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The Copyright of This Thesis Vests in the Author. No The copyright of this thesis vests in the author. No quotation from it or information derived from it is to be published without full acknowledgementTown of the source. The thesis is to be used for private study or non- commercial research purposes only. Cape Published by the University ofof Cape Town (UCT) in terms of the non-exclusive license granted to UCT by the author. University THE REGULATION OF WORK: WHITHER THE CONTRACT OF EMPLOYMENT?: AN ANALYSIS OF THE SUITABILITY OF THE CONTRACT OF EMPLOYMENT TO REGULATE THE DIFFERENT FORMS OF LABOUR MARKET PARTICIPATION BY INDIVIDUAL WORKERS Town Rochelle Le CapeRoux Juneof 2008 University THE REGULATION OF WORK: WHITHER THE CONTRACT OF EMPLOYMENT?: AN ANALYSIS OF THE SUITABILITY OF THE CONTRACT OF EMPLOYMENT TO REGULATE THE DIFFERENT FORMS OF LABOUR MARKET PARTICIPATION BY INDIVIDUAL WORKERS Rochelle Le Roux Thesis Presented for the Degree of DOCTOR OF PHILOSOPHY in the Department of Commercial Law UNIVERSITY OF CAPE TOWN June 2008 Town Cape Supervisor: Professor Evanceof Kalula (University of Cape Town) Co-supervisors: Professor Alan Rycroft (University of KwaZulu-Natal) and Professor Simon Deakin (University of Cambridge) University i DECLARATION I hereby declare that the thesis for the degree Doctor of Philosophy at the University of Cape Town hereby submitted, has not been previously submitted for a degree at this or any other university, that it is my work in design and execution and all the materials contained herein have been duly acknowledged. --------------------- -------------------- Rochelle Le Roux Date Town Cape of University ii ABSTRACT The focal research question of this thesis is the relevance of the contract of employment in modern employment. In answering this question three broad areas associated with the contract are explored: (1) the evolution of the contract of employment in South Africa and the dichotomy between the contract of employment and the independent contract; (2) the forms of engagement of workers in the South African labour market; and (3) alternative regulatory models with specific reference to models that are consistent with the South African Constitution. Using a comparative approach it is shown that the contract of employment in South Africa is in a relative state of unification. However, some assumptions about its historical evolution and the influence of Roman and Roman-Dutch law are overstated, and more recent developments, such as tax legislation, arguably had a gTownreater influence on the dichotomising of labour law. The study of the South African world of work illustrates that modern work is performed in diverse ways. After illustrating that labour law has both countervailing andCape social de velopmental roles, it is concluded that the contract of employment as traditionally understood is no longer capable of performing these roofles. It is further claimed that a process of diversification (as opposed to the unification of the contract of employment) will help to redefine the contract of employment and this may extend the coverage of labour legislation to those who, bearing in mind the purpose of labour law, ought to be protected by labour laws. Finally, it is argued that the South African CUniversityonstitution provides a ready paradigm within which to achieve such a process of diversification which would ultimately lead to an extension of the coverage of labour laws. iii ACKOWLEDGEMENTS I am extremely grateful to my supervisor, Professor Evance Kalula, for his advice, constant affirmation and support during the writing of this research. I am also indebted to Professor Alan Rycroft and Professor Simon Deakin who acted as my co-supervisors. I am indebted to Professor Richard Mitchell for helping me with the formulation of my initial proposal – which turned out to be a reliable roadmap – and to Professor Darcy Du Toit for many insightful conversations before and during the writing of this research. I gratefully acknowledge the financial support received from the Harry Crossley Foundation. Town I would like to thank Linda van de Vijver for her incomparable editorial services and Amanda Botha for the painfuCapel task of ch ecking cross-references, the case list and the bibliography. of I am deeply indebted to the staff of the Brand van Zyl Law Library and the Interlibrary Loans Department at the University of Cape Town and wish to record their excellent and friendly service. Throughout thisUniversity research my thoug hts were with Edith Stoffels, Linda Hess, Michael Pedro and Elsabe Guma. They are domestic workers who, despite having been exploited, still take pride in their work. I dedicate this thesis to the plight of domestic workers. I am also very grateful for the support and encouragement of a