Labour Law For
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Labour Law for Non-Lawyers
Employment Law and Labour Relations Handbook August to September 2006
Updated: 2 August 2006
The views expressed in this workbook are not necessarily reflective of the official views of Bankseta or Fasset. Page 2
TABLE OF CONTENTS Page
1. The Constitution of the Republic of South Africa, 108 of 1996 ("the Constitution")...... 3 1.1 Introduction...... 3 1.2 The Bill of Rights...... 3 1.3 The Impact of the Constitution on Labour Law...... 4 2. The Basic Conditions of Employment Act, 75 of 1997("the BCEA")...... 6 2.1 Overview...... 6 2.2 The Regulation of Working Time (Chapter 2)...... 7 2.2.1 Ordinary hours of work...... 8 2.2.2 Overtime...... 8 2.2.3 Meal intervals...... 8 2.2.4 Daily and weekly rest period...... 9 2.2.5 Pay for work on Sundays...... 9 2.2.6 Night work...... 9 2.2.7 Public Holidays...... 10 2.3 Leave (Chapter 3)...... 10 2.3.1 Annual leave...... 10 2.3.2 Sick leave...... 11 2.3.3 Maternity leave...... 12 2.3.4 Protection of employees before and after the birth of a child...... 12 2.3.5 Family responsibility leave...... 12 2.4 Particulars of employment and remuneration (Chapter 4)...... 12 2.5 Termination of employment (Chapter 5)...... 12 2.6 General (Chapter 11)...... 12 3. The Labour Relations Act, 66 of 1995 ("the LRA")...... 12 3.1 Overview...... 12 3.2.1 Overview...... 12 3.2.2 The Law...... 12 3.2.3 Relevant legal principles of independent contracting...... 12 3.2.4 Summary of relevant legal principles of a relationship of employment...... 12 3.2.5 Tax implications...... 12 3.3 Dismissals under the LRA...... 12 3.3.1 Overview...... 12 3.3.2 Misconduct...... 12 Page 3
3.3.3 Incapacity...... 12 3.3.4 Poor work performance...... 12 3.3.5 Probationary dismissals (usually found in the context of poor work performance). .12 3.3.6 Illness - HIV/AIDS...... 12 3.3.7 Incompatibility...... 12 3.3.8 Retrenchment...... 12 3.3.9 Automatically unfair dismissals...... 12 3.3.10 Constructive dismissals...... 12 3.3.11 Failure to renew a fixed term contract of employment...... 12 3.4 Unfair labour practices...... 12 3.4.1 Overview...... 12 3.4.2 Unfair conduct relating to promotion...... 12 3.4.3 Unfair conduct in relation to probation...... 12 3.4.4 Unfair conduct in relation to the provision of benefits...... 12 3.4.5 Unfair conduct relating to suspensions...... 12 3.4.6 Failure or refusal to reinstate an employee...... 12 3.4.7 Protected disclosures...... 12 3.5 Amendments to terms and conditions of employment...... 12 3.6 Collective bargaining...... 12 3.6.1 Overview...... 12 3.6.2 The right to strike and recourse to lockout...... 12 3.6.3 Collective bargaining...... 12 4. The Employment Equity Act, 55 of 1998 ("the EEA")...... 12 4.1 Overview...... 12 4.2 The prohibition of unfair discrimination (Chapter 2)...... 12 4.3 Forms of unfair discrimination...... 12 4.3.1 What action should an employer take when a case of sexual harassment is brought to his/her attention?...... 12 4.3.2 Interviewing applicants for employment...... 12 4.3.3 Unfair discrimination disputes...... 12 4.3.4 Affirmative Action...... 12 4.3.5 Income differentials...... 12 4.3.6 Monitoring, enforcement and legal proceedings...... 12 4.3.7 Failure to implement affirmative action – does this constitute unfair discrimination? 12 Page 4
1. The Constitution of the Republic of South Africa, 108 of 1996 ("the Constitution")
1.1 Introduction
General characteristics of constitutionality in South Africa include:
constitutional supremacy;
an entrenched bill of rights;
extensive powers of interpretation and enforcement of the provisions of the Constitution granted to the courts; and
a human rights friendly approach.
1.2 The Bill of Rights
The Bill of Rights contains several provisions which are of relevance to employment law. These include protection against discrimination, forced labour and servitude, the right to pursue an occupation, the right to freedom of association and the protection of children against exploitative labour practices. Section 23 of the Constitution deals specifically with labour rights and provides, inter alia, that:
everyone has the right to fair labour practices;
every worker has the right to form and join a trade union, participate in the union’s activities, and strike;
and every trade union, employer’s organisation and employer has the right to engage in collective bargaining.
Other relevant rights in the Constitution include, inter alia,:
the right not to be unfairly discriminated against and to equality before the law (section 9) ;
the right to be free of servitude and forced labour (section 13);
the right to freedom of expression (section 16); and
the right to freedom of association (section 19).
The content of some of the more directly relevant rights referred to above will be looked at more closely under individual headings. Constitutional Page 5
labour rights as well as other rights, such as equality rights, have provided the motivation for the promulgation of numerous Labour statutes, notably, the Labour Relations Act, 66 of 1995 ("the LRA"), the Basic Conditions of Employment Act, 75 of 1997 ("the BCEA"), and the Employment Equity Act, 55 of 1998 ("the EEA").
1.3 The Impact of the Constitution on Labour Law
There is a great deal of evidence in our case law to demonstrate that constitutional labour rights, read with other relevant rights, has had, and has continued to have a substantial impact on the development of labour law in South Africa. This is so despite the view held by some writers that because labour law is a specialised area of law which is already progressive in nature, and has been so since the time of the Industrial Court, it is inappropriate to develop labour law through the Constitution. The Constitutional Court has disagreed with this and the Constitution is, undoubtedly, the lens through which labour law and labour statutes are developed and interpreted and it would be a mistake to assume that with the advent of a labour law framework in the form of statutes and case law, the Constitution is no longer necessary as a point of reference for the development of labour law and labour relations.
One consequence of this is that parties are, in certain circumstances, entitled to rely directly on constitutional labour rights without first having to pin their case on specific provisions of labour statutes. Often this may be seen in so-called "discrimination" cases where an employee or an applicant for employment is discriminated against on the basis of one of the prohibited grounds listed in the equality provision of the Constitution, for example, on the grounds of his or her race or HIV/AIDS status. The fact that an employee is entitled to rely directly on constitutional causes of action without having to rely on statutorily conferred rights was confirmed in a decision of the Constitutional Court.
The pertinence of this is that a party who may not be able to rely on a provision of the LRA to seek protection because the LRA does not provide for such protection, may approach the Constitutional Court directly. There a number of examples of this which are looked at in our discussion below on some notable cases in this area, as well as in other sections of the handbook.
A most interesting area of law in this regard is the question of whether affirmative action infringes the right to equality and non-discrimination. The Constitutional Court has, on several occasions, found that it does not infringe the right to equality in terms of the Constitution which specifically allows affirmative action programmes as part of its concept of 'substantive equality.' Again this issue will be looked at in our discussion below on some case law in this area. It is noteworthy that the question of affirmative action appears to have reared its head again, after a relatively lengthy silence on Page 6 the topic, as Solidarity Trade Union has proposed that the beneficiaries of affirmative action be restricted to those born before 1990. We will see how this proposal is met by Parliament.
The above serves as a brief introduction to the impact that the Constitution has had on the development of labour law. This is best illustrated by a discussion of some of the important decisions to emerge from the Constitutional Court as we will see below in our discussion of the cases in this area. When we turn our attention to the issue of automatically unfair dismissals, and look at some examples of this species of unfair dismissal, we will be able to see the interplay between constitutional law and labour law. Page 7
2. The Basic Conditions of Employment Act, 75 of 1997("the BCEA")
2.1 Overview
The BCEA establishes and governs the minimum standards of employment for all employees, excluding members of the National Intelligence Agency, the South African Secret Service, the South African National Academy of Intelligence and unpaid volunteers working for charitable organisations.
An employee is defined as:
any person, excluding an independent contractor, who works for another person or for the State and who receives or is entitled to receive, any remuneration; and
any other person who in any manner assists in carrying on or conducting the business of an employer.
The concept of an independent contractor versus an employee is explained fully below.
The purpose of the BCEA is to advance economic development and social justice by fulfilling its primary objects, which include:
giving effect to and regulating the right to fair labour practices conferred by section 23 of the Constitution; and
giving effect to the obligations incurred by South Africa as a member state of the International Labour Organisation.
It is important to note that the BCEA or anything done in terms of the BCEA takes precedence over any agreement, whether entered into before or after the commencement of the BCEA.
The BCEA is divided into various sections, including:
the regulation of working time;
leave;
particulars of employment and remuneration;
termination of employment;
prohibition of employment; and Page 8
general.
The BCEA also contains the following Codes of Good Practice:
the Code of Good Practice on the Arrangement of Working Time;
the Code of Good Practice on the Protection of an Employee during Pregnancy and After the Birth of a Child;
the Code of Good Practice for Employment and Conditions of Work for Special Public Works Programmes; and
the Code of Good Practice for the Employment of Children in the Performance on Advertising, Artistic or Cultural Activities.
The Codes of Good Practice are not binding on the parties to the employment relationship, but should be taken into account in the application or interpretation of the relevant law.
2.2 The Regulation of Working Time (Chapter 2)
Certain categories of employees are excluded from some of the working time provisions, namely senior managerial employees, employees engaged as sales staff who travel to the premises of customers and who regulate their own hours of work, employees who work less than 24 hours per month for an employer and employees who earn in excess of R115 572.00 per annum*.
The BCEA does recognise that employees may be required to perform emergency work or work which is required to be done without delay owing to circumstances for which the employer could not have reasonably been expected to make provision.
Section 7 applies to all employees, including those mentioned above* and provides that an employer must regulate the working time of employees:
in accordance with the provisions of any Act governing occupational health and safety;
with due regard to their health and safety;
with due regard to any code of good practice relating to the regulation of working time; and
taking into account their family responsibilities. Page 9
2.2.1 Ordinary hours of work
An employer may not require or permit an employee (excluding those mentioned above* to work more than 45 hours per week or 9 hours in any day if the employee works 5 days a week, or 8 hours in any day if the employee works on more than 5 days in a week.
The parties to the employment relationship can agree to extend ordinary hours of work up to 15 minutes a day but not to more than 60 minutes per week in order to enable an employee whose duties include serving members of the public to continue performing those duties after the completion of ordinary hours of work.
2.2.2 Overtime
The provisions relating to overtime apply to those employees whose earnings do not exceed R115 572.00 per annum.
An employer may not require or permit an employee to work overtime, except in accordance with an agreement (which may not provide that an employee work more than 12 hours per day). In addition, an employer may not require an employee to work more than 10 hours of overtime per week. (A collective agreement may increase the maximum permitted hours to 15. However, this agreement cannot apply for over 2 months in any 12 month period).
An employer must pay an employee at least one and a half times the employee's wage for overtime worked. Alternatively, the parties can agree that the employer pay the employee not less than his/her ordinary wage for overtime worked and grant the employee at least 30 minutes' time off on full pay for every hour of overtime worked OR grant the employee at least 90 minutes paid time off for each hour of overtime worked.
An employer must grant paid time off within 1 month of the employee becoming entitled to it. This may be increased by agreement to 12 months.
2.2.3 Meal intervals
An employee who works continuously for more than five hours is entitled to a meal interval of at least 1 continuous hour. Work is continuous unless it is interrupted by an interval of at least 60 minutes.
During a meal interval, the employee may only be required or permitted to perform those duties that cannot be left unattended to and cannot be performed by another employee.
The employer is required to remunerate an employee who is required to work or be available to work during a meal interval. Page 10
The parties can agree in writing to reducing the meal interval to 30 minutes (not less) or dispense with the meal interval where an employee works less than 6 hours per day.
2.2.4 Daily and weekly rest period
Employees must be granted a daily rest period of at least 12 consecutive hours between the conclusion and commencement of work. This period can be reduced to 10 hours if the employee resides on the premises and whose meal intervals last 3 hours.
Employees must be granted a weekly rest period of at least 36 consecutive hours which, unless otherwise agreed, must include Sunday. The parties can agree on reducing the weekly rest period by up to 8 hours in any week, provided the rest period in the following week is extended equivalently. The parties can also agree on a rest period of at least 60 consecutive hours every 2 weeks.
2.2.5 Pay for work on Sundays
An employee who works on a Sunday is entitled to double his/her wage for each hour worked, unless the employee ordinarily works on a Sunday, in which case the employer must pay the employee one and half times his/her wage for every hour worked.
The parties can agree that an employee who works on a Sunday is granted paid time off equivalent to the difference in value between the pay received by the employee for working on a Sunday and the pay the employee would normally be entitled to.
If an employee does not ordinarily work on a Sunday, the hours worked form part of the calculation in respect of overtime pay.
An employer must grant paid time off within 1 month of the employee becoming entitled to it. This may be increased by agreement to 12 months.
2.2.6 Night work
Night work is work performed by an employee between 18h00 and 06h00.
The parties must agree to the performance of night work by an employee. The employee must be compensated by the payment of an allowance, which may be a shift allowance, or by reduction of working hours. In addition, the employer must ensure that transportation is available between the employee's place of residence and the workplace at the commencement and conclusion of the shift.
An employee who works for more than 1 hour after 23h00 and before 06h00 at least 5 times per month or 50 times per year is entitled to request a Page 11
medical examination at the employer's expense before commencing such work or within a reasonable time after commencing such work and at appropriate intervals thereafter. Section 90 of the BCEA protects the confidentiality of any medical examination conducted in terms of the Act.
Employers are obliged to inform employees of the health and safety hazards associated with night work, as well as of their entitlement to the medical examination mentioned above.
An employer is required to transfer the employee to suitable day work within a reasonable period of time if the employee suffers from a health condition associated with the performance of night work and it is practicable for the employer to do so.
2.2.7 Public Holidays
An employer may not require an employee to work on a public holiday, except in accordance with an agreement.
If a public holiday falls on a day on which an employee would ordinarily work, the employer must pay an employee who does not work at least the wage he / she would have ordinarily received. If the employee does work, the employer must pay the employee at least double what he / she would have ordinarily received or, if it is greater, the amount the employee would have ordinarily received plus the amount earned by the employee for time worked on that day.
If the employee works on a public holiday on which he / she would not ordinarily have worked, the employer must pay the employee his/her ordinary wage plus the amount earned for the work performed that day.
2.3 Leave (Chapter 3)
The provisions relating to leave do not apply to employees who work less than 24 hours per month for an employer and, unless agreed otherwise, the provisions do not apply to leave granted in excess of the minimum entitlement contained in the BCEA. These provisions apply to all employees, regardless of their annual remuneration.
2.3.1 Annual leave
"Annual leave cycle" is defined as the period of 12 months' employment immediately following the commencement of employment or the completion of the previous leave cycle.
An employer must grant an employee at least:
21 consecutive days' annual leave on full remuneration in respect of every annual leave cycle; or Page 12
by agreement, 1 day of annual leave on full remuneration for every 17 days' worked; or
by agreement, 1 hour of annual leave on full remuneration for every 17 hours worked.
An employer must grant an employee annual leave not later than 6 months after the end of the annual leave cycle.
An employer may not require or permit an employee to take annual leave during any other period of leave to which the employee is entitled in terms of the BCEA or during any period of notice.
An employer must grant an employee an additional day of paid leave if a public holiday falls on a day during an employee's annual leave on which the employee would ordinarily have worked.
An employer may not require or permit an employee to work for the employer during any period of annual leave.
An employer may not pay an employee instead of granting paid leave except on termination of employment.
Payment for annual leave must be made before the period of leave begins or, by agreement, on the employee's usual pay day.
All employment contracts should contain a provision relating to the prohibition of the accumulation of leave beyond a certain number of days.
