Much has been said recently about the extension of bargaining council collective agreements to non-parties, particularly in industries where terms and conditions of employment are negotiated at sector level.
The debate is not new. Nor is it unreasonable. Employers are entitled to question whether existing arrangements continue to serve the interests of business, employees and the broader economy. Before drawing conclusions, however, it is important that the discussion is grounded in fact and in an understanding of why collective bargaining remains an important feature of South Africa’s labour relations framework.
The extension of bargaining council agreements is not an unintended consequence of the Labour Relations Act. It is a deliberate feature of the legislation. Section 32 sets out the circumstances under which a bargaining council may request the Minister of Employment and Labour to extend a collective agreement to non-parties falling within the registered scope of the council.
Importantly, the process is not automatic. The law requires that prescribed representivity thresholds be met by both organised business and organised labour. It also requires compliance with specific statutory requirements, including the availability of an exemption procedure for employers seeking relief from the application of an agreement.
Critics often argue that employers who did not participate directly in negotiations should not be bound by the outcomes. While this argument has intuitive appeal, it is worth noting that the issue has already been considered by the courts.
In the matter between the Free-Market Foundation and the Minister of Labour, the constitutionality of section 32 was challenged. The High Court dismissed the challenge and confirmed the legitimacy of the legislative framework governing extensions.
In doing so, the Court recognised an important practical reality. Industry-level collective bargaining depends on certainty. As the Court observed, collective bargaining “will be undermined if bargaining agents in a majoritarian setting were uncertain at the outset of negotiations about whether or not their agreements would be extended.”
This observation goes to the heart of the matter. Collective bargaining provides a structured mechanism through which representative employers’ organisations and trade unions negotiate conditions of employment for an industry. The extension mechanism gives effect to that process and ensures that agreements reached through collective bargaining have practical meaning beyond the negotiating table.
The question of representivity is particularly important because it lies at the heart of section 32 of the Labour Relations Act.
The most recent membership verification exercise conducted by the Bargaining Council in 2025 confirmed that the SEIFSA Associations remain the largest employer grouping within the Council. Collectively, the SEIFSA Associations account for 56,9% of all employees employed by employers represented on the Council. By comparison, the next largest employer organisation represents 21,5% of those employees.
The same verification exercise confirmed that the trade unions party to the Council represent 53,2% of the employees employed by employers represented on the Council.
These figures are significant because they demonstrate that collective agreements concluded within the Bargaining Council are negotiated by parties that satisfy the representivity requirements contemplated by the Labour Relations Act. The extension of agreements is therefore not based on assumption or perception, but on objectively verified levels of representation by both organised business and organised labour.
None of this suggests that the system is beyond criticism or review. Questions around representivity, economic impact, exemptions and administrative efficiency should continue to be examined. Healthy debate is essential in any mature labour relations system.
What is important, however, is that the debate remains grounded in fact. The extension of bargaining council agreements is not unconstitutional. It is a long-established feature of South Africa’s labour relations framework and one that Parliament deliberately incorporated into the Labour Relations Act to support orderly collective bargaining and labour market stability.
The real question is not whether collective agreements should be capable of extension. The real question is whether all stakeholders are doing enough to ensure that the collective bargaining system remains representative, credible and responsive to the realities facing both employers and employees.
Lucio Trentini
Executive Director | SEIFSA
