The Labour Relations Amendment

Transcription

1 THE ROLE OF COLLECTIVE AGREEMENTS - THE REVIEW OF CCMA ARBITRATION AWARDS - OUTSOURCING AND THE LRA -INCOMPATIBILITY AS GROUNDS FOR DISMISSAL - ALCOHOL RELATED OFFENCES IN THE WORKPLACE - HEALTH SAFETY AND DISCIPLINE - THE SUSPENSION OF EMPLOYEES - SHRINKAGE AND DISMISSAL - WHAT IS AN EMPLOYMENT BENEFIT? - CALCULATING COMPENSATION FOR UNFAIR DISMISSAL - THE ROLE OF CONSISTENCY IN DISCIPLINE - IMPLEMENTING A FAIR RETRENCHMENT - PROCEDURAL FAIRNESS IN DISMISSAL - STRIKES IN SUPPORT OF UNLAWFUL DEMANDS -PICKETING RULES DURING STRIKES - DISMISSAL AND ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT Contemporary IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - PAYMENT FOR PUBLIC HOLIDAYS - TRANSFERRING CONTRACTS OF EMPLOYMENT - SECONDARY STRIKES - DISMISSAL FOR UNAUTHORISED ABSENCE - SELECTION CRITERIA IN RETRENCHMENT - INTERPERSONAL RELATIONSHIPS AND DISMISSAL - ACCESS TO EMPLOYER INFORMATION - PRE-DISMISSAL ARBITRATION - THE PROTECTION OF WHISTLEBLOWERS - DEFINING REMUNERATION - VICARIOUS LIABILITY AND THE WRONGFUL ACTS OF EMPLOYEES - DOES NEW EVIDENCE JUSTIFY A NEW DISCIPLINARY INQUIRY - DAMAGES FOR SEXUAL HARASSMENT AT WORK - DISCRIMINATION ON MEDICAL GROUNDS - DISMISSALS AND HEARSAY EVIDENCE - THE EMPLOYMENT OF FOREIGN WORKERS - THE DISMISSAL OF SEX OFFENDERS - DOUBLE PAY ON PUBLIC HOLIDAYS - PROTECTED DISCLOSURE AND COMPENSATION FOR DISMISSAL - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUNDS FOR REVIEWING CCMA AWARDS - PAYMENT FOR PUBLIC HOLIDAYS - DISMISSAL FOR ABUSE OF - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS - PICKETING RULES -REFERENCES IN RECRUITMENT - CONSTRUCTIVE DISMISSAL - FIXED TERM EMPLOYMENT CONTRACTS - DEDUCTIONS FROM PAY - THE TESTING OF EMPLOYEES - DISMISSAL FOR COLLECTIVE MISCONDUCT - RECOVERING STOLEN MONIES FROM EMPLOYEES - UNFAIR RETRENCHMENT - DISMISSAL FOR ABUSE OF - SICK LEAVE - WHO IS AN EMPLOYEE? - PROMOTION AND DEMOTION - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS - CHANGING TERMS AND CONDITIONS OF EMPLOYMENT - PICKETING RULES -WORKPLACE Labour PRIVACY AND INTERCEPTION - DISCIPLINING SHOP STEWARDS Law - THE ROLE OF COLLECTIVE AGREEMENTS - THE REVIEW OF CCMA ARBITRATION AWARDS - OUTSOURCING AND THE LRA - LEGAL REPRESENTATION AT DISCIPLINARY HEARINGS - INCOMPATIBILITY AS GROUNDS FOR DISMISSAL - ALCOHOL RELATED OFFENCES IN THE WORKPLACE - HEALTH SAFETY AND DISCIPLINE - THE SUSPENSION OF EMPLOYEES - SHRINKAGE AND DISMISSAL - WHAT IS AN EMPLOYMENT BENEFIT? - CALCULATING COMPENSATION FOR UNFAIR DISMISSAL - THE ROLE OF CONSISTENCY IN DISCIPLINE - IMPLEMENTING A FAIR RETRENCHMENT - PROCEDURAL FAIRNESS IN DISMISSAL - STRIKES IN SUPPORT OF UNLAWFUL DEMANDS -PICKETING RULES DURING STRIKES - DISMISSAL AND ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - DISMISSAL FOR ABUSE OF - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS -REFERENCES IN RECRUITMENT - CONSTRUCTIVE DISMISSAL - FIXED TERM EMPLOYMENT CONTRACTS - DEDUCTIONS FROM PAY - THE TESTING OF EMPLOYEES - DISMISSAL FOR COLLECTIVE MISCONDUCT - RECOVERING STOLEN MONIES FROM EMPLOYEES - UNFAIR RETRENCHMENT RESTRAINTS ABUSE OF - SICK LEAVE - WHO IS AN EMPLOYEE? - PROMOTION AND DEMOTION - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS - RULES DURING STRIKES - DISMISSAL AND ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY Vol. 21. UNFAIR No. DISMISSAL 10 - SYMPATHY May STRIKES RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - TRANSFERRING CONTRACTS OF EMPLOYMENT - POLYGRAPHS AND DISMISSAL - SECONDARY STRIKES - DISMISSAL FOR UNAUTHORISED ABSENCE - SELECTION CRITERIA IN RETRENCHMENT - INTERPERSONAL RELATIONSHIPS AND DISMISSAL - ACCESS TO EMPLOYER INFORMATION - PRE-DISMISSAL ARBITRATION - DEFINING REMUNERATION - VICARIOUS LIABILITY AND THE WRONGFUL THE EMPLOYMENT OF FOREIGN WORKERS - THE DISMISSAL OF SEX OFFENDERS - DOUBLE PAY ON PUBLIC HOLIDAYS - PROTECTED DISCLOSURE AND COMPENSATION FOR DISMISSAL - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUNDS FOR REVIEWING CCMA AWARDS - PAYMENT FOR PUBLIC THE SUSPENSION OF EMPLOYEES - THE ROLE OF REFERENCES IN RECRUITMENT - CONSTRUCTIVE DISMISSAL - FIXED TERM EMPLOYMENT CONTRACTS - THE TESTING OF EMPLOYEES - DISMISSAL FOR COLLECTIVE MISCONDUCT - RECOVERING STOLEN MONIES FROM EMPLOYEES - UNFAIR RETRENCHMENT RESTRAINTS OF TRADE - DISMISSAL FOR ABUSE OF - SICK LEAVE - WHO IS AN EMPLOYEE? - PROMOTION AND DEMOTION - - CHANGING TERMS AND CONDITIONS OF EMPLOYMENT - PICKETING RULES -WORKPLACE PRIVACY AND INTERCEPTION - DISCIPLINING SHOP STEWARDS - THE ROLE OF COLLECTIVE AGREEMENTS - THE REVIEW OF CCMA ARBITRATION AWARDS - OUTSOURCING AND THE LRA - LEGAL REPRESENTATION AT DISCIPLINARY HEARINGS - ALCOHOL RELATED OFFENCES IN THE WORKPLACE - HEALTH SAFETY AND DISCIPLINE - THE SUSPENSION OF EMPLOYEES - SHRINKAGE AND DISMISSAL - WHAT IS AN EMPLOYMENT BENEFIT? - CALCULATING COMPENSATION FOR UNFAIR DISMISSAL - THE ROLE OF CONSISTENCY IN DISCIPLINE - IMPLEMENTING A FAIR RETRENCHMENT - PROCEDURAL FAIRNESS IN DISMISSAL - STRIKES IN SUPPORT OF L -PICKETING RULES DURING STRIKES - DISMISSAL AND ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - PS - TRANSFERRING CONTRACTS OF EMPLOYMENT - POLYGRAPHS AND DISMISSAL - SECONDARY STRIKES - DISMISSAL FOR UNAUTHORISED ABSENCE - SELECTION CRITERIA IN RETRENCHMENT - INTERPERSONAL RELATIONSHIPS AND DISMISSAL - ACCESS TO EMPLOYER INFORMATION - PRE-DISMISSAL ARBITRATION - DEFINING REMUNERATION - VICARIOUS LIABILITY AND THE WRONGFUL ACTS OF EMPLOYEES - DOES NEW EVIDENCE JUSTIFY A NEW DISCIPLINARY INQUIRY - DAMAGES FOR SEXUAL HARASSMENT AT WORK - DISCRIMINATION ON MEDICAL GROUNDS - DISMISSALS AND HEARSAY EVIDENCE - THE EMPLOYMENT OF FOREIGN WORKERS - THE DISMISSAL OF SEX OFFENDERS - DOUBLE PAY ON PUBLIC HOLIDAYS - PROTECTED DISCLOSURE AND COMPENSATION FOR DISMISSAL - WHEN IS DISCRIMINATION FAIR - WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL -RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - PAYMENT FOR PUBLIC HOLIDAYS - DISMISSAL FOR ABUSE OF - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS - PICKETING RULES - CHANGING TERMS AND CONDITIONS OF EMPLOYMENT - WORKPLACE PRIVACY AND INTERCEPTION - DISCIPLINING SHOP STEWARDS - THE SUSPENSION OF EMPLOYEES - TESTING OF EMPLOYEES - DISMISSAL FOR COLLECTIVE MISCONDUCT - RECOVERING STOLEN MONIES FROM EMPLOYEES - UNFAIR RETRENCHMENT - DISMISSAL FOR ABUSE OF - SICK LEAVE - WHO IS AN EMPLOYEE? - PROMOTION AND DEMOTION - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS - CHANGING TERMS AND CONDITIONS - THE ROLE OF COLLECTIVE AGREEMENTS - THE REVIEW OF CCMA ARBITRATION AWARDS - OUTSOURCING AND THE LRA -INCOMPATIBILITY AS GROUNDS FOR DISMISSAL - ALCOHOL RELATED OFFENCES IN THE WORKPLACE - HEALTH SAFETY AND DISCIPLINE - THE SUSPENSION OF EMPLOYEES - SHRINKAGE AND DISMISSAL - WHAT IS AN EMPLOYMENT BENEFIT? - CALCULATING COMPENSATION FOR UNFAIR DISMISSAL - THE ROLE OF CONSISTENCY IN DISCIPLINE - IMPLEMENTING A FAIR RETRENCHMENT - PROCEDURAL FAIRNESS IN DISMISSAL - STRIKES IN SUPPORT OF UNLAWFUL DEMANDS -PICKETING RULES DURING STRIKES - DISMISSAL AND ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - PAYMENT FOR PUBLIC HOLIDAYS - TRANSFERRING CONTRACTS OF EMPLOYMENT - SECONDARY STRIKES - DISMISSAL FOR UNAUTHORISED ABSENCE - SELECTION CRITERIA IN RETRENCHMENT - INTERPERSONAL RELATIONSHIPS AND DISMISSAL - ACCESS TO EMPLOYER INFORMATION - PRE-DISMISSAL ARBITRATION - THE PROTECTION OF WHISTLEBLOWERS - DEFINING REMUNERATION - VICARIOUS LIABILITY AND THE WRONGFUL ACTS OF EMPLOYEES - DOES NEW EVIDENCE JUSTIFY A NEW DISCIPLINARY INQUIRY - DAMAGES FOR SEXUAL HARASSMENT AT WORK - DISCRIMINATION ON MEDICAL GROUNDS - DISMISSALS AND HEARSAY EVIDENCE - DISCRIMINATION ON MEDICAL GROUNDS - DISMISSALS AND HEARSAY EVIDENCE - THE EMPLOYMENT OF FOREIGN WORKERS - THE DISMISSAL OF SEX OFFENDERS - DOUBLE PAY ON PUBLIC HOLIDAYS - PROTECTED DISCLOSURE AND COMPENSATION FOR DISMISSAL - WHEN IS DISCRIMINATION FAIR - WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - RETRENCHMENT RESTRAINTS ABUSE OF - SICK LEAVE - WHO IS AN EMPLOYEE? - PROMOTION AND DEMOTION - PROBATIONARY PERIODS FOR NEW EMPLOYEES - SHOP STEWARDS - THEIR RIGHTS AND OBLIGATIONS - RULES DURING STRIKES - DISMISSAL AND ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - TRANSFERRING CONTRACTS OF EMPLOYMENT - POLYGRAPHS AND DISMISSAL - SECONDARY STRIKES - DISMISSAL FOR UNAUTHORISED Managing ABSENCE Editor: - SELECTION P.A.K. CRITERIA Le Roux IN RETRENCHMENT - INTERPERSONAL RELATIONSHIPS AND DISMISSAL - ACCESS TO Contributing Editor: Carl Mischke EMPLOYER INFORMATION - PRE-DISMISSAL ARBITRATION - DEFINING RETRENCHMENT Consulting RESTRAINTS Editor: ABUSE A.A.Landman OF - SICK LEAVE - WHO IS AN EMPLOYEE? - PROMOTION AND DEMOTION - PROBATIONARY PERIODS Published FOR NEW EMPLOYEES by Gavin - Brown SHOP STEWARDS & Associates - THEIR RIGHTS AND OBLIGATIONS - RULES DURING STRIKES - DISMISSAL AND Box Tokai 7966 ADMINISTRATIVE JUSTICE - WHEN IS DISCRIMINATION FAIR -WHAT IS AN OPERATIONAL REQUIREMENT? - RECISSION OF CCMA AWARDS - AUTOMATICALLY UNFAIR DISMISSAL - SYMPATHY STRIKES - RETIREMENT AGE AND UNFAIR DISMISSAL - GROUP MISCONDUCT - GROUNDS FOR REVIEWING CCMA AWARDS - TRANSFERRING CONTRACTS OF EMPLOYMENT - POLYGRAPHS AND DISMISSAL - Amendments to the Labour Relations Act. Part 1: Proposed changes on unfair dismissal, non-standard employment, strikes and lockouts by P.A.K. le Roux The Labour Relations Amendment Act Bill that was recently submitted to Parliament represents the most comprehensive set of amendments to the Labour Relations Act, 66 of 1995, (LRA) since its enactment in Most of the attention has concentrated on the proposed amendments dealing with the employees of temporary employment services, ie labour brokers, but there are several other proposed amendments that should enjoy the attention of industrial relations practitioners and labour lawyers. Depending on the way in which employers operate their businesses and the nature of their workforce, these amendments could be just as important as those dealing with labour brokers. Whilst this is only a Bill rather than the final legislation, the indications are that Parliament will make relatively few substantial changes to the Bill. The one potential exception are those amendments dealing with labour brokers. Here the Government may be influenced by pressure exerted by COSATU as it has already been in relation to the proposed amendments to strikes and lock-outs. The amendments can be classified under the following headings Amendments relating to our law relating to unfair dismissal; Amendments dealing with nonstandard employment, including employees employed by labour brokers; Changes to our law of strikes and lock-outs; Amendments that deal with organisational rights and collective bargaining Amendments dealing with dispute resolution procedures and institutions and enforcement mechanisms. Only the first three categories of amendment will be dealt with in this edition. Next month's issues will examine the latter two. Unfair dismissal The definition of dismissal It is proposed to amend the definition of dismissal to exclude reference to terminations of contracts of employment in parts of 186(1). The reference will now be to termination of employment. The reason given for this amendment in the Explanatory Memorandum is that it clarifies that a termination of employment is a dismissal, whether or not there is a formal written Page 91

2 contract of employment. This is somewhat bemusing it has never been suggested that there cannot be an oral contract of employment the termination of which can lead to a dismissal. It seems that the real reason is simply to ensure that the statutory concept of dismissal is delinked from the contractual concept of a termination of employment. Reasonable expectation of permanent employment The most important amendment to the definition of dismissal is that relating to the expiry of fixed term contracts. In terms of s 186(1)(b) a dismissal takes place if an employee employed in terms of a fixed term contract reasonably expected that the employer would renew the contract on the same or similar terms but the employer did not renew the contract, or offered to renew it on less favourable terms. Employees have tried to argue that this section also covers the situation where an employee alleges that she reasonably expected permanent employment - the term permanent employment referring to the situation where the employee would not be employed in terms