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Article 67/2021

Labour Edge

The facts of Chep SA (Pty) Ltd v Shardlow NO and Others (2019) 30 SALLR 169 (LC) are briefly as follows: approximately 201 workers were employed by C-Force to repair wooden pallets for the benefit of Chep.  The pallets were then returned or supplied in their refurbished condition to clients of Chep.  With reference to s189(2) of the LRA, what is the content of the so-called ‘first fiction’?

In Chep SA, the labour court recently dealt with this issue as follows:

  1. s189(2) of the LRA creates a legal fiction in that, when the employees provide a service to the TES’s client, they automatically become the TES’s employees. The labour court referred to this as the first fiction created by s198. These employees do not even have to enter into an employment contract as a statutory employer-employee relationship is created once they are placed;
  2. under both the 1956 LRA and the 1995 LRA (before the 2014 Amendments), the TES was expressly identified as the employer for purposes of the LRA and this first fictional employer-employee relationship thus has a recognised historic context in South African employment law;
  3. given the aforementioned considerations, the labour court was inclined to favour a textual approach to the interpretation of a TES as it, in a sense, has the effect of providing for an inroad upon the common law and codified understanding of the employment relationship (City Deep Lid v Silicosis Board 1950 (1) SA 696 (A));
  4. in light of the above, C-Force could not be regarded as a TES if it did not ‘provide or procure’ the individual employees (fourth and further respondents) for reward to the client, who was, in this instance, CHEP. The finding of the commissioner to the contrary constituted a material error of law that could not be correct;
  5. a consideration of the triangular nature of the relationship between a TES, client and placed employees also supported the above approach. The TES normally remunerates the employees and provides human resources functions, whereas the client conducts the day-to-day management of the employees and determines their working conditions. The TES is merely a third party that delivers the employees to the client; and
  6. moreover, the employees do not contribute to the business of the TES, except as a commodity. These factors do not appear to apply in casu and seem to support a conclusion that C-Force is not acting as a TES in its engagement with CHEP.
July 20, 2026

Precautionary suspensions

In the public sector, the Senior Management Service Handbook (SMS Handbook) directly addresses precautionary suspensions and the 60-day time limit.

Clause 2.7(2)(c) of the SMS Handbook provides that ‘If a member is suspended or transferred as a precautionary measure, the employer must hold a disciplinary hearing within 60 days. The chair of the hearing must then decide on any further postponement.’

Regulation 6 of the Local Government: Disciplinary Regulations Senior Managers, 2010 (Regulations) provides for the precautionary suspension of senior municipal employees and Regulation 6(6)(a) provides: ‘If a senior is suspended, a disciplinary hearing must commence within three months after the date of suspension, failing which the suspension will automatically lapse.’

What are the principles governing a determination of the question as to whether or not a senior municipal employee’s suspension automatically lapses in terms of the aforesaid Regulation 6(6)(a)?

Obviously, the answers to the aforesaid question are very relevant in the private sector where, firstly, a collective agreement regulates a similar process or, alternatively, such contractual rights have been created between the parties, to be enforced in terms of s77(3) of the BCEA.

July 13, 2026

In the previous article, we dealt with the consequences of a plant level collective agreement with a definite beginning and end date. We indicated to you that, in line with s23(2) of the LRA, and an analysis of the relevant case law, that, once such a collective agreement reaches its expiry date, it expires and is no longer of any force or effect. In this article, we deal with the scenario where a plant level collective agreement is concluded for an indefinite period and the employer gave notice to terminate same.

What are the consequences when a party to a plant level collective agreement, concluded for an indefinite time period, gives notice to terminate such collective agreement?

July 6, 2026

In terms of s23(2), a collective agreement binds, for the whole period of the collective agreement, every person so bound in terms of s23(1)(c) (the members of a registered trade union and the employers who are members of a registered employers’ organisation who are a party to the collective agreement, if the collective agreement regulates the terms and conditions of employment, or the conduct of the employers and employees) who was a member at the time it became binding, or who becomes a member after it became binding (irrespective of whether or not that person continues to be a member of such trade union or employers’ organisation for the duration of the collective agreement).

What is the relevant case law development as to a plant level collective agreement that has an expiry date, i e does such collective agreement continue to be of force and effect after such expiry date?