Labour law changes ‘keep employers flexible’

The proposed amendments to the Labour Relations Act (LRA) and the Basic Conditions of Employment Act (BCEA) would continue to allow employers flexibility in their engagement with employees, according to Paul Benjamin, a professor of labour law at UCT.

At the 25th Annual Labour Law Conference held in Johannesburg earlier this month, Benjamin challenged many of the submissions that had been made to the parliamentary portfolio committee on labour by a variety of business organisations.

The amendments, which are being considered by the portfolio committee, are aimed at restraining employers’ use of labour broking, part-time work and fixed-term contracts in a manner that undermines the rights of workers.

During the parliamentary hearings, the general message from business was that the proposed amendments would remove employers’ flexibility and increase the cost of employment. Business argued that the amendments would result in a reduction in employment.

Benjamin’s presentation acknowledged that the proposed amendments were designed to provide additional protection for employees earning below R183 000 a year and aimed to ensure that “atypical” employees had the right to be treated “on the whole not less favourably” than “standard” employees after six months.

With regard to labour brokers or temporary employment service providers (TESs), which are generally vehemently opposed to the amendments, Benjamin argued that the proposed legislation would see “the structure and effect” of the existing legislation largely remaining in place. The TES, not the client, would remain the employer. However, the employee would have additional protection including the ability to institute proceedings against either the TES or the client, and the Labour Court can determine whether the employee’s contract complies with the obligations of the law.

The proposed amendments aim to ensure that employees can only be employed by a TES if they are performing a temporary service, for six months or less; or is employed to replace somebody who is temporarily absent; or is employed to do work for a period determined by a collective agreement. If none of these circumstances apply, then the TES employee is deemed to be an employee of the client of the TES and is entitled to be treated “no less favourably” than an employee of the client performing the same or similar work. There are a number of “justifiable reasons” that will be accepted for different treatment.

Terminating someone’s employment before the end of the six-month period in order to avoid having to treat them the same as a full-time employee will be regarded as a dismissal.

With regard to fixed-term contracts, the proposed new restrictions on their use will not apply to small businesses or start-ups. They will also not apply to anyone earning more than R183 000 a year or to individuals working on fixed-term contracts that are permitted by sectoral determinations or collective agreements.

Fixed-term contracts can only be used for longer than six months if the nature of the work is of a limited or definite duration or if there is a “justifiable reason” for fixing the term. The list of “justifiable reasons” is extensive and includes students or recent graduates being trained or gaining work experience, and work that is exclusively, genuinely limited.

The protection provided by the proposed amendments for part-time employees will not apply to staff of small employers or to employees who work less than 24 hours a month. But otherwise after six months part-time employees have to be treated “on the whole not less favourably than comparable full-time employees”.

While the proposed amendments provide more protection for the most vulnerable workers without removing the flexibility demanded by employers, the sad reality is that the protection will be determined by the Department of Labour’s ability to police the legislation. On this score alone, business organisations may have overstated the impact of the amendments.