Prescribed award debt: Prescribes after 3 years

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   GilesFiles on June 9, 2015 at 5:19 pm

   Extract from article by John Grogan, which first appeared in Employment Law (2015) February issue under the heading The Sands of time: Prescription and the LRA [subscription required]

   The debate over whether the running of prescription is interrupted by the launching of a review has been ended by the new section 145(9). But the issue of prescription of claims under the LRA has not been rendered entirely academic by the amendment. For one thing, the new section 145(9) applies only to awards issued after 1 January 2015 (see section 145(10)). For another, the LRA now provides that only review applications under section 145 interrupt the running of prescription. By creating this particular exception, the legislator has confirmed that the Prescription Act continues to apply in all other contexts. This means that the three-year prescription rule will still apply when employees approach the Labour Court directly to enforce settlement or collective agreements, as occurred in SA Post Office and Technikon Pretoria, or to claim debts arising during the employment relationship, as occurred in Eskom Holdings, supra. It may also mean that a special plea of prescription can still be raised in arbitration proceedings or Labour Court trials if more than three years have passed since the cause of action that gave rise to the claim (provided the employer can prove that the employee was aware of the facts from which the alleged debt arose (Prescription Act, section 12(3)). Prescription still applies to claims under the Basic Conditions of Employment Act 75 of 1996 and the common law