A client asked: “Can my employee keep me on as a temporary employee, indefinitely, and dismiss me whenever it feels like it?”
Regarding temporary employment contracts, our Labour Relations Act (LRA) provides that:
- If a company employs a person for longer than three months, he or she would be ‘deemed’ to be an ‘indefinite period employee’ (i.e., permanent employee) of the employer.
- This principle will not apply if there is a justifiable reason to retain him or her as a temporary employee.
- The LRA protects them against unfair dismissal.
- If a labour broker employs a person, he does not become the client company’s employee after three months. However, if the broker dismisses the employee after three months for a reason, he believes is unfair, both the client company and the labour broker can be taken to CCMA and held jointly and severally liable.
- These provisions only apply to employees who earn less than the Basic Conditions of Employment Act threshold (currently R205,433.30 per year).
- It is also not applicable to businesses that employ less than ten people or new companies that employ less than 50 people within the first two years of the business opening.
There are circumstances when an employer is justified in employing someone on a temporary contract for longer than three months without becoming a permanent employee. E.g., if the employer can satisfactorily prove that the nature of the work is for a limited and definite period, or there is another justifiable reason for temporary employment such as:
- Replacing of another employee who is sick or absent from work.
- Employment on account of a temporary increase in the volume of work, which will likely not last longer than 12 months.
- If a company employs a student or recent graduate to gain work experience.
- It employs a person for a specific project which has a limited or defined duration.
- It employs a non-citizen who has a work permit for a specific duration.
- It employs a person to perform seasonal work.
- Employed for an official public works scheme or similar public job creation scheme.
- Employed in a position that is funded by an external source for a limited period.
- If an employee reaches the expected or agreed retirement age applicable in the employer’s industry.
Another change made to the temporary employment laws is that, after three months of employment, a fixed-term employee (even if the reason for the fixed term is justified) the employer cannot treat the employee less favourably than a permanent employee unless justified.
A justifiable reason includes when the different treatment is because of the application of a system that takes into account:
- Seniority, experience, or length of service
- The quantity or quality of work performed
- Or other criteria of a similar nature
The above is not applicable if such a reason is prohibited by Section 6(1) of the Employment Equity Act (this refers to human-rights grounds such as race, religion, gender etc.) Employers must also provide employees with equal access to opportunities to apply for vacancies, whether on permanent or fixed-term contracts.