Restructuring triangular employment: The interpretation of section 198A of the Labour Relations Act
Authors Paul Benjamin
Affiliations: Director, Cheadle Thompson & Haysom Attorneys, Johannesburg; visiting Associate Professor, School of Governance, University of Witwatersrand
Source: Industrial Law Journal, Volume 37 Issue 4, 2016, p. 28 – 44
The Labour Relations Amendment Act of 2014, which came into effect on 1 January 2015, amended s 198 and introduced a new s 198A to prevent abusive practices associated with the placement of workers by temporary employment services (labour brokers). Employees earning below the earnings threshold set by s 6(3) of the Basic Conditions of Employment Act who are placed with clients for more than three months, other than as substitutes, are deemed by s 198A(3)(b) to be employees of the clients for the purposes of the LRA. This article examines the judgment in Assign Services (Pty) Ltd v CCMA & others in which the Labour Court set aside a ruling by a CCMA arbitrator that the effect of s 198A(3)(b) was to make the client the ‘sole’ employer for the purposes of the LRA. It argues that the comments by the court on the nature of the contractual relationship between TESs and the workers they place are inconsistent with the jurisprudence of the Labour Appeal Court and were, in any event, not necessary for the court’s decision.