cent in 2004, ‘Thi finding has far-reaching implications for Cosatu's frre, Recent research by ‘Azi Sitas (2004) shows that union activists with higher education stand a mueh better chance of upward social mobility. While workers with little or no formal ‘education led the mobilisation of the struggle period, the period of democratic consolidation seems to rely on those with higher levels of educational attainment As Sitas observes, ‘The institutional pull of the transition seems not to favour “oral” people in preference of some formal educational competency’ (2004: 834). ‘Table 10.4 Highest formal educational levels of Cosatu members Highest educational level 1994 1958 2006 [No formal education 32%) 16. (3%) 3 (198) Sid 2 or lower 26 (496) 22 (3%) 4 (2%) Sids3—5 97 (1596) 65 (10%) 41%) Sids6—8 283 (44%) 246 (39%) 181 (28%) Sids9=10 199 196) 238 (37%) 247 (38%) ‘Technical diploma 18 (5) 31 (386) 53.03%) University degree 0 (0%) 1 (256) 5 0%) ‘Other pes-school qualification 7 0%) 6%) 4 (6%) Sources SWOP ea 19941998204 WORK RESTRUCTURING AND THE FUTURE OF LABOUR ‘The significant presence of public sector and white workers, particularly in unions such the South African Democratic Teachers’ Union, the Democratic ‘Nurses’ Organisation of South Africa and the South African Society of Bank Officials, some of which affiliated to Cosatu after the 1994 and 1998 surveys, probably accounts for this dramatic increase in educational levels. But even the traditional Cosatu unions have been gaining members from new sectors of the workforce such as airline pilots, public-sector managers and skilled workers. Significantly, some employers ~ such as those in auto assembly have raised educational requirements for new recruits and now insist on @ technikon diploma as ¢ minimum requirement. ‘A consistent finding in the longitudinal study is the one on the gender composition of Cosatu’s membership, which continues to confirm Baskin's (1991) estimate of 36 per cent. Table 10.5 presents the gender figures. ‘Table 10.5 Gender composition of Cesatu membership, 1994, 1998 and 2004 Gender 1994 1998 2004 Female 212 (4%) 191 3086) 225 (34%) Male 411 (66%) 448 (70%) 420 664) eure SWO? @ 1996, 1998, 2006 ‘A subtle but relentless generational change has been taking place in the union movernent over the last ten years or so. Understanding this change is key to grasping the changing social composition of union membership during this period. The process of attrition has resulted in the decline of the 1970s° and 1980s’ generation of union membership as a proportion of the total. Table 10.6 shows that the majority of Cosatu’s current members (55%) joined from 1991 onwards. Of these, 13 per cent joined between 2001 and 2004. Put differently, the table shows that the bulk of Cosatu. members (799%) are drawn from a new generation of workers. This suggests that there may have been uneven socialisation (of workers into the federation, its policies and orgenisational traditions, Indeed, it is possible that by the time this majority joined the federation, many of these policies and traditions would have become rituals, which each new member was expected to imitate and repeat in a mechanical, unquestioning way. The loss of large numbers of members and leaders through retrenchments and the brain drain has compounded this problem for the federation. 257 STATE OF THE NATION 2005-2006 ‘Table 10.6 Year in which Cosatu member joined the union Year Percentage of epondents 1970-1580 8 aaa 1ps1-i98s 2 1986-1550" 4 qi 1991-1995 2» - 1996-2000 7 2 aoe 201-2004 B Do net inow 1 Teal 100 Source: SWOP 194, 19,2004 How is the restructuring of work and the changing social composition of unionised workers impacting on management-labour relations? This is explored in the following section. Changing management-labour relations The South African workplace is facing a challenge constituted by three competing forces. On the one hand, it is facing intensified competition as South Africa is increasingly integrated into the global economy. On the other hand it is compelled to redress the apartheid legacy and respond to the demands for a more democratic workplace and society. In this section we raw on the studies collected in Webster and von Holat (2005) and identify a pattern of four distinct workplace strategies. ‘The frst ofthese, ‘negotiated reconstruction, refers toa strategy of negotiating the terms of a reconstituted workplace order, and may be driven by management or trade unions or both. ‘Wildcat co-operation’ describes ‘managerial strategy for incorporating black workers by negotiating informally with workers and introducing new management practices, but bypassing (or marginalising trade unions. ‘Authoritarian restoration” is a managerial strategy for reconstituting an authoritarian workplace order which draws on the dominant authoritarian strand of South African workplace history, but which may introduce new features and practices as well. A fourth group of workplaces is characterised by a stalemate brought about by the lack of any WORK RESTRUCTURING AND THE FUTURE OF LABOUR specific strategy, or by the failure of an attempted strategy of negotiation or authoritarianism. It should be noted that the success or otherwise of these strategies refers to successful implementation in the workplace — there is no necessary relation between this and the financial success of the company. While different labour processes, company and trade union capacities, or market conditions may constrain strategic options, the strategic choices made by managers and unions do have a degree of autonomy. Companies may operate in identical markets with virtually identical labour processes, yet have sharply divergent strategies. Nor are these strategies static or fixed. Workplaces may move from one to another over time. Some workplaces or companies say encompass more than one strategy. What emerges from the case studies is that where the union is strong and management is responsive, a successful negotiated reconstruction of the workplace is possible. Negotiated reconstruction ‘The strategy of negotiated reconstruction can be initiated by management, as was the case at Sea Harvest and BMW, or it may be induced by intense pressure from trade unions, such as the case of Highveld Steel and Spoornet (Webster & von Holdt. 2005). In the former cases, the result tends to be @ relatively stable negotiated relationship between management and unions, ‘with workers articulating more positive attitudes to the company. In the latter cases, however, the resulting negotiated agreement tends to be somewhat unstable because management had been forced to co-operate and was not particularly committed to implementing the agreements. All four cases of negotiated reconstruction reveal progress towards dealing with the legacy of apartheid, a reduction in racial tension, improved attitudes towards ‘work, a high level of union activity, a focus on production quality, an improved or high level of company performance and, in two cases, the introduction of new work organisation based on teamwork. Inthe case of BMW we find a lower incidence of increased workload and the introduction of new technology, while in Sea Harvest casualisation and externalisation are widely used. ‘The poor performance results in Spoornet are partly related to the fact that negotiated reconstruction failed to address the workplace dynamics captured by the nine workplace features ~ because of the inability or unwillingness 238 260 STATE OF THE NATION 2005-2006 PLmanagement to respond to union proposals for workplace change on the basis of co-determination. This failure indicates the crucial importance of management’ role in addressing the transformation of workplace relations and inefficiencies inherited from the apartheid workplace order These correlations suggest that negotiated reconstruction may produce Gements of the so-called ‘high performance work organisation’ (Ashe ee ate, 2002: 45), with its emphasis on improved working conditions the incorporation of ‘workers in decision-making, new forms of work organisation, improved levels of skill and so on. This approach to production Performance also appears o be intimately linked toa negotiated and strategic spbsoach to overcoming the legacy of apartheid in the workplace through black economic empowerment, training and employment equity as well new forms of supervision and work organisation, Howeven the degree of change should not be exaggerated. At BMW, workers

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