Duty to disclose: What information is a trade union allowed to know?
The Labour Relations Act No. 66 of 1995 (LRA) states that employers have a duty to disclose any information, to trade union representatives, that will allow them to carry out their trade union duties and bargain effectively. Unfortunately, employers often fear this duty because they are afraid that it will allow trade union members to run wild in their organisations. Is this fear justified?
Employers, of course, are scared that if they disclose information about their business, such as confidential trade secrets or other sensitive information, it will find its way into the hands of their competitors and consequently seriously damage the business.
However, without this information disclosure, effective collective bargaining wouldn't be possible. This duty imposed by the LRA is so important that the International Labour Organisation (ILO) has highlighted it – and for good reason.
For the trade unions to negotiate for the benefit of everyone, they need to be able to access employers' plans and decisions – or at least those ones that affect the negotiations. Without access to this information – and therefore without any insight into the employer's priorities and reasoning – trade unions cannot table more palatable offers and counteroffers during negotiations.
What type of information must be disclosed to trade unions?
Usually, trade unions need to access the employer's financial information during wage negotiations or retrenchments. This information allows trade unions to establish:
- If the employer is able to increase wages, or
- If retrenchments are indeed necessary.
If the employer doesn't supply the information requested by the trade union, the body will look at any information the employer does volunteer with suspicion. The lack of trust which results ultimately damages the diplomatic nature of the negotiations. Sadly, in these circumstances it's not uncommon to see employees revert to industrial action, which ultimately serves no-one.
The uncontrolled copying, distributing and disclosure of a company's confidential information could have dire consequences for the employment relationship. The delicate balance between the employer's right to keep certain information confidential and the union's right to information relevant to effective bargaining must be carefully managed.
In Burmeister & others v Crusader Life Assurance Corporation Ltd (1993) 14 ILJ 1504 IC, Roth SM stated:
- "I do however, agree with Mr Tiedemann that in order for there to be a meaningful consultation in the present matter, the applicants should be placed in possession of at least such of the details of the respondent's financial affairs as are reasonably necessary to enable the applicants realistically to assess their own and respondent's position in relation to their retrenchment so as to make meaningful consultation."
This case makes apparent that the parties' personal interests must be weighed up against any negative effect that the information disclosure may have. Unless the employer is able to show how its risk in divulging the information outstrips the risk of the trade union being denied that information, a competent commissioner or judge may order the employer to divulge the information.
In the end, it's impossible to control the flow of information once it's been divulged. An employer must, in determining how much information to disclose, weigh the possible risk of such information becoming public knowledge against the almost certain risk of undermining the negotiations and making an enemy of the trade union.
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Peter did a Bachelor of Technology (B.Tech), Human Resources Management and Services at Technikon Witwatersrand (1994-1998) and an Advanced Diploma – Labour Law, Law at University of Johannesburg (2001-2002). He joined Labour Net in 1997 and was a consultant there until 2000, and has been a director and shareholder in Invictus Outsourcing Solutions since November 2001. Peter has gained extensive knowledge and experience over the past 17 years in dealing with various Human Resources (HR) and Industrial Relations (IR) matters, including but not limited to :
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