Exploring the Impact of Recent Labour Relations Act Amendments

After the recent amendments to the Labour Relations Act, certain temporary and fixed term employees, including labour broker employees, may now be deemed to be permanent employees. The Labour Relations Amendment Act has increased the protection afforded to labour broker employees and temporary employees employed under fixed term and part-time contracts. The effect of these amendments is that:

• if labour broker employees do not genuinely provide temporary services; or
• in the case of fixed term employees, if there is no justifiable reason for fixing their term;

then these employees may be deemed to be permanent employees of the company for which they’re rendering services. With respect to labour broker employees, the amendments to the Labour Relations Act define a “temporary service” as: work for a client by an employee: i. for a period not exceeding three months, or ii. as a substitute for an employee of the client who is temporarily absent; or iii. in a category of work and for any period of time which is determined to be a temporary service by a collective agreement concluded in a bargaining council, sectoral determination or notice published by the Minister of Labour. Where an employee earning below the regulated earnings threshold (which at time of writing was R205,433.30 per year) does not perform a “temporary service”, that employee may be deemed to be a permanent employee of the company to which the services are provided. With respect to temporary employees, the amendments to the Labour Relations Act define a “fixed term contract” as: a contract of employment that terminates on: i. the occurrence of a specified event; ii. the completion of a specified task or project; or iii. a fixed date other than an employee’s normal or agreed retirement age. An employer may employ an employee on a temporary, fixed term contract or successive fixed term contracts for longer than three months of employment only if: i. the nature of the work for which the employee is employed is of a limited or definite duration; or ii. the employer can demonstrate any other justifiable reason for fixing the term of the contract. Where an employee earning below the regulated earnings threshold is employed on a fixed term employment contract for longer than three months and there is no justifiable reason for fixing the term, the employee will be deemed to be employed on a permanent employee basis. According to the new labour laws, labour broker employees who do not provide temporary services, and employees who are employed on fixed term contracts may well be deemed to be employed on a permanent basis for the company to which they are providing services. Before appointing an employee to perform services on a temporary basis, the prospective employer should carefully consider the requirements of the job, and whether a temporary employment is indeed justifiable.  

Please note that this information is supplied for general information and does not constitute legal advice. It is advisable for you to contact a legal practitioner for guidance in respect of your unique requirements.