Notable cases:
Jardine v Tongaat – Hulett Sugar Limited (2003) 24 ILJ 1147 (LC)
Jooste v Kohler Packaging Limited (2004) 25 ILJ 121 (LC)
2.3.2 Sick leave
"Sick leave cycle" means the period of 36 months' employment with the same employer immediately following the commencement of employment or the completion of the previous sick leave cycle.
During every sick leave cycle, an employee is entitled to an amount of paid sick leave equal to the number of days the employee would normally work during a period of six weeks. Despite this, an employee is only entitled to 1 day's sick leave for every 26 days' worked during the first 6 months of employment. Page 13
The employer is required to pay the employee the wage he / she would ordinarily have received had he / she worked on that day. Payment is to be made on the employee's usual pay day.
An employer is not required to pay an employee if the employee has been away from work for more than 2 consecutive days or on more than 2 occasions during an 8 week period and the employee does not produce a medical certificate stating that the employee was unable to work for the duration of the employee's absence on account of sickness or injury.
The medical certificate must be issued and signed by a medical practitioner or any other person who is certified to diagnose and treat patients and who is registered with a professional council established by an Act of Parliament.
Certain sections of the Traditional Health Practitioner's Bill have been enacted by Parliament (primarily those relating to the establishment of an Interim Council for Traditional Health Practitioners). Certain employees make use of traditional health practitioners when they are ill and employers will be obliged to accept the medical certificates issued and signed by such practitioners, provided they can provide proof to the employer that they are registered with the Interim Council.
Where it is not reasonably practicable for an employee to obtain a medical certificate (where the employee resides on the employer's premises), the employer is not permitted to withhold payment unless it provides reasonable assistance to the employee to obtain the certificate.
2.3.3 Maternity leave
An employee is entitled to at least 4 consecutive months' maternity leave.
An employee may commence maternity leave at any time from 4 weeks before the expected date of birth, unless otherwise agreed or on a date from which a medical practitioner or midwife certifies that it is necessary for the employee's health or that of her unborn child.
No employee may work for 6 weeks after the birth of her child, unless a medical practitioner or midwife certifies that she is fit to do so.
An employee who has a miscarriage during the third trimester of pregnancy or bears a stillborn child is entitled to maternity leave for 6 weeks after the miscarriage or stillbirth, whether or not the employee had commenced maternity leave at the time of the miscarriage or stillbirth.
An employee is required to notify her employer in writing of both the date upon which she intends to commence maternity leave and of the date when she intends to return to work. Notice of commencement of maternity leave should be given at least 4 weeks prior to the commencement of maternity leave, or, if that is not possible, then as soon as is reasonably practicable. Page 14
2.3.4 Protection of employees before and after the birth of a child
A pregnant employee or an employee who is nursing her child cannot be required or permitted by her employer to perform work that is hazardous to her health or to the health of her child.
During an employee’s pregnancy and for a period of 6 months after the birth of her child, her employer must offer her suitable alternative employment on terms that are no less favourable if she is required to perform night work or work which poses a danger to her health and safety or to the health and safety of her child and it is practicable for the employer to do so.
See the Code of Good Practice on the Protection of Employees during Pregnancy and after Child Birth.
2.3.5 Family responsibility leave
The provisions relating to family responsibility leave only apply to those employees who have been in employment for more than 4 months and who work at least 4 days per week.
All employees are entitled to 3 days’ paid leave during each annual leave cycle in the event that:
the employee’s child is born;
the employee’s child is sick; or
the employee’s spouse, life partner, parent, grandparent, child, grandchild or sibling dies.
The employee is entitled to be paid the wage he / she would have ordinarily received on the employee’s usual pay day. Where the employer requires proof of the events mentioned above, the employer is only obliged to pay the employee upon receipt of such proof.
Employees are permitted to take family responsibility leave in respect of either the whole or part of a day.
Should the employee fail to utilise his/her family responsibility leave, it will lapse at the end of the annual leave cycle in which it accrues.
2.4 Particulars of employment and remuneration (Chapter 4)
The provisions in this chapter apply only to those employees who work more than 24 hours per month for an employer.
Upon commencement of employment, an employer is required to provide an employee with the following particulars in writing: Page 15
full name and address of the employer;
name and occupation of the employee;
the employee’s place of work and where this may change, an indication of this;
the date on which employment began;
the employee’s ordinary hours of work and days of work;
the employee’s wage or the method of calculating his/her wage;
the rate of pay for overtime work;
any other cash payments which the employee is entitled to;
any payment in kind that the employee is entitled to and the value of such payment;
how frequently remuneration will be paid;
any deductions to be made from the employee’s remuneration;
the leave to which the employee is entitled;
the notice period or if a fixed term contract, the date of termination;
a description of any council or sectoral determination which covers the employer’s business;
any period of employment with a previous employer that counts towards the employee’s period of employment; and
a list of any other documents which form part of the contract of employment, as well as the whereabouts of these documents.
Where any matter listed above changes, the written particulars must be revised to reflect the change and the employee must be given a copy of the revised document.
Note that employers are not permitted to unilaterally change an employee’s terms and conditions of employment. Employers must consult with employees before any changes to employment are affected. Note the differences between consultation and negotiation.
Where an employee does not understand the written particulars, they must be explained to him / her in a language that he / she understands. Page 16
The employer is required to keep the written particulars for a period of 3 years after termination of employment.
A statement of the employee’s rights in the prescribed form must be displayed at the employer’s workplace in a location where it can be read by all employees. Such statement should be in all the official languages which are spoken at the workplace.
The employer is required to, at least, keep a record of the employee’s name and occupation, the time worked by each employee, the remuneration paid to each employee, the date of birth of each employee who is under the age of 18 and any other prescribed information.
An employer must pay to an employee any remuneration paid in money (as opposed to in kind) in South African currency, daily, weekly, fortnightly or monthly, and in cash, by cheque or by direct deposit into a bank account designated by the employee.
Any remuneration paid in cash or by cheque must be placed in an envelope and given to each employee at the workplace or at a place agreed to by the employee during working hours or within 15 minutes of the commencement or conclusion of those hours.
An employer is obliged to give the employee the following information on each occasion that the employee is paid:
the employer’s name and address;
the employee’s name and occupation;
the period for which payment is made;
the amount of the employee’s remuneration;
the amount and purpose of any deduction made;
the actual amount paid to the employee; and
if relevant, the rate of remuneration, overtime pay, the number of ordinary hours and overtime hours worked and the number of hours worked on a Sunday and / or public holiday.
An employer may not make any deduction to an employee’s remuneration unless the employee agrees in writing where the employee is indebted to the employer or where the deduction is required or permitted in terms of a law, collective agreement, court order or arbitration award.
A deduction may be made to reimburse an employer for loss or damage only if: Page 17
the loss or damage occurred during the course of employment and was due to the fault of the employee;
the employer has followed a fair procedure and has given the employee a reasonable opportunity to show why the deductions should not be made;
the total amount of debt does not exceed the actual amount of the loss or damage; and
the total deductions from the employee’s remuneration do not exceed one quarter of the employee’s remuneration in money.
2.5 Termination of employment (Chapter 5)
The provisions of this chapter only apply to those employees who work more than 24 hours per month for the employer.
A contract may only be terminated on notice of not less than:
1 week if the employee has been employed for 6 months or less;
2 weeks if the employee has been employed for more than 6 months but less than 1 year;
4 weeks if the employee has been employed for 1 year (this can be reduced to not less than 2 weeks by collective agreement) or is a farm worker or domestic worker who has been employed for more than 6 months.
Notice must be given in writing, unless the employee is illiterate. Where an employee who receives notice of termination does not understand it, it must be explained to him / her in a language he / she understands.
An employer may not give notice of termination during any period of leave to which the employee is entitled.
Instead of giving an employee notice, an employer may pay the employee the remuneration the employee would have received if the employee had worked during the notice period.
If an employee gives notice of termination and the employer waives any part of the notice, the employer must pay the remuneration as set out above, unless the employer and employee agree otherwise.
On termination of employment, an employer must pay an employee:
for any paid time off that the employee is entitled to and has not taken; and Page 18
remuneration in respect of any annual leave which the employee has not yet taken.
An employer must pay an employee who is dismissed for reasons based on its operational requirements severance pay equal to at least 1 week's remuneration for each completed year of continuous service with that employer.
An employee who unreasonably refuses to accept the employer's offer of alternative employment with that employer or any other employer is not entitled to severance pay.
Where there is a dispute concerning an employee's entitlement to severance pay, the employee may either refer the dispute to the bargaining council, if applicable, alternatively to the CCMA. A copy of the referral form must be served on the other party and the employee must provide proof of such service to the council or CCMA. The council or CCMA must attempt to resolve the dispute through conciliation. If the dispute remains unresolved, the commissioner shall issue a certificate of non resolution and the dispute may then be referred to arbitration.
Where the Labour Court is adjudicating a dispute concerning an operational requirements dismissal, the Court may consider the question of severance pay and the Court may make an order in this regard.
On termination, an employee is entitled to a certificate of service stating the employee's full name, the name and address of the employer, the dates of commencement and termination of employment, the employee's job title or a brief description of the work performed by the employee, the employee's remuneration on termination and, if the employee so requests, the reason for the dismissal.
Notable cases:
Purefresh Foods (Pty) Limited v Dayal and another (1999) 20 ILJ 1590 (LC)
Freshmark (Pty) Limited v CCMA and others (2003) 24 ILJ 373 (LAC)
2.6 General (Chapter 11)
A person whose services have been procured for, or provided to, a client by a temporary employment service ("TES") is the employee of that TES, and the TES is that person's employer.
A person who is an independent contractor is not an employee of the TES, nor is the TES the employer of that person. Page 19
The TES and the client are jointly and severally liable if the TES, in respect of any employee who provides services to that client, does not comply with the BCEA or a sectoral determination (the basic conditions of employment for employees is a particular area or sector).
For the purposes of determining the length of the employee's employment, previous employment with the same employer must be taken into account if the breaks between the periods of employment is less than 1 year.
Notable case:
LAD Brokers (Pty) Limited v Mandla (2001) 22 ILJ 1813 (LAC) Page 20
3. The Labour Relations Act, 66 of 1995 ("the LRA")
3.1 Overview
The purpose of the LRA is to advance economic development, social justice, labour peace and the democratisation of the workplace by fulfilling the primary objects of the Act, which are:
to give effect to and regulate the fundamental rights conferred by section 23 of the Constitution;
to give effect to the obligations incurred by South Africa as a member state of the International Labour Organisation;
to provide a framework within which employees and their trade unions, employers and employer's organisations can collectively bargain to determine wages, terms and conditions of employment and other matters of mutual interest; and
to promote orderly collective bargaining, employee participation in decision making at the workplace and the effective resolution of labour disputes.
The LRA applies to all employees, except members of the National Defence Force, the National Intelligence Agency, the South African Secret Service and the South African National Academy of Intelligence.
The LRA not only governs the collective bargaining process and the rights associated with it, but also governs all forms of dismissals. It also contains the following Codes of Good Practice:
the Code of Good Practice on Dismissal;
the Code of Good Practical on Dismissal based on Operational Requirements;
the Code of Good Practice on Picketing;
the Code of Good Practice on the Handling of Sexual Harassment Cases in the Workplace;
the Code of Good Practice on Key Aspects of HIV / AIDS and Employment. Page 21
The Codes of Good Practice are not binding on the parties to the employment relationship, but should be taken into account in the application or interpretation of the relevant law.
Employees versus Independent Contractors
3.1.1 Overview
Independent contractors, properly construed, are not employees and do not therefore enjoy the protections afforded by labour legislation. The contract between a principal and an independent contractor will usually contain an explicit waiver by the contractor to employment status.
It would, therefore, in the ordinary course be entirely permissible - and indeed expected - to exclude independent contractors from participation in employment benefit schemes or membership in employer funds and an independent contractor will have no recourse to the unfair labour practice provision of the LRA or any other remedy under labour law.
South African courts have accepted that employers may attempt to subvert labour law and avoid its consequences, by construing a relationship as one of independent contracting where, in fact, the relationship is one of employment. In such a case South African courts are prepared to go beyond the overt nature of the relationship to determine its true nature. If it is found that an ‘independent contractor’ is indeed an employee courts are readily prepared to confer the same rights to such person as other employees enjoy.
The pivotal question then is whether a person who provides services to another is, objectively speaking, an employee in the true sense or an independent contractor since numerous consequences flow from such distinction.
3.1.2 The Law
Generally, both South African common law and legislation distinguish between employees and independent contractors. Most legislation, such as the Income Tax Act, 1962, ("the Income Tax Act") provides that employees and independent contractors are treated differently. The underlying premise of such a distinction is that the two terms are mutually exclusive and distinct.
The South African common law has over the years developed a variety of tests to distinguish between contracts of employment and independent contracting agreements, namely, the control test, the intuitive test and the dominant impression test. The application of the dominant impression test is accepted as being definitive to establish whether a relationship is one of employment or independent contracting. Page 22
Particularly, the enquiry will be directed toward establishing whether an individual has placed his/her productive capacity at the disposal of an employer or not. The courts will look to a (existing) written contract which, ordinarily, contains the obligations of the employee or independent contractor and will accordingly manifest whether such person is providing productive capacity or ensuring that a particular result is achieved.
Put simply, an employment relationship will focus on the effort and personal service of the employee and not on a specific result. A contract of work or independent contracting agreement will focus on the particular job to be done and not the services rendered in order to get the job done. The independent contractor undertakes to perform or execute a particular piece of work or to produce a certain specific result. The customer or client is not interested in the personal services, but in the product or result of such labour.
In terms of the definitions in the LRA and the BCEA, an employee means:-
any person, excluding an independent contractor, who works for another person or for the state and who receives, or is entitled to receive any remuneration; and
an person who in any manner assists in carrying on or conducting the business of an employer.
Independent contractors are thus excluded from the definition of employee under South African labour law.
Section 200A of the LRA creates a number of presumptions as to who is an employee, rather than an independent contractor. Similar provisions are found in the BCEA. This means that an individual is presumed to be an employee if one or more of the following factors are present:
The manner in which the person works is subject to the control or direction of another.
The right to control the manner in which an employee performs or carries out his or her duties is an indication that the contract is one of employment. This is the case regardless of whether such control is exercised in practice.
The person's hours of work are subject to control or direction of another.
Payment without material reference to a result indicates employee status. This is based on the employee being paid for the effort and not for the task which is being performed. Conversely, payment with reference to a product or result indicates independent contractor status. Page 23
If the employer is entitled to make use of the employee's services during all normal business hours, such employer has acquired exclusive use of the employee's productive capacity, thus indicating that he/she has the status of an employee.
The person forms part of the organisation for which he works.
Personal service rendered by a person is indicative of an employee contract. Such an obligation indicates the acquisition of such person's productive capacity, rather than the result of the efforts of that person. Although a person may still be an independent contractor when they render personal service, in the instance where the employer has a contractual right to demand personal service and to object to substitution by another party or person, an employee relationship is indicated.
The person worked for an average of at least 40 hours per month over the last 3 months.
Services are rendered exclusively.
A work relationship will be indicative of an employment relationship where the "employee" is required to work exclusively for the "employer". Where the "employee" is entitled to carry out other business or seek other business opportunities, the contract is more likely to be one of an independent contract.
The person is under supervision.
Employee status is suggested by a greater degree of supervision on behalf of the employer, although this is not always conclusive and may differ depending on the nature of the work to be performed. The relevance of this factor must be measured against the nature of the work.
A reporting line exists.
Although this requirement is not conclusive, the fact that an employee must report to the employer is indicative of an employee relationship. This is especially so where the obligation to report is contractual and where such reports are made on a regular basis.
