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Monday, 22 January 2018

Perhaps the most controversial of the recent amendments to the Labour Relations Act (LRA) was the new section 198A (3)(b) of the Act. This section of the Act provides that in the event that a temporary employment service (labour broker) employee is deployed at one of its clients on a temporary basis, for a period exceeding three months, and earns less than the annual the Basic Conditions of Employment income threshold (currently R205 433.30), the employee is then deemed to be the employee of that client and the client is deemed to be the employer.

A similar concept was also introduced in relation to temporary employment contracts in excess of three months.

The CCMA was required to adjudicate a dispute relating to this new deeming provision in Assign Services (Pty) Ltd v Krost Shelving & Racking (Pty) Ltd & NUMSA [ECEL1652-15].

The 26 June 2015 arbitration award noted that The main thrust of the amendments is to restrict the employment of more vulnerable, lower paid workers by TES to situations of genuine and relevant temporary work and to introduce various further measures to protect workers employed in this way.

The arbitration award that the client organization was the sole employer of labour broker employees after three months.

The award was taken on review to the Labour Court, which reached a much anticipated judgment last week (8 September 2015) which set aside the arbitration award, and held that the client becomes a concurrent, and not the sole employer, after three months.

This specifically relates to the labour broker and the client being concurrent employers in terms of the LRA.

The judgment therefore upholds the dual employer concept, and provides that the deeming provision serves to create an augmentation, not a substitution, of LRA obligations.

The judgment is unlikely to be the final say on this problematic, and frankly in my view, absurd, amendment.

The Judge himself noted that The scope and exigibility of these (labour broker employee) protections will, I expect, give rise to considerable litigation in future.

The judge further appears to question the wisdom of these amendments which form a dual employment concept when he submits that there is a notable conundrum in that A contract of employment is one in which one person (the employee) subjects his or her productive capacity to the behests of another (the employer). To exploit this capacity, the employer must instruct the employee on the work to be performed and, if untenable conflicts are to be avoided, the source of this control, whether individual or collective, must always be unitary. No man can serve two masters says the Bible.

So on we trundle. Dont be surprised if the almost certain unfolding of conflicting case law authority continues to sustain uncertainty in the practical application of these amendments.

Follow Tony on Twitter at @tony_healy

First published in The Star Workplace on 16 September 2015