1 / 19

The LRA Amendments: Challenges for arbitrators

The LRA Amendments: Challenges for arbitrators. Alan Rycroft Tokiso workshop 24 July 2014. TES employees. Section 198A(9) provides that 3 months after the Amendment Act commences –

trevet
Download Presentation

The LRA Amendments: Challenges for arbitrators

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The LRA Amendments:Challenges for arbitrators Alan Rycroft Tokiso workshop 24 July 2014

  2. TES employees Section 198A(9) provides that 3 months after the Amendment Act commences – • TES employees are deemed to be the client’s indefinite employees, if not performing a temporary service; • TES employees’ rights to ‘not less favourable’ treatment from the client, commence (if deemed to be the client’s employees); • The termination by the TES of an employee’s ‘service’ to avoid the employee being deemed to be the client’s employee, constitutes a dismissal for the purposes of the LRA.

  3. Questions, questions, questions • If an employee of a TES is deemed to be the employee of the client, is it possible for there to be 2 employers? • After 3 months as a TES employee, who is responsible to pay the employee – the TES or the client? • Once a TES employee is deemed to be the employee of the client, which terms and conditions apply, particularly where they might have been better with the TES? • How does a deemed employee formalise her/his new status? • Is the ‘deeming’ provision only triggered when the TES treats its employee ‘not less favourably’?

  4. The dismissal of TES employees Section 198A(4), provides that the termination of a TES employee’s service to avoid being deemed to be the client’s employee constitutes a dismissal. • It does not provide that it automatically constitutes an ‘unfair dismissal’. (The unfairnessof the dismissal would then have to be determined by the facts of each case). • Note that these rights only kick in 3 months after the Amendment Act commences – which means it can be argued that such action prior to that date would not constitute a dismissal.

  5. Arbitrator’s dilemma # 1 Because the termination of a TES employee’s ‘service’ is constituted as a dismissal, does this prevent schemes by a TES to ‘roll’ employees amongst clients every 3 months, in an attempt to prevent them from being deemed to be a particular client’s employees?

  6. Deeming Meaning One • In its general sense deeming means 'considered' or 'regarded' (“The football match was deemed to be excellent”). Meaning Two • In some legislation ‘deem’ means that something must be accepted as correct unless the contrary is proved. • Eg s 83A of the BCEA and s 200A of the LRA: ‘A person who works for, or renders services to, any other person is presumed, until the contrary is proved, to be an employee’. • Here the deeming provision is expressed as a rebuttable presumption

  7. Meaning Three • In the legal context ‘deeming’ can create a legal fiction. Deeming provisions allow things which are not true to be treated as if they were. ‘When you talk of a thing being deemed to be something, you do not mean to say that it is that which it is deemed to be. It is rather an admission that it is not what it is deemed to be, and that, although it is not that particular thing, nevertheless, for the purposes of the legislation in question, it is to be deemed to be that thing’ (1891 case). • It is a device to artificially include in a definition those who by normal tests fall outside of that definition. Something is declared a fact regardless of the objective truth of the matter. Once deemed, there is an irrebuttable presumption.

  8. Arbitrator’s dilemma # 2 What does ‘deem’ mean in the LRA amendments?S 198A(3)(i) in the Bill: says: “deemed to be the employee of that client and the client is deemed to be the employer” • There is NO rebuttable presumption – the client is given no opportunity to prove that the employee of the TES is not, in contract, the employee of the client.

  9. Is being deemed an employee the same as being an employee? ANSWER ONE: A TES employee will remain an employee of that TES but must be treated on the whole not less favourably than an employee of the client performing the same or similar work, unless there is a justifiable reason for different treatment. The TES remains legally liable to remunerate the employee but must do so at the same rate as paid to the client’s employees doing similar work. The TES must also include benefits enjoyed by the client’s employees If s/he is dismissed, that employee can refer a dispute for unfair dismissal, citing either the TES or the client as the employer. ANSWER TWO: After the deeming provision takes effect, the TES is replaced by the client, who becomes the sole employer in law and in contract. The TES drops out of the picture completely.