Other indicators may also be present:
4. equipment
Provision by the employer of office equipment, stationery, etc, would indicate an employee relationship. Further, a employee who operates from the premises of the employer is more likely to be an employee than an independent contractor. Page 24
5. duration of relationship
Where the contract is open-ended or indefinite, it is more likely to be that of an employee than an independent contractor. An independent contracting agreement would be finalised or terminated once a particular result was produced.
6. compliance with the BCEA
Compliance by the employer with the BCEA would be indicative of an employment relationship.
7. viability on termination
A person whose 'business' would not be viable on termination of the contractual relationship between the parties may be regarded as being an employee since it indicates that such person is not carrying out an independent trade.
The individual is presumed to be an employee regardless of the form of the contract. The onus therefore resides on the employer to prove the contrary.
The presumptions found in section 200A of the LRA, and outlined above, do not, however, apply to a person who presently earns in excess of R115 572.00 per annum. In this instance, the onus rests on the individual who is trying to prove, or persuade a court of law, that he / she was, in fact, an employee rather than an independent contractor.
The presumptions do, however, provide guidance as to whether an individual is, in reality, an employee or an independent contractor. The company is urged then to consider the above presumptions/factors in order to arrive at the correct conclusion as to whether the consultant will be an employee of the company or whether he will be an independent contractor.
It must be emphasised that any single factor is unlikely to be determinative in classifying a particular relationship. The cumulative impression formed after reviewing such factors, where present, will tend to indicate the nature of a particular employment relationship.
7.1.1 Relevant legal principles of independent contracting
The distinction between an independent contracting relationship as opposed to an employment relationship is of importance for the following reasons:
independent contractors do not fall under the protection of labour legislation generally and are expressly excluded from the operation of the LRA and the BCEA; Page 25
an independent contracting relationship is therefore governed purely by the law of contract;
the important principle of Roman Law, sunt serranda, is therefore the primary guiding factor with regard to independent contracting relationships. This principle means that the content of the agreement is the most singular determining factor in the relationship between the parties to the agreement;
termination requirements with regard to independent contracting agreements are primarily determined by the content of the agreement between the parties;
in deciding whether a person is making their productive capacity available to an employer or contracting independently to achieve a specific result, the courts will not find that a particular feature of the working relationship is determinative of the nature of the relationship, but will rather review all relevant factors in a particular arrangement;
similarly, the South African Revenue Services ("SARS") classifies working relationships in a more aggressive manner due to recent legislative changes. Furthermore, the SARS will hold employers liable for any outstanding taxes not recovered due to an erroneous classification of a particular working relationship.
7.1.2 Summary of relevant legal principles of a relationship of employment
The implication of a finding that a person is an employee is that he or she will enjoy the protections afforded to employees under the LRA and the BCEA. This means that the company may only terminate the contract of employment on one of three statutorily recognised grounds, namely:
that the employee has committed misconduct;
that the employee is incapable of performing; and
that the operational requirements of the company necessitate the dismissal of the employee (i.e. a retrenchment dismissal).
The LRA, moreover, lays down certain procedural requirements that must be followed by an employer when contemplating a dismissal for one of the reasons given above. Such procedural requirements include, generally, that the employee is entitled to a fair hearing prior to being dismissed. In the case of a retrenchment dismissal, the LRA stipulates onerous procedures that must be followed by an employer which is contemplating dismissing an employee for operational reasons. This may be contrasted with the right of a Page 26
principal when terminating a contract with an independent contractor to terminate upon mere notice.
7.1.3 Tax implications
The Fourth Schedule to the Income Tax Act requires employees' tax ("PAYE") to be deducted or withheld from any "remuneration" paid or payable by an employer to an employee.
Paragraph 1 of the Fourth Schedule, however, excludes from the definition of "remuneration" any amount payable for services rendered by a person in the course of a trade carried on "independently" of the person by whom the amount is payable and of the person to whom the services are rendered. If the independent contractor provides consultancy services, no PAYE would be deductible by the principal from fees paid by it for such services.
The contractor would be deemed not to be carrying on a trade "independently" if:
he / she is subject to the control or supervision of any person as to the manner in which his/her duties are performed or as to his/her hours of work; or
the amounts payable for his/her services consist of or include earnings of any description that are payable at regular daily, weekly, monthly or other intervals.
It will be the responsibility of the 'employer' to determine whether or not payments made by it to a 'contractor' are excluded from the definition of "remuneration" (and are consequently not subject to PAYE) on the ground that the contractors are independent contractors. Should the employer take the view that the contractors are independent contractors (and consequently that the payments are not subject to PAYE), it runs the risk that the SARS takes a different view and seeks to hold it liable for the PAYE which should have been deducted, plus penalties and interest.
Previously, where doubt existed as to the status of a person who rendered services, it was possible to obtain a ruling from SARS. There has, however, been a shift in policy in this regard and the current attitude of SARS is that the factors indicated in the guidelines should be taken into account by the employer to decide whether payments are subject to PAYE. SARS will not provide further assistance in making this decision.
Notable cases:
Niselow v Liberty Life Association of Africa Ltd (1998) 19 ILJ 752 (SCA) Page 27
SABC v McKenzie (1999) 20 ILJ 585 (LC)
Denel (Pty) Ltd v Gerber (2005) 26 ILJ 1256 (LAC)
7.2 Dismissals under the LRA
7.2.1 Overview
As stated previously all employees have the right not to be unfairly dismissed. Indeed one of the most important innovations of the LRA, if not the most important, is the codification of a comprehensive unfair dismissal regime which lies at the heart of the LRA. The LRA provides that a dismissal is justified if the employer is able to show that the reason for the dismissal was both substantively and procedurally fair. In respect of substantive fairness – the first leg of the test – the LRA provides for three circumstances in which a dismissal may be considered fair. These are:
dismissals relating to the employee's conduct;
dismissals relating to the employer's operational requirements; and
dismissals relating to the employee's capacity.
In respect of the last category, two types of incapacity may be distinguished:
ill-health or injury; and
poor work performance.
The three categories of dismissal outlined above encompass most forms of dismissal even in circumstances in which the actual reason for the dismissal is not immediately apparent. The LRA does, however, recognise the existence of other types of dismissals which are discussed below.
The provisions of the LRA specify that the employer has the onus of establishing that the dismissal of the employee concerned was for a fair reason; put differently, the employer is generally required to begin leading evidence that demonstrates that the dismissal was both substantively and procedurally fair.
Guidelines, which employers are directed to follow in the contemplation and implementation of dismissals, are set out in schedule 8 to the LRA.
Aside from its normal meaning, "dismissal" is defined also to include the following situations:
the employer fails to renew a fixed term contract, or the employer renews the contract on less favourable terms in circumstances Page 28
where the employee had a reasonable expectation that the contract would be renewed on the same or similar terms and conditions;
the employer refuses to allow an employee to resume work after returning from maternity leave;
the employer dismisses a group of employees for the same or similar reasons, and selectively re-employs some of them without re-employing others; and
the employee has no choice but to terminate the contract of employment because the employer has made the employee's continued employment intolerable (so-called constructive dismissal);
We will focus below on the primary types of dismissal (misconduct, incapacity, and retrenchments) and, thereafter, some of the other kinds of dismissals will be reviewed with particular emphasis on constructive dismissals, failure to renew fixed term contracts, and automatically unfair dismissals.
7.2.2 Misconduct
As stated above, an employee's misconduct may in certain circumstances justify dismissal. It is important to note, however, that misconduct will not always justify dismissal but may necessitate verbal and/or written warnings in circumstances in which the penalty of dismissal is too harsh.
When contemplating dismissing an employee for misconduct, an employer must be able to justify both the substantive fairness (i.e. the reason) of the dismissal and follow a proper procedure prior to terminating the contract of employment. With regard to the former, the LRA requires that there be a fair reason for the dismissal relating to the conduct of an employee. Insofar as the requirements of substantive and procedural fairness are concerned, employers are well advised to take cognisance of the Code of Good Practice ("the dismissal code") found in schedule 8 to the LRA. Section 188 of the LRA explicitly enjoins this since it states that any person who is considering whether the reason for dismissal is fair or whether the dismissal was effected in accordance with a fair procedure must consider any relevant code of good practice in terms of the LRA.
Although the dismissal code does not itself bind an employer, it is a useful reference point which can guide the employer in acting fairly when an employee is alleged to have committed misconduct. Important aspects of items 1 to 4 of the dismissal code include: Page 29
not every type of misconduct warrants dismissal; only acts of misconduct that are sufficiently serious or which have been repeated are dismissible;
the purpose of disciplinary measures should be progressive and corrective in nature rather than simply punitive;
employers are, however, entitled to satisfactory conduct from their employees;
the law of contract is supplanted by statute since it is not sufficient simply to give notice of termination of contract in terms of the provisions of the contract of employment where an employee has committed misconduct;
fairness of the reason for the dismissal is judged on a case by case basis since it is impossible to regulate every type of misconduct. The nature of the employment relationship, and aggravating and/or mitigating factors will always play a role in the type of sanction handed down against the employee;
examples of sufficiently serious misconduct include gross dishonesty, wilful damage to property, wilful endangering of the safety of others, physical assault of a fellow employee, and gross insubordination;
employers are advised to adopt written disciplinary codes which will aid them in following a correct procedure and determining the suitable sanction in respect of listed acts of misconduct. A written code and procedure is also helpful to avoid inconsistent application of disciplinary measures which has become a focus of the courts;
insofar as a fair procedure is concerned, the employer is required to conduct an investigation to determine whether there are grounds for dismissal;
the employee should be notified of the charges against him in a form that he can understand;
the employee should be notified of his rights, for example, his right to be represented by a fellow employee;
the employee is entitled to state his case in reply to the allegations made against him;
the employee should be given a reasonable opportunity to prepare his case; Page 30
if the employee is dismissed, he should be notified of his right to request reasons and, if he unsatisfied with the outcome, to submit his dismissal to the CCMA for conciliation and arbitration or adjudication; and
the employee terminates the contract of employment after a transfer of a business when the new employer provides the employee with substantially less favourable conditions or circumstances at work.
Item 7 of the dismissal code sets out a brief guideline to assist a person (whether it be the employer, a commissioner in the CCMA, or a judge in the Labour Court) to determine whether a dismissal would, in any given circumstances, be fair. These principles are:
whether the employee contravened a rule or standard regulating conduct in the workplace (again we see the importance of establishing a written disciplinary code and procedure which would enable the parties to ascertain this);
whether the employee was aware, or could reasonably be expected to be aware, of the particular rule or standard purportedly in place within the workplace; and
whether such rule or standard has been consistently applied by the employer;
whether dismissal is an appropriate sanction in all the circumstances.
Examples of misconduct
Dishonesty is a very common instance of misconduct and one which often warrants the sanction of dismissal since it is accepted that honesty and trust between an employer and its employee goes to the very heart of the employment relationship. A form of dishonesty is theft which is probably the most serious form of misconduct. The elements of theft are:
taking possession
of goods
owned by another person (usually the employer)
unlawfully and
intentionally. Page 31
South African courts and the CCMA have consistently held that theft justifies dismissal even where such act constitutes a first offence. Theft has the potential to harm the business of the employer which, in turn, threatens the livelihood of employees, and it destroys the relationship of trust between the employer and the employee who has committed theft. Our courts have held that even where the theft is of a negligible nature it may justify dismissal, for example, where an employee steals a can of coke, the employer is entitled to regard such theft in a very serious light.
A similar offence to theft is fraud and one which is becoming increasingly common in the South African landscape. The elements of fraud are:
a factual misrepresentation
to the actual or potential prejudice
of another person (the employer)
made unlawfully and
intentionally.
It will often be the case that an incident of fraud in the workplace will be closely related to an act of theft and the employer may then be entitled to allege the fraud as a separate offence.
An intentional misrepresentation may be express or implied by behaviour or even by silence. The question to be asked in this regard is whether the employee's behaviour, in misleading the employer (or other person in the work context), was intentional and, if it was, whether such misrepresentation will prejudice or potentially prejudice the affected party. A common example of a misrepresentation is where an employee deliberately inflates his or her C.V. and/or lists skills that he / she does not, in fact, possess in order to secure employment. Our courts have held that in such case dismissal is an appropriate sanction. It is important to note that the employee need not aim to benefit him / herself before his/her actions may be said to constitute fraud. Such conduct only needs to prejudice, or potentially prejudice, any other party.
There are many other instances of common misconduct some of which will be looked at in our discussion of various cases. In the context of misconduct it is most helpful to look to case law due to the varied nature of misconduct and the many elements that make up this area of labour law.
It is important to note that a disciplinary inquiry need not take the form of a "mini trial" despite the fact that this method of dealing with misconduct has become most common in the workplace. There is no statutory requirement that disciplinary hearings need to be as formal as a criminal trial. Certainly the employer is not required to prove guilt beyond a reasonable doubt. The Page 32
test for guilt in the context of employment is the less onerous test of 'balance of probabilities', the same test utilised in civil matters. Undoubtedly the principles of natural justice must be applied in a disciplinary inquiry in order to establish procedural fairness; these principles include the right to be heard, and the right to have an impartial chairperson preside over the proceedings. These elements will be looked at in our discussion of the cases.
Notable cases:
Consani Engineering (Pty) Ltd v CCMA and others (2004) 25 ILJ 1707 (LC) - inconsistency
Goodyear SA (Pty) Ltd v CCMA and others [2004] 1 BLLR 7 (LAC) – drunk on duty
Amalgamated Pharmaceuticals Ltd v Grobler NO and others (2004) 25 ILJ 523 (LC) - theft/dishonesty
SAPU and another v Minister of Safety and Security [2005] 5 BLLR 490 (LC)
Cotton and Woolworths (2004) 25 ILJ 2059 (CCMA) – warnings
NUMSA obo Ngwenya and Circuit Breaker Indistries Ltd (2004) 25 ILJ 379 (BCA) - bias – objective chairperson
7.2.3 Incapacity
The issue of incapacity, and the manner in which an employer is required to deal with employees who are demonstrating one or other form of incapacity, is often a source of confusion for employers. Three types of incapacity are distinguishable. Incapacity may be present where:
employees demonstrate an inability to perform their job functions properly and in accordance with the standards required by the employer; or
employees are unable to perform their job functions properly due to sickness or injury; or
employees are incompatible with either their employer or their fellow employees. This is a strange species of 'incapacity' which, in the event of a dismissal, has been characterised as both an incapacity dismissal or a retrenchment. It is not a very common reason for dismissal but will be addressed below.
Each type of incapacity is dealt with separately below. Page 33
7.2.4 Poor work performance
Incapacity due to poor work performance should not be dealt with as an instance of misconduct unless the poor performance is the result of a deliberate act on the part of an employee not to perform his or her work functions in accordance with the requirements of the employer. In such case the employee may certainly be charged with negligence or the refusal to obey a lawful and reasonable instruction, etc. Poor work performance, more properly, is found in the context of an employee who is unable to perform his/her functions, and who may therefore require counselling and training in order to increase his/her levels of proficiency. The distinction is important because processes markedly different to those in the disciplinary context are followed by the employer when dealing with an employee who is demonstrating an inability to perform his/her work functions
Item 9 of schedule 8 pertains specifically to dismissals for poor work performance ("code on poor work performance") and states:
Any person determining whether a dismissal for poor work performance is unfair should consider-
whether or not the employee failed to meet the performance standard; and
if the employee did not meet the required performance standard whether or not-
. the employee was aware, or could reasonably be expected to have been aware, of the required performance standard;
. the employee was given a fair opportunity to meet the required performance standard; and
. dismissal was an appropriate sanction for not meeting the required performance standard.