of another fixed term contract, but would be employed in terms of contract for an indefinite period of time. The term permanent employment as usually utilised is something of a misnomer in that this does not mean that employment can never be terminated the parties are still permitted to do so provided that they give the required period of notice of termination (or terminate summarily because the other party has breached the contract) and provided further that, in the case of the employer, it had a fair reason for doing so. In practice the attraction of permanent status is twofold. Firstly, it enhances job security in the sense that there is no longer the prospect of an automatic termination of employment on the expiry of the period for which the contract was entered into. Secondly, and probably more importantly, employers often grant additional benefits to permanent employees such as membership of medical aid schemes and retirement finds which are not afforded to temporary employees employed in terms of fixed term contracts. In many cases employers would be able to justify not providing these benefits to temporary employees employed in terms of fixed term contracts on the basis that it serves no purpose to provide them to employees who will not be employed for any lengthy period of time. However, in many cases the fixed term contracts of these employees have been renewed on several occasions and employers have thus undermined this rationale. After several years of controversy and conflicting decisions, the Labour Appeal Court held, in University of Pretoria v Commission for Conciliation, Mediation & Arbitration & others (2012) 23 ILJ 183 (LAC) that a reasonable expectation of permanent employment does not fall within the definition for dismissal. A proposed amendment seeks to undo the LAC s decision. The proposed amendment introduces s 186(1)(b)(ii) which provides that a dismissal will also take place if an employee engaged on a fixed term contract reasonably expected the employer to retain the employee on an indefinite contract of employment but otherwise on the same or similar terms as the fixed term contract, but the employer offered to retain the employee on less favourable terms, or did not offer to retain the employee. It seems that this provision only applies to those situations where an employee has a reasonable expectation of being retained in employment in terms of a contract for an indefinite period of time and where the employee has a reasonable expectation that his or her other terms and conditions of employment will remain the same. If the expectation is that the employee will also receive the benefits accorded to permanent employees and s 186(1)(b)(ii) will not apply. If this is the case, this amendment does not, on its own, assist the employee to acquire enhanced benefits enjoyed by permanent employees. These benefits may be acquired by virtue of the provisions of the new s198b((8) dealt with below. It is important to note that s 186(1)(b) only describes when there will be a dismissal if a fixed term contract expires. This does not mean that a dismissal will be unfair. The employer will still be able to justify the dismissal on the grounds of the conduct or capacity of the employee, or the operational requirements of the business. However, the employer will be required to comply with the requirements for procedural fairness prior to the expiry of the fixed term contract. Page 92

3 Automatically unfair dismissals Section 187(1)(c) currently provides that a dismissal will be automatically unfair if the reason for the dismissal is to compel an employee to accept a demand in respect of any matter of mutual interest between employer and employee. This provision has been considered in the situation where an employer wishes to introduce new terms and conditions of employment and an employee or employees refuse to agree to these new terms and conditions. It has been argued that this provision prevents employers from dismissing employees in these circumstances. This section has, however, been interpreted in such a way as not to prevent an employer from dismissing employees who refuse to accept changes to conditions of employment at least in certain circumstances. This has been the case where the employer has been able to persuade a court that the reason for the dismissal is not to force employees to accept a change, but rather that its operational requirements justify dismissal. In effect the employer argues that it concedes that the employees do not want to accept the change to their conditions of employment and it is not attempting to force them to do so by dismissing them; it is dismissing them in order to replace them with employees who are willing to work in accordance with the new terms and conditions of employment and that these dismissals can be justified on the basis of its operational requirements. See the decision in National Union of Metalworkers v Fry s Metals (Pty) Ltd (2005) 26 ILJ 689 (SCA). The proposed new s 187(1)(c) states that a dismissal will be automatically unfair if the reason for the dismissal is the refusal of employees to accept a demand in relation to a matter mutual interest. The explanatory memorandum states that the purpose of the amendment is to remove the anomaly arising from the Supreme Court of Appeal s decision in the Fry s Metals decision and that the amendment seeks to give effect to the intention of the legislature when this section was originally enacted - ie to protect employees who refuse to accept a demand by an employer relating to a matter of mutual interest. It is seen as an amendment designed to protect the integrity of the collective bargaining process. An employer could still argue that the reason for the dismissal is not the refusal of employees to accept a demand relating to a matter of mutual interest, but rather that dismissal is needed to replace the employees with persons who are prepared to work in accordance with the new terms and conditions of employment. Whether the courts will accept this argument remains to be seen. If it is not accepted, the ability of employers to introduce more flexible working practices in the absence of employee consent will be further restricted. It