Van Wyk v Gowases and Another (LC 40/2008 ) [2008] NALC 3 (18 December 2008);

Group

Full judgment



Special Interest


SUMMARY

Case No.: A 4/2008

AFRICAN PERSONNEL SERVICES

and

GOVERNMENT OF NAMIBIA AND OTHERS

Heard on: 2008 November 24

Delivered on: 2008 December 1

PARKER, J et NDAUENDAPO, J et SWANEPOEL, AJ

___________________________________________________________________________

Constitutional Law - Human Rights – Right to carry on any business or trade under Article 21 (1) (j) of Namibian Constitution – Derogable – Only a business or trade that is lawful can claim protection under Article 21 (1) (j) of the Namibian Constitution.


Constitutional Law – Human rights – Locus standi in judicio – Article 21 (1) (j) rights vest in all persons, citizens of Namibia and non-citizens of Namibia so long as the non-citizens are lawfully within Namibia and they meet certain statutory requirements, e.g. work permits and permanent residence permits – Court reasoned that naturally and logically, while some of the Article 21 (1) rights can be exercised by natural persons only, others may be exercised by both natural and legal persons.


Constitutional Law – Legislation – Section 128 of Labour Act, 2007 (Act No. 11 of 2007) – Constitutionality and validity of – Court finding that applicant has failed to establish he has legal right to carry on business or trade of labour hire and therefore protectable right under Article 21 (1) (j) of Namibian Constitution.


Constitutional Law – Separation of powers – Principle firmly embedded in Namibia’s constitutionalism – Power of the High Court to declare statutes that are repugnant of the Constitution unconstitutional – Such power not violative of principle of separation of powers.


Labour Law – Namibia’s labour Law – Based on the common law of contract of employment, as modified by statute and Namibia’s obligation under ILO Constitution and ILO Conventions and Standards


Labour Law – Contract of employment – Governed by general principles of contract – Additionally, it is derived from locatio conductio operarum; i.e. letting and hiring of personal service between a servant and his master for monetary return, under Roman Law – This form of letting and hiring contrasted with locatio conductio operas (faciendi), i.e. present-day independent contractor and also with locatio conductio rei, i.e. the letting and hiring of a specified thing for reward, e.g. the hiring of a slave, as the thing (res) by his slave-master to another person for reward under Roman Law.

Labour Law Labour hire – What constitutes –– Imposition of a third person, i.e. the labour hire company, in the employer-employee relationship, though agency not privy to the contract of employment – Having no basis in Namibian labour law because it offends the common law, statute law, and Namibia’s international obligation under the ILO Constitution, which prohibits commoditization of labour, and further smacks of locatio conductio rei in Roman Law –


Practice – Affidavit – Hearsay evidence in – As a general rule hearsay evidence not permitted in – Where deponent includes in affidavit facts of which deponent has no first-hand knowledge, deponent may annex to his or her affidavit verifying affidavit of person who has first-hand knowledge of facts – If such deponent fails to do so such facts in his or her affidavit remains inadmissible hearsay evidence. – Court finding certain paragraphs in respondents’ affidavits constituting inadmissible hearsay evidence and therefore striking them out


PracticeDisputes of facts on the papers – Approaches by the Courts in dealing with such disputes of facts – Courts must critically examine the alleged disputes of facts in order to see if really they are genuine disputes of facts that cannot satisfactorily be determined without the aid of oral evidence – In casu Court finding that though some disputes of facts exist but they are irrelevant to the determination of the constitutional challenge Court is seized with.


Held: The Article 21 (1) (j) right is derogable.


Held: Not every business or trade is protected by Article 21 (1) of the Namibian Constitution


Held: Before an applicant can successfully complain of violation of the Article 21 (1) (j) right, applicant must establish, first, that applicant has a legal right to carry on the particular business or trade, and second, that that right is also a fundamental right.

Held: A lawful business or trade in terms of Article 21 (1) (j) is that business or trade, which is not criminal or which has legal basis in Namibian law.

Held: Contract of employment is governed by general principles of contract.

Held: Labour hire has no legal basis in Namibian law in terms of the common law, statute law or the ILO Constitution and consequently it is not lawful; and so labour hire is not a business or trade protected by Article 21 (1) of the Namibian Constitution.

Held: 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.

Held: Article 21 (1) (j) rights vest in all persons, natural and legal, and in citizens of Namibia and non-citizens of Namibia.


Held: Section 128 of Labour Act, 2007 is constitutional and, therefore, valid.


Held: Every legislation or section of it, irrespective of whether it regulates an economic activity, if inconsistent with Article 21 and if it does not meet the requirements of Article 21 (2), read with Article 22, is repugnant to the Constitution and is pro tanto void.

Held: When the High Court declares a statute or section of it unconstitutional, it does not by so doing violate the principle of separation of powers.

Held: Hearsay evidence in affidavit constitutes inadmissible evidence.

Held: Court may only call in aid oral evidence to resolve genuine disputes of facts where disputes are such that the issues cannot satisfactorily be determined without the aid of oral evidence.




