The Labour Court has dismissed a police union's application to prevent the Gauteng government from charging its members market-related rentals for living in state accommodation.

"The court application by [the Police and Prisons Civil Rights Union] was dismissed with costs," the provincial government said.

The court ruled that the decision to charge market-related rentals was taken by the department as a landlord and not as an employer.

"In other words, this is a matter between landlord and tenants, not employer and employee."

Gauteng infrastructure development MEC Bheki Nkosi said: "This is a landmark judgment, which will go a long way in assisting [us] to implement market-related rentals."

Popcru's action came after the department issued a notice of intention in February 2009 to charge market-related rentals to all occupants of state houses. New lease agreements were to be entered into between the occupants and the department from June 1 2010.

Anyone turning down the offer had to vacate the property by May 31 2010. The rental issue would also be excluded from collective bargaining.

The department said it would now apply for a declaratory order to enable it to secure the market-related rentals and prevent others from making a similar application.

Comment from Popcru could not be immediately obtained.