MODULE 4: LABOUR RELATIONS POLICY AND MANAGEMENT

FINAL REPORT

1 INTRODUCTION

The Hospital Strategy Project began shortly after the long-awaited signing of the first major wage agreement between employee organisations and government for the Public Service. This agreement was concluded after a long and difficult negotiation process. As such, the early phases of the HSP coincided with a period of heightened levels of worker dissatisfaction in the Public Service, which were only beginning to be addressed in any substantial way.

During that period, provincial administrations throughout South Africa were faced with low staff morale and high levels of industrial action, and delivery of essential health services to the community was affected. In the year since then, Public Service labour relations have developed more than in any other comparable period in the history of South Africa, although this growth is mainly due to the extremely low base from which labour relations have historically developed.

Many more changes are still required before the twin objectives of meeting the service needs of the community, and ensuring justice for hospital workers are achieved. It is also important to note that even those major changes which have occurred have been limited to the policy level, and have yet to be matched by similar advancements at the implementation and management level. In addition, policy changes have far outpaced changes in the attitudes of the key stakeholders. As a result of these trends, efforts to improve labour relations will remain a priority for at least the next decade.

Against this general background, this report covers:

· the theory and background to public service labour relations in South Africa;· factors that cause labour instability in public hospitals;· a discussion of the changes that have occurred over the past year, and their impact

on labour relations problems;· recommendations to address several of the major problems.

This report should be read in conjunction with the Policy Document on the Decentralisation of Hospital Management, in Volume 2 of the Final Report of the Hospital Strategy Project, which also deals extensively with labour relations.

2 PROCESS ISSUES

The work of this module began with a detailed situation analysis, which was conducted in 7 provinces (Mpumalanga and North-West Provinces were not covered, due to logistical constraints). A number of key officials were consulted in each of the provinces, including the labour relations or human resource managers at provincial level (where such positions existed), officials in the Provincial Service Commissions,

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and hospital managers and worker representatives. In addition, most of the major employee organisations in the health sector were also consulted. Subsequent to the completion of the situation analysis, two large national workshops were held, one with representatives of employee organisations, and the other with managers from provincial health administrations and hospitals. These provided the opportunity for the module team to present the findings of the situation analysis, as well as to make some initial recommendations on strategies to address the key problems identified in the situation analysis. The comments and input received at these two workshops were incorporated into the final report on the situation analysis, and into the process of strategy development. Once completed, the situation analysis was presented to the Hospital Coordinating Committee, as well as to a number of workshops with senior management of various provincial health administrations.

Subsequent to this, the module team undertook the following specific activities:

· Participation in the development of the proposals on decentralisation of hospital management;

· Liaison with Department of Public Service and Administration on the process of reforming the regulatory frameworks for labour relations in the public service;

· Interfacing between the Department of Public Service and Administration and the Department of Health on key developments in the bargaining process, and in labour relations policy more generally;

· Liaison with, and assistance to individual provinces in dealing with specific labour relations problems;

· Development of a presentation and training materials on the new Labour Relations Act and its implications for health sector managers and workers

· Presentations made to workshops in 6 provinces, including representatives of hospital and provincial management, as well as employee representatives.

· Development of final recommendations, in consultation with key stakeholders.

3 PUBLIC SERVICE LABOUR RELATIONS

A major weaknesses identified by workers, employee organisations and management in the public hospital system is the inadequate understanding of basic labour relations principles and processes, particularly amongst management. Most managers have been trained to function within a highly regulated and centralised system of public administration, and have not been able to keep sufficiently abreast of the rapid changes that have occurred in labour relations since the 1980’s, or of the intense changes that have occurred within the public service during the last few years. Through discussions with hospital managers over the past few months, it has emerged that their main problems are attributable mainly to the lack of a clear conceptual understanding of labour relations, hampered by the absence of a clear labour relations policy for the public service. This affects problem analysis, which in turn constrains the development of appropriate short and long-term strategies.

There is also evidence that there are some managers (at institutional, provincial, or at national level) who have not fully embraced the paradigm shift that has occurred in public service labour relations, and are thus hampering the development of effective employer-employee relationships. However, in defense of many managers

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(particularly at the institutional level), the relative infancy of ‘labour relations’ in the public service, and the current poor levels of public management are more crucial factors than their own attitudes in most cases. In this context, a number of broader issues need to be considered to fully appreciate the recommendations made by the Labour Relations module during the course of this project, and which are summarised in this report. These issues are dealt with in the following paragraphs.

3.1 Conflict as the basis of strategy development

Labour relations is the process of determining the rules that govern work, the worker, and the workplace that enable the effective functioning of the health system. The two key concerns of labour relations are therefore the methods and processes for determining these rules, and once appropriate rules are agreed, the implementation of these rules.

In determining these rules, the primary interests of workers and managers differ. Workers attempt to secure rules that accrue the greatest benefit to them. Managers on the other hand, attempt to develop rules that enable them to best manage the delivery of services to the community. This does not imply that workers are not concerned about the delivery of services, nor that managers are not concerned about working conditions, but rather that the primary interests of these two groups are different, and that the relationship between them is therefore inherently conflictual.

Acknowledgment and understanding of this conflict is crucial to the development of effective policies and strategies on labour relations. Policies must be geared towards creating appropriate mechanisms to manage this conflict, and realistic and creative measures are required that will harness these conflicting interests to ensure the provision of efficient and quality services, while ensuring justice on the shopfloor. Wishing away the conflict will result in the development of measures that are seriously flawed, as evidenced by the current Public Service Labour Relations Act.