As stated above, dismissals on the basis of poor work performance are unlike dismissals for misconduct as they are considered to be no-fault dismissals; neither party is to blame for the inability of the employee concerned to perform in accordance with the standards set by the employer. For this reason the LRA, as well as our courts, have established the code on poor work performance in order to ensure that a more sympathetic approach is taken by the employer. The employer is thus enjoined, in accordance with the guidelines in the code on poor work performance, and the fact that a sympathetic approach is required when confronted with an employee who is not performing to set standards, to: Page 34
inform the employee timeously of the deficiency in his or her work performance;
give the employee guidance and instruction on how to rectify the problem;
provide the employee with a reasonable opportunity to rectify the problem; and
consider alternatives to dismissal.
Item 8(2) and (3) of the code on poor work performance, dealing specifically with 'tenured employees' (i.e. employees who are permanent or have fulfilled their probationary requirements) provide further that an employee should not be dismissed for unsatisfactory performance unless the employer has given the employee appropriate evaluation, instruction, training, guidance or counselling and after a reasonable period of time for improvement, the employee continues to perform unsatisfactorily.
The courts have held in various cases that when employees enter into contracts of employment, they undertake, by implication, to work according to reasonable standards set by their employers, and if employees fail to meet the standard set by the employer, the employer is entitled to terminate the contract. The sanction of dismissal should, however, be considered only as a last resort in light of the guidelines set out above.
It is important to note that the employee who is performing poorly should not be disciplined for acts or omissions for which he / she is not to blame. Notwithstanding this, the inability to perform remains a recognised ground for termination of an employment contract under the LRA. Proof of poor work performance is best offered in the form of an objective assessment or appraisal of an employee's work. There must be a standard in existence which, itself, must be reasonable. The existence of the standard may be proved by a contractual provision, by practice, or by reference to industry norms. The reasonableness of a standard can also be proved by reference to workplace practices, the relative performances of other employees, by the express or implied warranties given by employees with regard to their level of skill and experience, the implications of the deficient performance for the business, or the position and status of the employee.
The employer must show that the employee's work has fallen below the required standard. This may be objectively proven in the form of complaints by customers, employees, supervisors, a demonstrable fall-off in trade, or evidence relating to the employer's actions on particular occasions. It may also manifest itself in the gradual drop below the employee's usual standard of work, or even in a single act or omission that shows that the employee is incapable of performing. An isolated error of judgement will not, however, ordinarily justify dismissal for poor work performance, unless it can be Page 35 shown that the employee was reckless or grossly negligent in his act or omission. The more senior, highly paid and specialised the employee, the higher the standard of work which can reasonably be expected of that employee.
The Labour Appeal Court has held that the stringent requirements pertaining to dismissals for poor work performance may not apply in the case of a senior employee and where the potential consequences of even a small departure from the standard of performance required of an employee are so serious that a single departure is sufficient to justify dismissal.
Although our courts appear to accept the notion that senior employees or managers should be able to assess their performance independently and take remedial action where necessary, this does not mean that all procedural requirements as laid down in Schedule 8 of the LRA, should be dispensed with. The employer must exercise caution and fairness before simply dismissing an employee for poor work performance.
In summary, the factors that are required to be taken into account in an objective assessment of whether or not dismissal is the appropriate remedy for an employee who is performing poorly may be listed as follows:
the position of the employee in the workforce;
the standard of work required from such employee, which is dependant on the position that the employee occupies;
the degree of seriousness of the failure to perform properly and in accordance with the standard set by the employer;
the length of the employee's service;
the employee's past record of work performance;
the possibility of providing additional training, instruction and guidance to the affected employee; and
the possibility of transference of the employee to another area of work.
Whilst the above factors are important in the determination of an appropriate sanction, they are not exhaustive, and each case must be decided on its own merits.
The procedure leading to dismissal should include an investigation to establish the reasons for the unsatisfactory performance and, as stated above, the employer should always consider other ways, short of dismissal, to remedy the matter. Page 36
Notable case:
Ross Poultry Breeders (Pty) Ltd v SOMYO (1997) 2 LLD 130 LAC
7.2.5 Probationary dismissals (usually found in the context of poor work performance)
Schedule 8 of the LRA was amended with effect from 1 August 2002 in order to provide for a reasonable probation period during which the employee's performance may be evaluated by the employer in order to determine whether or not the employee is suitable for permanent employment.
With regard to probationary employees, item 8 of Schedule 8 states, inter alia, that:
an employer may require a newly-hired employee to serve a probationary period before employment is confirmed;
the purpose of probation is to give the employer an opportunity to evaluate the employee's performance;
probation should not be used to deprive employees of the status of permanent employees;
the period of probation should be determined in advance and be of reasonable duration. The length of the probationary period should be determined with reference to the nature of the job and the time it takes to determine the employee's suitability for continued employment;
during the probationary period, the employee's performance should be assessed. An employer should give an employee reasonable evaluation, instruction, training, guidance or counselling in order to allow the employee to render a satisfactory service;
if the employer determines that the employee's performance is below standard, it should advise the employee of any aspects in which the employer considers the employee to be failing to meet the required performance standards;
if the employer believes that the employee is incompetent, the employer should advise the employee of the respects in which the employee is not competent;
the employer may either extend the probationary period or dismiss the employee after complying with the guidelines as aforesaid; Page 37
the period of probation may only be extended for a reason that relates to the purpose of probation. The period of extension should not be disproportionate to the legitimate purpose that the employer seeks to achieve;
the employer may only dismiss an employee or extend the probationary period after the employer has invited the employee to make representations and has considered any representations made; and
it is generally accepted that the reasons for dismissal may be less compelling than would be the case in dismissals of permanent employees.
While less compelling reasons may be accepted in assessing the fairness or otherwise of a dismissal of a probationary employee than under normal circumstances of poor work performance dismissals, the code on poor work performance nevertheless expects an employer to institute a proper procedure prior to dismissing a probationary employee who is performing below the required standards. An employer who simply dismisses a probationary employee on the last day of the probationary period runs the risk of being found to have dismissed such employee unfairly, with the consequent penalties accruing to it, i.e. the possibility of reinstatement with retrospective effect, or payment of compensation.
There can be no doubt that our courts have adopted the approach that the dismissal of a probationary employee must be fair, both substantively and procedurally.
Arbitrators have held, however, that there should be limited interference with the employer's reasons for dismissing a probationary employee who is found to be incapable of properly performing the job assigned to him / her.
This limited interference approach does not negate the requirement that a proper procedure be followed by the employer when performance managing and ultimately dismissing a probationary employee on the basis of poor work performance prior to dismissal.
The dismissal of an employee may be said to be procedurally fair if the employee has been given the opportunity to state his case before being dismissed and if the employer evaluated the employee's performance and gave the employee the necessary guidance and assistance to help the employee improve his or her standard of performance.
Notable cases:
Crawford v Grace Hotel (2000) 21 ILJ 2315 (CCMA) Page 38
SA Transport & Allied Workers Union v Spoornet, Orex, Saldanha (2001) 22 ILJ 2120 (ARB)
Yeni and SABC Broadcasting Company (1998) 3 LLD 38 (CCMA)
7.2.6 Illness - HIV/AIDS
Due to its controversial and, unfortunately increasingly relevant status as an incapacity issue, we have chosen to look at incapacity due to illness through the lens of how to deal with employees who are HIV positive or have developed full- blown AIDS.
Please note that we do not intend to look at the issue of incapacity due to injury since this would require a discussion of statutes such as the Compensation for Occupational Injuries Act which falls beyond the scope of this programme. In any event many of the same principles discussed below are relevant in the content of incapacity due to injury.
A full discussion of this issue requires that we take into account a number of instruments, namely, the Code of Good Conduct: Key Aspects of HIV/AIDS ("the Code"), the relevant provisions of the EEA, the provisions of the LRA concerned with incapacity dismissals and pronouncements by the Labour Court on the issue of HIV testing by employers.
The Code provides guidelines for employers who are increasingly required to deal with the prevalence of HIV/AIDS in the workplace and the resultant ill-effects that this has on the employment relationship and on productivity.
The Code provides for the effective management of HIV/AIDS in the workplace by means of an integrated strategy, which includes the following elements:
an understanding and assessment of the impact of HIV/AIDS in the workplace; and
measures to deal with and reduce this impact, including an HIV/AIDS policy for the workplace and HIV/AIDS programmes, which would incorporate prevention of the spread of the disease and the management of employees with HIV so they can work productively for as long as possible.
The Code also specifically entrenches the legal position encapsulated in terms of section 6(1) of the EEA, which provides that no person may unfairly discriminate against an employee on the basis of his/her HIV status. In any legal proceedings in which it is alleged that an employer has discriminated unfairly against an employee, the employer is required to prove that the alleged discrimination was, in fact, fair. Page 39
The Code also confirms the position held by section 7(2) of the EEA with respect to HIV testing by the employer. In terms of section 7(2), an employee may not be required by the employer to undergo an HIV test in order to ascertain his/her HIV status unless such testing is determined to be justifiable by the Labour Court. The Code does refer to authorised testing and states that an employer must approach the Labour Court for authorisation to conduct HIV testing on employees during procedures related to termination of employment.
The Code refers to the possibility of conducting voluntary HIV testing but specifies that such can only be done at the initiative of the employee. The Code provides for stringent guidelines on voluntary testing and states that such testing may only take place within defined conditions, including:
within a health care worker and employee-patient relationship;
with informed consent and pre- and post- test counselling, as defined by the Department of Health's National Policy on Testing for HIV; and
with strict procedures relating to confidentiality of an employee's HIV status.
The LRA prohibits dismissals on the grounds of an employee's HIV/AIDS status.
In terms of section 187(1)(f) of the LRA, if the reason for an employee's dismissal is unfair discrimination on the grounds of, inter alia, disability, such dismissal constitutes an automatically unfair dismissal entitling the affected employee to compensation in an amount equivalent to 24 months' remuneration (we will discuss the concept of automatically unfair dismissals in further detail below). Whilst the Code entrenches the above position, it further recognises that where there are valid reasons related to an employee's capacity to continue working and fair procedures have been followed, an employee who has effectively become incapacitated due to an HIV/AIDS related illness, may be fairly dismissed. In terms of clause 11.2 of the Code:
"[where] an employee has become too ill to perform their current work, an employer is obliged to follow accepted guidelines regarding dismissal for incapacity before terminating an employee's services, as set out in the Code of Good Practice on Dismissal.."
The Code goes on to create an additional procedural requirement with regard to an incapacity dismissal related to an employee's HIV status, namely, that the employer should ensure as far as is reasonably practicable that the employee's right to confidentiality regarding his/her HIV status is maintained during incapacity proceedings. Page 40
The above demonstrates that an employer retains the right to dismiss an employee where it has become evident that the employee is no longer able to fulfil his/her job functions adequately.
It is submitted that in the event that an employee demonstrates an incapacity to continue performing his/her work functions properly in accordance with the standards required by the employer, the employer is entitled to dismiss such employee following a fair procedure. The focus of such incapacity dismissal is on the inability to continue perform adequately and not on the issue of whether such inability to continue working is due to HIV/AIDS. An employee who is HIV positive may be able to continue working for some time before he / she falls ill and it is only at the stage that he / she has become incapacitated that the employer is entitled to consider dismissing him / her on the basis of such incapacity. It is questionable then what relevance testing the employee for HIV may have in the incapacity enquiry.
As stated above incapacity arising from ill-health can sometimes be a valid reason for dismissal, but the employer is required to demonstrate that the reason for dismissal is fair, and that a fair procedure was followed.
Guidelines in relation to incapacity specifically in the context of ill health, which employers are directed to follow in the contemplation and implementation of dismissals, are set out in items 10 and 11 to schedule 8 ("the code on ill health") The provisions clearly set out both substantive and procedural steps which need to be observed in order for a dismissal to be fair. The code on ill health refers to both the nature and seriousness of the incapacity and provides that the incapacity should arise from illness or injury. It also states that employers are entitled to satisfactory conduct and work performance from their employees.
The code on ill-health draws a distinction between an employee's temporary absence from work due to illness or injury and absences that endure for a time that is unreasonably long in the circumstances. If an employee is temporarily unable to work in the circumstances, the employer should investigate the extent of the incapacity or the injury. If the employee is likely to be absent for a time that is unreasonably long in the circumstances, the employer should investigate all the possible alternatives short of dismissal.
Regardless of the cause of the illness, in terms of the code on ill health, the employer will be required to investigate all alternatives short of dismissal. It should be noted that dismissal is generally not permissible when the absence is likely to be for a relatively short duration.
Item 10 of the Dismissal Code states:
incapacity on the grounds of ill-health or injury may be temporary or permanent; Page 41
if an employee is unable to work in these circumstances, the employer should investigate the extent of the incapacity or the injury;
if the employee is likely to be absent for a time that is unreasonably long in the circumstances, the employer should investigate all the possible alternatives short of dismissal;
when alternatives are considered, relevant factors might include:
the nature of the job;
the period of absence;
the seriousness of the illness or injury; and
the possibility of securing a temporary replacement for the ill or injured employee.
In cases of permanent incapacity, the employer should ascertain the possibility of securing alternative employment, or adapting the duties or work circumstances of the employee to accommodate the employee's disability.
Item 10 outlines the process to be adopted, short of dismissal. The process can be achieved by means of an investigation, during or after which a consultation should be conducted with the employee concerned in order that he / she may be allowed the opportunity to state his/her case. In this respect, the employee may be assisted by a member of a trade union or another employee. Although the outcome of the consultation process may result in the dismissal of the employee in question, it should be noted that the legislation envisages a "process" to be undertaken between employer and employee, other than a disciplinary enquiry. The latter forms the procedural component of the enquiry. The process is almost identical to that required in respect of incapacity due to poor work performance.
Item 11 of the code on ill health states:
any person determining whether a dismissal arising from ill-health or injury is unfair should consider –
whether or not the employee is capable of performing the work; and
if the employee is not capable –
. the extent to which the employee is able to perform the work; Page 42
. the extent to which the employee's work circumstances might be adapted to accommodate disability, or, where this is not possible, the extent to which the employee's duties might be adapted, and
. the availability of any suitable alternative work.
It is emphasised that the incapacity process is not of a disciplinary nature, but is more of an all-encompassing enquiry, including counselling and possibly medical assessment. Where an employee has demonstrated an incapacity to work through a prolonged absence from work, the employer is not required to ensure that a medical evaluation is done. The employer is reasonably entitled to believe that the employee's prolonged absence demonstrates incapacity.
Notable cases:
Irvin and Johnson Ltd v Trawler & Line Fishing Union & Others (2003) 24 ILJ 565 (LC)
Hoffmann v South African Airways (2000) 21 ILJ 2357 (CC)
7.2.7 Incompatibility
Incompatibility may be defined as the inability of an employee to work with his/her employer or fellow employees in a harmonious and productive manner.
Although the LRA does not specifically recognise incompatibility as a valid ground for dismissal, it is generally accepted that an employer may lawfully dismiss an employee for incompatibility in certain circumstances. It is not a form of dismissal that arises very often in the workplace but it is nevertheless important to grasp the fundamental principles of the concept since it is a slightly more complex aspect of labour relations that, if handled insensitively or clumsily by an employer, could result in an aggrieved employee being successful in a unfair dismissal dispute. As our case law has shown, moreover, the issue of incompatibility in the workplace has the potential to cause serious disruption which may result in economic losses; this will be looked at more closely below in our discussion of some cases in this context.
The issue of dismissal for incompatibility becomes clouded when we consider under which heading of dismissal it should be categorised. There is uncertainty in our case law as to whether a dismissal for incompatibility constitutes an incapacity dismissal or should more properly be classified as an operational requirements dismissal (i.e. a retrenchment). Page 43
For obvious reasons it is necessary to attempt to clarify under which banner of dismissal we wish to place an incompatibility dismissal since the procedures to be followed in each case are different. Unfortunately the LRA is silent as to the nature of an incompatibility dismissal.
