Thursday, 26 July 2018.
CONSTITUTIONAL COURT DETERMINES THE FATE OF LABOUR BROKERS
In a ruling handed down by the CCMA on 29 June 2015, the commissioner ruled on the interpretation of the deeming provision.
The deeming provision in s198A(3)(b)(i) of the Labour Relations Act (LRA) provides that an employee of a Temporary Employment Service (TES) not performing a temporary service for the client is “deemed to be the employee of that client and the client is deemed to be the employer; …”
This section has been considerably debated. The debate centres on what the legislature intended by introducing the deeming provision. Two main schools of thought emerged from this debate. The first was that once the deeming provision kicks in, the client of the TES becomes the sole employer of the employees, meaning that the TES employees are effectively “transferred” to the client. The second school of thought was that a dual employment relationship arose with both the TES and client as employers.
In a ruling handed down by the CCMA on 29 June 2015, the commissioner ruled on the interpretation of the deeming provision. The facts were briefly that the trade union, The National Union of Metalworkers of South Africa (NUMSA), argued that the employees, who fell below the threshold, had come to be exclusively employed by the client, Krost Shelving and Racking (Pty) Ltd after the three-month period. The TES, Assign Services, argued that the employees in question remained its employees but for the purposes of the LRA, there was a dual employment relationship. The CCMA found that the deeming provision should be interpreted to mean that the client becomes the sole employer of the placed TES employees for purposes of the LRA. The CCMA was taken on review to the Labour Court.
To read the full article, please download the PDF of the issue here.