The impact on the employer’s pension promise to its employees when it transfers its business as a going concern in terms of section 197 of the labour relations act
Date
2022
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
University of the Witwatersrand, Johannesburg
Abstract
The common law does not protect the interests of employers and employees adequately when an employer transfers its business to a new employer as a going concern. Section 197 of the Labour Relations Act 66 of 1995 guarantees transferring employees’ continuity of employment regardless of being transferred to a new employer. Section 197 of the LRA determines that the new employer effectively replaces the old employer. The transfer takes place without the affected employees’ consent. New employers may impose different terms and conditions of employment than what employees received from their old employer. Employees’ pension rights are major employment benefits that may be impacted by the transfer of business. The new employer’s retirement fund may provide benefits that are different to those offered by that of the old employer. While the transfer of business is regulated by labour law, the transfer of affected employees’ pension rights is regulated by pension law. This research report discusses how the application of pension law principles ensures that transferring employees’ pension rights are not prejudiced by the business transfer over which they had no control. In particular, this report examines the legal recourse available to employees when their existing retirement fund benefits are substantially different from what they were offered by the retirement fund which was associated with their old employer.
Description
A research report submitted for the degree of Master of laws by coursework and research report At the University of the Witwatersrand, Johannesburg
September 2022
Keywords
Common law, Employers and employees interest, Section 197, Labour Relations Act 66 of 1995, Section 197 of the LRA, UCTD
Citation
Van Zyl, Gottlieb Jan Hendrik. (2022). The impact on the employer’s pension promise to its employees when it transfers its business as a going concern in terms of section 197 of the labour relations act [Master’s dissertation, University of the Witwatersrand, Johannesburg]. WireDSpace.