Constitution Ruling With Regard to Temporary Employment Services (TES)

Constitution Ruling With Regard to Temporary Employment Services (TES)

Much has been said in the Media with regard to the recent Constitutional Court Reading with regard to Temporary Employment Services, or what is more commonly knows as Labour Brokers. The judgement clarifies the amendments to the Labour Relations Act of 2014.

The amendments of 2014 sought to protect employees in Labour Broker arrangements which were clearly articulated in a letter addressed to NUMSA by employees of Concor Engineering which were sent to them in 2009 (Labour brokers: The good, the bad, and the ugly). It is particularly clarifying clause 198A 3 (b),i.e.

  1. For the purposes of this Act, an employee –
    1. Not performing such temporary service for the client is –
      1. Deemed to be the employee of that client and the client is deemed to be the employer; and
      2. Subject to the provision of section 198B, employed on an indefinite basis by the client.

It is important to clarify a few issues which were raised in the judgement:

  1. The judgement only affects employees who earn below R205 433.33 per annum (gross salary) or R17 119.43 per month. These are regarded in the law as vulnerable employees.
  2. The judgement affects employees who are employed by a Temporary Employment Service (TES), but whose activities cannot be considered as Temporary. In other words, they are doing work that is core to the business of the client and that will last for longer than three months or in perpetuity.
  3. The employee is not replacing another employee who is sick or on maternity leave.
  4. The important thing is to distinguish between a TES and a sub-contractor or service provider.
    1. A sub-contractor has his own employees and provides not just the labour, but also the materials and tools required to do the work required.
    2. The sub-contractor has expertise which is not the core business of the client (e.g. security)
    3. The sub-contractor employs managers which directly supervise the employees in the carrying out of their duties.

By contrast, the TES merely supplies the labour who are then supervised and provided materials and tools by the client.

It is important to note that all TES providers must be registered as such and certified by the Department of Labour. The Department in the process of certification inspects and ensures that the TES is operating in accordance with all labour legislation.

We will see with interest what the effect of this judgement is going to be on the TES Industry.

For more information please see the press release on the Numsa website: NUMSA wins landmark Constitutional Court decision on labour brokers!

Employment Equity 2018 submissions

Employment Equity 2018 submissions

According to the Employment Equity Amendment Act 2013, a designated employer must submit a report to the Department of Labour once every year.

Please remember that a designated employer is defined as:

  1. an employer who employs 50 or more employees;
  2. an employer who employs fewer than 50 employees, but has a total annual turnover that is equal to or above the applicable annual turnover of a small
    business as defined in the table below:
Sector Or Subsections In Accordance With The Standard Industrial Classification Total Annual Turnover
Agriculture R 6 million
Mining and Quarrying R 22.50 million
Manufacturing R 30 million
Electricity Gas and Water R 30 million
Construction R 15 million
Retail and Motor Trade and Repair Services R 45 million
Wholesale Trade, Commercial Agents and Allied Services R 75 Million
Catering Accommodation and other Trade R 15 million
Transport, Storage and Communications R 30 million
Finance and Business Services R 30 million
Community, Social and Personal Services R 15 million

Failure to comply could result in a fine of between R 1 500 000.00 and R 2 700 000.00 or between 2% and 10% of turnover – whichever is greater.

In the event that you would require our assistance in the submission of the required reports and in order for Connold and Associates to accurately determine whether your company is classified as a designated employer, please can we request that you provide Tessa at our offices with:

  • The projected number of employees on your payroll as at 1 August 2018.
  • The company’s current annual Turnover.
  • Confirmation of Sector company is registered under.

Please contact Tessa Lourens at our office using the contact sheet below, if you would like us to assist with the relevant submission of your EE report to the Department of Labour.

Leadership Development Programme

Leadership Development Programme

Connold & Associates are hosting a Leadership Development Programme in Cape Town This Month (March 2018 dates to be confirmed).

