Labour brokers thrown Lifeline

By Moses Magadza 

The Supreme Court of Namibia has overturned a High Court judgment that outlawed “labour hire”, a controversial practice under which third parties recruit employees for prospective employers for a fee.

In 2007 the Parliament of Namibia adopted a new Labour Act which was implemented with effect from 1 November 2008.  Article 128 of that Act effectively banned the operations of labour brokers in Namibia.

Stung by the Act, Namibia’s largest labour hire company, Africa Personnel Services (APS), which has its headquarters in Windhoek and branches in several towns in Namibia and employs approximately 6085 employees, took the Namibian parliament and government to court arguing that the Act violated its constitutional right to do business. 

Three High Court judges ruled against APS, arguing that labour hire had no legal basis in Namibian law in terms of the common law, statute law or the International Labour Organisation Constitution.

“…consequently it is not lawful; and so labour hire is not a business or trade protected by Article 21 (1) of the Namibian Constitution…Applicant, a labour hire company, has no legal right to carry on business or trade of labour hire and therefore no right that is protectable by Article 21 (1) (j) of the Namibian Constitution,” the High Court ruled.

APS then successfully appealed against the High Court judgement in the Supreme Court and asked the higher court to strike down Section 128 of the Labour Act, of 2007 as unconstitutional.

Judgement

Chief Justice Peter Shivute, sitting with four Acting Judges of Appeal, handed down the judgement on December 14, 2009 and dwelt at length on the emotive nature of “labour hire” in Namibia.

“Considered in its historical context, it evokes powerful and painful memories of the abusive “contract labour system” which was part of the obnoxious practices inspired by policies of racial discrimination. So regarded, it constitutes one of the deeply disturbing and shameful chapters in the book of injustices, indignities and inhumanities suffered by indigenous Namibians at the hands of successive colonial and foreign rulers for more than a century before Independence. The manner of its implementation during that era mirrors and, in a sense, encapsulates a collection of some of the very worst elements the policy of apartheid brought to bear on them…” he noted.

Justice Shivute said that if properly regulated, agency work would pose no real threat to standard employment relationships or unionisation and greatly contribute to flexibility in the labour market. 

“It will enhance opportunities for the transition from education to work by workers entering the market for the first time and facilitate the shift from agency work to full-time employment. By enlisting as an agency worker with more than one agency service provider, those who by reason of their unemployment are for economic reasons constrained to find temporary work until they secure permanent employment elsewhere, improve their chances of earning an income in the interim.”

Unions do not agree

Not everyone agrees. 

Herbert Jauch, the outgoing senior researcher of the Labour Resource and Research Institute (LaRRI) says: “Recent studies have shown that companies use labour hire workers to reduce the impact of strikes by permanent workers, to achieve flexibility, to cut costs, to avoid labour problems and trade unions, to concentrate on their “core business” and to replace 'unproductive' workers."

He continues: "Labour hire workers are paid significantly less than permanent workers and they usually do not enjoy any benefits. The Supreme Court judgement, while being beneficial to labour hires companies and some of their clients will make matters worse for the workers concerned.  As labour hire companies do not create jobs, they are not beneficial for unemployed workers in their quest to find work.  One therefore has to conclude that the Supreme Court judgement not only contradicts the High Court ruling, but clearly serves the interest of the rich and powerful."