Over half of South Africa’s hospitality establishments do not comply with Department of Labour legislation, placing it on government’s list of “high risk” and “problematic” sectors for the 2010/2011 financial year.
This was revealed at a recent parliamentary briefing, where Siyanda Zondeki, Deputy Director-General: Service Delivery for the Department of Labour, revealed the results of an inspection of 2 622 establishments in the hospitality sector. It was found that 56 per cent of establishments did not comply with legislation.
Zondeki says that during the inspections, the department discovered that employers were not aware of the annual increases in terms of minimum wages and this led to the underpayment of salaries. This finding was echoed in a recent Tourism Update Online poll, where 49 per cent of respondents said they either were not aware of, or could not afford to pay, minimum wages to their staff.
Other issues highlighted during the department’s inspections included the calculation of wages, information concerning pay, deductions and other actions concerning remuneration, written particulars of employment, compressed working week, work on Sundays, night work and daily rest period. Many businesses also contravened the Unemployment Insurance Act and the Occupational Health and Safety Act.
Don Leffler, Director of The School of Business, says the tourism and hospitality sectors are largely made up of small businesses operating in very competitive markets with low margin returns on investments. “Many of these businesses, including one-man travel agents, tour operators, guides, B&Bs, restaurants and pubs, operate under the radar and, in some instances, either have limited knowledge of, or deliberately defy labour legislation requirements,” he says. “It is difficult to monitor and enforce compliance on these small businesses, particularly those operating outside of the main cities.”
Leffler says that while he believes the department’s statistics to be accurate, established medium to large businesses will be close to 100% compliant.
Interestingly, the draft National Tourism Sector Strategy identified the importance of making the tourism sector more attractive to job seekers as one of its key focus areas. In an environment where salaries are often below minimum wage, this could be difficult to achieve. Leffler says the retention of quality staff is hampered by generally poor training and development, career progression and salary levels. “Tourism is not perceived as a career of choice and this needs to be addressed so that the best people are attracted to the sector, retained and continually developed to meet changing requirements,” he adds.
