Case Law: Is a worker an independent contractor or an employee?
Before August 2002, the Labour Court had to struggle with the problem of whether or not a worker was, under certain circumstances, an independent contractor or an employee.
But in the case of Medical Association of SA & Others vs Minister of Health & Another (1997) 18 ILJ 528 (LC), a trade union applied to the Court on behalf of 9 of its members. These members were part-time district surgeons.
The concern was whether or not these surgeons were employees of the state under the new Labour Relations Act (LRA).
Read on to see what the judge found out...
In the above mentioned case, the judge found the following 5 things…
The purpose of the workers' contracts was to provide a personal service, and not to achieve a specified result. This was decided on because their contracts referred to them rendering 'services', and not a specific goal. For example, there wasn't a specific case they had to work on and research, but instead they were there to simply deal with whatever case came in.
It was found that the surgeons were required to be '…available at all times…' This showed the Court that the surgeons had to be at the beck and call of the employer all the time. They didn't work independently at their own convenience.
Read on to see the other 3 findings…
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The Court found that the contracts indicated that the employers would be liable for paying the surgeons' salaries EVEN for work they didn't do, as long as they were available to do the work.
The Court also found, through a clause, that the employer could control the way in which the surgeons carried out their services. This was based on a clause which stated that the surgeons would have to perform their duties in accordance with the instructions of the Director-General.
The contracts were liable for PAYE deductions and that they envisaged salary increases.
What did the Court decide?
After considering its findings, the Court decided that the surgeons were employees and not independent contractors.
What can you learn from this case?
From the Court's findings, you can learn that a worker is an employee if:
· She renders personal services without a specified result in mind;
· She doesn't work independently at her own convenience;
· She earns a fixed salary, even for work she doesn't actually do;
· Her work is directed and controlled by you;
· She is liable for PAYE deductions.
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Note: 5 of 3 votes