NUMSA v Staman Automatic CC and Other (J1196/03) [2003] ZALC 88; (2003) 24 ILJ 2188 (LC); [2003] 11 BLLR 1167 (LC) (13 August 2003)

NUMSA v Staman Automatic CC and Other (J1196/03) [2003] ZALC 88; (2003) 24 ILJ 2188 (LC); [2003] 11 BLLR 1167 (LC) (13 August 2003)

The court found that the employees in question are regular employees of Staman Automatic CC, performing core functions connected to Staman's machinery and infrastructure, which remain with Staman. The purported transfer agreement did not involve the transfer of an economic entity or business as a going concern, but rather an outsourcing of labour. The employees do not constitute a separate service or entity capable of transfer under section 197. The arrangement merely changes the employment status of the workers without transferring any assets, management structure, or goodwill. Accordingly, the requirements for a transfer as a going concern under section 197 were not met, and the...

Citation
[2003] ZALC 88
Parties
Applicant: NUMSA; Respondent: Staman Automatic CC; Respondent: Jobmates Labour Services (Pty) Ltd
Court
Labour Court
Jurisdiction
South Africa
Judgment Date
13 August 2003
Case Number
J1196/03
Procedural Posture
Urgent Application / Judgment After Urgent Interdict Application
Outcome
The application for an interdict was granted. The transfer of the NUMSA employees' employment contracts was declared not to be a transfer within the contemplation of section 197 of the Labour Relations Act.
Judges
A A Landman
Legal Topics
Section 197 Transfer, Outsourcing, Interdict, Contract of Employment, Temporary Employment Services
Labour Law Civil Procedure Section 197 Transfer Outsourcing Interdict Contract of Employment Temporary Employment Services

Case Brief

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Parties

NUMSA

Applicant

Staman Automatic CC

Respondent

Jobmates Labour Services (Pty) Ltd

Respondent

Procedural Posture

Urgent Application / Judgment After Urgent Interdict Application

Legal Issues

  1. 1 Whether the transfer of employees from Staman Automatic CC to Jobmates Labour Services (Pty) Ltd constitutes a transfer of a business as a going concern under section 197 of the Labour Relations Act.
  2. 2 Whether the requirements for an interdict restraining the transfer have been met.

Ratio Decidendi

The court found that the employees in question are regular employees of Staman Automatic CC, performing core functions connected to Staman's machinery and infrastructure, which remain with Staman. The purported transfer agreement did not involve the transfer of an economic entity or business as a going concern, but rather an outsourcing of labour. The employees do not constitute a separate service or entity capable of transfer under section 197. The arrangement merely changes the employment status of the workers without transferring any assets, management structure, or goodwill. Accordingly, the requirements for a transfer as a going concern under section 197 were not met, and the...

Court Disposition

The application for an interdict was granted. The transfer of the NUMSA employees' employment contracts was declared not to be a transfer within the contemplation of section 197 of the Labour Relations Act.

Orders

  • It is declared that the transfer of the NUMSA employees' employment contracts is not a transfer within the contemplation of section 197 of the Labour Relations Act 66 of 1995.
  • The first respondent is interdicted and restrained from transferring those employment contracts to the second respondent.