It has been argued that where the incompatibility results in poor work performance and an employer contemplates dismissing the employee on this basis, then the incompatibility becomes a species of incapacity and the employer should proceed accordingly, guided by the employer's policy on incapacity (if one exists) as well the code on poor work performance.
Although often the employee, who is accused of being incompatible with his/her co-employees or with his/her employer, cannot be said to be performing poorly because of the alleged incompatibility, an argument may nevertheless be advanced that the incompatibility has incapacitated the employee's ability to perform in a broad sense. Those who argue that incompatibility is properly construed as an incapacity dismissal do so on various bases; for instance, it is argued that incompatibility does not fit the definition of operational requirements provided in the LRA in terms of which 'operational requirements' is defined as "…requirements based on the economic, technological, structural or similar needs of an employer." Since incompatibility relates to the subjective relationship between an employee and other persons in the workplace (either fellow employees or the employer), it does not fit the objective definition of operational requirements. It is also argued that the procedure that is required to be followed in dismissing an employee on the basis of operational requirements is not suitable for a dismissal on the basis of incompatibility. For instance, in a dismissal on the basis of operational requirements, the employer is required to select the employees ear-marked for dismissal on objective criteria. The dismissal of a specific employee for incompatibility, does not involve the same objective factors since it is essentially a subjective issue.
On the other hand, there is support for the argument that a dismissal for incompatibility is a form of dismissal on the basis of the operational requirements of the employer. In a case before the Industrial Court, discussed below, the court found that a dismissal on the basis of incompatibility is a species of dismissal for operational requirements since the incompatibility of the employee in question may affect the operational functioning of the company as a whole.
The issue of categorising a dismissal for incompatibility as either a dismissal for incapacity, on the one hand, or a dismissal on the basis of the employer's operational requirements, on the other hand, is not settled in our law and there is a dearth of recent case law dealing with the issue. The problem that this potentially poses for the employer is the question of whether the employer should follow an incapacity procedure or an operational requirements procedure in dismissing the affected employee. Page 44
Although it is impossible to state with certainty, and as a general rule, that incompatibility dismissals are a species of either incapacity dismissals or operational requirements dismissals, in a specific factual scenario it is most likely possible to determine with reasonable accuracy which kind of dismissal it is and what is the appropriate procedure to be followed in the circumstances.
South African courts have adopted a fairly rigorous approach when dealing with an allegation that a dismissal, allegedly on the basis of incompatibility, is unfair. The Industrial Court held, for example, that the dismissal of a senior employee, allegedly on the basis that such employee was incompatible with members of his management team, was unfair and unlawful and it consequently ordered reinstatement. In such case the court found that the employer had failed to establish a proper case that the employee was incompatible and had, most importantly, failed to give the employee a hearing in terms of which he would be able to state his version. The court also found that the reason for the dismissal, as stated by the employer, was an insufficient reason for dismissal in the circumstances. The employer had advanced the argument that it was necessary to terminate the employee's employment since he had ongoing arguments with another member of the same management team. As a result the employer decided that one of them "would have to go". The court found that the reasoning of the employer was flawed and that the dismissal was without foundation.
Our courts have also accepted that the incompatibility must be of sufficient severity to justify dismissal on that basis and must able to be justified on genuine and objective grounds.
The Industrial Court has held that an employee must be advised :
what conduct is allegedly causing the disharmony;
who has been upset by the conduct; and
what remedial action is suggested to remove the incompatibility.
The employee must also be given a fair opportunity to consider the allegations and prepare his/her reply and be given a proper opportunity of putting his/her version. Where it is found that he / she was responsible for the disharmony, he / she should be given a fair opportunity to remove the cause for disharmony.
The Labour Court has also accepted the notion that the employer is required to prove that the fault lies with the employee, and that he / she contributed substantially to the disharmony. The court found that there are three main causes of incompatibility in the workplace: Page 45
the inability of an employee to 'fit in' in the workplace despite attempts made by the employer and co-employees to assist the employee in adjusting to the work environment;
unacceptable conduct by the employee giving rise to consternation and feelings of ill-will by co-employees or unfair expectations by co- employees; and
the fact that the employer concerned has no structures in place to deal with the issue of incompatibility.
In the first instance it may be argued that the fault lies with the employee accused of incompatibility. The dismissal in such instances is therefore likely to be fair.
In the second instance the employer is required to consider who is more at fault: the employee or his co-employees. This requires a factual assessment and a fact-finding enquiry on the part of the employer. It is only if the employer reasonably finds that the reason for the incompatibility is primarily because of the employee then the dismissal may be fair.
In the third instance, the employer is clearly to blame and the dismissal will almost certainly be unfair.
There can be no doubt that incompatibility can in certain circumstances give rise to serious problems in the workplace which would justify dismissal. Most often the form that incompatibility takes is where a co-employee or group of co-employees refuse to continue working with the employee for reasons of alleged incompatibility.
Notable cases:
Dally and Davmark (Pty) Ltd (1997) 2 LLD 50 (CCMA)
Larcombe v Natal Nylon Industries (Pty) Ltd, Pietermaritzburg (1986) 7 ILJ 326(IC)
Erasmus v BB Bread Ltd (1987) ILJ 537 (IC)
Joslin v Olivetti Systems and Networks Africa (1993) 14 ILJ 227 (IC)
Schreuder v Nederduitse Gereformeerde Kerk Wilgespruit (1999) 7 BLLR 713 (LC)
Lebowa Platinum Mines Ltd v Hill (1998) 19 ILJ 1112 (LAC) Page 46
7.2.8 Retrenchment
The duty on an employer to consult arises when the employer contemplates dismissing one or more employees for reasons based on the employer's operational requirements.
A dismissal based on the operational requirements of the employer’s undertaking is defined by the LRA as one that is based on the economic, technological, structural or similar needs of an employer.
This is not a closed category and it is difficult to define all the circumstances that might legitimately form the basis of a dismissal for this reason.
As a general rule, economic reasons are those that relate to the financial management of the enterprise.
Technological reasons refer to the introduction of new technology which affects work relationships either by making existing jobs redundant or by requiring employees to adapt to the new technology or a consequential restructuring of the workplace.
Structural reasons relate to the redundancy of posts consequent to a restructuring of the employer’s enterprise.
Dismissals for operational requirements have been categorised as "no fault" dismissals, in other words, the employee is not responsible for the termination of employment and the effective cause of the termination is one or more external or internal factors related to the employer’s business needs.
For this reason, together with the human cost of retrenchment, the LRA places particular obligations on an employer, most of which are directed toward ensuring that all possible alternatives to dismissal are explored and that those employees to be dismissed are treated fairly.
The obligations placed on an employer are largely procedural. Primarily, they comprise a duty to consult with the required party before a final decision to dismiss is taken, the fair selection of employees to be dismissed and the payment of severance pay.
The purpose of consultation is to permit the parties, in the form of a joint problem-solving exercise, to strive for consensus where that is possible.
The LRA requires that the parties attempt to reach consensus on, amongst other things, appropriate measures to avoid dismissals. In order for this to be effective, the consultation process must commence as soon as it is clear that a reduction of the workforce is likely so that possible alternatives can be explored. The employer should keep an open mind throughout the process Page 47 and seriously consider any proposals put forward by the affected employee(s).
The LRA also provides for the disclosure of information by the employer on matters relevant to the consultation. The matters over which information for the purposes of consultation is required are set out below but it is important to note that the list is not a closed one. If considerations other than those that are listed below are relevant to the proposed dismissal, they should be disclosed to the consulting party.
The period over which consultation should extend is not defined in the LRA. The circumstances surrounding the consultation process are relevant to a determination of a reasonable period.
Proper consultation will include: the opportunity to meet and report back to employees; the opportunity to meet with the employer; and to request, receive and consider information.
The more urgent the need by the business to respond to the factors giving rise to any contemplated termination of employment, the more truncated the consultation process might be. Urgency may not, however, be induced by the failure to commence the consultation process as soon as a reduction of the workforce is likely. On the other hand the parties who are entitled to be consulted have a duty to co-operate during the consultation process. It should be used as an opportunity to reach consensus, and not as a delaying tactic.
If one or more employees are to be selected for dismissal from a number of employees, the LRA requires that the criteria for their selection must be either agreed with the consulting party or be fair and objective.
Selection criteria that are generally accepted to be fair include length of service, skills and qualifications. However, depending on the circumstances, other selection criteria may also be fair. The less capable these criteria are of measurement against objective standards other than the opinion of the person making the selection, the less likely they are to be fair. The less objective the proposed criteria for selection, the more important the obligation to consult over selection criteria becomes. For this reason, length of service (applied in the form of LIFO or "last in, first out") is commonly applied, on its own or in combination with other criteria.
Exceptions to the general rule, for example the right to retain employees with special skills, are often recognised.
The BCEA requires an employer to pay severance pay equal to at least 1 week’s remuneration for each completed year of continuous service. Page 48
This minimum requirement does not relieve an employer from attempting to reach consensus on severance pay during the period of consultation.
If an employee either accepts, or unreasonably refuses to accept, an offer of alternative employment, the right to severance pay is forfeited.
A consideration of the reasonableness of the offer of alternative employment and the reasonableness of the employee's refusal determine the issue. In the first case, objective factors such as remuneration, status and job security are relevant. In the second case, the employee’s personal circumstances play a greater role.
Employees dismissed for reasons based on the employer’s operational requirements should be given preference where the employer again hires employees with comparable qualifications, subject to:
the employee having expressed within a reasonable time from the date of dismissal a desire to be re-hired, and
the right of the employer to limit preferential re-hiring to a specified but reasonable period of time.
Who needs to be consulted?
The employer must consult:
any person whom the employer is required to consult in terms of a collective agreement;
if there is no collective agreement that requires consultation, a workplace forum, if the employees likely to be affected by the proposed dismissals are employed in a workplace in respect of which there is a workplace forum;
if there is no workplace forum in the workplace in which the employees likely to be affected by the proposed dismissals are employed, any registered trade union whose members are likely to be affected by the proposed dismissals;
if there is no such trade union, the employees likely to be affected by the proposed dismissals or their representatives nominated for that purpose.
Matters that need to be consulted on
The consulting parties must attempt to reach consensus on:
appropriate measures to: Page 49
avoid the dismissal;
minimise the number of dismissals;
change the timing of the dismissal(s); and
mitigate the adverse effects of the dismissal(s);
the method for selecting the employee(s) to be dismissed; and
the severance pay for the dismissed employee(s).
What information needs to be disclosed?
The employer must disclose in writing to the other consulting party relevant information, including, but not limited to:
the reasons for the proposed dismissal;
the alternatives that the employer considered before proposing the dismissal, and the reasons for rejecting each of those alternatives;
the number of employees likely to be affected and the job categories in which they are employed;
the proposed method for selecting which employee(s) to dismiss;
the time when, or the period during which, the dismissal is likely to take effect;
the severance pay proposed;
any assistance that the employer proposes to offer to the employee(s) likely to be dismissed; and
the possibility of the future re-employment of the employee(s) who are dismissed.
South African legislation does not prescribe fixed time limits to a retrenchment procedure and there are no minimum consultation periods or number of meetings. The consultation process can only be said to be completed when the employer has complied with its obligations to seek consensus on all the prescribed issues.
The process commences with the issue of a notice to the affected employee in terms of which the information set out above is specified. In such notice the employee will be invited to attend a consultation at a date and venue stated in the notice. Page 50
We emphasise that the consultation process must take place prior to the employer having taken any final decision - care must be taken in the drafting of the section 189 notice because of this fundamental principle of South African labour law on retrenchments. For this reason, all discussions with the affected employee (s) pertaining to this process should avoid any express or implied suggestion that the employer has already reached its decision before the conclusion of the process. All written representations from the employee(s) must be responded to in writing and it is important to maintain a proper record of the consultations that have taken place and all correspondence exchanged.
Notable cases:
WL Ochse Webb & Pretorius (Pty) Ltd v Vermeulen (1997) 18 ILJ 361 (LAC)
Fry's Metals v NUMSA and others (2003) 24 ILJ 133 (LAC)
BMD Knitting Mills (Pty) Ltd v SACTWU (2001) 22 ILJ 2264 (LAC)
7.2.9 Automatically unfair dismissals
The LRA provides for a species of unfair dismissal, warranting higher compensation than ordinary unfair dismissals, since the legislature has deemed fit to provide additional protection to employees who are dismissed for any 1 of 9 reasons which fall under the banner of automatically unfair dismissals. This is due to the recognition that such dismissals have certain constitutional and policy implications.
A dismissal is automatically unfair if:
the employer acts contrary to section 5 of the LRA (dealing with protections relating to freedom of association); or
the employee participated in or supported a protected strike (we will focus on strike law further below); or
the employee refused or indicated a refusal to do normal work during a protected strike unless such work is necessary to prevent danger to life, personal security or health; or
the dismissal is to compel an employee to accept a demand in respect of any matter of mutual interest between the employer and the employee (this will be looked at closer below in our discussion on the issue of amendments to terms and conditions of employment); or Page 51
the reason for the dismissal is because the employee exercised, or indicated an intention to exercise, any right conferred by the LRA or participate in any proceedings in terms of the LRA; or
the reason for the dismissal is the employee's pregnancy, intended pregnancy, or any reason related to the employee's pregnancy; or
the reason for the dismissal is that the employer unfairly discriminated against an employee, directly or indirectly, on any arbitrary ground, including but not limited to:
race;
gender;
sex;
ethnic or social origin;
colour;
sexual orientation;
age;
disability;
religion;
conscience;
belief;
political opinion;
culture;
language;
marital status; and
family responsibility; or
the reason for the dismissal is a transfer or a reason related to a transfer contemplated in section 197 of the LRA (this section will be discussed below); or
the reason for the dismissal is a contravention of the Protected Disclosures Act, 2000, on account of the employee having made a protected disclosure in terms of that Act. Page 52
In the normal course an employer found to have dismissed an employee unfairly may be ordered to compensate such employee in an amount equivalent to 12 months' remuneration, and in certain circumstances to reinstate the aggrieved employee. In the case of automatically unfair dismissals, however, an employee is entitled to claim compensation in an amount equivalent to 24 months' remuneration, and may also be reinstated.
An employee who claims that his dismissal was automatically unfair is required, first, to establish the existence of a dismissal (if this is in dispute) and thereafter to adduce sufficient evidence to demonstrate that the dismissal may possibly have been for a reason recognised in law as giving rise to an automatically unfair dismissal. If the employee succeeds, the employer bears the onus of establishing, on a balance of probabilities that the reason for the dismissal was, in fact, unrelated to the reasons postulated for automatically unfair dismissals, and that the dismissal was ultimately substantively and procedurally fair.
Examples of automatically unfair dismissals
Discrimination
Pregnancy
Religion
Reasons relating to a transfer of a business
Notable cases:
Wardlaw v Supreme Mouldings (Pty) Ltd (2004) 25 ILJ 1094 (LC)
Colliers Properties v Christian (2005) 26 ILJ 1674 (LC)
Maharaj v CP de Leeuw (Pty) ltd (2005) 26 ILJ 1088 (LC)
Botha v Du Toit Vrey and Partners CC (2005) 26 ILJ 2362 (LC)
Kroukam v SA Airlink (Pty) Ltd (2005) 26 ILJ 2153 (LAC)
SAMWU v Rand Airport Management Company (Pty) Ltd (2005) 26 ILJ 67 (LAC)
Lukie v Rural Alliance CC t/a Rural Development Specialist (2004) 25 ILJ 1445 (LC)
7.2.10 Constructive dismissals
Section 186(1)(e) of the LRA provides that a dismissal includes circumstances where an employee terminates a contract of employment Page 53 with or without notice because the employer made continued employment intolerable for the employee.