will also possibly lead to greater use of the lock-out. It may also give rise to a reconsideration of employers contractual rights to change working conditions. Dismissing employees whose earnings exceed a specified threshold In terms of a new s 188B the dismissal of employees who earn above a specified earnings threshold will be deemed to be substantively and procedurally fair, provided that the employee is given at least three months written notice of termination or such longer period of notice as may be prescribed in his contract of employment. Payment of salary in lieu of such notice may also be given. There are three important provisos to this section. The first is that these employees are still protected against automatically unfair dismissals, with the exception of dismissals in the context of going concern transfers. Secondly, if an employer dismisses an employee earning more than the prescribed minimum without giving 3 or more months notice of termination of employment (or payment in lieu of notice) the right to claim unfair dismissal still exists. Thirdly, a transitional period is introduced - this section will only apply to contracts of employment concluded prior to the date of coming into effect of this section two years after this date. The earnings threshold will be determined by the Minister after consulting NEDLAC. The Minister is also required to take into account the extent to which employees, by reason of their earnings level, level of skill or position have sufficient bargaining power to ensure that adequate provision can be made in their contracts of employment for protection against unfair dismissal. Interestingly, the motivation for the introduction of this section is one of the lengthiest in the explanatory motivation. This is presumably because the argument will be made that the amendment deprives a group of employees of their constitutional right to fair labour practices. Various reasons for this infringement are given. Page 93

4 The first is that the legislature seeks to exclude those employees who have sufficient bargaining power to enable them to protect themselves contractually against unfair dismissal. The second is - the disproportionate cost, complexity, and impact on an employer s operations of procedures to terminate the employment of high earning employees in circumstances where the reason for doing so may not fall clearly and neatly within the fair reasons for dismissal specified in section 188(1)(a)(i) and (ii). By way of example, an employer may reasonably and fairly wish to replace a senior executive to secure a change in tone and culture within the leadership team, because the executive does not fit or no longer fits within the leadership team, because internal or external circumstances have changed, or because the employer wants to embark on a new direction for the business or enterprise. These reasons do not comfortably fall within the reasons for dismissal specified in section 188, but are widely recognised as legitimate reasons to replace senior employees. In addition, senior executives in practice exercise the role of employer in many respects, and usually occupy a special position of trust in relation to the employer. The uncertainty created by the application of section 188 in these situations leads to significant inflexibility and inefficiency at the top levels of a business or state enterprise. At the same time, the cost of asserting discipline and performance standards at senior levels is notoriously difficult to manage, and conflict at this senior executive level that results from efforts to terminate employment imposes significant constraints, measured in cost and efficiency, on both public and private sector employers. These arguments will in all probability be subjected to scrutiny in litigation. The notion that an employee with a high income necessarily has sufficient bargaining power to protect himself against unfair dismissal is debatable. If such a link can indeed be drawn it seems that the threshold will have to be fairly high. The explanatory memorandum does not give any indication what the threshold will be, but does state that it will be in excess of one million rand. The second motivation can also be debated. Firstly, the argument that certain reasons for dismissal do not fit neatly into the three statutory fair reasons for dismissal can also apply to other employees. The examples given above can, in any event, be accommodated within the three statutory reasons for dismissal. Even if this is not the case, suitable amendments to the LRA or to the Code of Good Practice:Dismissal could clarify the position. The third argument that the cost of asserting discipline and performance standards at senior levels is notoriously difficult to manage has some validity; but, in many cases this seems to be the result of companies imposing relatively high procedural standards on themselves when these are not necessarily required by the LRA or the Code of Good Practice: Dismissal. Finally, the difficulties faced by employers as enumerated above can apply equally to the executives or senior managers of small businesses or NGO s where these employees may not earn above the threshold. Why should such businesses or NGO not enjoy the same advantage? Operational requirement dismissals There are three proposed amendments impacting specifically on operational requirement dismissals. Extending the consultation process One of the least considered amendments is found in a proposed amendment to s 189A. A new s 189A(2)(d) is to be inserted into s189a(2). It reads as follows - (d) a consulting party may not unreasonably refuse to extend the period of consultation if such an extension is required to ensure meaningful consultation. This provision raises various questions. The first is who is a consulting party? Does it include only the union/ employee with whom the employer seeks to consult or does it include the employer party as well? The second arises from the fact is that it only refers to the period of consultation. Section 189(A) seems to distinguish between a facilitation process that applies where either the employer or the party with whom it wishes to consult requests facilitation by the CCMA, and a consultation process where no request is made for facilitation and a dispute will have to be referred to a bargaining council or the CCMA prior to the employer acquiring the right to terminate employment. Is it the intention that this amendment only applies to the latter situation? Finally, the question may be asked is whether this Page 94

