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South Africa's Labor Laws Need to Grow Faster

In South Africa, the rate of unemployment is about 25 percent. Some businesses and economists say South African labor laws are to restrictive. They say the rules are keeping the jobless rate so high. Business leaders are especially concerned about laws on hiring and firing workers. Here is one example.

Simon Arcus dismissed an employee who stabbed another worker. The fired employee took the businessman to labor court. Mr. Arcus spent $7,000 in court costs before he reached a settlement with the worker. He says he never should have had to pay those costs. He says the incident also costs him and his worker time.

Business owners like Simon Arcus believe it should be easier to dismiss workers. Now owners must give an employee a warning in person, and then two separate written warnings. Next comes a hearing where employees can defen their actions. Only after that can employees be fired. But fired workers can still appear their dismissal in labor court.

Lawyer Shamima Gaibie works with labor unions. She says workers need legal protections. She notes the case of striking mine workers in the town of Marikana. Police shot and killed 34 miners last year when a strike turned violent. Still many people say labor laws are slowing growth.

South Africa was rated next to last in hiring and firing practices in a report from the World Economic Forum. Lucy Holborn is with the South Africa Institute for Race Relations. She says the country's businesses are under pressure to help end poverty and inequality while creating jobs.

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