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Who is an Employee? The question addressed (Part 3)


When looking deeper into the rebuttable presumption, one might conclude that it is sufficient for any one of the seven listed factors to be present in the employment relationship to conclude that the applicant is an employee. Or one might conclude that provided the contract states that " this is not a contract of employment, but is a independent contractor contract," would be sufficient to establish that the relationship is an independent contractor arrangement.

 

Or perhaps the contract states words like " it is acknowledged by both parties that the person is not an employee, but remains an independent contractor, notwithstanding anything to the contrary in this contract."  Unfortunately, the Code has anticipated such happenings – and it states clearly in paragraph 16 that " a statement in a contract that the applicant is not an employee or is an independent contractor must not be taken as conclusive proof of the status of the applicant."

 

The Code states further that "  The fact that an applicant satisfies the requirements of the presumption by establishing that one of the listed factors is present in the relationship does not establish that the applicant is an employee."  "However, the onus then falls on the "employer" to lead evidence to prove that the applicant is not an employee and that the relationship is in fact one of independent contracting. If the respondent fails to lead satisfactory evidence, the applicant must be held to be an employee."

     

Thus, an employee can show that one of the seven factors listed in Part 2 of this article applies - it is then up to the employer to lead evidence to prove that despite the existence of one of the factors, the applicant is in fact not an employee but an independent contractor. If the employer cannot prove that, then the applicant will be ruled to be an employee. From the above, it becomes obvious that there are no " grey areas" in this matter - there are definite lines that have been drawn.

 

INTERPRETING THE DEFINITION OF AN EMPLOYEE.

 

The Labour Relations Act provides various definitions of "an employee." Section 78 provides a definition, specifically for the purpose of excluding senior managerial employees from the definition of "an employee."

 

This section states as follows:

" employee" means any person who is employed in a workplace, except a senior managerial employee whose contract of employment or status confers the authority to do any of the following in the workplace:-

 

[a] represents the employer in dealings with the workplace forum ; or

[b] determine policy and take decisions on behalf of the employer that may be in conflict with the representation of employees in the workplace.

 

Therefore, section 78 states that a senior managerial employee who has the authority to do any of the above, is excluded from the definition of : "an employee." In any event, senior managerial employees would normally be earning more than the threshold amount of R115 572 per year, which would, in any case, exclude them from the definition of " employee." Section 78 was probably introduced to remove any doubt. Section 200A has this definition of " an employee" :

 

(a) any person, excluding an independent contractor, who works for another person or for the State and who receives, or is entitled to receive, any remuneration; and

(b) any other person who in any manner assists in carrying on or conducting the business of an employer,  and 'employed' and 'employment' have meanings corresponding to that of 'employee. ('This definition is also found in the BCEA, the EEA and the SDA.)

 

In paragraph 22, the Code states that "The interpretation given to the term "employee" by the courts prior to the insertion into the LRA of the presumption (section 200A) as to who is an employee, remains relevant.

 

This is so because -

(a) the presumption only applies to employees who earn less than the earnings threshold determined by the Minister;

(b) in the case of employees who earn less than the threshold amount, the employer may lead evidence to rebut the presumption, and establish that they are not an "employee".

     

For example, if the person who claims to be an employee establishes that he or she has worked for the other person for an average of at least 40hours over the last three months, he or she must be presumed to be an employee.

 

The 'employer' may, however, lead evidence that that person is an independent contractor engaged to perform a particular task. The court or tribunal will then have to determine whether that person is an employee. Next week, we will address the question of : " when does a person become an employee?"

 

Any inquiries regarding this series of articles can be addressed  This email address is being protected from spambots. You need JavaScript enabled to view it.

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