Temporary Employment Services – Labour Relations Act Section 198

Revisiting The Labour Relations Act 66 of 1995

The changes to section 198 of the Labour Relations Act 66 of 1995 (LRA) is considered as one of the most significant, as this will deal with the issues regarding temporary employment service or labour brokers as they are more commonly known.

Currently Section 198 of the LRA, subsection (4) states the temporary employment service and the client are jointly and severally liable if the temporary employment service contravenes:

A collective agreement concluded in a bargaining council that regulates terms and conditions of employment;
A binding arbitration award which regulates terms and conditions;
The Basic Conditions of Employment Act or a determination made in terms of the Wage Act.

The insertion of subsection 4A* would now provide the employee with the right to institute proceedings against either the temporary employment service or the client or both the temporary employment service and the client.

Enforcing a compliance order in terms of the Basic Conditions of Employment Act by a labour inspector could be done against the temporary employment service and/or the client.

Subsection 4C* and 4D* would make provision for an employee to be employed by the temporary employment service on similar terms and conditions than that of the industry of the client.

The sector or area in which the client is engaged will determine whether an employee of a temporary employment service would be covered by a particular bargaining council.

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Restrictions On Temporary Employment

It is clear that more protection would be offered to employees employed by temporary employment service, especially those under the income threshold as determined by the Basic Conditions of Employment Act.

Employment by a temporary employment service, under Section 198A, will be restricted to the following:

Employment for period not exceeding three months for a client;
Employment as substitute for a temporarily absent employee of the client; or
Employment in a category of work and for a period of time which is considered to be a temporary service as determined by a collective agreement of a bargaining council or a sectoral determination.

In any other situation the employee would be considered an employee of the client and not the temporary employment service.

Employees employed directly by an employer through a fixed term contract and earning below the threshold will enjoy protection under Section 198B.

Also read our Human Resource Management Article

Provisions Towards Fixing The Term Of The Contract

An employer would now be allowed to employ someone on a fixed term contract or a successive fixed term contract for longer than a period of three months if the nature of the work the person is employed for is of a limited or definite duration or if the employer can demonstrate any other justifiable reason for fixing the term of the contract.

Section 198B subsection (4) makes provision for such a term to be justified in the following situations, if the employee:

is replacing another employee who is temporarily absent from work;
is employed on account of a temporary increase in the volume of work, which is not expected to endure beyond 12 months;
is a student or recent graduate who is employed for the purpose of being trained or gaining work experience in order to enter a job or profession;
is employed to work exclusively on a specific project that has a limited or defined duration;
is a non-citizen who has been granted a work permit for a defined period;
is employed to perform seasonal work;
is employed for the purpose of an official public works scheme or similar job creation scheme;
is employed in a position which is funded by an external source for a limited period; or
reached the normal or agreed retirement age applicable in the employers business.

Employers will thus in future have clear guidelines to assist in making decisions regarding temporary employment options.

These options should be considered with care as temporary employees, earning below the threshold, will now receive more protection from legislation in the workplace.

Also read our Industrial Relations Article

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*Amendment of Section 198 of Act 66 of 1995

43. Section 198 of the Principal Act is hereby amended by:

(a) The substitution for subsection (1) of the following subsection

(i) In this section, temporary employment service™ means any person who, for reward, procures for or provides to a client other persons

(ii) Who [render services to, or] perform work for [,] the client; and

(iii) Who are remunerated by the temporary employment service.

(b) The substitution for paragraph (d) of subsection (4) of the following subsection

(c) The insertion after subsection (4) of the following subsections

(d) A sectoral determination made in terms of the [Wage] Basic Conditions of Employment Act.

(4A) If the client of a temporary employment service is jointly and severally liable in terms of section 198 (4) or is deemed to be the employer of an employee in terms of section 198A (3)(b)

(a) The employee may institute proceedings against either the temporary employment service or the client or both the temporary employment service and the client;

(b) A labour inspector acting in terms of the Basic Conditions of Employment Act may secure and enforce compliance against the temporary employment service or the client, as if it were the employer, or both; and

(c) Any order or award made against a temporary employment service or client in terms of this subsection may be enforced against either.

(4B) Temporary employment service must provide an employee it assigns to a client with written particulars of employment that comply with section 29 of the Basic Conditions of Employment Act.

(4C) An employee may not be employed by a temporary employment service on terms and conditions of employment which are not permitted by this Act, or any employment law, sectoral determination or collective agreement concluded in a bargaining council applicable to a client to whom the employee renders services.

(4D) The issue of whether an employee of a temporary employment service is covered by a bargaining council agreement or sectoral determination must be determined by reference to the sector and area in which the client is engaged.