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South Africa – APSO seeking clarification on Labour Relations Amendments Act

26 March 2015

The Federation of African Professional Staffing Companies (APSO), together with several other staffing industry players, have decided to seek a legal interpretation and clarification through the courts on the so-called “deemed” clause of the Labour Relations Amendments Act.

Section 198A(3) of the Amendments Act, which came into force on 1 January 2015, states that only those employees falling under the ambit of “temporary services” as defined will be regarded to be actual employees of the temporary employment service itself.

Section 198(1) defines “temporary services” as only one of three things, being:

  • services limited to a fixed time period of not more than three months, or
  • where the employee is substituting for a temporarily absent permanent employee of another employer, or
  • where a particular work category is designated as a temporary service, or the maximum temporary period is determined by way of a collective agreement in a bargaining council or by way of a sectoral determination.

Employees that fall outside the ambit of the definition are deemed to be employees of the client of the temporary employment service and not employees of the temporary employment service.

For example, when a labour broker (the local term for staffing agency) supplies a client with a worker who does not fall within the above definition, the worker will be deemed to be a permanent employee of the client, irrespective of the agreement between the client and the labour broker.

According to a statement from APSO: “The Commission for Conciliation, Mediation, and Arbitration (CCMA) and Government appear to interpret the clause to mean that temporary workers transfer permanently to the client after the three-month period.”

“We do not believe that this is the correct interpretation. The Industry obtained a number of legal opinions, including senior legal counsel, which support our stance on the deemed provision.”  

“The question whether or not to go to Court was discussed eight months ago and a “wait and see” approach was taken. However, due to the current situation facing many members and their clients, and the resulting confusion being created, it has been decided that the time has come to challenge this incorrect interpretation in a co-ordinated manner.”

“In the event that we lose in the Labour Court, we will then take it to the Labour Appeal Court and eventually, if necessary, to the Constitutional Court. This is the biggest challenge that we as an Industry have embarked on and will require much effort. It is likely that the case will be vigorously defended from other quarters, especially organised labour,” the statement concluded.