CASE NO.: A 4/2008

IN THE HIGH COURT OF NAMIBIA


In the matter between:


AFRICA PERSONNEL SERVICES (PTY) LTD     Applicant

and

GOVERNMENT OF NAMIBIA     1st Respondent

SPEAKER OF THE NATIONAL ASSEMBLY     2nd Respondent

CHAIRPERSON OF THE NATIONAL COUINCIL OF THE REPUBLIC OF NAMIBIA     3rd Respondent

THE PRESIDENT OF THE REPUBLIC OF NAMIBIA     4th Respondent



CORAM: PARKER, J et NDAUENDAPO, J et SWANEPOEL, AJ

Heard on: 2008 November 24, 25

Delivered on: 2008 December 1

­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­_____________________________________________________________

JUDGEMENT:

PARKER, J.:

Introduction

[1] In this matter, application is made on notice of motion by the applicant in which it has prayed for orders in the following terms:


  1. striking down s 128 of the Labour Act, 2007 (Act No. 11 of 2007) as unconstitutional.


  1. costs of suit.


  1. Further and/or alternative relief.


[2] The applicant’s founding affidavit and replying affidavit are deposed to on its behalf by Johannes Arnoldus Botha who describes himself as the executive chairperson of the board of directors of the applicant. The applicant is represented by Mr. Smuts. The 1st and 4th respondents’ answering affidavit is deposed to on their behalf by Ms Ulitala Hiveluah who describes herself as the Permanent Secretary of the Ministry of Labour and Social Welfare. The 1st and 4th respondents (the respondents) are represented by Mr. Chaskalson. The 2nd and 3rd respondents have not filed any answering affidavits. This is an application that challenges the constitutionality of a section of a statute. In terms of Article 25 (1) (a), this Court has the power and the discretion, instead of declaring the section sought to be impugned invalid, allow Parliament or the Executive to correct any defect in the impugned law within a specified period, subject to any specified conditions. It is a reality of our statute law that since Independence it has only been the Executive that has tabled before Parliament legislative proposals for Parliament’s consideration and enactment. No private members’ Bills have been enacted since Independence. I, therefore, find that it is enough that the 1st and 4th respondents have been cited and they have caused an answering affidavit to be filed on their behalf in opposition to the application.


[3] The papers from either side have been embellished with innumerably copious annexes and attachments, including confirmatory affidavits. The main attachments to the applicant’s founding and replying affidavits, including confirmatory affidavits, primarily seek to glorify the virtues, benefits and advantages of labour hire. For instance, in his submission, Mr. Smuts mentioned how labour hire contributes greatly to the economy of the country, particularly in fulfilling seasonal-short-term labour requirements in such sectors as mining, fishing, agriculture, transportation and construction. The main attachments of the respondents’ answering affidavit, including confirmatory affidavits, on the other hand, basically highlight the ills and the dangerously exploitative nature of labour hire. For example, Mr. Chaskalson mentioned in his submission how labour hire shared certain attributes with the erstwhile notorious, inhuman, apartheid-coloured SWAWLA system and how labour hire commoditized labour and, thus, took away the dignity of those whose labour labour hire agencies hired out to their clients. In this regard, I think I must make the point that despite this lush of plenteous pages and pages of papers upon papers, the question that must be determined in the present application is not so dense and wide.


[4] I will first of all consider the applicant’s interlocutory application to strike out paras. 40.2 (record 224), 40.5 (record pp 224-5) and 48.4 (record p 230) in Hiveluah’s affidavit, and the whole of paragraphs 6 and 7, inclusive of their annexures, in Musukubili’s affidavit. Mr. Smuts argued that those paragraphs ought to be struck out because they constitute hearsay evidence. Mr. Chaskalson opposed the application, but conceded that, indeed, para 40.5 may be struck out. Mr. Smuts, too, conceded that annexure FM2 did not constitute hearsay evidence


[5] In the authoritative work Herbstein and Van Winsen: The Civil Practice of the Supreme Court of South Africa, 4ed at pp 368-9, the following general rule is put forth:


As a general rule … hearsay evidence is not permitted in affidavits. It may accordingly be necessary to file affidavits of persons other than the applicant who can depose to the facts. Indeed, this is very often done. Alternatively, when a deponent includes in his affidavit facts in respect of which he does not have first-hand knowledge he may annex a verifying affidavit by a person who does have knowledge of those facts.


[6] Having applied this general rule to the facts, I think I agree that paras. 40.2 and 6 (apart from annexure FM2) constitute hearsay evidence. The same cannot be said of para. 7 of Musukubili’s affidavit. Musukubili deposes to facts within his knowledge: he has first-hand knowledge of the facts he deposes to. He says, he enquired from Namib Bottle Sorting; he spoke to a Mr. De Preez; and he called applicant’s offices and spoke to a Mr. Kondo. What he states cannot constitute hearsay evidence; he does not put forth the statement to show the truth of what Mr. De Preez or Mr. Kondo had told him. In short, he had first-hand knowledge of what these people told him because they told it to him directly, not through a third party.


[7] The result is that paras 40.2 and 40.5 and 48.4 are struck out. Para 6, apart from annexure FM2, is also struck out. It is my opinion that the applicant’s application to strike out succeeds to the extent set out above, i.e. about 60%. The applicant must therefore have its costs to the extent of that percentage.


