The government's proposed changes to labour laws, including those covering the controversial topic of labour broking, could spark a new wave of industrial action in 2011. The Congress of South African Trade Unions (COSATU) thinks the reforms are inadequate and is threatening "the mother of all battles" in a bid to ban labour broking, whereby temporary workers are hired and placed by middlemen. However, those in the labour broking industry-comprising 3,000 agencies and 500,000 workers-think the changes are draconian and could effectively wipe out the sector, damaging job creation. The labour brokers' umbrella agency, the Confederation of Associations in the Private Employment Sector, may challenge the final bill in the Constitutional Court, although a similar contest in Namibia was unsuccessful. Other critics contend that the laws are poorly drafted, with the potential to create uncertainty and long legal battles.

The proposed amendments put forward in December by the new labour minister, Mildred Oliphant, cover four pieces of legislation: the Labour Relations Act, the Basic Conditions of Employment Act, the Employment Services Act and the Employment Equity Act. The changes are complex but appear to mark a strict crackdown on labour broking, although not an outright ban. This explains COSATU's discontent, although the union federation will continue to study the implications before giving a final verdict. Some reform of labour broking legislation is probably warranted, as the current rules are vague and sometimes exploited, with workers stuck in a temporary role for years because of uncertainty about who has ultimate responsibility for their welfare. The new draft hands this role to the employing firms rather than the brokers, who will be restricted to a "placement" function only, although the distinctions between the different types of brokers and agents-and the related role of sub-contractors-are not clearcut in either the old or new laws. There is a real danger of over-regulation in a bid to appease COSATU, whereas flexibility is likely to create more jobs.

Apart from tackling labour broking, the amendments also propose to criminalise violations of certain labour laws (and impose heavy penalties), tighten rules on child labour, restrict the hiring of foreign workers, establish a new framework for sectoral collective agreements and strengthen the Commission for Conciliation, Mediation and Arbitration. Ms Oliphant has called for final public comments by February 17th, prior to the bills going before parliament. However, unless changes are made, the laws mark a move towards a more restrictive labour market, with potential risks for growth, investment and jobs.