REPORT ON THE INVESTIGATION INTO A SECTORAL DETERMINATION FOR THE HOSPITALITY SECTOR-2010
CHAPTER ONE: 2
CHAPTER THREE 13
CHAPTER FOUR 31
CHAPTER FIVE 33
As directed by you, the Employment Conditions Commission (ECC) has pleasure in presenting you with a report on its investigation into the Hospitality Sector.
Background to the investigation
The current sectoral determination 14 for the Hospitality sector was published on 15 May 2007 and became effective from 1 July 2007. The wages component of the determination will lapse on 30 June 2010. The determination regulates conditions of employment and minimum wages to be paid in the hospitality sector. The wages were set in accordance with the number of employees an enterprise employs, where an enterprise with 10 or less employees pays 10% less than an enterprise with more employees. This approach was informed by the fact that the majority of employees in the hospitality sector are employed by small firms, i.e. those with 10 or less employees. The new minimum wages and the wage increase regime for the hospitality sector need to be in place by 1 July 2010.
Employers in the hospitality sector are to a very large extent organized in terms of the different fields in which they operate. Table 1 provides an overview of the range of organizations within the hospitality sector. As illustrated in the table, these organizations represent a reasonable profile of the main sub-sectors in the scope of coverage of the Sectoral Determination.
Table 1: overview of the range of organizations existing within the hospitality sector
Tourism Business Council SA
Umbrella body representing business sector in tourism on macro-issues;
Members include trade associations and individual businesses.
The Federated Hospitality Associations of South Africa (FEDHASA)
Hospitality trade association including, hotels, restaurants, caterers, self-catering, time-sharing, home hosting (B&B, guesthouses), suppliers, consultants and service providers to hospitality industry; conference venues, country clubs and taverns.
National Accommodation Association
Trade association for smaller establishments- 1-30 bedroom establishments.
Bed & Breakfast Association of South Africa (BABASA)
Mostly Small, Micro and Medium Enterprises SMME’s including lodges, guest houses (1- 15 rooms), B&Bs (1-6 rooms) & caterers.
Mostly informal and “unregistered”, partnerships and “mom and pop” shops.
Represents tour guides and adventure operators (e.g. bungee jumping etc.)
National Association of Catering Employers (NACE)
Employers organization in the catering industry
In the process of registering as an employers’ organization
South African Commercial and Catering Workers’ Union (SACCAWU)
Hotels, restaurants, tourism, gambling.
Congress of South African Trade Unions (COSATU) affiliate
Hotel, Liquor, Catering &
Allied Workers Union (HOTELLICA)
Trade union representing hotel and catering employees.
National Council of Trade Unions (NACTU) affiliate
Commercial Catering, Accommodation Workers’ Union (CCRAWU)
Independent trade union- breakaway from South African Catering, Commercial and Allied Workers’ Union (SACCAWU) mainly hospitality sector
Terms of reference
The terms of reference for this investigation as published in the Government Gazette No. 32526 notice No. R.873 dated 25 August 2009 was as follows:
“to review wages and the conditions of employment in the Hospitality Sector”.
A four-phased project framework was developed for the investigation:
Phase One – Administrative aspects
A notice was published in the government gazette on 25 August 2009, inviting interested parties to make written representations within 30 days to the Director-General. In response to the notice, four (4) written submissions were received from the following organisations:
Public hearings were scheduled across the country as set out in table 2 below.
A total of 28 public hearings were conducted, covering all nine provinces. There were almost three hearing sessions in each of the provinces. After the initial planned public hearings, site visits were conducted in certain workplaces, targeting specifically employees. This was due to the poor turnout of employees during the public hearings. Employee attendance was disappointing in most of the public hearings.
Table 2 below indicates places visited together with the attendance profile of stakeholders for each hearing.
As reflected in table 2 above, public hearings were not well attended, particularly in respect of employees’ representation. Subsequent to the public hearings, site visits were arranged where interviews in the form of a questionnaire administration were conducted. The questionnaire process yielded results, as the secretariat managed to visit workplaces and interviewed a total of 253 employees and 15 employers. Table 3 reflects the places visited and the number of employees and employers spoken to during the site visits.