3.2 Labour relations as a product of management and governance structures and systems

During the course of the situation analysis conducted by this module, employee organisations identified the management and governance of public hospitals as a major factor that determines the current poor state of labour relations within the hospital system. Deficient and weak governance and management structures encourage corruption, non-delivery of services, and low productivity. In addition, these factors have a major impact on staff morale and worker commitment to service delivery.

It is also essential for managers at all levels to realise the extent to which health sector policy and associated administrative measures impact, directly or indirectly, on workers and their employment conditions. A key example is to be found in the policy of extending free primary health care services to pregnant women and children. While some efforts were clearly made to communicate these policy changes to health workers, there is evidence that the full impact of these policies on the workload,

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deployment and morale of health workers was not assessed throughout the country, nor was it adequately communicated. This had negative effects on workers’ morale and support for the policy. It is therefore clear that the support of workers for any major policy shifts is crucial for successful implementation and service delivery.

Labour relations therefore extend beyond bargaining matters (which are conflictual) to issues of policy and management (which may or may not be conflictual). To balance workers’ needs with those of the institution will thus require management and governance models that allow for the effective participation of workers and the community in the running of institutions. Two key challenges arise from these observations: the first is to determine the appropriate institutional forms (hospital boards, workplace forums, joint management teams, etc.) to give effect to workers and community participation (see “Policy Document on Decentralisation of Hospital Management, Vol. 2. Final Report of the Hospital Strategy Project); the second is to identify, train and deploy hospital managers with the legitimacy, commitment and skills to effectively drive such a transformation programme.

3.3 Labour relations need to be managed

One of the critical weaknesses in the handling of labour relations by hospital and provincial managers is their tendency to see labour relations as an highly regulated and legislated area, which is beyond normal management competence and understanding. As a result, labour relations are addressed from a highly procedural, legalistic perspective, rather than being seen as an essential component of human resource management within the hospital setting. Understanding and managing effective labour relations processes is central to the functioning of any organisation. Every institution head, and to lesser degrees, all managers and front-line supervisors must therefore take responsibility for ensuring effective labour relations. Consequent on this, institutions must have dedicated labour relations capacity, either on a full-time or part-time basis, and provincial health administrations (PHA) should establish specialised labour relations units to provide advice and assistance to line managers, with the ultimate aim of building capacity amongst line managers.

Basic competence in labour relations should therefore be regarded as an essential prerequisite for any senior management position; and such competence should go beyond understanding the legal prescripts. Management of labour relations includes compliance with the procedures established in law, but more importantly, it requires a management approach to resolving labour problems, the answers to which are not stipulated in law.

3.4 Hospitals as an integral part of the public service

The White Paper on the Transformation of the Public Service and proposals on decentralisation of hospital management, firmly locate provincial hospitals within the context of developments in the broader public service. It is thus vital to understand the major impact of these new developments on labour relations. The conditions of service of health workers will largely be a product of a central bargaining process for the public service. At the central level, the employer side is led by the Department for

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Public Services and Administration. As such, processes outside of the direct control of national or provincial departments of health play a crucial role in the state of labour relations within individual hospitals. Thus, it is crucial for the health departments to interface effectively with the bargaining process, and in so doing, to clearly understand the difference between responsibility for decisions, which will be located outside of the health function in many cases, and influence over those decisions, which should be in the power of the health function.

3.5 Labour relations and human resource management

Human resource management is an active process of developing workers and ensuring their effective deployment within an organisation. Perhaps the major weakness in the management of the current public service is the lack of effective human resource management. Personnel practitioners mechanistically administer a highly regulated centrally defined system, seen for example in the grading process in which a complex system of Personnel Administration Standards (PAS) is used to place workers on an appropriate grade or salary notch, often unrelated to their real role or contribution in the workplace. The system also fails to promote career-pathing. Even with the limited opportunities provided by the current system, managers do not actively promote human resource development, for example, by promoting career development and training and development, particularly for lower-graded workers.

Hospitals also lack the systems and their managers the skills or will to effectively promote human resource management at institutional level. This has and continues to be a major source of worker dissatisfaction and industrial unrest. As noted above, labour relations management is intricately linked to human resource management, and the severe deficits in human resource management create major obstacles to effective labour relations management within the hospital system.

3.6 Summary of problems impacting on labour relations in the public hospital system

As has been briefly reviewed in the previous paragraphs, an extensive range of factors currently contributes to the strained relations between management and workers in the public hospital system. These are categorised and summarised in Table 1, which shows the main categories of problems, the causes contributing to them, the impact of these problems, and some strategies designed to address them. Further discussion is also contained in the other documents included in this Volume, and in the Policy Document on Decentralisation of Hospital Management, in Volume 2 of this Report. In addition to the detailed problem classification and analysis provided in Table 1, a few further issues deserve comment:

· Current issues of concern in labour relations include the traditional ‘content’ issues (low wages, promotion requirements, training opportunities, understaffing) as well as a number of ‘process’ issues (bargaining process unable to effectively resolve a historical backlog of grievances, lack of effective dispute resolution procedures, lack of implementation, no worker participation in management decision-making etc). Because of historical backlogs and raised expectations, the content issues

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currently overshadow the process issues, and this reinforces a sense that the grievances of workers are not being effectively solved, particularly amongst unorganised workers or workers that belong to weak unions.

