THE MULTI-FACTORAL TEST

The applicant referred an unfair dismissal case to the CCMA, claiming that he was unfairly dismissed by the respondent as his employment offer was withdrawn. The respondent argued the offer was withdrawn because the applicant’s operating licence had been suspended and he would have been an independent contractor, not an employee. The evidence favoured the conclusion that the applicant was not an employee, and he failed to prove dismissal. Accordingly, the CCMA lacked jurisdiction over the dispute.

Freswick / Mozee Management and Consulting Services (Pty) Ltd (2024) 32 CCMA 8.34.1

Case summary

The parties to the matter were Mark Freswick, the applicant, and Mozee Management and Consulting Services (Pty) Ltd, the respondent. The applicant asserted that he had signed an employment contract with the respondent to solicit funeral policies from church congregants for a salary of R7 million instead of commission. He subsequently referred the unfair dismissal dispute on the grounds that the respondent had withdrawn the offer of employment.

The respondent, however, contended that the offer of employment was withdrawn because the applicant’s operating licence had been suspended, so, the applicant would have been engaged as an independent contractor. The respondent also noted that the applicant would have been able to earn income from another business, UMC, as an intermediary service provider, a fact confirmed in a WhatsApp message.

It was common cause that the applicant’s licence was suspended. The applicant argued that his operating licence had lapsed because he failed to pay the required fees as he had no income. He claimed that he was neither dishonest nor involved in any ulterior conduct and that he would have been operating under the respondent’s banner as an employee, rendering his operating licence irrelevant.

The commissioner had to determine whether the applicant was an independent contractor and, if found to be an employee, whether he was unfairly dismissed. The commissioner referred to the case of Uber South Africa Technology Services (Pty) Ltd v NUPSAW and others [2018] 4 BLLR 399 (LC), which dealt with the distinction between an employee and an independent contractor, and the existence of an employment relationship. It was held that “the test to determine the existence of an employment relationship ultimately remains a multi-factoral one. In terms of the prevailing law, the ‘realities of the relationship’ cannot be reduced to a single, substantive test – a conspectus of all of the relevant facts and circumstances is required, including an examination of the realities of the relationship where this is warranted, typically in circumstances where contractual arrangements are used to disguise those realities. If the applicant is not deemed an employee, such applicant cannot allege unfair dismissal.” Thus, there can be no termination of employment if there is no existing employment relationship.

The applicant claimed he was employed as a head of department, but according to the agreement with the respondent, he would have been engaged as a representative. This indicated that the relationship intended by the parties was not an employment relationship, particularly because the applicant would have been able to source more income from other businesses, such as UMC.

The commissioner found that the contract in question called for the “informal arbitration” of disputes, excluding Labour Relations Act relief, and lacked details on work hours and income. Therefore, the more persuasive submission on the balance of probabilities was that of the respondent, as there were more determining factors leading to the conclusion that the applicant was not an employee. Consequently, the applicant could not have been dismissed as no employment relationship existed.

The commissioner ruled that the CCMA lacked jurisdiction over the dispute.

This article does not constitute legal advice. For an informed opinion and/or assistance with a labour-related matter, you are encouraged to arrange a formal consultation with the author.

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