[8] I now proceed to deal with the main application (the application). Suggestions were made by Mr. Smuts – though not vigorously, as I gathered – that if the Court found that the application could not be determined on the papers due to the existence of disputes of facts, the Court may order that oral evidence be led to resolve any such disputes. Mr. Chaskalson appeared to agree with Mr. Smuts. On my part, I do not think that would be necessary. As was observed in Ter Beek v United Resources CC and another 1997 (3) SA 315 (C), and adopted by this Court in Kahuure and others v Mbanderu Traditional Authority and others Case No.: (P) A 114/2006 (Unreported), it is not every dispute of fact that must go for oral evidence. Having examined the alleged disputes of fact, I am of the view that the present application, which is primarily a constitutional challenge of a statutory provision, can satisfactorily be determined without the aid of oral evidence. In other words, there may be disputes of fact on certain matters; but they are not so relevant as to be capable of impeding a proper determination of the present application. For instance, there is no dispute that the activity that the applicant carries on is labour hire as referred to in s 128 of the Labour Act; the section of the Act sought to be impugned in the present application.



[9] I will, at outset, concerning the main application get out of the way the respondents’ contention that the applicant has no locus standi to bring the application primarily on the basis that the right guaranteed by Article 21 (1) (j) (hereinafter referred to as “the Article 21 (1) (j) right”) vests in natural persons who are Namibian citizens. I am of the view that the right which is the subject matter of the present application vests in all persons whether they are citizens or non-citizens of Namibia, but, of course nothing precludes Parliament from enacting legislation which restricts the enjoyment of the right to non-citizens who meet prescribed statutory requirements, e.g. work permits and permanent resident permits, allowing them to lawfully reside in Namibia in order to practise any profession, or carry on any occupation, trade or business.


[10] The other leg of the respondents’ position is that the Article 21 (1) (j) right vests only in natural persons. I do not think that is correct either. (See Fantasy Enterprises CC t/a Hustler the Shop v Minister of Home Affairs and another; Nasilowski and others v Minister of Justice and others 1998 NR 96.) Granted, some of the rights guaranteed by Article 21 (1) can naturally only be enjoyed by natural persons, e.g. the right to freedom of speech (para. (a)), to freedom of thought, conscience and belief (para. (b)), to freedom to move freely throughout Namibia (para. (g)), and to freedom to practise any profession (para. (j)). However, some of the rights may be enjoyed by both natural and legal persons, and some by legal persons only, i.e. the right to freedom of the press and media (para. (a)), to freedom of association (para. (e)) to freedom to carry on any trade or business (para. (j) (the subject matter of the present application). If it was the intention of the makers of the Constitution to restrict the enjoyment of all the rights in Article 21 (1) to only natural persons who are Namibian citizens they would have made such of their intention known by clear words. Indeed, nothing could have prevented them from defining persons in the definitions provisions (Article 146) or from defining the word “person” specifically for purposes of Article 21 (1) only, as is done in many statutes. The result is that I find that the respondents’ position is indefensible and their submission baseless. I rather accept the applicant’s counsel’s argument on the issue. In any case, as far as this Court and the present application are concerned, the respondents’ counsel does not advance any submissions on the point: counsel reserved the respondents’ right to argue the matter on appeal, should it become necessary.


[11] As I have already intimated, the present application has been brought by notice of motion to strike down as unconstitutional s 128 of the Labour Act, 2007 (Act No. 11 of 2007) (the Labour Act 2007). The applicant’s position is that s 128 of the Labour Act 2007 is inconsistent with the applicant’s right to the fundamental freedom “to carry on a trade or business” guaranteed to it by Article 21 (1) (j) of the Namibian Constitution. In sum, by this application, the applicant seeks to impugn s 128 of the Labour Act 2007 on the basis, so the applicant contends, that the section infringes the applicant’s Article 21 (1) (j) right.


[12] Article 21 of the Namibian Constitution, inasmuch as it is relevant to the present application, provides:


(1) All persons shall have the right to:


(j) … carry on any … trade or business.


Section 128 of the Labour Act provides:


Prohibition of labour hire

128. (1) No person may, for reward, employ any person with a view to making that person available to a third party to perform work for the third party.


(2) Subsection (1) does not apply in the case of a person who offers services consisting of matching offers of and applications for employment without that person becoming a party to the employment relationships that may arise therefrom.


(3) Any person who contravenes or fails to comply with this section commits an offence and is liable on conviction to a fine not exceeding N$80,000 or to imprisonment for a period not exceeding five years or to both such fine and imprisonment.


(4) In so far as this section interferes with the fundamental freedoms in Article 21 (1) (j) of the Namibian Constitution, it is enacted upon the authority of Sub-article 2 of that Article in that it is required in the interest of decency and morality.


[13] The Article 21 (1) (j) right is derogable because it is not one of those rights declared underogable by Article 24 (3) of the Namibian Constitution: this is significant. Equally significant – and it arises from the derogability of that right – is that the exercise of the right is not boundless: it is subject to a restriction insofar as the exercise of the Article 21 (1) (j) right is “subject to the law of Namibia”. The constitutional restriction or limitation to the exercise of that right is provided for in Article 21 (2) of the Namibian Constitution in this way:


The fundamental freedoms referred to in Sub-Article (1) hereof shall be exercised subject to the law of Namibia, in so far as such law imposes reasonable restrictions on the exercise of the rights and freedoms conferred by the said Sub-Article, which are necessary in a democratic society and are required in the interests of the sovereignty and integrity of Namibia, national security, public order, decency or morality, or in relation to contempt of court, defamation or incitement to an offence.