5 provision is necessary? If the employer refuses to agree to the extension of a consultation or facilitation process and a union or employees wish to prevent dismissals on the basis that there has not yet been proper consultation they could, in any event, approach the Labour Court in terms of s 189A(13) for urgent relief. The amendment seems to envisage an additional remedy available to employees and unions, the precise scope of which needs to be considered. Referrals to the CCMA The proposed amendments clarify and extend the circumstances in which employees may refer an operational requirement dismissal dispute to the CCMA rather than the Labour Court. The most important extension is that a referral can take place to the CCMA in the situation where the employer employs less than 10 employees. See the proposed s 191(12). Repealing s 189A(19) Section 189A(19), which attempts to define when a dismissal on the grounds of operational requirements will be fair, is repealed. The Explanatory Memorandum states that the reason for this is that it will remove the uncertainty as to whether this test also applies to retrenchments not covered by s 189A and also to ensure that the Courts retain their discretion to develop the jurisprudence in this area in the light of the circumstances of each case and to articulate general principles applicable to all retrenchment cases. The date of dismissal Section 190 contains provisions relating to when a dismissal is deemed to take place - the importance of this date being that it determines when the 30 day time period for the referral of an unfair dismissal disputes starts to run. It is proposed to insert a new subsection, s 190(2)(d) which provides that, if a contract of employment is terminated on notice, the date of dismissal will be the date on which the notice expires or, if it is earlier, the date on which the employee is paid all outstanding salary. Non-standard employment Arenamed Chapter IX entitled "Non-standard Employment contains important proposed amendments dealing with the employees of temporary employment services (TES), employees employed in terms of a fixed term contract and part-time employees. Temporary employment services The amendments relating to TES envisage that Additional obligations will be placed on the TES as employer. The provisions relating to joint and several liability will be strengthened. The client of a TES will, in certain circumstances, become the employer of a person assigned by a TES to that client The current legal position is that in terms of section 198(2) the TES is the employer of the employee assigned to a client. This means that when a person assigned to a client by a TES is claiming that an unfair labour practice has been inflicted on him, or that he was unfairly dismissed, his remedy is against the TES. There are circumstances prescribed in both the LRA and the Basic Conditions of Employment Act, 75 of 1997 (BCEA) where the client and the TES are jointly and severally liable for contraventions of a bargaining council agreement, an arbitration award regulating terms and conditions of employment, the BCEA and a sectoral determination The proposed amendments amend this position in three ways. Additional obligations imposed on a TES The first proposed set of changes impose additional obligations on a TES as employer. These are - A TES will have to provide an employee it assigns to a client with written details of the terms and conditions of employment he will be entitled to whilst assigned to the client. The details to be provided are those prescribed in s 29 of the BCEA. The terms and conditions of employment provided to an employee of a TES will have to comply with any employment law, sectoral determination or bargaining council agreement applicable to a client that the TES employee has been assigned to. The implication is that a TES is not necessarily required to grant its employees the same terms and conditions of employment as those provided by a client to its employees, provided that it complies with the above. In addition, the issue of whether an employee Page 95

6 of a TES is covered by a bargaining council agreement or a sectoral determination must be determined by reference to the sector and area in which the client is engaged. Joint and several liability The circumstances in which a client can be held jointly and severally liable for a failure by the TES to comply with its obligations are not extended. However, the ability of the TES s employee to enforce his rights against the client in the situation where the client can be held jointly and severally will be enhanced. A new subsection 198(4A) will be introduced in terms of which - the employee in respect of whom the contraventions have taken place may institute legal proceedings against either the TES or the client, or both the TES and the client; an inspector of the Department of Labour acting in terms of the BCEA may secure and enforce compliance against either the TES or the client, or both the TES and the client; any order or award made against a TES or its client in terms of subsection 198(4A)may be enforced against either the TES or the client. The client as employer A new s198a envisages that, in certain circumstances, the client will be regarded as the employee of the person supplied to it by a TES. The underlying principle seems to be that if a client is making use of a TES in what is regarded as an acceptable way, the person assigned to the client will be regarded as the employee of the TES. Where there is unacceptable use the client will be regarded as the employer. In this case, however, the TES may still be held joint and severally liable in certain circumstances even though the client is now the employer. Acceptable use, which is defined as a temporary service, takes place if the person assigned to the client performs work for the client for a period of