Constitutional Court rules on Labour Brokers

CONSTITUTIONAL COURT RULES ON LABOUR BROKERS

Dear NEASA employer

The Constitutional Court, on 26 July 2018, delivered a long awaited judgement on the interpretation of section 198A of the Labour Relations Act.

The issue in dispute was whether the “deeming” provision in this section caused the client of a labour broker to become the sole employer of an employee provided by a labour broker after three months or, alternatively, if a “dual-employer” relationship came into existence in terms of which both the labour broker and its client became employers of the same employee.

In a majority judgement, the Constitutional Court came to the conclusion that the “sole employer” approach is the correct approach. Therefore, the final position now is that the client of the labour broker becomes the sole employer of an employee – who earns below the salary threshold provided for in the Basic Conditions of Employment Act – and who has been working for the client for more than three months.

The labour broker remains the employer during the first three months of employment.

Please contact our HOTLINE on 086 016 3272 should you have any queries in this regard.

Kind Regards,

Jaco Swart
National Collective Bargaining Coordinator

Privileged and challenged to be South African.
We are all in this together.