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Basic Conditions of Employment Amendment Bill to become law
Johan Botes, director in the employment practice at Cliffe Dekker Hofmeyr, explains, “The minister will now have the power to prohibit using sub-contractors when making a sectoral determination. (A sectoral determination is made by the minister regarding basic conditions of employment for employees in a sector and area. To-date, sectoral determinations made by the minister include those for the security industry and domestic workers.) Industries that typically use sub-contracting (such as the building or IT sectors) could have to reconsider their business models if a sectoral determination is ever made for those industries.”
Botes notes that currently, there is no indication the minister is planning to increase the number of sectoral determinations to other sectors. However, trade unions or employers organisations can apply to the minister to investigate employment conditions 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 if an investigation needs to be conducted.
“With the current focus still firmly on labour brokers, sub-contracting and using contract staff, it will not come as a surprise if trade unions look at using this extension of the minister's power to limit the practice of employers sub-contracting work to independent contractors to avoid employing staff directly to do the work.
“While this may have favourable consequences where this practice has been abused, 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 comfort 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, the likely impact of any proposed employment conditions on current employment and the creation of employment before the minister issues a sectoral determination.”
