An organisation representing labour brokers has vowed to challenge draft legislation proposing the banning of their services all the way to the Constitutional Court.

The labour movement has scored a victory in its long and bitter battle against labour broking, which will be banned outright if the government's proposed amendments become law - despite pleas by business for the practice to be simply regulated.

On Friday, Labour Minister Nelisiwe Oliphant released four bills for public comment. One of them proposed forcing employers to hire staff permanently instead of contracting them, and another obliges all employment agencies to be registered.

The labour broking industry is pinning its hopes on negotiations at the National Economic Development and Labour Council (Nedlac) to deliver a regulated model that will allow it to continue.

If this fails - which is likely given the uncompromising opposition by labour - the constitutionality of the law, after it is promulgated, will be challenged in the Constitutional Court.

Confederation of Associations in the Private Employment Sector president Elias Monage was hopeful the Nedlac negotiations would change the proposals on labour broking. "We are of the opinion that we will find a regulatory model," he said.

The Labour Relations Amendment Bill, gazetted by the Department of Labour on Friday for comment by February 17, states that "an employee must be employed permanently unless the employer can establish a justification for employment on a fixed term".

The department's chief director of labour relations, Thembinkosi Mkalipi, said some employers kept employees on contracts for years to limit costs.

"We are trying to regulate this. But where the employer has valid reason for having employees to be on contract, then he has nothing to fear," Mr Mkalipi said.

"The assumption at the CCMA (Commission for Conciliation, Mediation and Arbitration) or by the court will be that the employee is permanent unless the employer can show otherwise."

The amendments criminalise contraventions of the Basic Conditions of Employment Act, the Employment Equity Act and the new Employment Services Bill .

The Public Employment Services Bill outlaws labour broking by making it illegal for brokers to be the employer of the workers they have placed with a third-party company. Now, the company will be the employer and will be subject to the normal obligations of employers as regards wages and conditions of employment.

"The labour broker will not be able to be the employer of the labour that they recruit for third parties," Mr Mkalipi said, conceding that this was a ban on labour broking.

Existing "temporary employment services" or labour brokers would continue to exist for three years after the date of implementation of the law and will have to be registered and licensed.

But the government plans to move into the labour recruitment market by establishing a free, public employment service that will register work seekers.

It will be compulsory for companies to register their vacancies, failing which they will be fined a minimum of R10000.

The Employment Services Bill also empowers the labour minister to establish work schemes for unemployed youth. In consultation with the finance minister, she may prescribe an incentive or subsidy for employers for this.

The employment of foreign workers will be allowed only if there are no South Africans able to do the job and will be subject to strict conditions.

The Labour Relations Amendment Bill was intended to streamline the activities of the CCMA. Employers can limit their involvement with the CCMA to conciliation only at present.

Should the amendment become law, employers would not be allowed to refuse a case being arbitrated on the same day.

An amendment of the Basic Conditions of Employment Act will make it a crime for employers not to pay wages and overtime.

A proposed change to the Employment Equity Act would require that equal pay be paid for equal value, with contraventions subject to penalties ranging from 2%-10% of turnover .

Democratic Alliance labour spokesman Ian Ollis said that the poorly formulated bills could cost jobs. "It is the single most serious legislative assault on SA's economic development that we have witnessed under the Zuma administration. In its present form, it simply cannot be passed by Parliament in good conscience."