[14] Thus, the constitutional restriction or limitation in the main clause of Article 21 (2) to which the Article 21 (1) (j) right is subject is also not limitless: the restriction is in turn circumscribed by the proviso in the above-quoted Article 21 (2).


[15] The effect of the derogability of the right in terms of Article 24 (3) and the restriction and the proviso to the restriction in terms of Article 21 (2) is this: the Parliament may make law that is inconsistent with Article 21 (1) (j) or which takes away the right, provided this inconsistency or taking away was reasonable, necessary in a democratic society, and was in the interests of the different matters mentioned in Article 21 (2), as the Supreme Court of India observed in Narendra Kumar v Union (1960) 2 SCR 375 at 387. In that case, the Supreme Court of India was seized with interpreting Article 19 (1) (g) of the Indian Constitution whose provisions are almost identical to those of Article 21 (1) (j) of the Namibian Constitution. It follows that in my view what Article 21 (1) (j) has granted is not an absolute right but a right subject to permissible restrictions.


[16] The makers of the Namibian Constitution were not just content with providing only for a statutory restriction on the Article 21 basic rights (including the Article 21 (1) (j) right) that are derogable; they went further than that. The makers of the Namibian Constitution provided in Article 22, entitled “Limitation upon Fundamental Rights and Freedoms”, that whenever a statute takes away a derogable right under the Constitution, the law in question must be of general application and certain requirements must be worked into the Act or a provision thereof; showing the extent of the limitation and the authority in terms of the Constitution, on which the limitation is based. Article 22 provides:


Limitation upon Fundamental Rights and Freedoms

Whenever or wherever in terms of this Constitution the limitation of any fundamental rights or freedoms contemplated by this Chapter is authorised, any law providing for such limitation shall:


  1. be of general application, shall not negate the essential content thereof, and shall not be aimed at a particular individual;


  1. specify the ascertainable extent or such limitation and identify the Article or Articles hereof on which authority to enact such limitation is claimed to rest.


[17] The object of Article 21 (2), read with Article 22, of the Namibian Constitution is, therefore, to save laws that are otherwise inconsistent with Article 21 (1), or which take away the rights conferred by Article 21 (1). Accordingly, a legislation or a section of it, which is inconsistent with Article 21 (1) and which does not meet the requirements of Article 21 (2), read with Article 22, is repugnant to the Constitution and, therefore, pro tanto void (Marbury v Madison (1803) 1 Cranch 137).


[18] To repeat what I have said previously; the applicant says that its Article 21 (1) (j) right is infringed by s 128 of the Labour Act 2007. Doubtless, the first port of call in the present enquiry must perforce be the interpretation and application of Article 21 (1) (j) inasmuch as it is relevant to the present application. As I understand Article 21 (1) (j), not every “trade or business” is entitled to the protection of Article 21, e.g. a business that is for a criminal enterprise. Thus, a person who is in the business of, for instance, stock theft, the keeping of a brothel, trafficking in women or children, and slavery cannot be heard to claim a right under Article 21 (1) (j) of the Constitution on the basis that the business or trade yielded a profit or income. That much Mr. Smuts is in agreement with. The reason – and this is very important for our present purposes, as I shall demonstrate in due course - is not only because such activity is criminal; it is also because it has no basis in law. In my view, if the business or trade has no basis in law, it is not lawful; and as Maritz, J (as he then was) correctly stated, in Hendricks and others v Attorney-General, Namibia and others 2002 NR 353 at 357H, “It is, in my view, implied by that article (i.e. Article 21 (1) (j)) that the protected right relates to a profession, trade, occupation or business that is lawful.”(My emphasis) It is also my view that “lawful” ought to be understood in its wider signification, namely that the activity involved in the business or trade is lawful when it is not a crime or when it has legal basis in Namibian law. In this regard, as I will demonstrate shortly, in Namibia labour hire is not lawful because it has no legal basis in Namibian law.


[19] What is “labour hire”? The use of a labour-hire arrangement involves splitting, so to say, what would otherwise be a contract of employment into a number of contracts for the provision of personal service between X (a person who is to supply the service) and Y (a labour-hire agency) and between Y and Z (a host or a client of Y, i.e. the one for whom X renders his or her personal service). In “Labour Hire in Namibia: Current Practices and effects” (May 2006) at p.8, LaRRI, a labour resource and research institute, describes labour hire as an arrangement whereby an agency provides individual workers to a client or host. According to LaRRI, “Labour hire employment involves three parties and creates ‘triangular employment relationship” which differs from the traditional type of employment involving two parties (the employer and employee)”. With respect, this is muddled theorizing. To start with, there is no such thing as “triangular employment relationship” in our law. LaRRI also describes labour hire in the above-quoted publication as “form of a global trend towards more ‘flexible’ forms of employment …” (ibid. at p 5). Mr. Smuts adopts this LaRRI statement in his submission. With respect, LaRRI’s characterization of labour hire as form of “employment” is obfuscatory, unless LaRRI does not use the term “employment” in its legal signification; otherwise, the characterization has no relevance in law; and so it must be rejected for the purposes of our present enterprise.


