Stakeholders await court ruling on temporary workers

There has been a lot of debate surrounding the word “deemed” in the Labour Relations Act (LRA).

Numerous arbitrations have found that a parallel employment relationship comes into existence after the employee has been employed at the client for three months. This parallel employment relationship means the temporary employment services (TES) provider as well as the temporary employment services client both become the employers of the temporary employment services worker.

The Labour Appeal Court (LAC) set aside the Labour Court (LC) decision on July 11 2017 which ruled on this parallel relationship.

After this, an appeal was launched in the Constitutional Court. The decision, which was reached by the Labour Appeal Court – that the temporary employment services client is the only employer, will be appealed.

Until this is heard and a ruling made, the LAC decision remains in terms of S18(1) of the Superior Courts Act. In other words, both the TES provider and the TES client are the employers of the TES worker.

The law is that the noting of an application for leave to appeal has the effect of suspending the decision which forms the subject matter of that application.

The big legal question is, if there are one or two employers – for the sake of the LRA – after a temporary employment employee has been employed for three months?

Some of the issues arising out of the LAC decision include the important approach that the Basic Conditions of Employment Act (BCEA) and LRA must be interpreted in a manner that does not conflict with the other piece of legislation.

The BCEA states that the TES only is the employer and the LRA has a deeming provision after three months of continuous employment.

This deeming is only applicable to employees who earn less than R205 433 per annum. This is a statutory creation intended to give extra protection to such employees.

The crux of the question pertains to the rights and obligation of the LRA (only) and whether there is one employer (the client) or if the rights and obligation under the LRA are for both (TES and client).

With respect to the learned judges, despite a great deal of arguments being placed before the LAC as to why the single employer argument would result in disharmony (and other problems) this issue was not dealt with by this court.

The matter will now be heading for the Constitutional Court where a ruling could take up to a year.

Jonathan Goldberg is CEO of Global Business Solutions