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Labour Relations

The potential challenges and problems with Amendment Bill

Fri, 14 Sep 2012 13:47

Jonathan Goldberg

There are a number of challenges to the amendment bills before Parliament. The most important must be that there is sufficient research that indicates that some of these amendments will lead to job losses.

Independent research has indicated that these potential amendments will lead to job losses in excess of 500 000. This research was conducted on the impact on these amendments on jobs. The research was conducted by SBP which included well known researcher Professor Neil Rankin from the University of the Witwaterstrand.

The headline summary indicated that although the object of the amendments was to address abusive practices and vulnerable work, they will place a burden on the whole business community for uncertain benefits and will have a particularly negative impact on small and growing businesses and will probably force some to close down.

Their assessment demonstrates that these amendments will cost existing jobs. They concluded that the exact magnitude is difficult to define but it can confidently be expected to amount to several hundred thousand.

Beside the above negative impacts there are a number of possible Constitutional challenges to these proposed amendments.

Compulsory lodging security to take matters on review from the CCMA for employers only. To expect small and medium size employers to lodge up to 24 months security for review from an administration arbitration restricts such employers to adjudication and is excessive. Refer to sections 24(8)(a) and (b).

The deeming provision in terms of section 198 in respect of temporary employment services. The deeming provision is unclear and could amount to tantamount ban or an over restrictive measure. Our recommendation is to introduce joint and several liability after a particular period for dismissals. See section 198A(3)b.

The six month limitation for atypical seems to be out of sync with the international norm. Potentially someone might mount a challenge that also effectively could amount to a ban or again an over restrictive measure. Our recommendation is to go to 12 months in line with international norms to divert potential litigation.

On equal treatment this clause should be removed from section 198. This has been included in the Employment Equity Act Amendment Bill.

In respect of atypical it is going to cause a race to the bottom and employees are going to lose out because employers are going to ensure that their comparator is justifiable in terms of the Bill or their comparator is the minimum. This is just going to cause a huge amount of litigation.

Jonathan Goldberg is the CEO of Global Business Solutions. Email him at execoffice@globalbusiness.co.za or see Jonathan Goldberg