[20] A legal definition of labour hire has been suggested by an employer and industrial lawyer in Australia, a country where such arrangement has proliferated in recent years – but not without controversy – as follows:


Labour hire is a form of indirect employment relationship in which the employer (the agency) supplies its employees to work at a workplace controlled by a third party (the client) in return for a fee from the client. A typical agency will direct an employee to work for a period (assignment) ranging from a single day to a number of years.


[Charles Power, “Labour hire: the new industrial law frontier,” Law Institute Journal, vol. 76, No. 6 (July 2002), p 64.]


[21] In the applicant’s founding affidavit, the applicant says that it concludes agreements to provide its services to its clients on the one hand and on the other hand has employment agreements with its own employees. The deponent states further that “the applicant enters into a written agreement with the client for the supply of the required labour force from the applicant to the client on terms and conditions set out in the agreement.” I have not one iota of doubt in my mind that the arrangement the deponent describes is indubitably labour hire as defined by Power. In any case, there is no dispute that the business or trade the applicant carried on is labour hire.


[22] Is labour hire “a form of employment” in our law? Employment of whom by whom? To answer the question we must direct our attention to the following enquiry: what is a contract of employment in our law? A contract of employment is an agreement whereby an individual (the employee, i.e. X) agrees to render his or her personal service to another person (the employer, i.e. Y) for an indefinite or definite period in return for an ascertainable wage or other remuneration. The agreement also entitles Y to determine, among other things, what X’s personal service will be, to generally supervise X when X is performing his or her personal service, and to generally control the manner in which X discharges such personal service. Van den Heever, AJ put it simply in National Automobile & Allied Workers Union (now known as National Union of Metalworkers of SA) v Borg-Warner SA (Pty) Ltd in this way:


Under the common law, parties conclude a contract under which one of them is to provide services in return for payment. Their agreement determines when the relationship so constituted starts; what reciprocal rights and duties are acquired and incurred by each; and, if it is to be of indefinite duration, how it may be terminated.


(1994 15 ILJ509 (A) at 515G)


[23] The general principles of contract apply to a contract of employment. (See e.g. Paxton v Namib Rand Desert Trails (Pty) Ltd 1996 NR 109.) Accordingly, in terms of our common law a contract of employment is between X (the servant, i.e. employee) and Y (the master, i.e. employer); a third party, e.g. a labour hire company, Z , is not, and cannot be, privy to such contract. What is more, the contract of employment under our common law is based on the Roman Law of locatio conductio operarum, i.e. the letting and hiring of personal service in return for a monetary return. Joubert, JA described such contract in the landmark case of Smit v Workmen’s Compensation Commissioner 1979 (1) SA 51 (A) at 56E as follows:


This was a consensual contract whereby a labourer, workman or servant as employee (locatio operarum) undertook to place his personal services (operae suae) for a certain period of time at the disposal of an employer (conductor operarum) who in turn undertook to pay him the wages or salary (merces) agreed upon in consideration of his services.


This species of letting and hiring under Roman law stands in contradistinction to locatio conductio rei, i.e. the letting and hiring of a specified thing for reward. But, since Roman Law recognized slavery of persons who are not Roman citizens, a slave could form the thing (res) in a locatio conductio rei, and, therefore, the master of a slave could hire or rent the slave to another person for whom the slave performs personal service. The other species of letting and hiring under Roman Law which is also part of our common law was locatio conductio operas (faciendi), i.e. the present-day independent contractor. (See Smit supra at 57C-E).


[24] It follows that at common law, the basis and essence of a contract of employment is the rendering of personal service by the locator operarum (servant) to conductor operarum (master). There is, therefore, no room for a third party in the servant (employee)-master (employer) relationship in our law. This legal reality was confirmed statutorily by the repealed Labour Act, 1992 (Act No. 6 of 1992): the definition of “employee” and of “employer” in s 1 of the repealed Labour Act 1992 is based primarily on the common law contract of employment. According to s 1 of the 1992 Act,


employee” means any natural person –


  1. who is employed by, or working for, any employer and who is receiving, or entitled to receive, any remuneration; or


  1. who in any manner assists in carrying on or the conducting of the business of an employer;


and “employed” and “employment” shall have corresponding meanings;


employer” means any person, including the State –


  1. who employs, or provides work for, any person and who remunerates or expressly or tacitly undertakes to remunerate him or her;


  1. whom permits any person to assist him or her in any manner in the carrying on, or conducting of, his or her business.


And “employ” and “employment” shall have corresponding meanings;



Similar provisions are in the Labour Act 2007. Section 1 of that Act provides:



employee” means an individual, other than an independent contractor, who –


  1. works for another person and who receives, or is entitled to receive, remuneration for that work; or


  1. in any manner assists in carrying on or conducting the business of an employer;…

And,

“employer” means any person, including the State who –


  1. employs or provides work for, an individual and who remunerates or expressly or tacitly undertakes to remunerate that individual; or


  1. permits an individual to assist that person in any manner in the carrying or, conducting that person’s business.