  10. Treating deemed employees ‘not less favourably’ ‘Justifiable reasons’ for treating deemed employees ‘not less favourably’ than comparable employees doing similar work, include – (a) seniority, experience or length of service; (b) merit; (c) the quality or quantity of work performed; or (d) other criteria of a similar nature.

  11. ‘Equal pay for equal work’ disputes can now arise in 2 ways: • ‘Non standard’ employment disputes; • The unfair discrimination provisions of the Employment Equity Act. The new s 6(4) of the EEA provides that differences in the terms and conditions of employment between employees doing substantially the same work or ‘work of equal value’, due to arbitrary grounds, constitutes unfair discrimination. • Consideration will have to be given to not just basic pay rates, but also to other aspects forming part of the remuneration package such as pension or medical aid contributions. • Where similar benefits are not provided, a monetary equivalent may have to be incorporated.

  12. Arbitrator’s dilemma # 3 Is the client treating a deemed employee less favourably if: • The TES’s pension scheme is less favourable? • A more experienced employee doing the same job as the deemed employee is paid more? • The client says the ‘comparable’ employee is more meritorious?

  13. Fixed-term contracts Fixed term contracts (FTCs) should not be longer than 3 months, unless the • work is of limited or definite duration, • or a ‘justifiable reason’ exists; failing this, the employee may be deemed to be employed on an indefinite basis. • In any event, employees on fixed term contracts of longer than 3 months must be treated ‘not less favourably’ than permanent employees performing similar work, unless ‘justifiable reasons’ exist.

  14. ‘Justifiable reasons’ for having fixed term contracts longer than 3 months These include being employed – (a) to replace a temporarily absent employee; (b) due to a temporary work increase, not expected to last beyond 12 months; (c) as a student/ recent graduate, to get training or work experience; (d) to work exclusively on a specific project of limited / defined duration; (e) as a non-citizen in terms of a work permit for a defined period; (f) to perform seasonal work; (g) on an official public works or job creation scheme; (h) in a position funded by an external source for a limited period; or (i) past the normal or agreed retirement age.

  15. Arbitrator’s dilemma # 4 • Cases have held that, unless agreed, an employer may not retrench during a fixed-term contract. • If a fixed-term contract employee is deemed to be an indefinite employee, does s/he lose the protection that the fixed-term contract gave against retrenchment?

  16. Part-time employees 3 months after the Amendment Act commences, the following rights will apply: • The right to ‘not less favourable’ treatment; • Equal access to training and skills development opportunities; • Equal opportunities to apply for vacancies.

  17. Disputes are likely to arise in one of two circumstances: 1. Allegations by employees (eg a group of TES employees, FTC workers or part time employees) that they are receiving less favourable treatment than similar permanent employees; 2. Attempts by an employer to terminate the employment or services of one or more employees. • Section 198D(3) to (5) : interpretation or application disputes arising from s 198A to 198C may be referred to the CCMA or applicable bargaining council for conciliation, within 6 months after the cause of action arising. • Alleged unfair dismissal disputes: this seems to vary the standard 30 day referral time limit in terms of section 191(1)(b). • If the dispute is not resolved after conciliation, it may be referred to arbitration within 90 days.

  18. Arbitrator’s dilemma # 5 Section 187: dismissal automatically unfair if the reason for the dismissal is: (c) to compel the employee to accept a demand in respect of any matter of mutual interest between theemployer and employee. NEW (c) a refusal by employeesto accept a demand in respect of any matter of mutual interest between them and their employer. Does this amendment apply to retrenchment consultations?

  19. Arbitrator’s dilemma # 6 If a dismissal is found to be unfair, is an arbitrator obliged to make an order of either reinstatement, or re-employment, or compensation? Numsa & another v GFD Motors (Pty) Ltd & others (LCCT 24/7/2013) S 193 : if the dismissal is unfair the arbitrator may…

More Related