Employers often find themselves being dragged to the CCMA, when they believe that the applicant is not an employee. Almost in all cases the intention of the employer was never to regard the individual as an employee, but are vexed with a rude awaking when they realise that South Africa’s labour law, has made provisions as to defining who is an employee and who is not.

Section 200A of the LABOUR RELATIONS ACT 66 OF 1995 (as amended), deals with this instance and states:

200A. Presumption as to who is employee

(1)  Until the contrary is proved, a person, who works for or renders services to any other person, is presumed, regardless of the form of the contract, to be an employee, if any one or more of the following factors are present:

(a) the manner in which the person works is subject to the control or direction of another person;

(b) the person’s hours of work are subject to the control or direction of another person;

(c)  in the case of a person who works for an organisation, the person forms part of that organisation;

(d) the person has worked for that other person for an average of at least 40 hours per month over the last three months;

(e) the person is economically dependent on the other person for whom he or she works or renders services;

(f)   the person is provided with tools of trade or work equipment by the other person; or

(g) the person only works for or renders services to one person.

(2)      Subsection (1) does not apply to any person who earns in excess of the amount determined by the Minister in terms of section 6(3) of the Basic Conditions of Employment Act.

(3)        If a proposed or existing work arrangement involves persons who earn amounts equal to or below the amounts determined by the Minister in terms of section 6(3) of the Basic Conditions of Employment Act, any of the contracting parties may approach the Commission for an advisory award on whether the persons involved in the arrangement are employees.

The first most important factor that an employer has to consider is that the Act says that section 200A is a presumption. That is if any of the factors contained in the section (a to g) exist, that person will be regarded as an employee notwithstanding any contract that is signed. Further, the onus shifts onto the employer to prove that the person is not an employee. It is quiet common for an employer to enjoin an individual as in independent contractor, but only to see once the contractors services is no longer required he will refer a dispute to the CCMA. Therefore employers must be aware of this section and ensure that when they use independent contractors they do not fall foul of the section, and should they do for a cogent reason, an argument can be forwarded as the onus of proof is borne by the employer.

Section 200A also does not apply to person earning above the BASIC CONDITIONS OF EMPOYMENT ACT NO.75 OF 1997 section 6(3) earnings threshold which is currently at R205 433.30 per annum. This illustrates that the legislation seeks to ensure protection for “vulnerable employees”.

Section 3 goes on further to amplify its intention as it provides that persons who earn the threshold amount or below may approach the CCMA for a determination if they are an employee or not.

It is most pertinent that employers are aware of the above-mentioned, that will ensure success should a dispute be referred.

Article by:
Adrian Moodley
CEO – Dispute Resolution Official
Admitted Attorney (LLB-UKZN)