What happens if an employer transfers a business as a going concern to a new employer? Section 197 of the Labour Relations Act provides that the employees are transferred with the business and the new employer steps into the shoes of the old employer. But what happens if the business is then transferred yet again? This would be a second generation outsourcing, and for some time the question has risen as to whether the employees would be protected by section 197 in the case of a second generation outsourcing. The Labour Appeal Court has now settled this debate by holding that section 197 must be interpreted broadly to include protection for workers who are outsourced again.
For further information on any labour related matters, you can contact