Research Articles (Mercantile Law)

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Browsing Research Articles (Mercantile Law) by Author "Govindjee, Avinash"

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    Activation in the context of the unemployment insurance system in South Africa
    (Juta Law Publishing, 2011-01) Govindjee, Avinash; Olivier, Marius; Dupper, Ockert
    The main aim of labour market activation policies is to bring jobless people from unemployment or inactivity into work or, at the very least, to influence the employment prospects of the unemployed positively. Activation schemes typically make benefit receipt conditional upon job search activities, acceptance of available job offers and participation in training activities. This article addresses the appropriate role of the Unemployment Insurance Fund (UIF) in the establishment of activation in South Africa. It focuses on a number of principled and practical considerations and constraints that challenge the use of activation mechanisms, such as the fragmentation of the existing legal and institutional frameworks, the lack of available employment opportunities and human rights considerations. It is argued that the limited and short-term impact of the UIF, its strong labour-market orientation and its inability to appropriately contribute to preventing and combating unemployment or to reintegrate the unemployed into the labour market all point to the urgent need to reform the UIF. The gaps in the current unemployment insurance system are highlighted, as is the need to enhance the relationship between the unemployment insurance system and (appropriate) activation measures. The role of existing social security and employment creation initiatives in this dynamic is also considered. In particular, the absence of a link between those excluded from the UIF and the activation mechanisms introduced by the Skills Development Act 97 of 1998 is underscored. Proposals contained in the Employment Services Bill are also evaluated. It is suggested that an expanded form of employment services provision, incorporating a network of labour centres, ought to receive prioritisation in the South African context. This must be coupled with a move to consolidate the various available governmental databases in terms of which unemployed persons may register as job-seekers. The creation of an enabling framework to achieve such goals would require a variety of legislative changes, some of which are discussed in the article.
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    Constitutional perspectives on unemployment security and a right to work in South Africa
    (Juta Law Publishing, 2011-09) Govindjee, Avinash; Dupper, Ockert
    The endemic problem of unemployment poses a serious challenge to the realisation of South Africa's constitutional goals and values. One of the most glaring gaps in the assistance provided to the unemployed in South Africa is the exclusion of the long-term unemployed from any income-replacement measures. While the state's focus, when it comes to people of working age, is on job creation (rather than extending the range of social grant recipients), policy interventions to reduce unemployment tend to operate largely in the absence of a proper legal framework. For example, there is no designated right to work in the Bill of Rights. No legislation deals specifically with employment creation initiatives and few court cases have considered this issue. Without a right to work, there is a real possibility of a successful constitutional challenge to the current situation. Although this article acknowledges indirect ways to give constitutional recognition to such a right, a more direct approach is favoured in the form of the insertion in the Constitution of a limited, qualified right to unemployment security, including the right of access to employment opportunities and work. This would allow the state to limit an unemployed person's right to social assistance - the root of a potential constitutional challenge - on the basis that the state is striving, within its available resources, to progressively take reasonable legislative and other measures to create employment opportunities. In the absence of such an explicit right, the state may find it very difficult to use its attempts to create more jobs as a justification for its failure to pay social grants to the entire uncovered adult population. Significantly, constitutionalising such a right would embody transformative constitutionalism. It is argued that the Constitution should be the starting point in the quest for meaningful social change. A new constitutional right would result in a principled basis for the introduction of legislative and policy measures aimed at defusing the time bomb of long-term unemployment and endemic poverty.
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    Extending coverage of the unemployment insurance-system in South Africa
    (Juta Law Publishing, 2010-02) Dupper, Ockert; Olivier, Marius; Govindjee, Avinash
    The scope of the Unemployment Insurance Act (UIA) is narrow as it continues to exclude the atypically employed (particularly independent contractors, so-called dependent contractors and those who are self-employed or informally employed), public servants, learners, and certain categories of migrant workers from its purview. Given the vulnerable position of these groups, it is arguable that South Africa should, as a matter of principle, broaden the scope of coverage to include them. While the importance of including all the currently excluded groups cannot be denied, it is acknowledged that it will not be financially feasible to include all of the groups at once. In prioritising the groups most urgently in need of inclusion, two important factors are taken into consideration. Firstly, the exclusion of certain groups may be vulnerable to constitutional challenge. The exclusion of, in particular, public servants and migrant workers fall into this category. This article proceeds from the standpoint that priority should be given to the inclusion of those currently excluded from the UIA where the exclusion raises concerns of a constitutional nature. Secondly, including some groups may possibly have no or negligible financial impact on the financial viability of the Fund, and their inclusion should therefore be supported. In this regard, the return of contributions to undocumented migrants, the inclusion of learners and the inclusion of the partially unemployed come to mind. However, this article also recognises that some of the recommendations made may have a significant impact on the solvency levels of the Fund, and that it may not be possible to accommodate all of them immediately. This relates in particular to the introduction of unemployment benefits to employees who resign to take care of children or to care for a terminally ill family member (the so-called “carer’s benefit”).
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    Redesigning the South African Unemployment Insurance Fund : selected key policy and legal perspectives
    (Juta Law Publishing, 2011-01) Olivier, Marius; Dupper, Ockert; Govindjee, Avinash
    This contribution examines selected issues from a policy and legal perspective. Against the background of the broader social security reform agenda in South Africa and the vision of a comprehensive social security system, the contribution covers five key areas, namely alignment with international standards; the need to develop synergies with the rest of the social security system and for institutional reform and alignment; addressing certain material deficiencies and inconsistencies in the UIF legislation (with reference to removing the restriction on certain contributors to benefit and redefining the range of dependants); re-aligning the current UIF benefit regime to focus on loss of employment; and improving the UIF benefit regime through the introduction of standardised measures and other reforms (with reference to the indexation of benefits, utilising a minimum wage arrangement as a basis for benefit enhancement, adjusting the contribution rate and developing a streamlined adjudication framework). It is argued that complying with relevant international standards will move South Africa closer to be in a position to ratify these instruments, in particular ILO Convention 102 of 1952 on minimum standards in social security. Ample opportunity exists to introduce streamlined approaches in among others the collection of contributions and shared benefit payment facilities and arrangements, and the harmonisation of benefits. However, particular considerations and substantive constraints define and circumscribe the extent and content of the alignment of the UIF that is currently considered. These relate in particular to the compensation function of the UIF; its role as a labour market instrument; and the need to recognise unemployment insurance as a separate risk category with a ringfenced contribution and benefit regime framework. It should also be considered to separate unemployment insurance benefits in the strict sense of the word (ie benefits accruing to a beneficiary as a result of loss of employment) from unemployment-related benefits such as sickness, maternity and adoption benefits.