· The roots of many of the problems are deep-seated and require fundamental changes to public service management. The regulatory framework, particularly the Public Service Act and Regulations, the Public Service Staff Code, and the occupational differentiation system for job grading, are not amenable to piecemeal reform, and need to be completely scrapped in favour of a more modern frameworks. Such an approach offers long-term benefits but takes time to develop. Although these issues are beyond the direct control of national and provincial departments of health, they are not beyond the influence of these departments, which should aggressively seek to influence these transformation processes.

· While many of the problems described are due to weaknesses at the policy level and in the associated regulatory frameworks, significant progress can nevertheless be made by addressing weaknesses at the level of practice. For example, significant goodwill could be achieved by addressing such problems as public service workers not being paid on time, formal agreements not being properly implemented, and trade unions not being allowed to operate effectively.

· The strained labour relations environment is a complex matrix of interlinking and mutually reinforcing causes, with solutions required on a wide variety of fronts. In many areas, significant advances are already being made, but there is a failure to communicate these adequately. As a result, workers and management are out of touch with current policy processes, and continue to feel the frustrations of the past.

· Some of the difficulties confronting hospital and provincial management are rooted in problems that South Africa faces as a nation, for example, the difficulties in closing the wage gap, poor worker-management communication, and the lack of skilled managers. There are also several labour relations issues that are confronting public services worldwide, and which have not been fully or effectively resolved by any country. Specific examples here include the rights of supervisors, and the extent of collective bargaining that is appropriate within the public service. In this context, South Africa can be seen to be pioneering some developments in public service labour relations, and transitional difficulties are therefore not surprising.

· Finally, many of the problems described here are a direct result of the period of transition, particularly those emerging from the ‘right-sizing’ and public service rationalisation process. These essential initiatives have generated real and legitimate fears in relation to job security, aggravating an already problematic labour relations environment. This has been further exacerbated by the extreme centralisation of personnel management functions to the PSC in the transition period, a process that is currently being addressed in some provinces and at national level.

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Table 1: Summary of critical labour relations problems in the public hospital system

Problem Major Causes Impact Compounding Factors Strategies

Hospital Management isolated from the bargaining process

1. Nature of the public service, PSC is the central personnel agency

2. Traditional communication, i.e. memo's and circulars

3. Managers are only provided with formal agreements and may not fully understand the underlying principles of agreements

1. Institutional management feel like 'unequal partners' to unions who have better communication structures

2. Ineffective management and implementation of agreements

3. Low level of commitment to change

1. Rapid pace of fundamental change which institutional managers are unable to cope with

2. Lack of management capacity at the provincial and institutional levels

3. Lack of dispute resolution systems

1. Cooperative governance approach to bargaining

2. Use the current wage agreement to strengthen communication and implementation

3. Fundamental nature of changes require additional resources

No effective participation by workers in policy-making processes

1. Culture of adversarialism between workers and management

2. Managers’ resistance to unions and change

3. Lack of management and union capacity to engage in co-determination

4. Unorganised workers

1. Reduced service delivery (ineffective implementation of policies)

2. Delays in implementation of agreements and overall health policies

3. Labour unrest

4. Lack of support by workers for positive developments

1. Significant levels of unorganised workers

2. Lack of skilled personnel to drive the co-determination agenda

3. Management resistance to the creation of structures and processes of co-determination

1. Ensuring that the National Health Consultative Forum operates more effectively

2. Development of similar forums at provincial and hospital level (may require assistance by a third-party facilitator)

3. Development of union and management capacity

Lack of trust and respect between workers and management at the institutional level

1. Culture of adversarialism between management and workers

2. Lack of a common vision of the role, responsibilities, and powers of the different parties

1. Breakdown in the management of institutions

2. Reduced service delivery

3. Further deterioration of the relationship between workers and management

1. Under-management of critical human resources and labour relations processes

2. Development of power-bases by unions, groups of workers, or management

3. Inter-union rivalry

1. Relationship-building exercises (through third-party facilitation)

2. Joint workshops (preferably with an outside facilitator) to develop a common vision around roles and responsibilities

3. Development of clear and transparent rules

Problem Major Causes Impact Compounding Factors Strategies

Serious grievances of workers not effectively addressed

1. Major weaknesses in the process of collective bargaining, especially at the central level

2. Limited participation of institutional management in the collective bargaining process

3. Weaknesses in dispute resolution procedures

1. Loss of credibility in the collective bargaining process

2. Continued labour dissatisfaction and consequent industrial unrest

1. Ineffective communication of the bargaining process to institutional management

2. Backlog and long list of collective grievances

3. Unorganised workers

4. Poor understanding of dispute resolution processes

5. Nature of bargaining

1. Cooperative governance approach to bargaining

2. Improvement of the bargaining process

3. Implement dispute resolution provisions of the new Labour Relations Act

Major inefficiencies in the implementation of personnel policies

1. Management incapacity at the institutional level

2. No back-up or assistance to institutional management during implementation

3. Lack of dispute resolution mechanisms

1. Worker dissatisfaction

2. Weakening of the collective bargaining process

3. Loss of faith in management

1. Weaknesses in national and provincial systems

2. Lack of coordination between different processes

1. Greater interprovincial and intraprovincial cooperation

Weaknesses in employer-employee relationships

1. Major weaknesses in the Public Service Labour Relations Act, the Public Service Act and regulations, and the Staff Code.

