Last week’s ruling on labour brokers by the Constitutional Court has already led to a significant victory for workers at breakfast cereal behemoth Kellogg’s.
This week Kellogg’s abandoned its attempt to get rid of 120 workers supplied by the largest South African labour broker Adcorp.
This followed shortly after the workers started fighting for their pay and benefits to match directly employed workers at the same site.
Many of the Adcorp workers had been working at Kellogg’s for several years – in one instance as long as 16 years.
In March some of these Adcorp workers went to the Commission for Conciliation, Mediation and Arbitration (CCMA) to dispute the enormous gap between their pay and the pay of directly employed Kellogg’s workers.
They get paid at most R1 500 a week, including overtime, compared with R4 000 for direct workers doing similar work, said Edgar Mokgola, an organiser from the Casual Workers’ Advice Office, a small NGO in Germiston that helps brokered workers.
They also lack benefits, such as medical aid or a 13th cheque, he told City Press.
On July 1 the Adcorp workers at Kellogg’s received an SMS instructing them to go to Adcorp offices in Isando instead of the factory.
When they got there they were told that Kellogg’s had terminated its contract with Adcorp and they were being retrenched.
This was despite the so-called deeming provision introduced into the Labour Relations Act at the beginning of 2015.
The provision reads that labour broker employees earning less that R205 000 a year, who work at a client for more than three months, are automatically “deemed” to be employees of that client unless they were working on a clearly once-off or temporary job.
That means Kellogg’s would have to retrench them, not Adcorp. Instead, some of them were offered new one-year contracts at Kellogg’s.
A group of 26 out of the 120 went to the labour court represented by the Casual Workers’ Advice Office and their case was set to be heard on Thursday.
On Wednesday evening this week Kellogg’s threw in the towel and instead agreed to directly employ the workers. This followed a Constitutional Court ruling last week on the interpretation of the “deeming” provision.
The court ruled that the provision means the client, in this case Kellogg’s, is the “sole employer” in terms of labour law after the three-month period.
The ruling is a blow for the labour broker industry which places more than 600 000 workers at clients on any given day, according to most estimates.
Up to this week Kellogg’s has simply claimed that it has no responsibility towards the workers because Adcorp is their employer.
The details of the workers’ re-employment still need to be ironed out but, according to Mokgola, Adcorp should now be out of the picture.
Adcorp spokesperson Nomonde Xulu said the company would not comment on the precedent set by the Kellogg’s matter.
“We will refrain from discussing, negotiating or providing an opinion within the public domain at this time,” said Xulu.
Kellogg’s’ legal head, Emmanuel Hinson, told City Press that the constitutional court judgment had brought “clarity to the relationship between Kellogg’s and staff supplied by Adcorp”.
“The parties reached an agreement which gives effect to the ConCourt’s judgment, the details which we are not at liberty to disclose,” he said.* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER