SA Labour Guide inadvertently circulated a misguided article this week by Ivan Israelstam – “Foreign employers can’t escape South African labour law” where the following statement is made – “Even South Africans working outside South Africa can, in certain cases, refer labour disputes to the South African dispute resolution system”. The Labour Court decision relied on was overturned by the Labour Appeal Court in 2008.
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Parry v Astral Operations Ltd [2005] 10 BLLR 989 (LC) is one of the authorities relied on for that contention. It is correct that the Labour Court decided it did have jurisdiction over an unfair dismissal dispute concerning Mr Parry, the general manager of the employer’s operations in Malawi, whose services were terminated based on operational requirements.
The Labour Court reasoned that :
• Both parties were based in South Africa
• The parties had agreed that the employer’s (South African) policies would apply
• The employer had not approved the contents of Malawian law
• Both parties were under the impression that South African law applied.
However, when the employer appealed that decision it was set aside by the Labour Appeal Court in 2008 – Astral Operations Ltd t/a County Fair v Parry (2008) 29 ILJ 2668 (LAC) per Zondo JP. That case was only reported in the Industrial Law Journal.
John Grogan discussed the appeal case briefly in “Extra-territorial” (2009) Employment Law 25:1 p 18. These are extracts from that article.
“Although Parry reported to Astral’s head office in South Africa, the Malawian and South African operations were independent of each other. The LAC accordingly concluded that the Labour Court lacked jurisdiction to entertain Parry’s claims under the BCEA.
Parry’s claims under his contract of service suffered the same fate. The court noted that the BCEA confers on the Labour Court concurrent jurisdiction with that of the High Court. That being the case, it could be argued that the Labour Court would have jurisdiction because the contract was concluded in South Africa and the order granted was enforceable in this country.
However, the LAC held that, if the BCEA does not apply, the section conferring concurrent jurisdiction on the Labour Court cannot apply either. So even if South African law applied, it did not follow that the Labour Court had jurisdiction. The finding on the choice of law simply meant that a Malawian Court could have applied South African law.
The appeal was upheld”.