Page 7 - KZN Business Sense 3.5

KZN

KwaZulu-Natal
Business Chambers Council
FIXED TERM EMPLOYEE CONTRACTS

Nikita Pillay - subordinate to the employer • Replacing another employee business has been in operation orders that can be made against
DRG - Performs specied work or a who is temporarily absent from for less than two years the employer for unfair dismissal
Outsourcing specic result work • An employee engaged in terms are as follows:
HR & IR
Consultant - Relationship is only terminated • Engaged on account of a if a xed term contract that is • The LRA requires the CCMA or
by breach, completion of the job temporary increase in work permitted by any statute, Labour Court to reinstate the
or consent volume, which is not expected sectoral determination or employee. is means that the
- Uses own tools and equipment to endure beyond 12 months collective agreement. employer must give the
- Hires own sta • A student or recent graduate employee his/her job back and
- Is paid in accordance with hours who is employed for the Additional Protections to pay the employee all
worked or on commission purpose of being trained or ere are some additional remuneration calculated back to
- Is not subject to discipline by gaining work experience in provisions aimed at protecting the date of the dismissal. e
another order to enter a job or employees on xed term employer must also reinstate all
O ne of legislation • Engaged to work exclusively on Firstly, a person employed on a retrospectively
contracts.
profession
the employee’s benets
- Is not protected by labour
the
- Could work any hours that suit
• The LRA also permits the
a genuine and specic project
most
important changes to the Labour him/her that has a limited or dened xed term contract for longer than CCMA or Labour Court to
order re-employment instead of
duration
- Can enter into as many
three months, may not be treated
Relations Act (the Act), which contracts as he wants • A non-citizen who has been less favourably than someone reinstatement. is means that,
came into eect on 1 January - Is not supervised on a day-to- granted a temporary work employed on a permanent basis while the employer must give
2015, is the added protection day basis permit performing the same or similar the employee his/her job back,
aorded to employees on xed • Engaged to perform seasonal work, unless there is a justiable this will not be with back pay
term contracts. While some What is a xed term contract? work reason for dierent treatment. • Even if the employer does not
employers and employees are not A ‘xed term contract’ is dened • On an official public works (Part-time employees also enjoy have to take the employee back
directly aected, the impact will in the Act as a contract of scheme or similar public job protection against unfavourable at all it may still have to pay
be far reaching and employers are employment that terminates on: creation scheme treatment). compensation up to a maximum
encouraged to review their current • the occurrence of a specified • Engaged in a position which is of 12 months’ remuneration
contracts and practices to ensure event funded by an external source for Secondly, employees on xed calculated at the employee’s
compliance. • the completion of a specified a limited period term contracts must also be given newest rate of remuneration
task or project • Has reached the normal or equal access to opportunities to • If the dismissal is deemed to be
e relevant provisions, which • a fixed date other than an agreed retirement age applicable apply for vacancies. automatically unfair the
are contained in a new Section employee’s normal or agreed in the employer’s business. maximum compensation that
198B of the Act, are summarised retirement age. irdly, where an employee is may be awarded is 24 months’
below. However, to apply the e above covers the common employed on a xed term contract remuneration
correct laws respectfully, it is Fixed term employment beyond situations that come to mind, but exceeding 24 months, the • Such compensation is payable in
important to be able to rstly three months there may be other justiable employee would be entitled to addition to all other possible
dierentiate between employees e real impact of the reasons that have not been listed severance pay upon termination. dues to the employee. ese
and independent contractors. amendments relates to xed term in the Act. could include notice pay, leave
contracts that are for a period of Fourthly, where the employer pay and even payment for the
Section 83A of the BCEA and longer than three months. For Fixed term employment for three has failed to renew a xed term unexpired portion of the
Section 200(A) of the LRA creates such contracts to be enforceable months or less contract where there was a employee’s contract.
an assumption in favour of an there are three main requirements If someone is employed for ‘reasonable expectation’ of such
employee and states that a person that must be met three months or less, the renewal (or where the employer e Labour Court and CCMA
