AGENCY SHOP AGREEMENTS The other week we introduced to the reader the types of Collective Agreements envisaged by the Industrial Relations Act, 2000 (As Amended), these being the Recognition Agreement, the Procedural Agreement, the Substantive Agreement and the Agency Shop Agreement. Due to the controversy that surrounds the latter type of Collective Agreement (the Agency Shop Agreement) we undertook to further its discussion focusing on the latest Court Judgments on its interpretation and legal implications. In the Industrial Relations Act, Agency Shop Agreements are governed by Section 44. The Act provides that “a representative trade union, staff association and an employer or employer’s organisation may conclude a Collective Agreement to be known as an agency shop agreement requiring the employer to deduct an agreed agency fee from the wages of its employees who are identified in the agreement and who are not members of the trade union”. The essence of an agency shop agreement is to enable the trade union or staff association an opportunity to receive a certain contribution from those employees who are not members of the trade union and thus are not paying any subscriptions to the trade union and yet they also benefit from the results of the negotiations between the Union and their employer. For example, if the Union successfully negotiates for a particular wage increment, the non-Union members also benefit from the increment. Before the 2005 amendment of the Industrial Relations Act, an employee who is not a Union member and due to be affected by an Agency Agreement had to give his/her consent in writing towards the deduction of the agency fee from his/her salary. This was in terms of Section 44 (4) of the Act. But the 2005 amendment of the Industrial Relations Act deleted this sub-section. The effect of the deletion is that it is no longer necessary to obtain the written consent of an employee to deduct any agency fee from the employee’s wages. Interpreting the constitutionality of this amendment, the full bench of the High Court noted that Section 44 (4) which provided for the need for written consent was removed because possibly the required written authority was hard to come by. The Court proceeded as follows: It is worth noting that the Constitution is Act No.1 of 2005 and the amendment to the [Industrial Relations] Act is Act NO. 3 of 2005. The right to give the required consent to effect deductions was taken away immediately after the Act containing the Bill of Rights was passed. This in my view has significance in that Parliament deliberately took away this right fully knowing the contents of Section 25 (5) and 32 (2) of the Constitution”. The Court further noted that the intention of the legislature in enacting Section 44 (1) of the Industrial Relations Act was to strike a balance between the interests of employees who do not wish to become members of a Union and to avoid the unfairness of giving the non-Union members a free ride. Section 44 (4) did not strike this balance as it allowed non-Union members a free ride in the sense that they could withhold their consent to the deduction of an agency fee from their salaries; thereby defeating the whole purpose of having an agency shop agreement. The amendment in deleting Section 44(4) corrected this anomaly; thereby re-fortifying Section 44(1) of the Industrial Relations Act, said the Court in its judgment in the decided case of Celani Mhlongo & 20 Others vs. Nedbank Swaziland Limited & 3 Others, Case No. 1360/2011 – (High Court). WRITTEN BY: MTHUNZI SHABANGU-SCL
Posted on: Mon, 02 Dec 2013 08:46:09 +0000
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