less than six months; as a substitute for an employee of the client who is temporarily absent from work; in a category of work and for any period of time which is determined to be a temporary service by a collective agreement entered into by a bargaining council, a sectoral determination, or a notice published by the Minister of Labour in terms of s 189A. The termination of an assignment to a client by a TES in order to avoid the application of the above principle will be regarded as a dismissal interestingly, not necessarily an unfair or an automatically unfair dismissal. In other words, acceptable use is temporary use or use that is officially sanctioned or sanctioned by a collective agreement. If the use of the services of a TES does not fall within one of the above circumstances, the person assigned to the client by the TES will be regarded as being employed by the client. This means that the client can be held liable for any unfair labour practices committed as well as for an unfair dismissal. It also means that, for the purposes of determining organisational rights and for the purposes of strikes and lock outs as well as dispute resolution, the client will be regarded as the employer. As far as terms and conditions of employment are concerned, the employee deemed to be the employee of the client must be treated on the whole not less favourably than an employee of the client performing the same or similar work, unless there is a justifiable reason for different treatment. Section 198D states that a justifiable reason includes the application of a system that takes into account seniority, experience or length of service, merit, the quality or quantity of work performed or any other criteria of a similar nature that is not a discriminatory ground prohibited by the Employment Equity Act,55 of There is one important limitation to the principle that the client will be regarded as the employer in certain circumstances; it will not apply in respect of employees who earn more than the amount specified in a notice published in terms of s 6(3) of the BCEA. Finally, a proposed section 198(4F) envisages the registration of a TES as a precondition for conducting the business of a TES. This legislation is still to be enacted. Fixed term contracts As was discussed above, s 186(1)(b) will be amended to enhance, to some degree at least, the job security of Page 96

7 employees employed in terms of fixed term contracts. The proposed s198b seeks also to ensure that employees employed in terms of this type of agreement are employed on suitable terms and conditions of employment. For the purpose of this section, a fixed term contract is a contract of employment that terminates on the occurrence of a specific event; the completion of a specified task or project; a fixed date, other than an employee s normal or agreed retirement date. Exclusions The operation of this provision is limited in three important ways. Firstly, it does not apply to fixed term contracts entered into with employees who earn more that the threshold amount prescribed by the Minister of Labour in terms of section 6(3) of the BCEA. Secondly, it does not apply to an employer that employs less than 10 employees or, who employ less than 50 employees and whose business has been in operation for less than two years, unless the employer conducts more than one business or the business was formed by "the dissolution for any reason of an existing business. The section draws a distinction between fixed term contracts entered into for a period of 6 months or less and fixed terms contracts entered into for longer periods. Fixed term contracts entered into for a period of six months or less. The regulation of this type of contract is left largely unchanged. However, s198b(6) does provide that an offer to employ an employee in terms of a fixed term contract must be in writing. This does not mean that fixed term contracts for a period of less than six months go unregulated. They are still covered by the BCEA and are often regulated in collective agreements. In addition, employees employed in terms of any fixed term contract, whether employed for less than six months or longer than six months, must in terms of subsection 198B(9) be provided with the same opportunities to apply for vacancies as employees employed for an indefinite period of time. Fixed term contracts entered into for a period in excess of six months Subsection 198B(3) provides that An employer may engage an employee on a fixed term contract or successive fixed term contracts for longer than 6 months of employment only if (a) the nature of the work for which the employee is engaged is of a limited or definite duration; or (b) the employer can demonstrate any other justifiable reason for fixing the term of the contract. A list of circumstances is then provided which justify entering into a fixed term contract for longer than six months. These include if the employee - is replacing another employee who is temporarily absent from work; is engaged because of a temporary increase in the volume of work which is not expected to endure for longer than twelve months; is a student or a recent graduate who is employed for the purpose of being trained or gaining experience in order to enter a job or profession; is engaged to work exclusively on a genuine and specific project that has a limited or defined duration; has been engaged for a trial period of not longer than six months for the purpose of determining the employee s suitability for employment; is a non-citizen who granted a work permit of a defined period; is engaged to perform seasonal work; Contemporary Labour Law is published monthly from August to July of each year. Visit our website at www. workplace.co.za for information and subscription details. Subscription Enquiries : Tel : (021) Fax : (021) workplace.co.za ISSN X Copyright held by the authors. No part of this publication may be reproduced in any form without the prior written consent of the publishers. Page 97

8 is engaged on an official public works scheme or similar public job creation scheme; is engaged on a position which is funded by an external source for a limited period; or., has reached the normal or agreed retirement age applicable to the employer s business. Any contract entered into for a period of more than six (6) months must state the reason why the contract is being entered into for a period in excess of six months. The mere fact that an employer enters into a fixed term contract for a reason that cannot be justified does not render the contract invalid. It simply means that the contract will be deemed to be an indefinite period contract. In terms of subsection 198B(8), if an employee is employed on a fixed term contract for longer than six months the employee must be treated on the whole not less favourably than an employee employed on an indefinite contract performing the same or similar work, unless there is a justification for different treatment. The justifiable reasons referred to in s 198D and described above will also apply here. Section 198B(8) will obviously apply when the fixed term contract in excess of six months can be justified. But what will be the position if the longer fixed term contract cannot be justified? On one interpretation this is no longer a fixed term contract but is one for an indefinite period of time. Therefore, s198b(8) does not apply. It would, however, be surprising if such an interpretation were to be adopted. Finally, the provisions of s 198B(10) provide that if a contract is entered to for a period in excess of 24 months for the purpose of the employee working on a specific or genuine project that has a limited or defined duration, the employee must, when the contract expires, be paid an amount equal to one week s remuneration for each completed year of the contract. However, a different arrangement can be made in an applicable collective agreement and an employer may also refuse to pay this benefit if the employee unreasonably refuses to accept an offer of employment with the employer concerned or any other employer. Part-time employment Section 198C will regulate the employment of parttime employees. The thrust of the proposal is that part time employees should not be treated less favourably than full-time employees unless there is a justifiable reason for this differentiation. The definition of a part-time employee reads as follows A part time employee is an employee who is remunerated wholly or partly by reference to the time that the employee works and who works less hours than a comparable full-time employee. A comparable full time employee - (i) is an employee who is remunerated wholly or partly by reference to the time that the employee works and who is identifiable as a full-time employee in terms of the custom and practice of the employer of that employee; (ii) does not include a full-time employee whose hours of work are temporarily reduced for operational reasons as a result of an agreement. The reference in both definitions to employees whose remuneration is based on the time that they work in a given period is interesting. It is unclear what is meant here but it seems that the provision will only apply to employees whose remuneration is calculated every week or month on the time actually worked (eg hourly-paid employees). If this is the intention, the implications of this limitation will have to be considered. Exclusions The exclusions relating to employees who earn in excess of the threshold set in s 6(3) of the BCEA and small businesses describe above in the context of fixed term contracts also apply here. In addition, the section will not apply to part-time employees during the first six months of their continuous employment with an employer and to employees who ordinarily work less than 24 hours per month for an employer. Obligations relating to part-time employees. Subsections 198C(3) and 198C(4) state that an employer must, after taking into account the working hours of the relevant part-time employee - treat a part-time employee on the whole not less favourably than a comparable full-time employee doing the same or similar work, unless there is a justifiable reason for different treatment. The justifiable reasons referred to in s 198D and described above will also apply here; Page 98

9 provide a part-time employee with access to training and skills development on the whole not less favourable than the access applicable to a comparable full-time employee; provide a part-time employee with the same access to opportunities to apply for vacancies as it provides to full-time employees. Section 198C(5) gives further guidance on how to identify a comparable full-time employee. It provides that regard must be had to a full time employee employed by the employer on the same type of employment relationship who performs the same or similar work in the same workplace as the part-time employee. If there is no comparable full-time employee who works in the same workplace, regard must be had to a comparable employee employed by the employer in any other workplace. Comment It is difficult to predict how these provisions relating to non-standard employment will affect employer hiring and employment practices and the consequences of their application are difficult to predict. Much will depend on the how arbitrators interpret concepts such as comparable employees, similar work, justifiable reasons and what they will regard as on the whole not less favourable terms and conditions of employment. What is clear is that arbitrators will face a difficult task in this regard and it is hoped that they will be given sufficient training to be handle these issues. It seems likely that these provisions will lead to a drop in the use of these types of employees if only because employers will want to avoid the uncertainties of litigation on these issues. Whether they will be replaced by full-time, permanent employees is a more difficult question to answer. What seems clear is that these amendments will certainly not assist in the creation of jobs. Strikes and picketing The proposed amendments to the law regulating strikes and lock-outs fall into three broad categories namely those limiting the right to strike; those regulating picketing in greater detail; and those dealing with essential and maintenance services. The amendments dealing with essential and maintenance services will not be dealt with here Limiting the right to