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Trade union Solidarity has warned of the unintended consequences of the Labour Relations Amendment Act (LRAA), No 6 of 2014, which was promulgated on January 1.
The new legislation, tabled in an effort to protect temporary workers, could lead to fewer people finding work and the contracts of temporary employees not being renewed after three months, Solidarity deputy general secretary Johan Kruger said on Friday.
The LRAA required employers to limit the use of temporary contracts and to ensure temporary workers were employed for no longer than three months.
Companies that employed temporary workers for more than three months were required to provide them with the same benefits as those available to permanent employees.
Kruger said government’s ambitions of “forcing” employers to employ temporary workers permanently would discourage employers to employ temporary workers.
“Companies will increasingly subcontract services or scale down certain activities rather than employ temporary workers,” he noted.
However, in a previous brief, law firm Cliffe Dekker Hofmeyr director and national head of the employment practice Aadil Patel said employees would “enjoy far greater protection” than what was currently available to them, with concomitant limitations placed on employers to use such employment structures.
The new law meant that employers had to justify fixing the duration of an employment contract, and would result in the employees becoming permanent employees or being deemed to be employees of the labour broker, or the temporary employment service, used by the company.
The legislation that was meant to protect workers was limited “in some respects”, Patel commented, pointing out that it only applied to those earning below a statutory income threshold and, in the case of fixed-term employees, some smaller and start-up employers may be exempted.