Article 41/2021

Labour Edge

Does merely being employed on the basis of a series of fixed-term contracts, without more, create a reasonable expectation in terms of s186(1)(b) of the LRA?

The provisions of s186(1)(b) of the LRA were interpreted in University of Pretoria v CCMA and Others (2012) 33 ILJ 183 (LAC) (Davis JA) as follows:

‘[18]   The words employed in s186 envisage that two requirements must be met in order for an employer’s action to constitute a dismissal:

  • a reasonable expectation on the part of the employee that a fixed term contract on the same or similar terms will be renewed; and
  • a failure by the employer to renew the contract on the same terms or a failure to renew it at all.

These words do not however carry the meaning which is urged by third respondent, namely that, by being employed on the basis of a series of fixed terms contracts, an employee has without more a reasonable expectation of a permanent appointment. The distinction between the fixed term contract and a permanent contract has a clear economic rationale. An employer in the position of appellant may have discretionary funds for a limited period. During this period, it offers a series of fixed term contracts to a particular employee. At some point these funds are depleted and the employer can no longer afford a further fixed term contract. By contrast, the creation of a permanent post would necessitate a more permanent source of funding”

[21]    The words chosen by the legislature, absent an amendment to the legislation, cannot carry the burden of third respondent’s case in that it covers a restrictive set of circumstances, namely a reasonable expectation of a renewal of that which had previously governed the employment relationship, namely a fixed term contract which had previously been enjoyed, which had now expired and, by virtue of the factual matrix created, at best, a reasonable expectation of a renewal.’

Does the LRA impose a duty to bargain?

Which principles govern breaches of contracts in the employment sphere?

How did the labour court recently, in Jacobson v Vitalab (2019) 30 SALLR 175 (LC), interpret s187(1)(c) of the LRA dealing with the refusal to accept a demand?