The Department of Labour announced on 8 May 2013 that amendments to the Basic Conditions of Employment Act (BCEA) had been accepted by Parliament. The Basic Conditions of Employment Amendment Bill is now set to become law and will increase the power of the Minister of Labour, prohibit certain conduct by employers and streamline the enforcement of the Act.
Johan Botes, Director in the Employment practice at Cliffe Dekker Hofmeyr, explains, “The Minister will now have the power to prohibit the use of sub-contracting when making a sectoral determination. A sectoral determination is made by the Minister in respect of basic conditions of employment for employees in a sector and area. Sectoral determinations made by the Minister to-date include those applicable to the security industry and domestic workers. Industries that typically use sub-contracting (such as the building or IT sectors) could have to re-consider their business models should a sectoral determination ever be made in respect of those industries.”
Botes notes that there is currently no indication that the Minister is planning to increase the number of sectoral determinations to other sectors, but trade unions or employers organisations are entitled to apply to the Minister to investigate conditions of employment in their sector or area. The Minister could then instruct the Director General to conduct an investigation or request the Employment Conditions Commission to advise her on whether an investigation ought to be conducted.
“With the current focus still firmly on labour brokers, sub-contracting and use of contract staff, it will not come as a surprise if trade unions seek to use this extension of the Minister's power to limit the practice of employers sub-contracting work to independent contractors in order to avoid employing staff directly to do the work.
“While this may have favourable consequences in instances where there has been abuse of this practice, sub-contracting work has allowed many entrepreneurs and start-up businesses to get their small businesses off the ground and grow the number of employees on their books. It would be a travesty if the legitimate use of sub-contractors were to fall victim to the general disgruntlement towards labour brokers and sub-contractors,” he notes.
“Employers can take heed, though,” Botes adds, “in that sectoral determinations are only issued after a lengthy process whereby the Employment Conditions Commission must report to the Minister on a number of factors (including the ability of employers to carry on their business successfully and the likely impact of any proposed condition of employment on current employment and the creation of employment) before the Minister will issue a sectoral determination. There are currently 12 (twelve) sectoral determinations and 2 (two) ministerial determinations in operation. The current BCEA has been in operation since 1 December 1998 , with minor changes introduced in 2002.”