Where an employee claims that he / she has been constructively dismissed, the employee is required to prove that continued employment with the employer was rendered intolerable due to the employer's conduct. The courts have held that when an employee resigns or terminates the contract of employment and claims constructive dismissal, such employee is in fact indicating that the situation has become so unbearable that the employee cannot fulfil what is the employee's most important function, namely to work. The employee is in fact saying that he / she would have carried on working indefinitely had the unbearable situation not been created. The employee does so on the basis that he / she does not believe that the employer will ever reform or abandon the pattern of creating an unbearable working environment. If the employee is wrong in this assumption and the employer proves that his/her fears were unfounded then he / she has not been constructively dismissed and his or her conduct proves that he / she has in fact resigned.
There must thus be unfair or wrongful conduct by the employer that drives the employee to terminate the employment relationship. In this respect, the courts have ruled that the employer’s conduct does not have to be intentional.
Mere unhappiness at the employer's conduct will not be sufficient to establish constructive dismissal and the employee may be expected to take reasonable steps to resolve the problem. The courts have found that an employee who resigned to avoid further threats from the Chief Executive Officer was not constructively dismissed.
The employee's circumstances should, however, be viewed in context to establish whether resignation constitutes a reasonable response to the employer's conduct. Recent decisions of the Labour Court and Labour Appeal Court confirm that if the employee's subjective concerns are not well founded, or if there are other reasonable remedies, the employee has failed to discharge the onus.
Resignation in circumstances other than those described by Section 186(1) (e) can never amount to dismissal.
Thus, in order to prove constructive dismissal as defined in section 186(1) (e), the employee would have to show that:
he / she terminated the contract of employment;
the employer's conduct has become intolerable;
the intolerable circumstances are of the employer's making; and Page 54
the reason for the termination of the contract must be causally linked to the intolerable circumstances created by the employer's conduct.
Constructive dismissals in the transfer context
In 2002 the legislature amended the LRA to incorporate a new category of constructive dismissal relating specifically to the transfer of employees as a result of the sale of a business as a going concern.
Section 186(1)(f) of the LRA provides that a dismissal exists where an employee terminated the contract of employment with or without notice because the new employer, after a transfer in terms of section 197 or 197A, provided the employee with conditions or circumstances at work that are substantially less favourable to the employee than those provided by the old employer.
This provision re-enforces the protection that section 197 of the LRA offers in ensuring that employees' entitlements remain substantially the same after the transfer of a business as a going concern.
The section provides that where there is a transfer of a business as a going concern, the contracts of employment transfer automatically and all the rights and obligations between the old employer and the employee continue to remain in force.
Section 197(3) provides that the terms and conditions of employment cannot be less favourable on the whole. Should the conditions or circumstances be less favourable, a disgruntled employee may resign and claim that he has been constructively dismissed.
Notable cases:
Jooste v Transnet Limited t/a South African Airways (1995) 16 ILJ 629 (LAC)
Ntsabo v Real Security CC (2003) 24 ILJ 2341 (LC)
Unilong Freight Distributors (Pty) Ltd v Muller (1998) 19 ILJ 229 (SCA)
Salstaff & another v Swiss Port South Africa [2003] 3 BLLR 295 (LC)
Albany Bakeries Ltd v Van Wyk & others (2005) 26 ILJ 2142 (LAC)
Smithkline Beecham (Pty) Ltd v CCMA & others (2000) 21 ILJ 988 (LC) Page 55
7.2.11 Failure to renew a fixed term contract of employment
The LRA provides that a dismissal means, inter alia, that an employee reasonably expected the employer to renew a fixed term contract of employment on the same or similar terms but the employer offered to renew it on less favourable terms, or did not renew it.
In normal circumstances a fixed term contract of employment terminates upon the expiry of a specified date or upon the happening of a specified event. In terms of normal contractual principles and principles of modern labour law there is, in fact, no dismissal in these circumstances.
In the absence of an agreement to the contrary (i.e. the inclusion of a notice period in the contract of employment), an employer may not terminate the fixed term contract of employment prematurely. This distinguishes a fixed term contract from an indefinite duration contract in terms of which an employer is always entitled, subject to the requirements of substantive and procedural fairness, to terminate the contract of employment at any stage of employment.
For this reason it is important for an employer to include within the fixed term contract of employment an explicit notice clause entitling the employer to terminate the contract prematurely in certain circumstances, for example, misconduct and/or dismissal due to the operational requirements of the employer. In the event of a premature termination of employment and in the absence of such clause, an employee is likely to receive from the CCMA or Labour Court the value of his/her remuneration for the outstanding period of employment.
However, whilst fixed term contracts of employment serve valid economic and operational purposes they are often used as a device by which employers attempt to circumvent the unfair dismissal regime of the LRA (for the same purpose that employers create independent contracting relationships which are, in fact, employment relationships). This may lead to abuse which the LRA seeks to prevent.
In terms of the LRA, where an employee has a legitimate and reasonable expectation of renewal of his/her fixed-term contract, an employer may well be required to renew the contract on the same or similar terms set out in the original contract of employment.
It is important to note that this is restricted to a renewal of the contract for a further fixed term and does not anticipate that the employee may be entitled to indefinite term employment.
In contradistinction to the above, is also possible that in circumstances in which an employee works continuously for a number of years, albeit on the basis of a contract that is renewable at fixed intervals, a continuous and Page 56 uninterrupted employment relationship materialises. The effect of this is clearly to render what is, in form, a fixed term employee a permanent employee. This principle accords with the equity jurisprudence of labour law which is more concerned with the substance of the employment relationship than its form. In this case, however, an employee cannot rely on the provisions of the LRA dealing with the renewal of fixed term contracts of employment since the employee's contention is that he / she is an indefinite term employee.
In these circumstances an employee will be required to establish the existence of a dismissal by establishing that he / she had a legitimate expectation of permanent employment. The onus will then shift to the employer to demonstrate that the dismissal was substantively and procedurally fair.
The question of which consequence may ensue, as summarised above, will be decided with reference to the factual circumstances of the matter in issue.
The issue of what constitutes a 'legitimate expectation of renewal' has on various occasions been scrutinised by our courts. A number of factors may be utilised in making such a determination, for example,
whether any representations have been made by the employer regarding the renewal or non renewal of the contract, as the case may be;
what the provisions of the contract state;
whether any past practice of renewal exists; and
what purpose the fixed term contract serves.
The question is an objective one taking into account any relevant considerations in each circumstance. It is evident that this objective enquiry curtails the employer's discretion to renew a fixed term contract.
Notable cases:
SARPA obo Bands and others v SA Rugby (Pty) Ltd [2005] 2 BALR 209 (CCMA)
Aphane v Leeuw [2005] 7 BALR 734 (CCMA)
Oos Randse Administrasie en 'n Ander v Rikhoto 1983 (3) SA 595 (A) Page 57
Ampofo And Others v MEC For Education, Arts, Culture, Sports And Recreation, Northern Province, and Another (2001) 22 ILJ 1975 (T)
7.3 Unfair labour practices
7.3.1 Overview
Section 23 of the Constitution states that everyone has the right to fair labour practices (i.e. both employers and employees). The LRA, on the other hand, merely provides that every employee has the right to fair labour practices. The LRA therefore does not cover unfair conduct on the part of employees or trade unions. The question then arises whether a complainant can rely on the constitutional provision relating to fair labour practices due to the fact that the LRA does not regulate the issue sufficiently. The courts have held that the applicant should first seek a remedy in terms of the provision as contained in the LRA prior to seeking relief in terms of the Constitution. It is submitted, however, that applicants are entitled to approach the courts on the basis that a constitutional right has been infringed despite the existence of other statutory remedies.
Section 186(2) of the LRA provides that an unfair labour practice is an unfair act or omission that arises between an employer and an employee, involving:
unfair conduct by the employer relating to the promotion, demotion, probation (excluding disputes about dismissals for a reason relating to probation) or training of an employee, or relating to the provision of benefits to an employee;
the unfair suspension of an employee or any other disciplinary action short of dismissal in respect of the employee;
a failure or refusal by an employer to reinstate or re-employ a former employee in terms of any agreement; or
an occupational detriment, other than dismissal, in contravention of the Protected Disclosures Act, on account of the employee having made a protected disclosure defined in the Act.
It is important to note that an unfair labour practice can only occur in the context of an existing employment relationship, since the conduct must arise between the employer and the employee. In addition, only those individuals who fall within the definition of "employee" as contained in the LRA are entitled to protection in terms of this section. As discussed above, the actions involve conduct of the employer against the employee(s), which means that neither an employee nor a trade union are capable of committing an unfair labour practice. Page 58
The fact that the unfair labour practice "involves" certain acts or omissions implies that such conduct is limited to that conduct. The consequence of this is that if the conduct of the employer does not fall, at least partially, within the conduct mentioned in the section, it will not amount to an unfair labour practice. It is important to note that even though unfair discrimination no longer forms part of the unfair labour practice section, it is adequately dealt with in the EEA, which is discussed below.
In order to determine whether conduct amounts to an unfair labour practice, one is required to determine whether the employee's (or the employer's) right has indeed been infringed or is about to be infringed. Once the existence of an unfair labour practice has been established, a remedy should be granted. The remedy should have as its purpose the correction of the unfair conduct. The courts may, in terms of section 193(4) of the LRA, order reinstatement, re-employment or compensation. The most important principle in relation to unfair labour practices relates to fairness. The question of whether conduct amounts to an unfair labour practice involves questions both of law and fact, as well as moral judgement (i.e. fairness).
7.3.2 Unfair conduct relating to promotion
The greatest number of unfair labour practice disputes relate to allegations by employees that they have been unfairly treated in the context of promotion.
The 3 main issues which arise out of these cases are the following:
the definition of promotion;
what constitutes unfair conduct on the part of the employer; and
what remedies are available in the event that the court finds the employer’s conduct to be unfair.
Employers normally use one of the following procedures when promoting employees:
employees are evaluated on a regular basis and progress to a higher levels over a period of time; or
vacancies are advertised both internally and externally – both current and external applicants are required to apply.
The first issue to determine is whether there is an existing employment relationship between the employer and the employee. If this is the case, the current job is to be compared with the job being applied for. A number of factors are considered including remuneration levels, fringe benefits status, responsibility and status. Page 59
In order to establish whether the employer’s conduct was unfair, the courts examine whether the employer has failed to meet an objective standard, which includes arbitrary, capricious or inconsistent conduct, regardless of whether it was intentional or negligent.
The courts have held that the conduct of the employer in relation to promotions must be both procedurally and substantively fair. The courts have had difficulty in evaluating the reasons why an employer decides to promote one employee over another because the employer is entitled to take subjective factors such as performance into account when making a decision. However, the employer should be in a position to provide reasons and the courts are prepared to scrutinise those reasons in order to ensure that there is a logical connection between the real reasons and the decision. Employers should, as a rule, follow their own procedures. If the employer has a practice of advertising posts, it cannot, without a good reason, depart from that policy.
An interesting question relating to acting allowances within the unfair labour practice regime has started to develop recently. An employer may request employees to act in a certain position for a period of time. The fact that the employee acts in a different position does not entitle the employee to be appointed to that post. The courts have held that even where the employee has a legitimate expectation of being appointed to the acting position, this will only entitle the employee to be heard before a final decision is taken.
The relief for employees subjected to an unfair labour practice by their employer must be determined on reasonable terms. A problem arises in relation to the remedy for an unfair labour practice in relation to promotion – in most circumstances, the position which the complainant employee failed to get has normally been filled by another employee, thus the court cannot order the employee’s promotion.
7.3.3 Unfair conduct in relation to probation
It is important to note that the purpose of probation is to put the employer in a position to make an informed decision about the capacity and suitability of the employee to perform his/her function.
In determining whether conduct relating to probationary employees is procedurally and substantively fair, employers should examine the procedures relating to dismissal for poor work performance, as well as the guidelines relating to probation contained in the LRA.
Unfair labour practices in this context may include failure by an employer to inform the employee about the required performance standard (substantive), or failure by the employer to provide the employee with guidance and assistance (procedural). Page 60
7.3.4 Unfair conduct in relation to the provision of benefits
The courts have grappled extensively with the definition of "benefits" in relation to unfair labour practices. The problem is complicated by the fact that employees may not strike over issues that may be referred to arbitration and a dispute concerning benefits would fall within the arbitration category. Thus, what is included in the notion of benefits is relevant for determining whether employees may strike or whether they are required to follow the arbitration route. For example, if the concept of remuneration is included in the definition, then the right to industrial action will be severely affected.
The approach by the courts in this regard has been haphazard and inconsistent. For example, the courts have held that benefits include deductions form remuneration, payment for accumulated leave and payment in respect of a motor vehicle scheme. In other decisions, the courts have held that only disputes about existing rights (as opposed to the creation of new rights) can be arbitrated upon. Hopefully the courts will come to a conclusive decision in the near future.
7.3.5 Unfair conduct relating to suspensions
There are 2 kinds of suspension:
where disciplinary charges are being investigated against an employee, an employer may suspend that employee to prevent the employee from interfering in the investigation into the employee’s conduct;
where suspension is imposed as a disciplinary measure short of dismissal after a disciplinary hearing has taken place.
Both forms of suspension fall within the unfair labour practice regime.
The suspension of an employee pending the outcome of investigations into the employee’s conduct must be both procedurally and substantively fair. Thus, the employer must have a reason for believing that the suspension of employee is necessary. For example, where the suspected conduct may create a state of affairs such as rumours and suspicion which necessitates the suspension in order for work to carry on smoothly. Another reason could be that the employer suspects that the employee may attempt to intimidate potential witnesses. In relation to procedural fairness, the employer does not have to hold a hearing before suspending, but it should inform the employer of his/her suspension in writing, the reasons for the suspension and the conditions of the suspension.
The employer must continue to remunerate the employee during the suspension – if the employer fails to do so, it will be in breach of contract. However, where the employer suspends the employee after a disciplinary Page 61
enquiry, employers are entitled to suspend the employee without pay if it can show that it is a reasonable alternative to dismissal.
7.3.6 Failure or refusal to reinstate an employee
Employees are protected against a failure or refusal by an employer to reinstate them where an agreement to that effect exists.
7.3.7 Protected disclosures
Any occupational detriment an employee may suffer due to making a protected disclosure may constitute an unfair labour practice. According to the Protected Disclosures Act, 26 of 2000 (“the PDA”), an occupational detriment includes:
being subjected to disciplinary action;
being dismissed, suspended, demoted, harassed or intimidated;
being transferred against the employee’s will;
being refused transfer or promotion;
being subjected to a term and condition of employment or retirement which is altered to the employee’s disadvantage;
being refused a reference or being provided with an adverse reference from the employer;
being denied appointment;
being threatened with any of the above actions;
being otherwise adversely affected in respect of his/her employment, profession or office, including employment opportunities and work security.
A disclosure is defined as any disclosure of information regarding any conduct of an employer or an employee of that employer made by an employee who has reason to believe that the information concerned shows or tends to show that:
a criminal offence has been committed, is being committed or is likely to be committed;
a person has failed or is likely to fail to comply with any legal obligation to which that person is subject;
a miscarriage of justice has occurred or is likely to occur; Page 62
the heath and safety of an individual has been, is being or is likely to be endangered;
that the environment has been, is being or is likely to be damaged;
unfair discrimination;
that any of the above matters is being or is likely to be concealed.
A disclosure will be protected if it is made in good faith, if it is believed to be substantially true by the employee and if it is not made for personal gain.
If the employee makes a protected disclosure as outline above and the employer acts in a manner as outlined above as a result of such disclosure, the employee has a claim for an unfair labour practice.
