Trade unions can thus negotiate the terms and conditions for the transfer of employment contracts. The court found that the right to use the assets was a compelling factor in concluding that it was a transfer of a going concern.
Conceptual Framework
Much reliance will be placed on the textbooks of John Grogan and Van Niekerk et al. As previously indicated, these powers under Article 197 will be critically examined and certain recommendations made.
Research Questions
In their view, the fact that no tangible business assets (the buses) were transferred (despite D continuing the same activity as C, presumably serving the same customers on the same bus routes and engaging 73% of C's employees to carry out the contract), was thus sufficient to rule out that the transfer fell within the scope of the directive on acquired rights.45 There is a great deal of input from the academic world and jurisprudence that analyzes collective bargaining. Compared to the United Kingdom, the extent to which South Africa's Transfer of Business Act differs with respect to employee participation in the terms and conditions of transfer.
Focus of Research
To what extent a refusal to bargain by the employer would affect a transaction in respect of which a business is transferred.
Research outline
13 Chapter 4 provides the background discussion of the dissertation with an analysis of the enabling legislative provisions within the Labor Relations Act. It articulates the implications of a decision to initiate collective bargaining in terms of section 197 of the Labor Relations Act.
Introduction
What is collective bargaining and what’s the purpose of collective bargaining?
The LRA encourages employees to form or join unions52 which in turn can gain organizational rights in their capacity as unions,53 and from a position of collective power, unions participate in collective bargaining. The collective agreement organizes and distributes the contractual power by means of the game of power inherent in the process.'54.
What can the subject of collective bargaining be?
The LRA also allows either party to exercise economic power in the form of strikes or lockouts to ensure that collective bargaining is not a process of begging but a meaningful process of negotiation.55. In terms of section 64(2) of the LRA, a trade union must obtain an advisory award before it can engage in industrial action over a refusal to bargain dispute.62 A refusal to bargain includes a refusal to bargaining and a disagreement about the subjects of the talks. .63 However, section 65 of the LRA limits the matters over which a union can compel an employer to bargain, limiting the disputes over which unions can strike.
What are collective agreements and who is bound by collective agreements?
In the case of Entertainment Commercial Catering & Allied Workers Union & others v Southern Sun Hotel Interests (Pty) Ltd 68 the employer requested that the employees change their provident fund. Some of the rights granted by the LRA and the Basic Conditions of Employment Act 75 of 1997 (WBAC) can be modified by collective agreements,79 as long as the collective agreement does not provide for less favorable terms than those set out in the WBAC not.
Is there a duty to bargain?
For an effective strike, it is therefore important for the union to gather a large membership. To illustrate this clearly, we will discuss the rise of the Association of Mineworkers and Construction Union (AMCU) as a powerful union in the platinum sector.
Conclusion
The importance of the right to strike, in this context, is also emphasized by the courts.103 In relation to article 197, even though there is no duty to collective bargaining, article 197 of the LRA creates the opportunity for trade unions to engage touch collective bargaining with the new employer. The nature of collective bargaining as regulated by the LRA exposes commercial transactions, such as transfers of a business as a going concern, to potential threats such as industrial action.
Introduction
Work security and the common law
As illustrated by the seminal case of Kebeni & others v Cementile Products (Ciskei) (Pty) Ltd112, as early as the 1980s the judiciary abandoned the move towards protecting job security in the event of a transfer of a business. as a going concern. Despite the progressive guidelines set out by Bulbulia M, the protection of employment security through legislative provisions was only enacted by section 197 in the 1995 LRA.
The purpose of section 197
As a result of these developments, there was a growing need to protect employees when a business was transferred, so the Industrial Court began developing guidelines to protect employees111. The Industrial Court developed the common law by imposing unfair labor practice principles to protect employees from the inevitable prospects of job loss.113 Although it was lawful to terminate employment, the court ascribed the principle that lawful actions do not always result in fair and equitable consequences.114 In Kebeni, the employer removed unionized employees from the workplace on the pretext that the company would be taken over by an entity included in the Ciskei where unions were prohibited.
The qualifying provisions of section 197
SAA has entered into an outsourcing contract, which is expected to last for ten years. Thus, the court had to define and explain the scope of Article 197(1) of the LRA.
Is there a transfer of a business?
LGM was to provide its services for a fee, the assets and inventory were sold to LGM, which upon termination of the SAA contract would have the right to repurchase them. LGM was allowed to use, among other things, MSA's office space, networks and upon termination of the contract, these facilities would be transferred to MSA.
Is there transfer as a going concern?
In deciding whether a business has been transferred as a going concern, the livelihood and not the form of the transaction must be taken into account. The provisions of the new section 197(2) regulate the default legal consequences of a transfer of a business as a going concern.
Which terms and conditions transfer?
