AST Holdings (Pty) Ltd v Roos (JA2/2005) [2007] ZALAC 4; [2007] 10 BLLR 891 (LAC); (2007) 28 ILJ 1988 (LAC) (4 May 2007)

AST Holdings (Pty) Ltd v Roos (JA2/2005) [2007] ZALAC 4; [2007] 10 BLLR 891 (LAC); (2007) 28 ILJ 1988 (LAC) (4 May 2007)

The Labour Appeal Court held that section 197(4) of the Labour Relations Act prohibits any agreement that interrupts an employee's continuity of employment when a business is transferred as a going concern. The respondent's years of service with Iscor must be included in the calculation of severance pay, as the transfer of his contract of employment to AST Holdings occurred within the context of section 197. The purported agreement to forfeit prior years of service was unlawful and contrary to the express provisions of section 197(4). The Basic Conditions of Employment Act 75 of 1997, in force at the time of retrenchment, required severance pay to be calculated on the basis of continuous...

Citation
[2007] ZALAC 4
Parties
Appellant: AST Holdings (Pty) Ltd; Respondent: Andre Roos
Court
Labour Appeal Court
Jurisdiction
South Africa
Judgment Date
4 May 2007
Case Number
JA2/2005
Procedural Posture
Civil Appeal / Appeal From Labour Court Judgment
Outcome
Appeal dismissed with costs.
Judges
McCALL, ZONDO, KRUGER
Legal Topics
Transfer of Business, Continuity of Employment, Severance Pay, Section 197 Lra, Basic Conditions of Employment Act
Labour Law Transfer of Business Continuity of Employment Severance Pay Section 197 Lra Basic Conditions of Employment Act

Case Brief

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Parties

AST Holdings (Pty) Ltd

Appellant

Andre Roos

Respondent

Procedural Posture

Civil Appeal / Appeal From Labour Court Judgment

Legal Issues

  1. 1 Whether the respondent's years of service with Iscor should be included in the calculation of severance pay after transfer to AST Holdings.
  2. 2 Whether an agreement to forfeit prior years of service upon transfer is lawful under section 197(4) of the Labour Relations Act.
  3. 3 Whether the Basic Conditions of Employment Act applies to the calculation of severance pay in this context.

Ratio Decidendi

The Labour Appeal Court held that section 197(4) of the Labour Relations Act prohibits any agreement that interrupts an employee's continuity of employment when a business is transferred as a going concern. The respondent's years of service with Iscor must be included in the calculation of severance pay, as the transfer of his contract of employment to AST Holdings occurred within the context of section 197. The purported agreement to forfeit prior years of service was unlawful and contrary to the express provisions of section 197(4). The Basic Conditions of Employment Act 75 of 1997, in force at the time of retrenchment, required severance pay to be calculated on the basis of continuous...

Court Disposition

Appeal dismissed with costs.

Orders

  • The appeal is dismissed with costs.
  • The respondent's years of service with Iscor must be included in the calculation of severance pay.