Notable cases:
Public Servants Association v Department of Justice and others (2004) 25 ILJ 692 (LAC)
MITUSA v Portnet (2000) 21 ILJ 2519 (CCMA)
Schoeman and another v Samsung Electronics (Pty) Ltd (1999( 20 ILJ 200 (LC)
Northern Cape Provincial Administration v Commissioner Hambidge NO and others (1999) 20 ILJ 1910 (LC)
Protekon (Pty) Ltd v CCMA and others (2005) 26 ILJ 1105 (LC)
Perumal v Minister of Safety and Security and others (2001) 22 ILJ 1870 (LC)
NUMSA v Borg Warner SA (Pty) Ltd (1994) 15 ILJ 509 (A)
7.4 Amendments to terms and conditions of employment
Overview
This is an area of labour law which has enjoyed some measure of controversy and which also feeds into other areas of labour law, namely, the unfair labour practice regime, the unfair dismissal regime, and the law on retrenchments, as these are espoused in the LRA. It is for this reason that we have chosen to deal with the issue as a separate topic on its own but it is worth bearing in mind that the question of amendments to terms and conditions of employment may raise its head in any of the above contexts. Page 63
Under the common law, an employer is not permitted to amend unilaterally the terms of a service contract with an employee, and if it does so without agreement, the employee would have an election either to resile from the contract or to sue for damages in terms of the contract.
This is because where an employee has contractual rights and entitlements, an employer is not lawfully entitled unilaterally to change the provisions of the contract. An employer is, however, free to change benefits such as loan schemes and special leave privileges to which an employee is not contractually entitled. This must be effected, however, in accordance with the principles of consultation and fairness in order that the unfair labour practice provision of the LRA is not triggered.
The courts will, however, in certain circumstances, sanction a unilateral change to contracts of employment by employers if they can adduce sound commercial reasons for doing so and if the employer has negotiated the matter in good faith with the employees concerned.
It is thus clear that where an employer intends changing the terms and conditions of employment of an employee, and the relevant employee agrees to these changes in terms and conditions of employment, then, by agreement, the employer and employee may change the terms and conditions governing the employee's service with the employer.
However, where an employee does not agree to such change, an employer is not entitled to unilaterally change the terms and conditions of employment, unless the employer can show that it has commercial rationale and has consulted in a fair manner involving the employees properly in the process.
A dispute relating to a unilateral change to terms and conditions of employment cannot be adjudicated or arbitrated by the CCMA, but proceeds by way of power-play.
The LRA states that any employee or trade union that refers a dispute about a unilateral change to terms and conditions of employment to a council or the CCMA may, in the referral, and for a specified period:
require the employer not to implement unilaterally the change to terms and conditions of employment; or
if the employer has already implemented the change unilaterally, require the employer to restore the terms and conditions of employment that applied before the change.
The employer must comply with a requirement in terms of this subsection within 48 hours of service of the referral on the employer. The LRA states further that every employee has the right to strike if the issue in dispute has Page 64 been referred to a council or to the CCMA as required and a certificate stating that the dispute remains unresolved has been issued.
In addition to this remedy of a protected strike, the employees may elect to rather exercise their contractual remedies. If the employer changes the terms and conditions of employment of the employees without their consent, its conduct may constitute a repudiation of the employees' contracts of employment. In that event, the employees will have an election whether to accept the repudiation and claim whatever damages they may suffer as a result of such repudiation or they may reject the repudiation and hold their employer to their contracts of employment.
In the section of the handbook dealing with automatically unfair dismissals, the LRA states that a dismissal is automatically unfair if the reason for the dismissal is to compel the employee to accept a demand in respect of any matter of mutual interest between the employer and the employee.
A "matter of mutual interest" between an employer and employee includes terms and conditions of employment, including wages / salaries and hours of work.
Thus if an employee refuses to accept a unilateral amendment to a condition of employment, such as a salary reduction, and is subsequently dismissed, such dismissal would be automatically unfair.
However, an employer may still be able to dismiss on the basis of its operational requirements if the reason for the dismissal is not to compel an employee to accept a demand in respect of a matter of mutual interest but to terminate the employment relationship for business reasons. Although this dismissal will not be automatically unfair, the employer will still have to justify the fairness of the dismissal on the basis of the operational requirements of the business. This was confirmed in a recent decision of the Supreme Court of Appeal.
In summary, employers are not prohibited from retrenching employees who refuse to accept changes to their terms and conditions of employment as long as there is a commercial rationale for the proposed changes.
An employer should always first enter into consultations with the relevant employees in an attempt to obtain their consent to the proposed amendments to the terms of their employment.
Should the employer reach a successful agreement with its employees in this regard, then it may go ahead and implement the agreed changes.
An employer will not, however, be entitled unilaterally to change the employees' terms and conditions of employment unless they agree thereto. Should it insist on the amendments and implement them without the Page 65
individual employee's consent, then the employer faces the possibility of a strike or the possibility of the affected employees taking legal action against the employer for breach of contract.
Should the employer dismiss employees solely on account of their non- acceptance of the proposed amendments to their terms and conditions of employment, then such dismissals would be automatically unfair dismissals.
Notable cases:
Protekon (Pty) Limited v CCMA and others (2005) 26 ILJ 1105 (LC)
SAMRI v Toyota of South Africa Motors (Pty) Limited [1998] 6 BLLR 616 (LC)
Steynsfield Restaurant CC v Ndlovu and others (1994) 15 ILJ 297 (LAC).
WL Ochse Webb and Pretorius (Pty) Limited v Vermeulen [1997] 2 BLLR 124 (LAC).
Fry's Metals (Pty) Ltd v National Union of Metal Workers of SA and Others LAC/SCA
7.5 Collective bargaining
7.5.1 Overview
There is a distinction in labour law between the individual employment relationship between an employee and the employer and the collective employment relationship between the employer and a group of employees or trade union.
Collective labour law focuses on the matters such as the legal nature of trade unions, collective agreements, collective bargaining institutions and the legal consequences that result from industrial action (strikes, lock outs etc.)
Section 23(2) of the Constitution provides that every worker has the right to:
form and join a trade union;
participate in the activities and programmes of a trade union; and
strike.
The section goes further and confers rights on employers to form organizations and participate in the activities and programs of such organizations. In addition, trade unions have the right to organize and the Page 66
right to determine their own administration, programmes an activities. Employer’s organizations and trade unions also have the right to engage in collective bargaining.
The LRA was enacted to give effect to the Constitution. It protects the right to associate freely, the right to organize, the right to engage in collective bargaining and the right to engage in various forms of industrial action. Section 1 provides that the purpose of the LRA is, inter alia, to provide a framework within which employees and their trade unions and employers and employer’s organizations can collectively bargain to determine wages, terms and conditions and other matters of mutual interest and to formulate industrial policy. In addition, the LRA’s purpose involves promoting orderly collective bargaining at every level and employee participation within the workplace.
7.5.2 The right to strike and recourse to lockout
The Constitution enshrines the right of employees to strike. Through their constitutional right to engage in collective bargaining, employers enjoy a corresponding recourse to lock-out. The LRA provides that employees who have followed a prescribed procedure are protected from dismissal whilst striking; striking employees are not entitled to be paid whilst on strike. There are certain limitations on the right to strike e.g. employees engaged in essential services or in maintenance services do not have the right to strike. Employers have recourse to lock-out employees in order to compel compliance with legitimate employer demands; however, an employer who locks out its employees is not entitled to employ replacement labour during the course of the lock-out unless the lock-out is in response to a strike.
The LRA prohibits employees from striking where the reason for the strike is the alleged unfair dismissal of a co-employee or employees.
7.5.3 Collective bargaining
The LRA seeks to encourage and promote formal collective bargaining between employers and unions at national, sectoral and plant level.
The LRA requires that certain organisational rights are granted to representative unions, and provides that collective agreements between unions and employers enjoy an enhanced legal status.
What is interesting to note is how the LRA clearly favours majority unions within the workplace. Majority unions are entitled to form workplace forums, they are entitled to exercise all the organisational rights as contained in the LRA (only unions who are sufficiently representative are entitled to exercise 3 of the 5 rights), collective agreements concluded between majority unions and employees may be extended to non members who are employees and the option to conclude agency shop or closed shop agreements is provided Page 67 for in the LRA (this is an agreement which only a majority union can enter into).
Questions have arisen concerning interference by the courts in the collective bargaining process. The general rule is that the courts should not interfere in this process at all – the employee's remuneration is none of the court's business. Collective bargaining concerns the power play that exists between employer and employee and this process must be protected from interference by the courts.
Another important question relating to the collective bargaining has been raised by the courts and a number of authors. The right to engage in collective bargaining is contained both within the Constitution and the LRA. The question then arises whether if there is a right to engage in collective bargaining (as opposed to the right to bargain collectively which was contained in the interim Constitution) , then is there a corresponding duty to engage in collective bargaining. In one court decision, it was held that the right to engage in collective bargaining is nothing more than the protection of the right to engage against state intervention. In a subsequent decision, it was held that a corresponding duty engage in collective bargaining does exist.
Notable cases:
NUMSA & others v Bader Bop (Pty) Ltd & another (2003) 24 ILJ 305 (CC)
SANDU v Minister of Defence and others 2003 (3) SA 239 (T)
SANDU and others v Minister of Defence [2003] 9 BLLR 932 (T)
NUMSA v Vetsak Co-operative Ltd and others (1996) 17 ILJ 455 (A) Page 68
8. The Employment Equity Act, 55 of 1998 ("the EEA")
8.1 Overview
The preamble to the EEA provides that it is recognised that as a result of apartheid and other discriminatory laws and practices, there are disparities in employment, occupation and income within the national labour market and that those disparities create such pronounced disadvantages for certain categories of people that they cannot be redressed simply by repealing discriminatory laws. The EEA was therefore enacted to promote the constitutional right of equality, eliminate unfair discrimination in employment, ensure the implementation of employment equity to redress the effects of discrimination and achieve a diverse workforce broadly representative of South Africa's people.
The purpose of the EEA is to eliminate unfair discrimination in the workplace, thereby promoting equal opportunity and fair treatment and to proactively advance employees who were discriminated against in the past via affirmative action measures in order to redress the disadvantages in employment experienced by designated groups. The aim of this is to ensure that these employees are equitably represented in all job categories and at each level in the workplace.
It must be stressed that whereas the prohibition of unfair discrimination applies to all employers in respect of every employee, the obligation to implement affirmative action measures to advance employees in the workplace only applies to certain employers in respect of certain employees. In other words, the prohibition of unfair discrimination applies to every employer and employee in South Africa while affirmative action only applies to certain employers (“designated employers”) and certain employees (employees from “designated groups”).
The EEA is divided into various sections, including:
Chapter I – Definitions, Purpose, Interpretation and Application (as the title denotes, this Chapter defines certain terms in the Act, explains the purpose of the Act as well as how it is to be interpreted and applied);
Chapter 2 - Prohibition on Unfair Discrimination;
Chapter 3 – Affirmative Action;
Chapter 4 – Commission for Employment Equity (this Chapter establishes a Commission for Employment Equity (“CEE”) to advise the Minister of Labour. The CEE will play a role in the drafting of Page 69
Codes of Good Practice and Regulations and in monitoring that there is speedy progress in South Africa in the area of employment equity. The CEE may also make awards recognising employers’ achievements towards achieving employment equity in South Africa;
Chapter 5 – Monitoring, Enforcement and Legal Proceedings (this Chapter is divided into 3 parts and deals with the ways in which employment equity progress will be monitored and enforced by the authorities as well as the jurisdiction and powers of the various bodies and the procedures to be followed in the event of a dispute); and
Chapter 6 – General Provisions.
8.2 The prohibition of unfair discrimination (Chapter 2)
Chapter 2 prohibits all employers from discriminating unfairly against any worker or applicant for employment. The prohibition on unfair discrimination extends to any employment policy or practice and therefore extends to virtually every aspect of the employment relationship. In practice this means that the following must be free of unfair discrimination:
recruitment procedures;
advertising and selection criteria;
interviewing applicants for employment, appointments and the appointment process;
job classification and grading;
remuneration;
employment benefits and terms and conditions of employment;
job assignments;
the working environment and facilities;
training and development;
performance evaluation systems;
promotion;
transfer; Page 70
demotion;
disciplinary measures other than dismissal; and
dismissal.
8.3 Forms of unfair discrimination
The following forms of unfair discrimination are identified and prohibited:
direct or indirect discrimination against an employee in any employment policy or practice on one or more grounds including; race, gender, sex, pregnancy, marital status, family responsibility, ethnic or social origin, colour, sexual orientation, age, disability religion, HIV status, conscience, belief, political opinion, culture, language and birth.
Unfair discrimination is defined as differential treatment on an arbitrary ground (i.e. on a ground that is capricious and without commercial rationale).It is irrelevant that the employer does not have intention to discriminate.
Indirect discrimination occurs when the employer imposes an apparently neutral criterion on all employees but the application of that criterion has a discriminatory affect on certain groups of employees. For example, where minimum height is a condition of employment, it will have a discriminatory effect on women because women are generally shorter than men and such condition therefore constitutes indirect discrimination.
Discrimination in the form of affirmative action is not regarded as unfair, nor is it unfair to discriminate against an employee on the basis of an inherent requirement of the job.
harassment of an employee (in particular sexual and racial harassment)
The Code of Good Practice on the Handling of Sexual Harassment Cases ("the Code") was published to supplement the statutory prohibition as contained in the EEA. The objective of the Code is to eliminate sexual harassment in the workplace and states that sexual harassment covers sexual attention that:
is persisted in;
the recipient has clearly indicated is offensive; and
the perpetrator should have known is unacceptable. Page 71
The court, recognising that sexual harassment may be subtle and often in the eye of the beholder has stated that evidence in such cases must be carefully weighed.
The definition of sexual harassment includes physical contact, verbal innuendoes, suggestions, hints, comments with sexual overtones, sex- related jokes or unwelcome graphic comments about a person’s body made in their presence or directed at them, inappropriate inquiries about a person’s sex life, unwelcome gestures, indecent exposure and the unwelcome display of sexually explicit pictures and objects.
The following forms of sexual harassment are unique to the workplace:
“quid pro quo harassment” which refers to the situation where an employer, supervisor, manager or co-employee undertakes or attempts to influence the process of employment, promotion, training, discipline, dismissal, salary increment or other benefit of an employee or job applicant in exchange for sexual favours;
ignoring an employee – this can constitute sexual harassment where a person in authority rewards only those who respond to his/her sexual advances with promotion or increases and ignores those who don’t; and
dismissing an employee once an affair is over on the ground that the employee’s presence is a source of embarrassment to the other person.
The Code emphasises that employers and employees should not only refrain from sexual harassment but should also discourage such conduct by others who have any dealings with the workplace (e.g. customers, suppliers, job applicants etc). Notwithstanding this, employers do not have authority to take disciplinary action against non-employees for the sexual harassment by them of their own employees.
Management must take active steps towards eliminating sexual harassment in the workplace by issuing policy statements and procedures on sexual harassment. A policy statement on sexual harassment must state that all employees, job applicants and other persons who have dealings with the business have a right to be treated with dignity and due respect for their privacy and integrity and that sexual harassment is prohibited. The statement should state further that victims of sexual harassment have a right to raise a grievance with the guarantee that appropriate action will be taken and that managers are obliged to take disciplinary action against any employee who does not comply with the policy.
Management should also implement orientation, education and training programmes to communicate the policy and procedures to employees and Page 72
inform employees that grievances will be treated seriously, sensitively and quickly by the employer
8.3.1 What action should an employer take when a case of sexual harassment is brought to his/her attention?
The Code suggests that the employer should appoint an individual to whom victims of sexual harassment can confide in on a confidential basis.
A complainant should be given the option of informally attempting to resolve the problem. This would involve explaining to the perpetrator that his or her conduct is unwelcome and offensive and makes the victim of such harassment feel uncomfortable within the workplace.
If the complainant should also be afforded the opportunity to institute formal proceedings. This involves an investigation into the conduct of the alleged perpetrator, and if necessary, disciplinary action against the alleged perpetrator. (The only difference between this disciplinary action and other disciplinary action is that special steps must be taken to ensure confidentiality. Accordingly, only the victim, the offender, witnesses, an interpreter (if necessary) and an “appropriate member of management” should be present at the enquiry).
