14 November 2011

Labour Bills update

The National Economic Development and Labour Council (NEDLAC) released labour bills for comment to the public early this year. The labour bills sought to amend the Labour Relations Act, the Basic Conditions of Employment Act and the Employment Equity Act. NEDLAC also released the Employment Services Bill, a new addition to the employment law statutes.

Interest groups made representations with the aim of influencing the final laws to be enacted. Labour brokers, for instance, raised alarm as to the impact of the proposed amendments on their industry. Employers also questioned the wisdom of introducing further limitations on the already strained flexibility enjoyed by employers to hire new staff and dismiss those already in its employ. Many felt that the legislature missed an opportunity to create a more flexible regulatory framework that could assist in stimulating the job market at a time when unemployment is a national scourge.

The Minister of Labour publicly called for the finalisation of the bills by October 2011. This deadline has passed without the bills being finalised. While NEDLAC is set to brief the parliamentary Portfolio Committee on Labour on 15 November 2011, it appears unlikely that the bills would be promulgated into law by May 2012, as per the Minister's wish.

At present, the Labour Relations Bill inter alia imposes a limitation on the use of fixed term contracts of employment. It provides that an employee must be employed permanently unless the employer can justify the need for fixed term employment. Further, in an attempt to regulate labour broking, the bill abolishes section 198 of the LRA (which currently regulates labour brokers).

The Employment Equity Bill inter alia provides that workers must be paid the same when performing work of equal value.

Among others, the Employment Services Bill regulates the operation of private employment agencies and implements a public employment agency which provides recruitment and placement services free of charge.

Employers and employees alike wait with bated breath to get clarity on the extent of the amendments to the draft bills. While workers seek greater protection and job security, employers will be hoping that any additional restrictions contained in the final bills will be limited to the bare minimum. This is especially true in industries faced with small profit margins where further limitations could push those businesses teetering on the edge of viability into the abyss.

Sherisa Rajah

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