2. Lack of management and union capacity

1. Slows down progress (despite good intentions)

2. Greater pressure on all levels of management to address difficult issues

1. Difficult and complex process of changing the regulatory framework

2. Participation of national and provincial departments of health in changing the regulatory framework

1. Improved participation by health in processes established by the Department of Public Services and Administration

2. Implementation of improved macro-management proposals (decentralisation proposals)

3. Relationship-building between managers and worker

Lack of management capacity 1. Overcentralisation and a rule-driven bureaucracy do not facilitate management development

2. Unclear role for labour

1. Undermanagement of institutions

2. Reduced service delivery

1. Competency of personnel in labour relations unit

2. Lack of support from Province and National levels

1. Training and Development of Management

2. Implementation of proposals on decentralisation of hospital

Problem Major Causes Impact Compounding Factors Strategies

relations units (an added-on function)

3. Management not able or not willing to accept responsibility for labour relations issues

3. Lack of exposure to best practices and strategies developed by other managers

4. Lack of a labour relations policy framework

management

Lack of an overall labour relations policy framework

1. Lengthy process of developing the new Labour Relations Act and its implementation in the public service

2. Paucity of research, information and knowledge of effective labour relations in the public service

1. Ineffective guidance to institutional management

2. Management resistance to union participation

1. Structures in transition because of the rationalisation process

2. Labour unrest

1. Information and training sessions on the new LRA (for all relevant groups)

2. Development of a labour relations policy

3. Establish effective procedures for investigating violations to the provisions of the policy

Evidence of resistance to unionisation and progressive labour relations practices

1. Attitudes

2. Lack of training and information

3. Limited capacity of the Provincial Administration to effectively monitor individual hospitals and to rectify any problems

1. Development of adversarial relationships between employee organisations and management

1. Lack of an overall labour relations policy

1. Provincial Administration to investigate complaints and grievances, and to ensure proper report-backs

4 A YEAR OF CHANGES

In the year since the Hospital Strategy Project was initiated, a number of developments have changed labour relations significantly, and several of these provide the frameworks and basis for addressing some of the problems summarised in the previous section.

4.1 The new Labour Relations Act

The new law replaces the Public Service Labour Relations Act which previously governed public hospitals. Current labour relations legislation suffers from serious deficiencies (these are discussed in detail in an explanatory memorandum on the draft negotiating document on the new Labour Relations Act, in this Volume). The new law represents a complete overhaul of the current labour relations framework, and was a product of intense negotiations between government, organised labour, and organised business at NEDLAC. It attempts to address fundamental problems currently encountered by both workers and managers.

The new law will be introduced by August 1996, and should play a significant role in resolving future labour disputes. Four issues that were the source of major problems for stakeholders in public hospitals have now been addressed. These are:

· The introduction of better dispute resolution procedures;· Methods for dealing with strikes and disputes in essential services;· Improved bargaining structures and processes for the public service;· The introduction of co-determination structures.

If used effectively, the new LRA should play a major role in facilitating labour peace and improving service delivery. However, its effectiveness will depend largely on a thorough understanding of the law, and particularly of the underlying principles of the various provisions, by both management and workers.

4.2 The White Paper of the Transformation of the Public Service

A long awaited White Paper on the transformation of the public service was finally released in October 1995. The White Paper introduced certainty about government’s transformation agenda, particularly around some key labour relations provisions. These include:· Provisions on improved wages;· Human resource development;· Worker participation in the management of the public service and public service

institutions;· Decentralisation of institutional management, and a complete overhaul of the

existing regulatory framework.

4.3 A significant public service wage agreement

The recently negotiated wage agreement does not simply improve salaries for substantial numbers of public service workers in multiple occupations, but also introduces a new system of grading and of organising work, which should enhance effective bargaining in the future. In addition, the system will facilitate productivity gains by encouraging training and development, since the grading system is more effectively linked to skills development. Furthermore, the agreement covers wage increases for a 3-year period. This provides provincial departments of health with a sufficiently long period of certainty, and a window of opportunity to address other major weaknesses, particularly around the implementation of agreements and of human resource management. Finally, the agreement make provision for rightsizing.

Despite these gains, improper understanding of the process, and/or deficiencies in implementation will reverse the positive advances that have been made on other fronts. The process must be undertaken with the full participation of employee organisations, and should assist in the redeployment of public service personnel for service delivery.

The approach to implementation of the agreement will therefore be crucial. In the short-term, say over the next two months, the provincial departments of health will need to ensure that workers’ current grades are translated to the appropriate notch. In the medium-term, the emphasis should be on training and development. Provincial departments of health need to play a number of key roles in this implementation, including monitoring the implementation of the agreement, publicising progress, providing specialist support to hospitals, and resolving any disputes that may arise.

4.4 Decentralised Hospital Management

The Hospital Strategy Project, on behalf of the Department of Health, has developed detailed proposals on the decentralisation of hospital management, which are presented in Volume 2 of the Final Report of the Hospital Strategy Project. A number of important labour relations proposals have been incorporated into this broad policy proposal. In general, the proposals should have significantly positive effects on hospital management, and by implication, on labour relations in the hospital setting. However, at present neither workers nor management adequately understand the proposed model and its impact on labour relations. This creates a risk that the decentralisation proposals will be resisted, and even more importantly, that even successful decentralisatoin of management may not fulfill its potential in terms of improved labour relations and labour productivity. Further consultation with employee organisations, and with managers at institutional and provincial levels therefore remain a priority in order to ensure effective implementation of these proposals. Once the policy has been communicated to worker organisations and province level management, it will be essential for these two stakeholder groups to develop strategies for communicating this policy to their constituents at hospital level.

