Written by Ivan Israelstam, Chief Executive of Labour Law Management Consulting.
Employers must beware of concluding employment contracts that they are unable or unwilling to implement.. This is because, as soon as the applicant becomes an employee, the employer’s extremely onerous obligations in labour law come into effect.
At first glance it seems easy to ascertain the date on which the job applicant becomes an employee. This is because the Labour Relations Act (LRA) appears to answer the question. According to section 213 of the LRA an employee is:
“(a) any person, excluding an independent contractor, who works for another person or for the state and who receives, or is entitled to receive, any remuneration; and
(b) any other person who in any manner assists in carrying out or conducting the business of an employer…”
This definition seems to make it clear that a person only gains the status of ‘employee’ when he she begins working for the employer. That is, the definition strongly implies that the employer’s legal obligations begin on the day that the employee physically begins work. However, this is not necessarily so. That is, there are circumstances where the employer’s labour law obligations come into effect well before the employee begins work. For example, under the Employment Equity Act (EEA) an employer is prohibited from unfairly discriminating against an applicant for employment.
Also, there is a school of thought that a job applicant attains labour law rights as soon as the parties have concluded an employment agreement even if this occurs long before the individual’s first day in service.
In the case of Wyeth SA (Pty) Ltd vs Manqele (People Dynamics, September 2003 page 39) the Labour Appeal Court upheld the decisions of the CCMA that Manqele had achieved legal employee status the moment his employment contract was signed and that the contract’s termination constituted unfoar dismissal.
In the light of this decision employers should:
- Avoid entering into written (or unwritten) employment agreements until all the terms and conditions have been dealt with thoroughly
- Make it clear that the discussion of the terms and conditions of a contract in no way constitutes an offer of employment. For example, should a manager ask the employee whether, if made an offer, a R10 000 per month salary would be acceptable, the employee’s answer of ‘Yes’ would not constitute an agreement. However, should the manager say to the employee ‘we are offering you the job if you will accept R10 000 a month, then the employee’s acceptance will constitute a finalised employment agreement.
- Never employ, contract with or cancel the employment contract of any person without involving a labour law expert experienced in dealing with these tricky issues.
Details:
To attend our 23 October 2015 seminar in Johannesburg on HOW TO WIN AT THE CCMA please contact Ronni via 0845217492 or ronni@labourlawadvice.co.za.