strike The proposed amendments create an additional procedural hurdle to overcome prior to a strike being rendered protected, namely the holding of a ballot in which the majority of the members of the trade union calling the strike vote in favour of strike action. Newspaper reports indicate that this amendment will be withdrawn as a result of an agreement reached between COSATU and the Government. It will therefore not be dealt with here. The proposed amendments also re-introduce an absolute prohibition on the right to strike. Section 65(1)(c) currently states that a protected strike cannot be called in respect of matters that employees have the right to refer to arbitration or adjudication in terms of the LRA. When the LRA was originally enacted, allegations of unfair discrimination were dealt with in terms of schedule 8 to the LRA. These claims were to be adjudicated by the Labour Court. This meant that s 65(1)(c) applied and strikes and lock outs on discrimination issues could not be the subject of protected strike action. However, when the Employment Equity Act, 55 of 1998 (EEA) was introduced, the provisions in schedule 8 to the LRA dealing with allegations of unfair discrimination were deleted and replaced by equivalent provisions in the EEA. This meant that unfair discrimination claims were now to be subjected to adjudication in terms of the EEA. This, in turn, meant that the prohibition in s 65(1)(c) no longer applied and strikes dealing with allegations of unfair discrimination could therefore be protected, even though they could be adjudicated in terms of the EEA. Section 65(1)(c) will now be amended to remove this anomaly and this type of dispute can once again not be the subject of a protected strike. The same applies to lock outs in the unlikely event that the employer were to seek to utilise a lock out in these circumstances. Page 99

10 Picketing Who can picket and where can picketing take place? It is proposed that s69 of the Act be amended to enable registered trade unions only to authorise picketing by union members - the reference to supportters will be removed. The actual place where picketing should be able to take place has been the subject of some controversy. Section 69 provides that picketing can take place at any place to which the public has access but not on the employer s premises unless the employer consents to the picketing taking place on its premises. However, the employer may not unreasonably refuse to give this consent and, if consent is unreasonably refused, a CCMA commissioner may prescribe picketing rules which permit picketing on that employer s premises. An additional dimension to the problem arises when the employer s place of business is situated on a third party s premises the most important example in practice being that of retail businesses situated in shopping malls. Mall owners have been unwilling to grant unions the right to picket on their premises - especially in the situation where other businesses and their customers may be affected by the pickets. A proposed amendment to s 69(6) provides that a CCMA commissioner who is tasked with the duty to draw up picketing rules (in the absence of the parties agreeing to on these rules) can provide for picketing - in a place which is owned or controlled by a person other than the employer, if that person has had an opportunity to make representations to the Commission before the rules are established. Enforcing picketing rules In terms of subsections 67(2) and 67(6) participation in a protected strike does not constitute a delict or breach of contract and no civil legal proceedings can be instituted against any person who participates in such a strike. However, in terms of s 67(8) this protection does not apply to criminal offences committed during the course of a strike. It is proposed to amend s 67(8) to limit the protection granted by s 69 further. Protection will not be granted- to a material breach of a picketing agreement established in terms of section 69(4) or a picketing rule established in terms of section 69(5). Given the fact that the most serious breaches of picketing rules would probably constitute a criminal offence of some form, this amendment, on its own, is not that significant. However, it must be considered in the context of the other proposed changes relating to picketing discussed below. Section 69(8) read with s 69(11) envisages that disputes concerning alleged breaches of the right to picket as well as alleged breaches of picketing rules will be referred to the Labour Court for adjudication. The powers of the Court to remedy or prevent such breaches will be significantly extended. It is provided that the Court will, in terms of a new s 69(12), be able grant just and equitable relief which may include an order directing any party to comply with a picketing agreement or rule; varying the terms of a picketing agreement or rule; suspending the picket or strike; or suspending the engagement of replacement labour or suspending a lockout. The power of the Labour Court to suspend a strike, picket or lock-out, as well as to suspend the use of replacement labour are, of course, far reaching and the Labour Court will be called upon to make difficult decisions (often on an urgent basis) impacting on constitutional rights. The use of the word suspension also appears to connote a temporary step which can be rescinded pending certain conditions being met. There is one important potential limitation in this regard. It relates to the way in which picketing rules are established. In many cases employers and trade unions will agree to picketing rules prior to a strike or lockout commencing. It is only when agreement cannot be reached that the assistance of the CCMA is called upon. In terms of s 69(4) a CCMA commissioner will, in effect, attempt to assist the parties to reach agreement on these issues. If agreement cannot be reached, the Commissioner is empowered to impose rules on the parties. The new powers granted to the Labour Court referred to above only apply to agreements facilitated by the CCMA or rules imposed by the CCMA. They will not apply to agreements voluntarily entered into between an employer and a union. P.A.K. le Roux Page 100