One aim of the recent Amendments Bill to the Basic Conditions of Employment Act No. 75 of 1997 (BCEA) is to regulate our different employment relationships. Changes to the legislation are designed to respond to the growth of the South African labour market’s informal sector. It is important that people who work in this sector are given the same protection as other workers under the BCEA.
Fixed-term workers, whose contracts have definite start and end dates, will also be afforded additional protection under the BCEA. In terms of section 83A (2) of the BCEA, the legislation only applies to fixed-term workers earning below the prescribed threshold, which is currently R183 000 per annum. The proposed amendments (align) the regulation of fixed-term contracts for with other employees whose earnings also fall below this threshold.
In terms of the proposed amendments to section 186(1)(b) of the Labour Relations Act Act 66 of 1995 (LRA), employees who are employed for longer than six months will be deemed to be employed for an indefinite period. As such, they should be treated the same as any permanent employee doing the same or similar work. Staff employed on permanent contracts will no longer enjoy preferential treatment when it comes to applying for internal vacancies or development opportunities and so on.
If a fixed-term employee has been employed for longer than two years, they will have the same rights to severance pay as any permanent employee. Note, however, that these terms will not apply to casual workers working less than 24 hours per month.
The definition of ‘dismissal’, as per the LRA, will also be extended to include cases in which an employee’s contract is not renewed, even though they have a reasonable expectation of being offered an indefinite employment contract. Previously, the definition of ‘dismissal’ was limited to a failure to renew a fixed-term contract despite the contractor having a reasonable expectation of having the fixed-term contract renewed. This change is designed to prevent employers from employing people indefinitely on a fixed-term basis even though their work requirements involved are not fixed-term in nature. This means that there is now a greater chance of a dismissal being deemed unfair if an employee is not offered permanent employment.
In terms of these proposed amendments, for the first six months of a fixed-term contract, employers will not have the validity of their contract scrutinized. After six months, employers must ensure that any renewals on a fixed-term basis are justified by the nature of the work involved. Notable exceptions to these new provisions include small businesses with less than 10 employees and new businesses under two years old with fewer than 50 employees.
Clearly, if these proposed amendments are passed into law they, will have a significant impact on labour practices across a wide range of businesses. As a business owner, it is important that you consult your attorney to ensure your current employment practices and policies will not be deemed unlawful. Failure to take the necessary steps could expose your business to new legal risks and possible uncertainty
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