[25] Accordingly, I respectfully accept Mr. Chaskalson’s submission that in the labour-hire arrangement there is the interposition of a third party (the labour hire agency’s client) in the employer-employee relationship. It is my view that this third-party interposition creates an unacceptable situation that has no legal basis in our law of contract of employment. In this regard, I accept Mr. Chaskalson’s submission that the whole core nature and character of labour hire is to hire out or rent labour. In my opinion, it is letting or hiring of persons as if they were chattels.


[26] In sum, in terms of our law the legal basis for the employment relationship remains contractual, even if terms of such contract are today modified by a large number of legislative enactments (Van der Berg v Chairman of the Disciplinary Committee 1991 NR 417). I must add that the employee (X) can have two or more employers (W, Y, S, T, etc.) at the same time, so long as X has a valid contract of employment with W, Y, S, and T, and the contracts of employment permit X to have a multiplicity of employers at the same time.


[27] It seems to me clear, therefore, that the hiring or renting of one’s employee to another person, for reward, in order for such employee to render personal service to that other person is not only not part of our law of contract of employment but it also smacks of the hiring of a slave by his slave-master to another person under locatio conductio rei in Roman Law.


[28] I have taken some time to consider our law respecting contract of employment at common law and as modified by statute for a very good reason. It is to show that any form of business or trade involving the splitting of what would otherwise be a contract of employment into a number of contracts for the provision of personal service between a person who is to supply the service and an agency and between the agency and a client of the agency to whom the person renders his or her personal service is unknown to our law of contract of employment. If one may ask, under what Namibian law is the applicant entitled to enter into a contract of employment with persons and then hire or rent them, for reward, to third parties? In my opinion, there is no such law. To start with, in a labour-hire arrangement, there are protectable, contractual reciprocal rights and duties as between an employee (X) and his or her employer (Y), i.e. the agency which hires or rents X to Y’s client (Z); but there are no protectable, contractual reciprocal rights and duties between X and Z and yet it is to Z that X renders personal service.


[29] As I say, this arrangement whereby an employer (the agency) supplies his or her employees to work at a workplace controlled by a third party (the client) in return for a fee from the client is unknown, nay, offensive of, our law of contract of employment at common law or in terms of statute, and accordingly, such arrangement has no legal basis at all in our law, and additionally, it violates a fundamental principle on which the ILO is based, namely, that “labour is not a commodity.” [Annex to ILO Constitution and Philadelphia Declaration, entitled “Declaration concerning the aims and purpose of the International Labour Organization]. Accordingly, I hold that the labour-hire arrangement has no legal basis in Namibian law in terms of the common law and statute law and in terms of Namibia’s international obligation under the ILO Constitution; it cannot, therefore, create a legal right in favour of any person. And it has been stated authoritatively that before a person can complain of the violation of a fundamental right under Article 21 (1), it must be established that the right claimed is, first, a legal right and second, that it is a fundamental right. (See Seervai, Constitutional Law of India, 4 ed: p 908.) Seervai was writing about fundamental rights under the Indian Constitution which, as I have already said, are almost identical to the fundamental rights under the Namibian Constitution. In other words, the threshold that a person, like the applicant, seeking to enforce his or her Article 21 (1) (j) right must cross is that he or she must establish that he or she has a legal right to carry on the particular business or trade; and he or she can only do that if he or she is able to establish that the activity involved is lawful; in the sense that it is not a crime or that it has legal basis in our law. As I have already held, labour hire has no legal basis at all in Namibian law, and, therefore, it is not lawful.


[30] Both counsel referred to the Court Parliamentary debates to support their respective positions. According to Mr. Smuts the Parliamentary debates go to show that all along, before clause 128 (I use the term “clause” advisedly) was passed, the then Minister of Labour and Social Services, for example, stated that in introducing clause 128, “we are merely trying to regulate what is there.” Mr. Smuts added that the debates were significant. I rather read that some of the Parliamentarians who contributed to the debate both in the National Assembly and the National Council inveighed contumeliously against labour hire –– mainly because, according to them, labour hire bore a close affinity with the SWANLA system of yester-apartheid days; a system described by Mr. Smuts as “pernicious”.


[31] I respectfully agree with Mr. Smuts that the Parliamentary debates are significant; but in my view, they may have only very limited significance, and for a different purpose. It is my opinion that such debates may assist one to understand the history of the particular legislation, but they cannot be used to prove any point or support any contention in judicial proceedings. The following passage from Trav.-Cochin v Bombay Company Ltd (1952) SCR 1112 at 1121, decided by the Supreme Court of India is insightful and instructive because it says it all:


“… the use made by … Judges below of the speeches made by the members of the Constituent Assembly in the course of the debates on the draft Constitution is unwarranted. That this form of extrinsic aid to the interpretation of statues is not admissible has been generally accepted in England, and the same rule has been observed in the construction of Indian Statutes – See Administrator-General of Bengal v. Prem Nath Mallick. The reason behind the rule was explained by one of us in Gopalan thus: ‘A speech made in the course of the debate on a bill could at best be indicative of the intent of the speaker, but it could not reflect the unarticulated mental process lying behind the majority vote which carried the Bill. Nor is it reasonable to assume that the minds of all those legislators were in accord.’ Or, as it is more tersely put in an American case – ‘Those who did not speak may not have agreed with those who did; and those who spoke might differ from each other.’ U.S. v. Trans-Missouri Freight Association.