number of friends, relatives and colleagues: my mother (Joyce Le Roux), Hannelie Arndt, Amanda Botha, Anita Visser, Dilshaad Brey, Evert Verhulp, Faldielah Khan, Guido de Wilde, Hugh Corder, Jan Hallebeek, Jenny Erasmus, Lyn Holness, Mike Larkin, Pamela Snyman, PJ Schwikkard, Rosy Watson, Sue Wright, Zoelfa Jaffer, Linda Whitfield, Danie Visser and Margareet Visser. iv TABLE OF CONTENTS Declaration i Abstract ii Acknowledgements iii Table of contents iv Abbreviations and Acronyms x CHAPTER 1 INTRODUCTION 1 1.1 Focal research question, rationale for and aim of the research 1 1.2 Areas of research and methodology Town 4 1.2.1 The evolution of the contract of employment 4 1.2.2 The world of work 5 1.2.3 The future of the contract of eCapemploymen t and the Constitution 5 1.2.4 The purpose of labour laofw 6 1.3 Literature survey 6 1.4 A note on dates 8 1.5 A note on labour dispute settlement in South Africa 9 1.6 StUniversityructure 10 CHAPTER 2 THE EVOLUTION OF THE CONTRACT OF EMPLOYMENT IN SOUTH AFRICA: A COMPARATIVE STUDY 11 2.1 Objective 11 2.2 The evolution of the contract of employment: England 12 2.2.1 Introduction 12 2.2.2 The rise and fall of the Master and Servant Laws 13 v 2.2.3 Social welfare legislation and the contractualisation of employment 16 2.2.4 The ‘worker’ concept 21 2.2.5 Concluding remarks 21 2.3 The evolution of the contract of employment: South Africa 22 2.3.1 Introduction 22 2.3.2 Master and Servant Laws and social welfare legislation: Towards unification 27 2.3.2.1 Master and Servant Laws 27 2.3.2.2 Social welfare legislation 36 2.3.3 The control test 41 2.3.4 The influence of Roman-Dutch law and the binary divide Town 47 2.3.4.1 Introduction 47 2.3.4.2 Roman-Dutch law 49 2.3.4.3 The locatio conductio in SouthCape Africa 50 2.3.4.4 Towards a binary divide 52 2.3.4.5 The exception of 56 2.3.4.6 The end of the control test – the confirmation of the binary divide 60 2.3.4.7 The binary divide and tax legislation 64 2.3.5 Industrial relations legislation 68 2.3.5.1 1914University to 1956 68 2.3.5.2 1956 to 1979 77 2.3.5.3 1979 to 2000 79 2.3.5.4 2000 and beyond 82 2.3.5.4.1 The courts 82 2.3.5.4.2 Legislation 85 2.3.5.4.3 Code of Good Practice: Who is an employee? 85 2.3.6 Précis 86 2.4 The evolution of the contract of employment: the Netherlands 87 2.4.1 Introduction 87 vi 2.4.2 The general nature of the arbeidsovereenkomst 88 2.4.3 The arbeidsovereenkomst compared to other specific agreements in the BW 92 2.4.4 Conclusion (the Netherlands) 100 2.5 Conclusion 101 CHAPTER 3 REFLECTING ON THE PURPOSE OF LABOUR LAW 104 3.1 Objective 104 3.2 The traditional and related views 104 3.3 The new world of work 112 3.3.1 Unemployment 114 3.3.2 Non-standard employment Town 114 3.3.3 Feminisation of work 115 3.3.4 Informal labour market 115 3.4 The future: a social welfare agenda?Cape 116 3.5 The limitations of labour law 119 3.6 Précis of 121 3.7 The Constitution 121 3.8 Conclusion 129 CHAPTER 4 THE WORLD OFUniversity WORK: FORMS OF ENGAGEMENT IN SOUTH AFRICA 131 4.1 Introduction 131 4.2 The size of the workforce 136 4.3 Standard employment 139 4.4 Non-standard employment 140 4.4.1 Casualisation 142 4.4.2 Externalisation 147 4.4.2.1 Intermediaries 148 4.4.2.1.1 Subcontracting, outsourcing and homeworking 148 vii 4.4.2.1.2 Labour broking 153 4.4.2.1.3 Franchising 157 4.4.2.2 Commodification of the individual employment relationship 159 4.4.2.3 Précis 161 4.5 Work without a valid contract 162 4.5.1 Introduction 162 4.5.2 Absence of required intent 162 4.5.2.1 Clergy 162 4.5.2.2 Genuine volunteer workers 164 4.5.3 Illegality arising from a legislative prohibition 167 4.5.3.1 Illegal foreign workers 168 4.5.3.2 Child labour 172 4.5.3.3 Sex workers Town 173 4.6 Independent contractors and the self-employed 174 4.7 Idiosyncratic forms of work 176 4.7.1 Worker co-operatives Cape 176 4.7.2 Partners 178 4.7.3 Students undergoing vocationalof work 179 4.7.4 Students (as students) 182 4.7.5 Exclusions in the LRA and BCEA and other legislation 183 4.7.6 Presidential appointments, parliamentarians and ministerial appointments 184 4.7.7 JudgesUniversity 187 4.7.8 Unpaid work and caring responsibilities 187 4.8 The informal labour market 188 4.9 Conclusion 190 CHAPTER 5 WHITHER THE CONTRACT OF EMPLOYMENT? EVOLUTION OR METAMORPHOSIS 194 5.1 Introduction 194 5.2 The statutory regime 195 viii 5.2.1 The Labour Relations Act 66 of 1995 (LRA) 195 5.2.2 The Constitution 198 5.2.2.1 General 198 5.2.2.2 Interpretation 200 5.2.2.3 The worker 202 5.2.2.4 Labour practice 206 5.2.2.5 The nature of section 23(1) of the Constitution 209 5.3 The potential of the current legislative regime 210 5.3.1 The definition in the LRA and the BCEA 211 5.3.2 The presumption in the LRA and the BCEA 214 5.3.3 The Code 218 5.3.4 Economic dependence and the independent contractor
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