4.5 Improved Bargaining

As noted above, limitations in the central bargaining process have in the past seriously hampered the conclusion of effective agreements between employee organisations and the state. Some progress has recently been made in improving the situation, through better chairing of meetings, and through the use of tasks teams to feed into the bargaining process. The new LRA provides for a Public Service Coordinating Bargaining Council (PSCBC), which is not simply the existing central chamber in a new form, but is a structure with greater responsibilities and powers. For example, the PSCBC can play a role in the mediation and arbitration of disputes emerging from the implementation of an agreement at the institutional level. A constitution for the PSCBC is being finalised, and function departments and provinces have been requested to provide comments. At the time of writing of this report, it appears as if neither the provincial nor the national departments of health have responded to this request.

The bargaining process has also improved with respect to employer participation, and the department of health and provincial administrations are now directly represented at the bargaining process. This has assisted in addressing issues of concern from provinces, as well as in facilitating communication of outcomes and progress to provinces. However, it has emerged that provincial health representatives are not adequately integrated into structures of provincial administrations. This hampers the collation of issues of concern and reporting back on progress and development. Furthermore, in most provinces, there is currently no formal mechanism or channel through which developments on the bargaining front can be effectively communicated to individual hospital management.

4.6 Intergovernmental co-operation

One of the initial recommendations made by the Hospital Strategy Project was the establishment of an intergovernmental forum, which could bring provincial health administrations together to deal with labour relations issues of common interest. The Department of Health recently facilitated the establishment of such a forum in the form of the Health Care Personnel Matters Forum , an interprovincial forum focussing on the full range of issues related to human resources development. The direct link between this forum and the Provincial Health Restructuring Committee (PHRC) is significant. Further recommendations on intergovernmental co-operation are made at the end of the Report.

4.7 Changes in government organisation

Finally, the establishment of a Department for Public Services and Administration can be considered a major advance. This Department will be responsible for all executive functions in relation to human resource policies, conditions of service, and labour relations. As a result, the role of the PSC has been restricted to the functions of monitoring and evaluation.

The Department for Public Service and Administration has publicly committed itself (through the White Paper and other policy documents) to a new way of working. It is committed to greater intergovernmental co-operation, as well as to creating a more flexible environment for human resource management. These commitments will be formalised in changes to the legislation, including the Public Service Act.

In addition, constitutional accountability institutions such as the Office of the Public Protector have also been established. Unions and management should be encouraged to use these structures to facilitate the investigation of managers accused of abuse and corruption.

Despite these important areas of progress, there has been more limited progress on a number of other areas, such as improving personnel management at institutional level;worker/ union participation in policy matters, and the establishment of a public service transformation forum and transformation units. These issues now require urgent attention by provincial departments of health and the Department for Public Services and Administration. It is also vital to note that most of the positive changes outlined here have been very poorly communicated to hospital management and workers. Communication of the changes in this dynamic labour relations environment to relevant stakeholders at all levels must therefore also be regarded as an urgent priority.

5 THE WAY FORWARD AND KEY RECOMMENDATIONS

Provinces currently differ significantly in their capacity to deal effectively with labour relations issues and with human resource development more generally. The provinces that inherited former homelands or self-governing territories are in general weaker than those which did not, mainly due to the denial of trade union rights in these territories during the apartheid years, as well to as the lack of suitably trained personnel within these provinces. It should therefore be noted that some of the recommendations made here should be tailored to the needs of individual provinces. As a general principle, however, the Department of Health should see it as a responsibility that all provinces ultimately have similar capacity to deal with these issues.

5.1 Implementing cooperative governance

The method of determining wages and working conditions is a key labour relations policy issue, and labour relations legislation regulates the nature and form of that determination. The new LRA unashamedly promotes collective bargaining for both the private and public sectors. Within this framework, the parties are required, through the exercise of power, to determine their own arrangements.

The limited texts on public service labour relations identify management organisation in the collective bargaining process as an additional key policy issue. Over the last year, management organisation has improved, with developments based on the experiences of the 1994/ 95 bargaining round, but occurring outside of a clear policy

framework. Improvements were made in two phases. The first wave strengthened the mandating powers of key ministers, including the Minister of Health, through the establishment of a Forum of Mandating Ministers. The second wave facilitated the involvement of provinces and departments in the bargaining process.

These trends mirror developments on the constitutional front. The new constitution is modeled around cooperative governance. Cooperative governance gives individual units (provinces, hospitals, etc.) more collective power over a central process. This is unlike autonomy which attempts to devolve power to individual units. A model of cooperative governance underlies proposals on the decentralisation of hospital management.

Health (as an industry) and the public service as a whole needs to embrace cooperative governance for bargaining purposes. Therefore, the third wave of reform must be geared towards the greater involvement of hospital management in the bargaining process, which will clearly be the most difficult, but perhaps the most important part of the process.

Collective bargaining using a cooperative governance framework comes with costs and benefits. There are three major benefits for institutional level managers:

· Institutional management would be able to shape policies, frameworks, and agreements that are consistent with managing at the institutional level;

· Institutional managers will be sufficiently empowered to conclude further agreements, and to develop additional measures within the central framework. For example, managers will be able to define a specific mix of skills that will be required to be on a certain grade;

· Finally, this process will give institutional managers the ability to implement agreements properly, including dealing effectively with atypical situations. This will also reduce the need for the central authorities to develop extensive and confusing implementation manuals.

The costs of achieving these benefits are mainly financial. Bringing the management of institutions together to participate in this process will be time consuming and expensive. Furthermore, there may be a need to employ additional personnel at a senior level to drive the process. These costs are however regarded as fully justified, given the benefits which will be derived from increased participation of institution level managers in the bargaining process.