31 accept the new employer, it is open to an employee to resign if he or she is dissatisfied with the new employer. 145. Section 197, subsection 3, does not apply where a condition, even if it is a single condition, is regulated by a collective agreement.156 In other words, it is according to section 197, subsection 3, it is sufficient that the new employer has employed the transferred employees on terms that are 'on the whole no less favorable' for them than those on which they were employed by the old employer.
Other agreed variation of consequences
Van Niekerk et al write that the wording of section 197(3) suggests that even if a single term and condition of employment is governed by a collective agreement, "generally no less favorable". In terms of section 197(6), employers can contract out of the two legal consequences of the transfer of a business as a going concern.
Conclusion
Section 197, subsection 6, can vary the legal consequences of default as regulated by section 197, subsection 2162 as well as the binding nature of all collective agreements in accordance with section 197, subsection 5, letter b).163 The provisions in section 197, subsection ) and 197(6) show that the process and outcome of a business transfer can be influenced by collective bargaining.
Agreement that a transaction constitutes a section 197 transfer
The automatic consequences of a transfer of a business as a going concern
The new employer does not have to apply the same terms of employment as the previous employer. Section 197, subsection 3, provides that it is sufficient for the new employer to apply terms and conditions which are 'on the whole no less favorable' to them.
Variation of the consequences of a transfer: section 197(6) agreements
However, the wording of Article 197(3) suggests that even if a single condition of employment of the transferred employees is governed by a collective agreement concluded between the old employer and the employees, the classification is 'no less favorable overall'. does not apply. The new employer is bound by the collective labor agreement and must apply the same conditions as stated in the collective labor agreement.
The bargaining parties
Non-compliance with section 197(6)
The agreement between the two parties was declared a transfer of a business as a going concern under section 197 of the LRA. According to this collective agreement, the transfer of employees is negotiated with the employees on an individual basis in accordance with § 197, subsection
The interests of the parties
Therefore, the Ministry and SALGA were bound by the operation of section 197(6) to negotiate exclusively with the unions. Thus, section 197(6) does not create a right to collective bargaining or consultation, nor is there a commensurate duty on the employer to engage in negotiations under subsection 197.184(6).
Trade Union Interests
The tribunal also encouraged interaction between unions and employers in the event of mergers. The Walmart Inc case illustrates the importance of trade union rights for trade unions.
Employee Interests
This could force unions to use strike action to achieve their demands. The Walmart case shows the extent to which unions are trying to secure these rights.
Employer’s Interests
Essentially, the commercial transaction remains protected regardless of the outcome of the collective bargaining negotiations. It is thus emphasized that potentially only powerful trade unions with the power to force the employer's hand through strikes can effectively influence the process of a transfer of a company as a going concern.
Unpacking the European Union’s Transfer of Undertakings Directive
Irma Catering A/S had rented the restaurants and bars in that theater, A/S Palads Teatret. Without any intervention from Irma Catering, Palads Teatret concluded a new lease contract with Daddy's Dance Hall A/S for the rent of the restaurants and bars in question.
Analysing Transfer of Undertakings (Protection of Employment) Regulations (TUPE)
Daddy's Dance Hall is with Mr. concluded a management contract with Tellerup, according to which Mr. Tellerup rehired as restaurant manager effective date of lease transfer. The trial period clause was inserted into the contract at Mr. Tellerup's request.
Variation of terms and conditions
The facts of the case were: The employee's employment contract provided for a retirement age of 60. As already explained, the agreed change in his retirement age to 65 could not deprive him of the transferred vested right to retire at the age of 60.
Trade Union Organisational Rights and Rights to Represent
This interpretation is supported by the DTI's guidance to TUPE, which states that 'the underlying purpose of the Regulations is to ensure that employees are not penalized when a transfer occurs. Changes in the conditions agreed upon by the parties that are entirely positive are not prevented by the Regulation.234.
Duty to inform and consult representatives
53 (2) Sufficient time before a relevant transfer to enable the employer to any affected. employees to consult with the appropriate representatives of any affected employees, the employer must inform those representatives of—. a) the fact that the transfer will take place, the date or proposed date of the transfer and the reasons for this; These involve the transfer of some tangible or intangible assets and the transfer of a large proportion of staff (in terms of numbers and skills).
The relevance of foreign law in the LRA
From the adoption of European law to the presentation of problems of Section 197 of the Labor Relations Act (LLM thesis University of Cape Town, 2012) at 51. I accept that the two-stage transaction intrinsic to second-generation outsourcing does constitute a transfer as contemplated by section 197 of the LRA.
Conclusion
Blackie W, Horwitz F, 'Transfer of employment contracts as a result of mergers and acquisitions: a study of section 197 of the Employment Relations Act 66 of 1995.' From the adoption of European legislation to presenting the problems of section 197 of the Employment Relations Act (LLM thesis University of Cape Town, (2012)).
