16 December 2010

The Immigration Act and employment: what to do

Currently, the Immigration Act (the Act) and its regulations create various options for work permits in order to accommodate the diverse needs of employers, ranging for permits that provide for secondment arrangements to entities that seek to employ a number of foreign employees.

The application requirements for the various work permits are in themselves administratively onerous and can be costly. For example, one of the requirements for an application for a general work permit is that the applicant has his/her qualifications evaluated by the South African Qualifications Authority. While the application for this evaluation appears relatively simple given that one merely has to complete a form, it can turn into a logistical nightmare for an applicant that graduated from university over a decade ago and no longer has access to her original university transcripts. Have you already framed and mounted that degree certificate? Well, we'll need that too.

In instances where a foreign national has rendered services to a company in South Africa on an intra-company (secondment) permit for the last two years and has subsequently been offered the position for an indefinite period, she will be required to submit an application for a general work permit prior to the expiration of her current permit. Once an application has been completed and lodged at the Department of Home Affairs, the processing of the application can take up to four months. Following from the example above, this could effectively result in the foreign employee's existing intra-company transfer permit expiring before the outcome of the general work permit is received.

So, what does an employer do when an employee has a pending application at Home Affairs and his/her existing permit has expired? The Act specifically prohibits an employer from employing a foreigner whose status does not authorise her to be employed. Further, anyone who knowingly employs a foreigner in violation of the Immigration Act is guilty of an offence and liable on conviction to a fine, or imprisonment as prescribed by the Immigration Act. Accordingly, the employee is not permitted to conduct any work during this time. This can translate into an employee not being able to render services for up to four months due to the delays in processing the application at the Department of Home Affairs.

The quagmire faced by employers is does one deliberately contravene the law and succumb to the operational needs of the business to have an employee render complete and uninterrupted services or does one have the employee sit and wait the outcome of her application? The matter is complicated even further by the employment law requirements for the fair dismissal of an employee. One cannot simply terminate an employee's employment because she is no longer in possession of a valid work permit.

In Discovery Health v CCMA and Others the Labour Court considered the issue of the termination of a foreign national's employment due to him not being in possession of a valid work permit. After considering the constitutionally guaranteed right to fair labour practices, the Labour Court held that the contract of employment concluded by the employer and the foreign national was not invalid, despite the fact that he did not have a valid work permit. The Labour Court was of the view that sanctioning the employer's argument that the contract was invalid in this instance would defeat the right to fair labour practices. For this reason, the foreign national was considered to be an "employee" as defined in the Labour Relations Act and consequently entitled to refer a dispute concerning his unfair dismissal to the appropriate labour dispute forum.

The Court held further that even if the contract concluded between the employer and the foreign national was invalid due to the provisions of the Act, the foreign national was still an "employee" as defined in the Labour Relations Act as the definition is not dependent on a valid and enforceable contract of employment.

Essentially, the effect of this judgment is that the employment relationship between a foreign employee and a company is not invalid purely due to his/her work permit having expired. Accordingly, a Company will be required to ensure that it complies with the fair dismissal procedures when terminating the employee's employment on the basis that his work permit has expired.

Pranisha Maharaj, Associate, Employment Law

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