SASLAW SEMINAR
27 FEBRUARY 2014
Name of presenters: Paul Benjamin
Title of Presentation: Necessary protection or unnecessary rigidity?
the new rules for non-standard work
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Rise of non-standard employment
 From atypical to non-standard
 From secure to contingent – shifting risk (demutualisation)
– from full to partial or no protection (informalisation)
 Corporate restructuring (vertical disintegration) or labour
law avoidance
 SA: Ten year policy process
 Triangular employment, fixed term contracts, part-time
employment re-regulated
 Section 197 transfers case-law
 Sect 200B – disguised employer
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Doomed or “deemed”: TESs past,
present and future
 1983 LRA: triangular employment recognised: labour broker
deemed to be employer of workers placed with clients
 1995 LRA: LBs become TESs; joint & several liability added
2002 LRA: presumption of employment introduced/
significant court decisions on disguised employment
 October 2002: ERPM strike – workforce of 4000 supplied
through labour brokers
 2004: DOL research: triangular employment major driver of
informalisation: Motivation lower wages and absence of
unfair dismissal protection: issue referred to NEDLAC
 2008: Minister of Labour calls for ban – 2010 Bill
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Subsequent developments
 Joint and several liability fails to protect- employer liability
only on default by TES
 TUs raise use of LBs as interest issue and strike : Goodyear
(2006), Tshwane Municipality (2008), SAA (2009) ...also
strikes to regain loss benefits
 Exponential growth in use of labour brokers (CAPEs
estimate – 1 million placed employees)
 No significant decisions until 2010 (Nape, Mahlamu)
 Cases – Dyokwe v de Kock (Mondi/ Addecco ‘conversion)
 Abacendisi (SCA) (HR manager as labour broker)
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Regulatory options
 Legislative change required
 “Agency as employer” an exception justified in limited
circumstances – temp, sub, other (home care)
 Regulatory models: ban/ joint employment/ deemed
employment/ bargaining councils
 “Deemed” employment lessens role of LBs
 Role of labour market intermediaries in policy debate
 NDP: subsidy for agencies who place new employees
(Harambee)
 We have not developed “value added” LMI sector
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Statutory changes
 198 (4) – full joint and several liability – employee may
claim against TES or ER or both
 198A – new protections iro employees earning below
BCEA threshold (R193k) (198A(2))
 (1) Temporary services – 3 months/ as substitute/ ito
BC agr, sectoral determination or Ministerial notice.
 (3) Deemed to be employee of client after three
months
 (4) Dismissal to avoid deeming unfair
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Fixed Term Contracts
* Section 186 – definition of dismissal
* Dismissal extended to include where employee
reasonably expected to be offered indefinite
employment – not limited to expectation of renewal
of fixed term
* This applies to all fixed term contracts
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Fixed Term Contracts
* Section 198B – new restrictions on use of fixed term
contracts
* Does not apply to:
* Employees earning more than R193k (BCEA
threshold)
* Small businesses or start ups
* Fixed term contracts permitted by statute, ectoral
determination or collective agreement
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Fixed Term Contracts
* Section 198B (continued)
* No scrutiny of reasons for use of fixed term
contracts for period up to 3 months
* Fixed term contract can be used for longer then
3 months only if nature of work is of a limited or
definite duration, or if there is a justifiable reason
for fixing the term
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Fixed Term Contracts
* Justifiable reasons include:
* Temporary replacement
* Temporary increase in volume of work – up to
12 months
* Work exclusively on a genuine limited duration
project
* Student or recent graduate being trained or gaining
work experience
* Seasonal work
* Official public works scheme
* Limited funding by external source
* Employee is over retirement age
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Fixed Term Contracts
* Section 198B (continued)
* Employee on fixed term for longer than 3 months
without justifiable reason is deemed to be employed on an
indefinite contract
* Employee on fixed term for longer than 3 months is
entitled to be treated on the whole not less favourably
than comparable indefinite employee
* Fixed term contract employees must have same
opportunity as indefinite employees to apply for
vacancies
* If fixed term for project work extends beyond 24 months,
employee has a right to “severance
pay” on expiry
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Part Time Employees
* Section 198C
* Additional protection does not apply to
* employees earning over R193k
* Small employers
* Employees who ordinarily work less than 24 hours
a month
* During first 6 months of employment
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Part Time Employees
* Employees to whom the section does apply are
entitled to:
* Be treated on the whole not less favourably than
comparable full time employees, including access
to training and skills development
* Same access to opportunities to apply for vacancies
as full time employees (ghetto effect)
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Cross-cutting provisions
 Transitional provisions –
 Existing non-standard employees acquire most rights
three months after legislation comes into effect
(198A(9), 198B (8)(b) 198C – inserted by NCOP)
 Reasons justifying differential treatment – 198D(2) –
impact on remuneration packages
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