Expect more discussion around controversial hiring laws for South Africa

 ·11 Feb 2022
Dr Aaron Motsoaledi South African Minister of Home Affairs

One of the key issues missing from president Cyril Ramaphosa’s state of the nation address on Thursday evening (10 February) was the discussion around the hiring of foreign workers and the introduction of new quotas, says Peter Attard Montalto, head of capital markets research at Intellidex.

While analysts and insiders had indicated that the controversial regulations would be discussed in the address, the absence of these new rules does not mean they are not still under discussion, Montalto said.

“There was no mention of the xenophobic push in government for quotas on foreign workers – an issue that has concerned investors. However, the minister for Home Affairs was on the wires straight away after talking about it. There is clearly huge contestation about the issue and cabinet statements on the issue will have to be inspected closely.

“We do see more xenophobic policy shifts coming – though do not see full regulatory might passing muster and expect something softer and more rhetorical from the government which will still stir problematic sentiments in parts of the populous,” he said.

A law is currently being finalised that will cap the number of foreigners that businesses owned by locals can hire, Home Affairs Minister Aaron Motsoaledi said on Tuesday. Three other pieces of legislation dealing with immigration and refugees are also under review, he said.

“If you are a South African business person who opens a restaurant or a factory, there is no law that tells you what to do, you can bring 100% foreign nationals or 100% South Africans,” Motsoaledi said in an interview with Bloomberg. “We are saying there is an issue with unemployment and the absence of those quotas.”

The Department of Employment and Labour (DEL) has previously raised concerns around illegal recruitment practices in South Africa – including the hiring of immigrant foreign workers who are not in the country lawfully.

To address these and other issues, the department said it has developed a new National Labour Migration Policy and proposed amendments to the existing Employment Services Act.

In a statement on 25 January, the department said that these proposals will be released for a three-month public comment process before the end of February/March 2022 once Cabinet approves the department’s submission. Social partners at Nedlac will also be afforded the opportunity to adjust the Policy and the Bill during May/June before we make a submission to Parliament, it said.

About three million of South Africa’s 60 million residents are migrants, according to the national statistics agency, with many attracted by the prospect of finding work in the continent’s most-industrialized economy.

But jobs remain in short supply for the unskilled, with the unemployment rate currently standing at a record 35%, and the presence of foreigners has stoked resentment among some locals who see them as competitors for opportunities, housing and other services.

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