There are many examples of employees in supervisory and management positions who are uncertain of how to lead their teams to greater performance. This programme integrates through theory and experiential learning, the essential components of leadership in business today.

The Programme enables Managers to integrate their knowledge and practice in Leadership Development. The content is spread over a 10-month period. Participants are expected to attend a 1-day programme per month. The programme covers 5 important principles of leadership: Understanding Business, Introduction to Management, Performance Management, Leadership and Industrial Relations.

For More information please visit our course page here.

Please see the accreditation for our course here.

Employment Equity 2017 submissions

Employment Equity 2017 submissions

According to the Employment Equity Amendment Act 2013, a designated employer must submit a report to the Department of Labour once every year.

Please remember that a designated employer is defined as:

  1. an employer who employs 50 or more employees
  2. an employer who employs fewer than 50 employees, but has a total annual turnover that is equal to or above the applicable annual turnover of a small.

business as defined in the table below:

Sector Or Subsections In Accordance With The Standard Industrial Classification
Total Annual Turnover
Agriculture R 6 million
Mining and Quarrying R 22.50 million
Manufacturing R 30 million
Electricity Gas and Water  R 30 million
Construction  R 15 million
Retail and Motor Trade and Repair  R 45 million
Wholesale Trade, Commercial Agents Services and Allied Services  R 75 Million
Catering Accommodation and other Trade  R 15 million
Transport, Storage and Communications  R 30 million
Finance and Business Services  R 30 million
Community, Social and Personal Services  R 15 million

Failure to comply could result in a fine of between R 1 500 000.00 and R 2 700 000.00 or between 2% and 10% of turnover – whichever is greater.

In the event that you would require our assistance in the submission of the required reports and in order for Connold and Associates to accurately determine whether your company is classified as a designated employer, please can we request that you provide Tessa at our offices with:

  • The current number of employees on your payroll as at 1 August 2017
  • The company’s current annual Turnover
  • Confirmation of Sector company is registered under

Please contact Tessa Lourens at our office if you would like us to assist with the relevant submission of your EE report to the Department of Labour.

Lifeskills Training Course

Lifeskills Training Course

Beqfin recently held a one-day workshop (Accredited by the SABPP), for their staff.  The purpose of the workshop was to educate employees with regard to their rights as employees and to demonstrate through a series of exercises, the importance of productivity and customer service.  Below are photographs of the staff planning and executing the building of a lego tower.

2017 TRAINING SCHEDULE

2017 TRAINING SCHEDULE

This is a reminder that Connold and Associates have the following training programmes scheduled:

LEADERSHIP DEVELOPMENT Programme

Johannesburg 22 JUNE 2017
Cape Town 6 JULY 2017

This programme as aimed at Middle Management level employees who preferably have a Matric plus a further qualification. This programme is run over a 10-month period with delegates attending training one day per month.

The Cost of the course is R 1 787.00 per delegate per day – excluding VAT and includes training material, the venue, refreshments and a light lunch.

EME EMPLOYMENT EQUITY Programme

Johannesburg 12 JULY 2017

This programme is aimed at Training and Employment Equity Committee members and empowers them with current knowledge and information relating to Employment Equity and Skills legislation.

The Cost of attending the public training programme is R 985.00 per day per delegate – excl VAT for the 5-hour programme (excl VAT) and includes the venue, training material, refreshments and a light lunch.

The above training programmes may also be structured that they are presented as in-house spec company specific programmes. Please contact Tessa on (011) 452 1707 or tessa@connold.co.za if you require any additional information regarding the above courses and in order to book your de delegates on any of the above training programmes.

WHAT TO DO?

What To Do?

Many of our clients are asking advice as to what to do on Friday as staff are either wanting the day off or saying that they feel that they will have difficulty getting to work.

Some companies have made the decision to support the strike and are closing for the day, but for the rest our advice is:

  • Where possible allow the staff to take a day’s annual leave on condition that they apply in advance and that it is approved before Friday.
  • Ensure that essential services are covered and that those staff who are critical to the continuation of the business are made aware that they are not eligible for leave.
  • Those that do not apply for leave and then do not come to work must have an acceptable reason, alternatively, it should be treated as an unpaid day.

