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February 12, 2016

Termination of a service agreement and s 197 of the LRA

In Enviroserv Waste Management v Interwaste (Pty) t/a Interwaste Environmental Solutions and Others (P408/15) [2015] ZALCPE 6, the court had to decide if the expiry of a limited duration contract with a service provider and the awarding of the tender for the provision of such services to a new service provider, constituted a transfer of a business as a going concern.
Enviroserv handled General Motors South Africa’s (“GM”) on-site waste management. When the service provider agreement ended, GM contracted Interwaste as its new supplier.
The crisp question that the court had to decide was whether the termination of a service agreement entitled the employees of the first service provider to have their contracts transferred to the new service provider.
The court considered the effect of section 197 of the Labour Relations Act which provides that if a transfer of a business takes place, the new employer will be “automatically substituted for the old employer in respect of all contracts of employment in existence immediately before the date of transfer”.
Section 197 contemplates a transfer of a business as a going concern. The section depends on the presence of three factors, namely, “business”, “transfer” and “going concern”.
The court held that the activities of Enviroserv and GM did not constitute a “business” as envisaged by section 197, on the basis that the nature of the waste management industry is one in which businesses win and lose tenders to provide services for a limited period, which did not constitute a “business” for the purposes of section 197. On that basis, the employees did not have a reasonable expectation of being transferred to Interwaste, and the court dismissed the application to have the employees transferred to Interwaste.

February 10, 2016

My body corporate has disconnected my electricity!

Please can you kindly advise me on how I can challenge the body corporate to stop the process of disconnecting electricity.

The electricity at our complex is pre-paid.

As regards your query, first and foremost you must check the Management and Conduct Rules of the scheme to ensure that the Rules do not give the Body Corporate the right to terminate the electricity supply to your section if you are in arrears with your levy.

Secondly you must bear in mind that notwithstanding that you have a prepaid meter there is still a portion of electricity that you are not paying, i.e. the electricity consumed on common property that you are responsible for by virtue of the participation quota of your unit.

Would it not be more worthwhile for you to make an arrangement to pay the arrear levies due to the Body Corporate in respect of your unit?

Answer provided by Karen Bleijs, a sectional title expert.