If the victim is not satisfied with the outcome of the internal disciplinary proceedings, he or she may refer the dispute to the CCMA for conciliation. In the event of settlement not being reached, the Labour Court has the jurisdiction to resolve the matter and has the power to order the employer to compensate the aggrieved employee, and / or to take steps to ensure that the situation is rectified. Compensation can amount to a maximum of 24 months' remuneration.
testing an employee for any medical condition
This is prohibited unless either legislation permits it or requires it or if it is justifiable to do so in the light of medical facts, employment conditions, social policy, the fair distribution of employee benefits or the inherent requirements of a job. Furthermore, the EEA prohibits HIV testing unless the Labour Court determines that such testing is justifiable. In making a determination, the court may make any order that it deems appropriate in the circumstances and may impose conditions relating to counselling HIV positive employees, maintaining confidentiality the period during which testing is permissible and the categories of employees that may be tested.
Notwithstanding this prohibition, the courts have held that Labour Court’s permission is not required where the HIV test/s are both voluntary and anonymous. Page 73
The Code of Good Practice on Key Aspects of HIV/AIDS and Employment and the HIV/AIDS Technical Assistance Guidelines have been produced in order to assist employers with regard to the testing of employees for HIV/AIDS and the implementation of an HIV/AIDS policy and programme.
psychological testing and other similar assessments
This is prohibited unless it can be shown that the test or assessment is valid and reliable, can be applied fairly to all employees and is not biased against any employee or group. It follows that the test or assessment may not be racially or culturally unfair.
8.3.2 Interviewing applicants for employment
Applicants for employment are also protected under the EEA against unfair discrimination. This implies that recruitment and interviewing processes must be free of unfair discrimination. Several cases have been brought before the CCMA and the Labour Courts by unsuccessful applicants for employment who allege that they were discriminated against unfairly in the recruitment and/or interviewing process.
Applicants for employment may not be unfairly discriminated against on grounds such as race, gender, sex, pregnancy, marital status, family responsibility, ethnic or social origin, colour, sexual orientation, age, disability, religion, HIV status, conscience, belief, political opinion, culture, language or birth.
The only lawful grounds for differential treatment of applicants are the following:
affirmative action - employers may choose to employ a black person rather than a white person, or a woman rather than a man or a disabled person rather than a physically fit person if the employer has identified in its employment equity analysis that it does not have a sufficient number of designated employees within in the workplace;
age - if an employee or applicant has reached the normal retirement age, an employer need not employ such a person;
inherent requirements of the job - an employer may choose one applicant over another if the chosen applicant displays competencies more suitable for the job. The employer is required to identify the requirements for the job and may then appoint the applicant which it believes would be most competent to perform the job. An employer who chooses one applicant over another would not be guilty of unfair discrimination since it would be able to justify Page 74
the appointment based on commercial rationale and its inherent job requirements.
Example
An auditing firm wishes to employ a qualified accountant to join its firm. The employer identifies the following competencies which are required for the job:
bilingualism, since the firm has many Afrikaans and English speaking clients;
accreditation with a professional body or other requisite qualification/accreditation;
technical understanding of tax, accounting and auditing principles;
an ability to liaise with clients and to get on with people;
good administrative, organizational and time-keeping skills;
a driver’s licence; and
computer skills.
Once the employer has decided that potential candidates require the skills as listed above, the employer is entitled to phrase questions during the interview in such a way in order to ascertain whether the applicant has the required competencies. Any arbitrary questions, which in no way relate to the above competencies would be considered arbitrary and discriminatory. Foe example, it would be discriminatory to ask a female applicant whether she is married or has children, as this in no way relates to the competencies identified by the employer. However, asking questions which may be aimed at finding out whether the female applicant has a driver's licence cannot be considered unfair discrimination, since it is contained within the competency criteria.
An employer should identify the competencies required for the job (i.e. what the ideal candidate will need to display in order to do the job properly) before interviewing any candidates.
If a competency is identified for the job which would be relatively easy to train the applicant in, then questions in this regard should be asked in order to ascertain whether the candidate is in a position to benefit from such training. Page 75
Once competencies have been identified for the job the employer must identify the level of competency needed for the job. For example although computer literacy may be a competency identified for a secretarial position, the level of competency required would not be as high as for the position of a software engineer.
The employer or interviewer should prepare a set of questions, which will be put to the candidate. The questions must be aimed at determining whether the candidate possesses the competencies required for the job and also to determine his or her level of competency. In the example outlined above, the employer has identified that the candidate (trainee accountant) must have computer skills (a competency identified above). The employer would then be entitled to ask questions relating to levels of competency in relation to specific software products which the employer utilises on a daily basis. Inviting the candidate to share his or her past experiences regarding use of the computer software would also be relevant because it would assist the interviewer assess the candidate's level of competence.
Job application forms (if used) should only pose questions that relate to the identified competencies.
If an unsuccessful applicant asks why his or her application was refused, the employer must be able to provide a reason based on the applicant’s competency in relation to the inherent requirements of the job. In other words, any refusal should be based on commercial rationale and not on an arbitrary or discriminatory ground.
The EEA prohibits both direct and indirect discrimination. The employer should be careful not to ask questions, which are either directly or indirectly discriminatory.
The interviewer should be aware that an employer may incur liability where discriminatory questions are asked, even if the interviewer did not intend to discriminate or did not think that the questions were discriminatory. The interviewer must not be unprepared. He or she must prepare questions carefully, having regard to the competencies identified for the job.
8.3.3 Unfair discrimination disputes
The EEA provides that disputes relating to alleged unfair discrimination must be referred to the CCMA within 6 months after the act or omission that allegedly constitutes unfair discrimination. The CCMA must attempt to conciliate the dispute. If conciliation fails, either party may refer the dispute to the Labour Court for adjudication, unless all parties consent to arbitration of the dispute. Page 76
It should be noted that disputes concerning unfair dismissal are excluded from the ambit of the EEA and must be referred to the appropriate body in terms of the LRA.
8.3.4 Affirmative Action
Chapter 3 compels “designated employers” to implement affirmative action measures for people from designated groups in order to achieve employment equity.
A designated employer is defined as:
an employer who employs 50 or more employees; or
an employer who employs fewer than 50 employees, but has a total annual turnover that is equal to or above the applicable annual turnover of a business in terms of Schedule 4 to this Act (the annual turnovers listed in the Schedule range from R2 million to R25 million);
a municipality, as referred to in Chapter 7 of the Constitution;
an organ of state as defined in section 239 of the Constitution, but excluding local spheres of government, the NDF, the NIA and the SASS;
an employer bound by a collective agreement in terms of section 23 or 31 of the LRA;
An employer who is not a designated employer may notify the Director- General of the Department of Labour that it wishes to comply with Chapter 3.
Designated groups is defined as black people, women and people with disabilities. Black people is a generic term which includes African people, Coloured people and Indian people.
People with disabilities are defined as those who have a long-term recurring physical or mental impairment that substantially limits their prospects of entry into or advancement in employment.
Every designated employer must do the following in order to achieve employment equity within the workplace:
conduct an analysis of its existing policies, practices, procedures and the working environment. The analysis should identify any employment barriers, which adversely affect people from the designated groups (i.e. which create obstacles to the employment and/or promotion of black people, women and people with disabilities). The analysis Page 77
must include a profile of the employer’s workforce within each occupational category and at each level to determine the degree of under-representation of workers from the designated groups within those categories and at those levels.
prepare and implement an employment equity plan ("the plan") that will achieve reasonable progress towards employment equity in that employer’s workforce. The plan must state the following:
the objectives to be achieved for each year of the plan;
the affirmative action measures that will be implemented in the workplace. The EEA defines affirmative action measures as measures designed to ensure that suitably qualified people from designated groups have equal employment opportunities and are equitably represented in all occupational categories and levels in the workplace of a designated employer. Suitably qualified people are persons who are qualified for a job because of any one of, or any combination of formal qualifications, prior learning, relevant experience, or capacity to acquire within a reasonable time, the ability to do the job. When determining whether an employee is suitably qualified to do the job an employer may not unfairly discriminate against a person only on the ground of that person’s lack of work experience.
The following affirmative action measures must be implemented by a designated employer:-
identifying and eliminating employment barriers, which adversely affect people from the designated groups;
furthering diversity in the workplace based on equal dignity and respect of all people;
making reasonable accommodation for people from designated groups in order to ensure that they enjoy equal opportunities and are equitably represented in the workforce;
ensuring equitable representation of people from the designated groups in all occupational categories and levels in the workforce and retaining and developing people from designated groups and implementing appropriate training measures.
It must be stressed that in implementing affirmative action measures, a designated employer is not required to take any decision about an employment practice or policy that would establish an absolute barrier to the Page 78 employment or advancement of people who are not from designated groups. Note also that while designated employers are required to adopt preferential treatment of people from the designated groups, the Act does not lay down any quotas.
Where the analysis identifies under-representation of people from designated groups, the plan should state the numerical goals to achieve equitable representation of people from designated groups in each category and at each level in the workplace.
The plan must also contain the timetable within which these goals are to be achieved and the strategies to be used in order to achieve these goals. In setting numerical goals, a designated employer must aim to ensure that representation of people from the designated groups reflects the demographic profile of the national and regional economically active population, taking into account the pool of “suitably qualified” people from designated groups from which the employer can reasonably be expected to appoint of promote. The economic and financial factors in the sector in which the employer operates, the present and anticipated financial circumstances of the employer, the number of present and planned vacancies in the employer’s workplace and the employer’s annual turnover will be taken into account by the Director-General of the Department of Labour ("the Director General") in assessing the employer’s numerical goals.
The plan must also contain:
the timetable and plan for the achievement of goals other than numerical goals;
the duration of the plan, which may not be less than 1 year or more than 5 years;
the procedures that will be used to monitor the implementation of the plan and whether reasonable progress is being made towards achieving employment equity;
the internal procedures that will be used to resolve disputes concerning the interpretation or implementation of the plan; and
the persons in the workforce who will be responsible for monitoring and implementing the plan.
The EEA also provides that the employer must submit a report to the Director-General on progress made in implementing its employment equity plan. The period within which a designated employer needed to submit its first report depended on the number of employees employed by that employer. Those who employ fewer than 150 employees had to submit the Page 79
first report within 12 months after the date of commencement of the EEA (1 December 2000), or within 12 months of the date on which the employer became a designated employer. Subsequent reports must be submitted once every two years on the first working day of October. Designated employers who employ 150 or more employees had to submit the first report within 6 months of commencement of the EEA (1 June 2000), or within 6 months of the date on which the employer became a designated employer. Subsequent reports must be submitted once every year on the first working day of October.
The Chief Executive Officer must sign the report and, if the designated employer is a public company, a summary of the report must be included in the company’s annual report.
The first report must refer to the initial development of and content of an employment equity plan. Subsequent reports must give details of progress made in implementing the employment equity plan.
The EEA requires that a designated employer must consult and attempt to reach consensus with a representative trade union representing a sufficient number of employees at the workplace and its employees or representatives or if there is no representative trade union, with the employees or their representatives (nominated by them).The consulting group must represent the interest of all workers in the workplace. The group must consist of employees from all occupational categories and levels of the employer’s workforce (both from designated and non-designated groups.)
In consulting with a trade union and/or employees or their representatives, the employer has a duty to disclose all relevant information. The requirement of consultation is not intended to deprive employers of their power but to ensure that all involved parties are committed to workplace transformation and to foster democracy and productivity in the workplace.
8.3.5 Income differentials
Designated employers are also required to submit a statement to the Employment Conditions Commission ("the Commission") on the remuneration and benefits received by employees in each occupational category and level of the employer’s workforce and to take steps progressively to reduce “disproportionate” differentials (which the Commission is required to define).
The Commission must advise the Minister of Labour on appropriate measures for reducing disproportional incomes.
Miscellaneous duties of designated employers Page 80
A designated employer is required to assign one or more senior managers for the purpose of implementing and monitoring the plan.
A designated employer is required to display the following at its workplace:-
a statement informing employees of the provisions of the Act;
a copy of the most recent report sent to the Director-General; and
any compliance order, arbitration award or order of the Labour Court issued in terms of the EEA.
A designated employer is required to keep records of the members of its workforce and of its employment equity plan.
8.3.6 Monitoring, enforcement and legal proceedings
Compliance with the EEA is policed at various levels:
within the workplace - the designated employer must consult and attempt to reach consensus on the analysis of existing policies and procedures, the preparation of an employment equity plan and reports thereon;
by the Department of Labour - labour inspectors have powers of entry into an employer’s workplace and may question and inspect any relevant documents.
an inspector may secure a written undertaking from the employer to comply with any duty contained in the EEA. If the employer refuses to sign the undertaking or does not comply with the written undertaking, the inspector may issue a compliance order. The compliance order must set out what the employer is required to do, when it must comply as well as the fine that may be imposed if the employer does not comply. The employer is required to display the compliance order at the workplace. If it wishes to object to the compliance order, it must do so within 21 days after receiving the order by submitting such objection to the Director General. The Director-General may confirm, cancel or vary the order and must specify a date for compliance. After receiving the Director-General’s order the designated employer must either comply with it or appeal against it by referring it to the Labour Court. If the employer appeals to the Labour Court, the operation of the compliance order will be suspended, pending the court's decision. If the employer does not comply with or appeal the order, the Director-General may apply to the Labour Court to have the order made an order of court. Page 81
In assessing whether a designated employer is implementing employment equity in the workplace, the Director-General must take the following into account:
the extent to which suitably qualified people from the designated groups are represented in the workplace in relation to the nationally and regionally economically active population;
the pool of suitably qualified people from designated groups from which the employer can reasonably be expected to appoint or promote people;
financial factors relevant to the particular sector in which the employer operates;
the employer’s present and anticipated financial circumstances;
the employer’s present and planned turnover with regard to vacancies;
progress made in implementing employment equity by other designated employers operating under comparable circumstances and in the same sector;
reasonable efforts made by the designated employer to implement employment equity;
the extent to which the designated employer has eliminated employment barriers.
The Director-General may conduct a review to determine whether an employer is complying with the EEA. He may ask the employer to submit a copy of its current analysis or plan and may also invite the employer to meet with him. The purpose of the review is to ascertain whether the employer is complying with the EEA.
After reviewing the situation, the Director-General may approve the designated employer’s equity plan or he may make a “recommendation” to the employer outlining the steps it must take and the period within which the steps must be taken. If a designated employer does not comply with the Director-General’s recommendation he may refer the matter to the Labour Court.
8.3.7 Failure to implement affirmative action – does this constitute unfair discrimination?
Designated employers are required to take appropriate steps, including the implementation of affirmative action, in order to achieve employment equity. Page 82
Employees (including applicants for employment) have a right not to be unfairly discriminated against.
The question thus arises whether a black employee can argue that he or she has been unfairly discriminated against in circumstances where the employer does not implement affirmative action measures. There are conflicting decisions in this regard. The courts have held that employer who fails to implement affirmative action measures are violating the rights of employees who fall within one of the designated groups not to be unfairly discriminated against. The courts have also held that the employer's failure to implement affirmative action measures does not amount to unfair discrimination.
Notable cases:
Biggs v Rand Water (2003) 24 ILJ 1957 (LC)
McInnes v Technikon Natal (2000) 21 ILJ 1138 (LC)
Stoman v Minister of Safety and Security and others (2002) 23 ILJ 1020 (T)
Coetzer and others v Minister of Safety and Security and another (2003) 24 ILJ 163 (LC)
Grobler v Naspers Bpk 2004 (4) SA 220 (C); (2004) 25 ILJ 439 (C) and Media 24 Ltd & another v Grobler (2005) 26 ILJ 1007 (SCA)