All strike action, whether for a protected strike or an illegal strike is on the basis of no work, no pay.

Our advice is that anyone who does stay away loses a day’s pay, but that this should not be treated as a disciplinary offence.  Much as we did in the stay aways in 1980.

If anyone would like wording for a notice for staff, please contact Debbie or Tessa at the office.

2017 Training Schedule

2017 Training Schedule

 DAYSJANFEBMARAPRMAYJUNJULAUGSEPOCTNOVDEC
Employment Equity Committee½232312
Employee/Employer Rights Rights2 hrs
Industrial Relations222, 23, 2417,18,1919,20,2119,20,21
Leadership Development10206
Life Skills (above threshold)161113
Life Skills (below threshold)17137
Performance Management
(Appraisers - on line)
13081517
Performance Management
(Appraisees - on line)
½3191719
Performance Management (Manual)19202318
Update on Legislative Changes11691611

The above training programmes may also be structured that they are presented as in-house company specific programmes. Please contact Tessa on (011) 452 1707 or tessa@connold.co.za if you require any additional information regarding the above courses and in order to book your delegates on any of the above training programmes.

 

What You need to know about UIF

On the 19th January 2017 the President assented to an amendment to the Unemployment Insurance Act that significantly improves the benefits that can be received from UIF and even better takes away some of the obstacles that existed in claiming these benefits. The improvement in benefits has been motivated by the surplus of R111 Billion that the Fund has in reserve at the moment. In 2015 the fund collected R16 Billion rand and paid R7 Billion in benefits.

There are essentially five benefits that can be claimed from UIF and over the next few weeks, we will explain these benefits and the changes that this amendment to the act introduces.

It is to be noted that although the act has been assented to, it has not yet been promulgated and there is no indication as to when the Minister of Labour will promulgate the act, but we anticipate that it will be within the next few weeks.

So, as a contributor to UIF employees can claim benefits in the event of:

  1. Becoming unemployed as a result of your dismissal. Dismissal may be for misconduct, incapacity, operational reasons (retrenchment) or retirement.
  2. Becoming too ill to work, either permanently or temporarily
  3. Having a baby (maternity leave)
  4. Adopting a baby
  5. And in addition their beneficiaries can claim a dependents benefit in the event of their death.

Legal Requirement

In the new amendment, all employees are required to contribute towards an Unemployment Insurance Fund administered through the Department of Labour. This includes everyone, from Executive Directors to Domestic Workers. It includes foreign nationals, even if they are working on work permits (or even illegal employees) and part-time employees. The only employees who do not contribute to Unemployment Insurance are those that work for less than 24 hours and independent contractors.

What this means is that if you employ a person for more than three days you have to deduct UIF from their pensionable earnings.

If you don’t’ (and please when you consider this put on your hat as the employee of a domestic worker even if she only works for you one day a week), you face a potential fine or a maximum of 12 months in prison. You also become liable to pay the benefits that the employee would have received if they had been contributing.

At the moment the maximum contribution level is capped at R148-72 per month which caps an employees benefit to a salary level of R14 872-00. This means that whatever their salary is their maximum benefit from UIF is 38% of R14 872-00, i.e. R5 617-16 per month. They can claim this for 34 weeks which works out to 7,85 months or until they start contributing to UIF again.

The good news is that when the amendment is promulgated, maternity leave will increase to a flat 66% of salary which means that during maternity leave if the employee’s salary is over the capped limit, they would be entitled to R9 815.52 per month for the four months that they are on maternity leave. Below that they would receive 66% of their actual salary.

In our next blog, we will discuss how to claim for unemployment benefits and the changes in applying that the new act has brought in.

If you are an employer of a domestic worker, please made sure that you register for UIF and pay the contribution across. This can be done by Ufiling and EFT and it can be done annually.