[32] Thus, as far as I am concerned, after a statute has been passed the Parliamentary debates that led to the passing of the particular statute pale into complete insignificance and absolute irrelevance as far as the law that has been passed is concerned, as is the case with the Labour Act 2007. From the excerpts of the Hansard, it is clear to me that the minds of all the legislators were not in accord with that of the Minister of Labour and Social Services. Indeed, the Minister’s was a lone voice. In sum, as far as these proceedings are concerned, what we must determine is s 128 of the Labour Act 2007 as passed by the democratically elected representatives of the people of Namibia who have the constitutional power to make and unmake legislation in terms of Chapter 7 of the Namibian Constitution. What Member of Parliament so-and-so said, or did not say, can only have interest for historians and researchers – not a court of law.


[33] Related to the issue of Parliamentary debates is M. Smut’s argument that the Labour Advisory Council (LAC) recommended that labour hire be regulated in the terms as set out in draft regulations submitted to the Ministry of Labour and Society Welfare. According to Mr. Smuts, by not taking further steps to implement the LAC draft regulations, the respondents breached an ILO Convention requiring consultation by the respondents with employer organizations and unions on changes to, and the development of, labour legislation. With the greatest deference, this is a very weak argument and it cannot take the applicant’s case any further.


[34] The LAC was established under s 7 of the repealed Labour Act, 1992 (Act No. 6 of 1992) and it functioned in terms of Part III of that repealed Act. It may be said in parentheses that the Labour Act 2007also provides for the LAC. Doubtless, the LAC was, and is, established in line with Article 2 of ILO’s C144 Tripartite Consultations (International Labour Standards) Convention, 1976. The, LAC is a statutory machinery for promoting tripartite social dialogue, involving representatives of Government, of employers and of workers. The LAC is, as the name suggests, and in line with ILO standards, a consultative body, having advisory and recommendary functions. Indeed, as the chapeu of s 8 of the repealed 1992 Labour Act provides,


The functions of the Council (LAC) shall be to make such investigations as it may be necessary, and to advise the Minister (responsible for Labour) generally or in respect of any particular case (in any matter listed in that section) … (My emphasis)


[35] Thus, no one can seriously argue that whatever the LAC advised or recommended should become law. The LAC could not by any stretch of legal imagination replace the Parliament, which has the power to make legislation, or the Minister who has the power to make delegated legislation in terms of Article 40 of the Namibian Constitution. In any case, there is nowhere in the ILO’s C144 Convention that enjoins State Parties to the Convention to accept without question tripartite recommendations and advice. The Convention does not say so; and the repealed Labour Act 1992 did not say so, either.


[36] Mr. Smuts’s further related argument is that in terms of s 126 of the Labour Act, 2004 (Act No. 15 of 2004) the respondents accepted the existence of labour hire in Namibia. That may be so; but I fail to see how this argument can possibly assist the applicant. To start with, though the Labour Act 2004 was passed, it never came into operation as was envisaged by s 140 of that Act. A fortiori, that Act has been repealed by the Labour Act 2007, and the said s 126 of that Act was not saved by the transitional provisions in the Labour Act 2007. The result is that as far as a court of law is concerned, a provision of a statute that has been repealed, as the said s 126 has been, is totally irrelevant in judicial proceedings as the present; particularly when determining the constitutionality of a provision of a statute that is in operation, even if the repealed provision and the current enforceable one are on the same subject matter. For this Court to pay any attention to a provision of a statute that has been repealed would amount to this Court telling the respondents that the Parliament has no power to make and unmake legislation. We cannot do so without offending the doctrine of separation of powers which, as I observed in Jacob Alexander v The Minister if Justice and others Case No.: A 210/2007 at p31 (Unreported), “is firmly embedded in Namibia’s constitutionalism.”


[37] In short, by repealing the Labour Act 1992 and the Labour Act 2004 and enacting the Labour Act 2007, the Legislature has made its choice, which it has the constitutional power to do, namely to prohibit altogether labour hire in Namibia, and the Judiciary must, as I say, respect the Legislature’s choice. Of course, in a proper case, and the present one is not one of them, the Court may intervene, as I have already said, if a legislative provision is repugnant to the Constitution. In that case it would not matter whether the provision sought to be impugned is a legislation affecting an area of the economy. Section 128 of the Labour Act 2007 also demonstrates the Parliament’s desire to prohibit labour hire, not to regulate it, as Mr. Smuts submitted was the purpose of the LAC draft regulations which the respondents ignored. To “regulate” a supply of water does not mean to shut it off altogether; it is to control and manage it. (Greenberg, Strout’s Judicial Dictionary of Words and Phrases, 6ed) In my opinion, where an activity has no legal basis and is, therefore, not lawful, such as labour hire, it would make no sense to make regulations to control and govern or manage it. For this reason I do not think Namibia Insurance Association v Government of the Republic of Namibia and others 2001 NR 1; and Mweb Namibia (Pty) Ltd v Telecom Namibia Limited and others Case No.: A 91/2007 (Unreported) are of any real assistance on the point under consideration.


