The Labour Appeal Court settled an extensive battle between unions, employers and labour brokers regarding a long-contested provision of the Labour Relations Act.

The ruling? Any employer who uses labour brokers (or any temporary employment service) must employ workers after a 3-month period, if they fall under a specific earning threshold.  This means that employees who earn less than R205,433 annually qualify for permanent employment if they complete three-month stints on contract.

The judgement reverses the one that has handed down in 2015 that stated labour brokers and client companies were so-called “dual employers”, which caused mass confusion amongst unions, companies and labour brokers.

Not to mention, most people who are employed through labour brokers are often very vulnerable and weren’t benefitting from a labour law that was meant to protect them.

This prompted The National Union of Metalworkers of SA to approach the court in hopes of obtaining clarity on who was required to hire staff permanently following three-month periods as temporary workers. They also argued that in order for employees to receive suitable protect under the Labour Relations Act, the sole employer should be the client company, and that it would safeguard employees against unfair dismissal and discrimination.

Thus, the court found that companies that use labour brokers are the sole “employer”.

The ruling has been hailed as a victory for employees it will reduce exploitation that comes from permanent employment being disguised as a temporary service.