In Department of Agriculture, Forestry and Fisheries v Teto and Others,1 the Labour Appeal Court (“LAC”) considered whether the termination of employees initially engaged on fixed-term contracts constituted a dismissal on the basis that the employees had become indefinitely employed when they were permitted to work beyond the expiry date in their fixed-term contracts.
In this case, the employees had been engaged on fixed-term contracts for the duration of one year but had continued to work for the employer in their same positions, performing the same tasks for another two years before their services were eventually terminated. The General Public Service Sectoral Bargaining Council found that the employees were permanent employees and had been unfairly dismissed. The employees’ reinstatement was ordered.
On review, the Labour Court held that:
On appeal, the employer argued that it was not the employer of the employees at the time of the termination, as they were temporary employment service employees. It further alleged that on the expiry of the fixed-term contracts the employees were no longer employed by the employer and instead became employees of an agency, which paid their salaries. The evidence of the employees was that on the expiry of the fixed-term contract, they had been informed that they would continue in their same positions on an indefinite basis, but their salaries would no longer be paid through the government payroll system. Instead, they would be paid through a service provider. The employer paid the agency, and, in turn, the agency paid the employees. The reason for this was that the employees’ positions did not appear on the organogram of the employer. Importantly, there was no employment contract entered into between the employees and the agency, the employer made arrangements for their travel to work, and paid daily subsistence allowances.
The Labour Appeal Court held that:
Thus, the appeal was dismissed.
The employees cross-appealed against the Labour Court’s judgment alleging that they should be reinstated as opposed to being awarded compensation. Regarding the cross-appeal, the Labour Appeal Court held that reinstatement is the default remedy if a dismissal is substantively unfair unless there are exceptional circumstances that warrant the granting of compensation instead. The employer had not made out a case that any exceptional circumstances exist and as such the cross-appeal was upheld. The employees were subsequently reinstated.
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