[38] I have amply demonstrated that the labour hire arrangement has no legal basis whatsoever in our law; it is, therefore, not lawful, and accordingly, such arrangement cannot create any legal right in favour of the applicant and, a priori, cannot create a fundamental right in terms of Article 21 of the Namibian Constitution. In this regard, I reiterate the point that the core nature and character of labour hire partake of some of the aspects of letting and hiring of slaves as chattels under Roman Law, and, therefore, cannot have a lawful place in Namibia.


[39] For all the above conclusions and reasons therefor, I respectfully accept the respondents’ contention that in Namibia labour hire is not a business or trade that is entitled to the protection of Article 21 of the Namibian Constitution. Having so held, it serves no useful purpose – indeed, there is no need – to consider whether the requirements in Article 21 (2), read with Article 22, of the Constitution have been met.


[40] In a rearguard action, Mr. Smuts argued that by legislating s 128 (4), the respondents acknowledged that s 128 (1) limited the applicant’s Article 21 (1) (j) right in respect of carrying on trade or business of labour hire. My answer to that is that, as I see it, in providing for a justification for limiting a person’s right to carry on business or trade of labour hire in terms of s 128 (4) of the Labour Act, the Parliament acted in the mistaken belief and under the misapprehension that labour hire is an economic activity protected by Article 21. Thus, it is my view that the Parliament only acted ex abundanti cautela when it legislated in terms of s 128 (4). This legislative excess of caution and supererogation do not, in any way, detract from my holding that labour hire is not a lawful activity and is accordingly not entitled to protection under Article 21 of the Namibian Constitution. If that is the case, as I say it is, then Article 21 (2), read with Article 22, of the Constitution does not and cannot apply to labour hire.


[41] Mr Smuts submits that labour hire cannot be equated with the SWANLA arrangement. Counsel submits further that while the SWANLA arrangement was deplorable and oppressive and was abolished in 1972, the labour hire arrangement is a form of business engaged in internationally and in Namibia since 1996. That may be so; but it is still my considered opinion, and for all the reasons given, that in Namibia, labour hire is not an economic activity protected by Article 21 of the Namibian Constitution. A great number of the papers annexed to applicant’s affidavits also appear to extol, as I intimated earlier on, the economic advantages and benefits of labour hire for employees of the applicant, including provision of training, and for the economy of the country. The applicant’s counsel also added that labour hire is carried on internationally. With respect, these arguments cannot take the applicant’s case any further. The same arguments can be made by a person who carries on a trade or business of trafficking in women and children, and slavery.


[42] Considering the core nature of labour hire, as I have already described it, coupled with the fact that it has no legal basis in Namibia and, therefore, not lawful, the respondents are entitled to reasonably take the view that that activity must be rooted out and not regulated in Namibia, as they have done by s 128 of the Labour Act; for, as I have intimated previously, it is otiose to make regulations to regulate an activity that does not exist in the eyes of the law. In that case, this Court could not say that the respondents were wrong in prohibiting and criminalizing the activity as a way of discouraging persons from dabbling in the activity, and in visiting criminal sanctions prescribed in s 128 (3) of the Labour Act on those who persist in carrying on the activity. It would be presumptuous of a court to consider whether the object of s 128 (1) could have been better achieved by different methods.


[43] For completeness, I turn to consider the remaining subsection, i.e. subsection (2), of s 128 of the Labour Act 2007. What s 128 of the Labour Act prohibits is labour hire: the prohibition does not, according to s 128 (2), apply to the activity in which X offers a service whereby X matches offers of, and applications for, employment in which X does not become a party to any contract of employment that may ensue from X’s services. This arrangement is undertaken by the recruitment industry (Steve O’Neill, “Labour hire: issues and responses,” Research Paper No. 9 2003-04, Dept. of Parliamentary Services, Australia). In this arrangement in which some companies outsource their personnel recruitment functions, a specialist recruitment company (A) provides shortlists of suitable candidates or tests such candidates and makes appropriate recommendations to the organization wishing to recruit the candidates (B). A is not a party to any contract of employment that may be concluded between B and its employee that may arise as a result of A’s recruiting exercise.


[44] For all the above conclusions and reasons for them, I hold that s 128 of the Labour Act, 2007 (Act No. 11 of 2007) is not unconstitutional; that section of that Act is, therefore, valid. Accordingly, the applicant’s application must fail.


[45] I think this is a case where it is fair and just that costs should follow the event; and so the respondents must have their costs in the application.


[46] In the result, I make the following order:


  1. The application is dismissed with costs.

Paragraphs 40.2, 40.5 and 48.4 (in Hiveluah’s affidavit) and paragraph 6, apart from annexure FM2, (in Musukubili’s affidavit) are struck out with 60% of costs in favour of the applicant.



____________________________

Parker, J



I agree.



____________________________

Ndauendapo, J



I agree.



____________________________

Swanepoel, AJ



ON BEHALF OF THE APPLICANT: Adv. D. Smuts, SC

Adv. E. Schimming-Chase

Instructed by: M B De Klerk & Associates


ON BEHALF OF THE 1ST AND

4TH RESPONDENTS: Adv. M. Chaskalson

Instructed by: The Government Attorney


ON BEHALF OF THE

2ND RESPONDENT: No appearance


ON BEHALF OF THE

3RD RESPONDENT: No appearance








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