The process of establishing the structures and mechanisms of cooperative governance is as important as the actual systems that are established. The commitment of the provincial administration to cooperative governance must be effectively communicated to hospital management. This commitment must continuously be reinforced during the process. Effective participation of hospital management in developing the modalities of cooperative governance will strengthen the design of the system. These developments must be linked to the process of decentralising management to hospital level.

5.2 Strengthening the interprovincial forum on health care personnel matters

As noted several times in this report, provinces differ significantly in their capacity to deal with labour relations, with some provinces lacking basic procedures and systems, as well as the capacity to develop these, while others have developed detailed and effective procedures and systems, including, for example, training materials, communication systems, strike handling systems, etc. A number of common tasks need to be performed by each province, for example, the development of accredited training on Adult Basic Education and Training (ABET) for general assistants in hospitals. Interprovincial cooperation on these various issues could therefore assist weak provinces, and could also ensure economies of scale in tasks that transcend provincial boundaries.

An interprovincial forum, the Health Care Personnel Matters Forum, has been established, and could play a substantial role in ensuring interprovincial cooperation on these issues. In order to ensure this, however, its aims need to more clearly defined and its mandate broadened. Some additional aims for the forum should include:

· To share information on strategies and programmes, and their successes and failures

· To identify common policy matters that require attention, and to facilitate a process of lobbying the relevant bodies to ensure adequate influence. For example, this Forum could be used to influence the Public Service bargaining process, as well as various policy decisions of the Department for Public Services and Administration);

· To facilitate the participation of the health departments in processes initiated by the Department for Public Services and Administration, and to assist in shaping the priorities of that department;

· To influence the training of health workers by interacting with universities and other training institutions.

To ensure the success of such a forum, the following measures will be required:

· Systems and structures need to be established to ensure effective linkages between provincial representatives, senior provincial management and hospital managers;

· A detailed programme of action should be developed for the Forum;· The forum should be given adequate logistical and technical capacity, and

consideration should be given to providing it with a full-time secretariat, as well as with outside technical assistance;

· The interprovincial forum should have research capacity (in-house capacity as well as a budget to commission research). This will assist in the development of codes of good practice, the development of new strategies and the evaluation of existing strategies. Some immediate research possibilities might include:

- Report on the intervention of IMSSA into four hospitals in Gauteng;- Successes and failures of joint management forums (which most provinces have experimented with) and the development of workplace forums.- Evaluation of strategies adopted to address grievances in state welfare institutions in the Western Cape.

5.3 Co-determination and the National Health Consultative Forum

The need for the National Health Consultative Forum (NHCF) was confirmed after the widespread nurses strike in late 1995. Aside from an initial meeting held on 3 November 1995, the forum only met once thereafter, on 13 June 1996, to discuss proposals on the decentralisation of hospital management. This plenary was neither well-organised nor well-attended. Such a forum still remains crucial and it would be useful to evaluate its performance and to put in place strategies to improve its functioning.

Some of the factors that may be hampering its effective functioning include:· lack of identified individuals, within the Department of Health, to take

responsibility for the NHCF;· lack of clear, agreed terms of reference;· lack of advance planning, including an agreed schedule of dates when the Forum

will meet;· lack of a clear, agreed and mandated agenda.

All of these issues should be addressed as a matter of some urgency, in order to ensure that the (NHCF) begins to fulfill its proper role.

The implementation of decentralisation proposals and the rightsizing process will also require the establishment of Provincial Health Consultative Forums, and provinces should begin with the establishment of these fora as soon as is feasible.

At the workplace level, proposals around workplace forums are still being finalised by the Department for Public Services and Administration. Provinces need to be actively involve in the development and implementation of these proposals.

5.4 Development of a communications strategy

Lack of effective communication with workers, managers and the community is a universal weakness in all provinces. In some provinces, a formal communications strategy is non-existent. With the rapid pace of change that is currently being witnessed, communication becomes increasingly crucial, and a failure to communicate undermines all the potential impacts of these policy changes. It is therefore recommended that provinces develop a formal communications strategy, including norms and standards governing expectations of communication between different levels. For example, such a strategy should set guidelines for the speed at which particular decisions or information should be communicated to individual hospitals, and should also specify the type of information, the appropriate level of detail etc. Provinces may also need to negotiate similar standards with the Department for Public Services and Administration. Such standards will help to monitor communication, facilitate accountability as well as to identify problem areas.

In summary, an effective communications strategy will:· Facilitate better understanding of the current labour relations environment by

public service workers;

· Alert workers to potential problems, such as delays in implementation, and thus avoid unnecessary conflict;

· Sensitise the community to these changes, facilitating a better understanding of the difficulties faced by workers and management alike;

· Facilitate a cooperative governance approach to collective bargaining.

5.5 Decentralisation of hospital management

Proposals around the decentralisation of hospital management can play a significant role in improving labour relations by ensuring effective human resource development, and the speedy resolution of disputes that can be addressed at the institutional level. The decentralisation proposals deal extensively with the labour relations implications, and these still need to be discussed extensively with unions, either collectively or individually.

As this policy shifts to implementation, a number of issues will become important:

· The proposals introduce a single source of managerial authority within hospitals, i.e. the Chief Executive Officer (CEO). The need for personnel management and labour relations skills will be crucial in the choice of candidate. Furthermore, the CEO would need to display progressive attitudes towards labour relations so as to secure the support of employee organisations.

· The role of a Labour Relations officer at institutional, departmental, or provincial level as outlined in Chapter L of the staff code is an advisory one. In practice, because of lack of capacity on the part of the hospital manager, labour relations officers are asked to exercise authority that they do not have while hospital managers are asked to exercise skills which they do not have. The role of labour relations units should remain similar to that proposed in Chapter L, with a proper balance between advisory roles and authority being established.

