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Business Transfers and Employment Rights in South Africa

Business Transfers and Employment Rights in South Africa is an in-depth guide to the full range of employment- law issues that arise in the course of business transactions. Authoritative and comprehensive, it i

Publication Language: English
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ISBN/ISSN: 9780409012460

Product description

Business Transfers and Employment Rights in South Africa is an in-depth guide to the full range of employment- law issues that arise in the course of business transactions. Authoritative and comprehensive, it is the first reference on this key area of business. It will help you, the busy professional, to understand the employment-law implications of your transactions, to structure your transactions appropriately and to manage risk from a human resources perspective.


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Table of contents

The impact of business transfers on employment contracts: Developments from the common law


A contract of employment as personal to the parties

A change in shareholding in the corporate entity that owns a business does not interrupt employment contracts with the corporate entity

A transfer of the business from one owner to another generally resulted (before section 197) in the redundancy of employees

The prohibition on unfair labour practices

Developments in Europe: The safeguarding of employees' rights

Developments in South Africa: Section 197 of the Labour Relations Act

The impact of the constitutional right to fair labour practices

Section 197: The statutory assignment of contracts of employment

The applicability of section 197


The test for the application of section 197



Employment in the business being transferred

Transfer "as a going concern"


Addendum: The constitutional dimension


Socio-economic rights

The status of employment benefits

Section 197 and the Constitution


Applying the constitutional test


Consequences of transfer: Conditions of employment


Transfer of a contract of employment: New contract or old?

The content of the contract of employment: What is transferred?

Automatic substitution of employers in respect of contracts of employment in existence immediately before the date of transfer

A right to object?

Rights and obligations between old employer and employee continue in force between new employer and employee

Anything done before the transfer by or in relation to the old employer is considered to have been done by or in relation to the new employer

Identifying the terms of the contract of employment

Arbitration awards and collective agreements

Variation by the new employer

Variation by performance in excess of what is required under the contract

Variation permitted (expressly or impliedly) by the terms of the contract itself

Variation where the existing terms of the contract cannot be performed

Permissible unilateral variation

Variation by agreement: Collective bargaining and individual consent

Do any process obligations arise when a section 197 transfer is contemplated or takes place?

Joint and several liability

Severance pay

Specific conditions of employment

Restraints of trade

Bonus incentive and commission schemes

Share option schemes

Benefits payable post-retirement

Job titles


Employee benefit schemes


Termination of employment benefits will not generally be payable on the transfer of employment under section 197

Permissible variation

Pension funds

Medical aid schemes

Group life insurance and other insured benefits

Transfers from insolvent enterprises

The effect of insolvency on the position of employees

The purpose of sections 197A and 197B

The meaning of "transfer"

The scope of sections 197A and 197B

The effect of section 197A on the parties' rights and duties

Is the differentiation between employees of solvent and insolvent enterprises justified?

Further differences between solvent and insolvent transfers

Further requirements of the Insolvency Act and/or Companies Act

The duty to advise, to disclose information and/or to consult

Transfers and dismissal


Constructive dismissal in the transfer context

Section 187(1)(g)

Remedies for other claims in terms of section 197


Available remedies

Against whom must remedy be sought?

Contractual claims

Agreements in terms of section 197(7)