Outsourced – Let’s chat about S197 of the Labour Relations Act

When a portion of a business is transferred or outsourced as a going concern to a new owner, the rights of employees are always a primary concern. Outsourcing must be commercially sensible, but it must also protect employment and support our fragile job markets.

Essentially, when a company takes over or buys out an existing company or division as a going concern, the rights of the employees and the obligations of the old employer are transferred to the new employer. “This includes but is not limited to length of service,” says Russell Milella of The Nimble Group, who have successfully implemented S197 transfers many times when deploying BPO solutions with their clients. Legally speaking, the new employer becomes responsible for all obligations related to the employees who are transferred from their existing employer.

S197 Applies If the Following Three Criteria Are Met

• There is a transfer of an entity from one party to another.
• The transferred entity must be the whole or a part of a business.
• The business must be transferred as a going concern.

“The process is neither difficult nor daunting,” says Milella. “Businesses considering this type of transfer should not be unduly concerned about the future of their staff, as it is very uncomplicated and caters fully for all affected employees.”

Key Considerations When Contemplating Transfers

• Agreements with unions
• Number of employees to be transferred
• Pension Fund, Provident Fund and Medical Aid
• Any outstanding labour disputes and their monetary value
• All leave entitlements and records up to date

Proud to Be a Substantial Job Creator

Nimble touches the lives of many people daily. With over 2,000 employees across the Nimble Group, substantial clients, and extensive engagement with the broader population through our large processing centre activities, the very essence of our business is people-oriented.

“When core activities are people dependent, the onus is firmly on the business and its management to be deeply people-centric,” says CEO Rowan Gordon. “Nimble’s responsibility to conduct itself as a good corporate citizen in the jurisdictions in which it operates, and to positively impact its stakeholders—customers, employees, management, shareholders, and civil society—is a responsibility we take very seriously.”

When It Comes to BPO, Nimble Will Guide You Every Step of the Way.We ensure an easy transition while protecting continuity of employment for your staff.