5.6 Developing an appropriate policy environment

Chapter L of the Public Service Staff Code currently provides a framework for labour relations policy for the public service. The policy aims at creating a climate of labour peace on the basis of reconciling the needs (objectives) of the institution and the needs (objectives) of its staff members. This policy statement fall short of the ideal approach suggested in the situation analysis carried out by the Hospital Strategy Project in two main respects. Firstly, the situation analysis defined needs in more explicit terms (i.e. efficient and effective service delivery and justice on the shopfloor) than does the current policy statement; and secondly, the Hospital Strategy Project approach acknowledges that there is a conflict between these objectives, and that effective strategies are required to manage the conflict. It does not wish away the conflict and contradictions between the needs of workers, management, and the community.

The above approach forms the basis of the new LRA. Therefore, current policy positions in the public service needs to be revised in line with these changes. Once

again, the process of developing such a policy is as important as the actual policy, and in this case, the effective participation of hospital managers is especially crucial.

5.7 Development of a common vision

The situation analysis and subsequent work on labour relations by the Hospital Strategy Project revealed the lack of a common vision between workers and management on crucial issues such as the role and rights of employee organisations, workplace democratisation, and the powers and responsibilities of institutional management. These issues were intensively discussed during the finalisation of the new Labour Relations Act. Public and private debate shifted thinking by workers and management on the type of labour relations policy required for South Africa.

Although workers communicated their feelings on the new Act through employee organisations and union structures, no equivalent process was in place for hospital managers. This denied hospital managers a valuable opportunity to develop their own understanding of the new law, as well as of the principles underlying specific provisions. In addition, extensive, constructive interaction and discussion between workers and management at institutional level on these issues might well have assisted in the development of a common vision between these two crucial stakeholder groups.

However, the opportunity should not yet be regarded as lost. Joint workshops between hospital managers and senior employee representatives on the new LRA would assist in developing a common approach to key labour relations issues such as trade union rights and responsibilities, management prerogatives, and co-determination. In general, there is support from unions and hospital mangers for the approach of joint workshops, and provincial health administrations should begin to organise workshops of this kind as an urgent priority.

However, in cases where the relationship between employee organisations and management is not working well, third party facilitation and mediation may also be necessary. One difficulty in this context concerns the position of unorganised workers, or workers organised into small crisis committees that operate outside of formal processes. These issues will need to be addressed on an ad-hoc basis, but should not be seen as obstacles to the instigation of a more structured process of communication and development of joint vision between workers and management.

Many provinces have in principle agreed to institute such relationship-building exercises. However, nothing substantive has happened thus far, mainly because of the lack of capacity at provincial level, and particularly due to the shortage of skilled facilitators that are employed within provinces. This can be addressed in a number of ways: outside assistance could be used, and/or the interprovincial forum could establish a task team to assist provinces that have a capacity problem. Finally, a ‘train the trainer’ approach could be developed, in which one or two people from each of the provinces are trained to repeat the workshops for different health regions within the province.

5.8 Influencing processes and policies of the Department for Public Services and Administration

Earlier this year, the Public Service Act and the Public Service Commission Act was amended to give the Minister for Public Services and Administration executive and policy making powers, and to create an independent Public Service Commission. The functions of the Public Service Commission shall be to advise departments, monitor the action of departments to ensure the proper implementation of policy, and conduct necessary research for public sector development.

All policy matters relating to human resource practices, conditions of service, labour relations, organisational development and information technology will be placed within the ambit of the Minister for the Public Service and Administration and a department for Public Services and Administration. All executive powers relating to career paths of public servants, organisational structures and the post establishments of departments will be exercised by the various Ministers and their departments. There is also a general trend towards cooperative governance, as outlined above. Furthermore, the Department for Public Services and Administration has indicated it’s commitment to co-operating with stakeholders, within and outside of government, in the formulation of policies.

The Department is currently involved in a number of major projects that would significantly alter the course of labour relations in the public service. These include job evaluation, drafting of a new Public Service Act, as well as redrafting the Public Staff Code. These projects are of a medium-term nature, and they provide the departments of health with an opportunity to influence the nature of public service personnel policies.

It is recommended that all such opportunities to influence these vital processes to taken, and that the interprovincial forum discussed above play the major role in coordinating any interventions from the Department of Health.

5.9 Addressing obstacles to effective human resource management

The poor state of personnel and human resource management in the public hospital system has been fully described in this report and elsewhere in this Volume, as have some of the policy measures now in place to address these issues. In some cases, unions have pointed to a deliberate attempt by hospital managers not to implement existing or new legislation properly. Evidence provided by new managers that have taken over the running of hospitals, as well as work conducted by IMSSA in hospitals in Gauteng show that in some instances this is true. These problems need to be investigated and addressed. This could be done through internal processes, but it may be best to appoint a separate commission of inquiry or to use accountability structures created by the constitution, e.g. the office of the public protector. Investigation must be accompanied by regular reports and transparency in the process.

5.10 Dispute Resolution

A careful examination of the statutory structure of dispute resolution reveals that the procedure in the PSLRA are complex, technical and time consuming. Alternative dispute resolution procedures such as mediation and arbitration have a higher rate of success. These dispute resolution procedures have formed the basis of the new LRA. The effectiveness of these processes have been shown to work within the public service in a variety of ways, including high-profile work conducted by IMSSA in Gauteng hospitals.

