South Africa has the worst labor-employee relations in the world, ranking 137 out of 137 countries, the World Economic Forum’s latest World Competitiveness Report shows.
According to Gawie Cillié, employment relations expert and lecturer at the University of Stellenbosch Business School (USB), the alarming result is directly linked to the low levels of trust between employers and employees in South Africa.
This, coupled with poor reliance on professional management, the country’s capacity to retain and attract talent, as well as the high unemployment and poverty levels, have all contributed to a negative labor-employee relationship, he said.
“The efficiency of a country’s labor market is directly linked to GDP, long-term growth, overall prosperity and competitiveness on a global scale,”
“The unhealthy state of our labor-employee relations will have a direct impact on organisational performance which can seriously threaten our ability to create a sustainable, lucrative and productive future for the next generation.”
He added that despite an enabling statutory framework and a strong tradition of collective bargaining and labor mediation dating back to the late 1970s, there is little evidence of workplace relations today living up to the stated purposes of the Labour Relations Act – i.e. ‘to promote orderly collective bargaining, employee participation in decision-making in the workplace and the effective resolution of labor disputes.’
“There are many reasons for high levels of conflict in our labor-employee relationship, but by far the low levels of trust underpin the realty we are facing,” he said.
“If there is little or no trust cooperation suffers and the conflict escalates quickly resulting in a severe damage in the relationship costing money and employee efficiency.”
“The lower the levels of trust are, the greater the need to rely on formal rules to keep employees productive and compliant.
“On the other hand, if trust is high, reliance on the rules becomes less necessary. Employees tend to be more self-motivated, conflicts tend to be resolved quickly and equitable and formal rules (e.g. relating to poor work performance or ill-discipline) only have to be applied as a last resort,” he said.