is deemed to be an employee until • The nature of the work must be provisions above do not apply. oered to renew it on less have the powers to make such
otherwise proven. Section 200 (A) for a limited duration or there favourable terms), the basis for an additional awards by virtue of
of the LRA provides guidelines must be some other justiable However, employees on shorter unfair dismissal claim has been section 195 of the LRA and
that emphasize what factors reason for xing the term of the xed term contracts should extended to also include an section 74(1) of the BCEA.
determine an employee status. contract continue to enjoy the protections expectation of indenite Furthermore, the Labour Court
• The fixed term contract must be that existed prior to the 2015 employment. e onus to prove has jurisdiction, in terms of
In order to dierentiate between in writing amendments. An employer may, the expectation remains on the section 77(3) of the BCEA to
a dependent worker status • The contract must specify the for example, not abuse a xed employee. determine any matter relating to a
(employees), and an independent ‘justiable reason’. term contract by using it as a contract of employment.
worker status (independent substitute for probation. Another Implication of changes
contractors), the Common Law A dispute would typically arise example is where an employee ere is likely to be a signicant For these reasons above, it is of
Dominant Impression Test, needs in the context of termination of works beyond the expiry date of increase in disputes that are utmost importance that the proper
to be applied. employment. Should the employer the contract without signing a new referred to the CCMA. ese formulation, implementation,
fail to prove that the requirements agreement – the employee could would include unfair dismissal enforcement, and compliance in
e test questions three aspects: mentioned above have been met, still successfully argue that disputes, as well as unfair labour the processes involved in the
Near Conclusive – control manner the employee will be regarded as employment has become disputes arising out of less take-on, on boarding and
/ exclusive acquisition having been employed on an indenite. Furthermore, the favourable treatment of employees monitoring of employees on xed
Persuasive – extent of control indenite (permanent) basis. In provisions relating to a reasonable employed for a xed term or term contracts, exudes diligence
Relevant – labels, clauses, these circumstances there is a expectation of renewal or part-time. and assiduousness, in order to
compliance, economic good chance that the employee’s permanent employment may also avoid nancial implications and
circumstances, “resonant” of. services would not have been be expected by these employees. Termination, unfair dismissal, non-compliance with the law.
terminated for a fair reason and consequences of misuse of
Briey explained, A Dependent and it is probable that the Which employers and employees xed term contracts Nikita Pillay is employed at DRG as a
Contractor / Employee: requirements of a fair procedure are excluded? Fixed term contracts are as Human Resource Generalist, accompanied
by experience in Industrial Relations. Her
- Is supervised (for misconduct, incapacity or Fixed term contract employees binding as any other contract, and key focus is Labour Law compliance, and
- Renders personal services operational requirements) would are employed for a xed period or due respect should be provided by providing advice and guidance in this
- Employment terminates on have not been met. e potential specic task and cannot expect to both parties to meet the respect.
death, breach or expiration of adverse implications for the be hired on a permanent basis. obligations on the terms and T: 031 767 0625
the period of employment employer should therefore be e LRAA of 2013 introduced conditions of the xed term C: 073 366 8377
- Is provided with tools and compounded. some far-reaching amendments contract. nikita@drg.co.za
www.drg.co.za
equipment regarding xed term contracts
- Has duties which are dependent What is a justiable reason? workers. Such amendments do not Termination of a xed term
on the employer e Act lists examples of apply to: contract prior to the stated
- Is paid a xed salary ‘justiable reasons’ for employing • Employee who earn above the termination date, warrants
- Is subject to the discipline of the someone for a xed term period threshold as set out in the BCEA justiable reasons that can be
employer of longer than three months. e • Employers that employ less than veried.
- Is protected by labour legislation conclusions of a xed-term 10 employees
contract will be justied if the • Employers that employ less than According to sections 193 and
An independent contractor: employee is: 50 employees and whose 194 of the LRA the awards and
- Is equal with and not

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