However, the nature of these processes and their use in resolving disputes is poorly understood at institutional and provincial level. The lack of understanding combined with the shortage of funds to employ professional mediators have hampered the widespread use of these methods in public hospitals. Mediation can be used for a variety of purposes including relationship building, development of procedures and rules governing the relationship between workers and management, and in resolving disputes.

It is recommended that provinces allocate a budget for purposes of mediation. This must be coupled with an analysis of the key flashpoints that require mediation, and with an ongoing process of identifying such flashpoints at an early stage.

5.11 Development of norms and standards

One of general strategies suggested by the Hospital Strategy Project to address issues of hospital system efficiency is the use of norms and standards and performance indicators. Such norms and standards are developed by all stakeholders, and can provide a reference point for all parties in evaluating the performance of institutions and/or the system as a whole. Performance indicators can also serve as development indicators. Unfortunately, the Hospital Strategy Project was not able to extend this work to the development of appropriate labour relations norms and standards, due to time constraints.

Over the past year, provinces have gained some experience in the development of norms and standards in various areas of their work. It is therefore recommended that provinces develop a set of key indicators, norms and standards that of relevance for labour relations. The following are some basic examples of such indicators, which would obviously need to be developed further:· time of getting agreements to institutional level; · period required to address a grievance; · response time by province and/ or national DoH in responding to a wildcat strike; · plan of action in the case of the province receiving notice of an intention to strike.

5.12 Training and development

Training and development is a critical strategy for the improvement of labour relations in the hospital system. Training and development should not be simply on labour relations, but should also focus on the skills and information required to operate in a progressive labour relations environment. Key issues to be covered should include, among others, negotiations skills, mediation and arbitration, etc.

As part of the Hospital Strategy Project, a one-day workshop on the changing environment of labour relations was run for six provincial health departments. The audience differed from province to province. The presentations revealed some significant weaknesses. Most participants do not have any previous exposure to the new law, and there is little understanding of the underlying principles of the new law. In many cases, current attitudes towards unions and workplace democratisation run contrary to the new Act. In general, hospital managers feel isolated from general developments, and are not even aware of other significant changes including the new wage agreement and decentralisation proposals.

In terms of training, it is suggested a tender should be issued for a comprehensive programme of education and training on the new Labour Relations Act and on labour relations in general. Such a tender could be issued by the province as a whole, or by provincial or national departments of health. Although it would be useful to contract a single provider, this may not be possible, and alternative models should be investigated. One workable model might be to use a number of agencies that will provide a package of training focussed on a range of different target groups. At a minimum, the programme should target:

· Management echelon Basic information focusing on the underlying principles and thrust of the new Act. Because of the target audience, this would be a shorter (half-day workshop) programme at the provincial level.

· Hospital management (e.g. superintendent, hospital secretary, senior nursing services manager, and senior personnel and labour relations practitioners)

This programme should consist of at least 3 full-day sessions. The programme should include the new Labour Relations Act, as well as practical management issues of labour relations (conflict management, negotiation, bargaining, etc.).

· Supervisors and line managersThe focus here should be on understanding the overall labour relations arena, the changing nature of public service labour relations, and new roles and responsibilities. Because of large numbers of people involved, the programme should be for a single day and may need to occur on a district by district basis.

· Joint workshop A one day workshop that brings together senior employee organisation representatives and hospital management to explore the implications of the new act and other developments on the existing relationship.

In evaluating the tender, provinces should seek contractors who show an appreciation of the public service and its difficulties, and who are acceptable to employee organisations. Material must also be evaluated on its ability to shift the thinking and attitudes of managers towards a progressive approach to labour relations.

In general, employee organisations take responsibility for the training of their members and representatives. The province should facilitate training by providing adequate time-off, facilities, etc.

6 CONCLUDING REMARKS

A number of common themes have emerged from this analysis, and have informed the recommendations set out in this report and in other sections of this Volume:

· Changes in the labour relations environment over the past two years require significant changes in attitudes and approaches of all parties. These changes are difficult and complex, and therefore require active processes involving all key parties;

· The current inability of managers and workers to interact with each other in a constructive, effective way needs to be urgently addressed;

· Individuals feel isolated and are unable to see an light at the end of the tunnel. This is made worse by the lack of information-sharing, especially around successful changes in policy and success stories at institutional level. The lack of information-sharing also impacts on creativity and innovation. Individual hospital managers armed with the experiences of others (both positive and negative) will manage more effectively.

7 USEFUL REFERENCES

In compiling this report, significant use was made of the following material. Those texts which deserve a reading by provincial managers are marked with an asterisk.

Beaumont, PB (1992), Public Sector Industrial Relations, Routledge, London

Coleman Charles J (1990), Managing Labour Relations in the Public Sector

* Douglas, David (1995), Healing our Hospitals, published in the South African Labour Bulletin, volume 19, number 5, pages 65-67, November 1995

* Ministry of Labour (1995), Explanatory memorandum on the draft negotiating document (the new Labour Relations Act)

Ministry of Public Services and Administration (1995), White Paper on the Transformation of the Public Service

* Nyembe, Lucienne (1995), Problems and challenges for the management of labour relations in the South African public service during the transition

* Rayworth, JF (1992), Collective Bargaining in the Canadian health system, Health Manpower Management, volume 18, number 2, pages 27-30

* (1995), Report of the Committee on State Welfare Institutions (Western Cape)

(1996), Progress report regarding the process to address grievances as set out in the Ministerial Committee’s report on grievances in state welfare institutions (Western Cape), compiled by Anita Olsen