Category

Employment and Labour Law

Our Brave New World: Using Zoom for Retrenchment Consultations

By | Employment and Labour Law

“O brave new world” (Shakespeare)

The COVID-19 pandemic will doubtless lead to many new developments on the legal front.

For example, with widespread employee retrenchment now an unfortunate reality in our struggling economy, all employers, employees and trade unions should know of an important new Labour Court decision validating the use of remote conferencing for the retrenchment consultation process. 

The consultation process, rudely interrupted

  • An employer decided in January 2020 that it needed to restructure its business operations, which prompted it to contemplate dismissal of employees based on operational requirements. 
  • The next step in terms of the Labour Relations Act was to enter into a meaningful consultation process with employees and/or their representatives, aimed at discussing and seeking consensus on possible alternatives to retrenchment, minimizing dismissals, severance pay etc. 
  • This being a large scale retrenchment proposal the employer issued a formal notice inviting consultation and requested facilitation of the consultation process. A facilitator was appointed and several physical meetings were held. 
  • Before the final consultation meeting could be held however the process was rudely interrupted by the declaration of a National State of Disaster and the consequent lockdown and restrictions on gatherings. 
  • The Commission for Conciliation, Mediation and Arbitration (CCMA) proposed methods by which the process might continue, including usage of Zoom, but the trade union in question refused to participate via Zoom and the employer proceeded with the meeting in its absence. 
  • When the employer then issued notices of retrenchment, the union applied urgently to the Labour Court to declare the process procedurally unfair.

Our “new normal”

“With the advent of the outbreak of the Covid-19 pandemic, the “new normal” presented itself” (extract from Labour Court judgment)

Commenting on the irony of the union complaining about “the efficacy and reliability” of Zoom whilst using it to make its own urgent application to court, and noting that the facilitator, with “powers to make a final and binding ruling on procedure”, was not averse to using Zoom for the meeting, the Court found that the union had refused to participate in the consultation process through no fault of the employer’s. 

As the Court put it: “With the new normal – lockdown period during Covid-19 pandemic – zoom is the appropriate form in which meetings can take place. What is involved in this period is the health and safety issue … It is a necessary tool to ensure that restrictions like social distancing as a measure to avoid the spread of the virus are observed.”

Accordingly there was no procedural unfairness and the union’s application was dismissed. 

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Unemployed, Can’t Pay Bond and Credit Instalments? “Credit Life Insurance” May Save You

By | Credit Law, Employment and Labour Law, Personal Finance, Property

If you are one of the many employees retrenched or put on short pay or unpaid leave as a result of the COVID-19 crisis and lockdown, you will be wondering how to cover the monthly instalments on your mortgage bond and other credit agreements. You have no doubt heard of the “payment holidays” banks are offering, but remember that although these are a lot better than losing your house, car etc, they are no free lunch. Interest and fees will still be building up.

Credit life insurance is not just death cover

That’s why you need to check right now whether or not any of your credit agreements are covered by “credit life insurance”. Many people don’t even realise they have this cover in place, and those that do may look at the “life” part of the name and think “well that’s no good to me or my family, I’m unemployed not dead”. The good news there is that most policies cover a host of other events leaving you unable to pay instalments – see below for more.

Do you have cover?

You may well have this cover in place without even realising it because it is commonly required when you take out any form of credit – think mortgage bonds, vehicle finance, credit cards, retail credit (store cards etc) and so on. 

If you aren’t sure, check your latest bond or credit statement for any sign of an insurance premium deduction (it may be called “balance protection” or the like). Then contact the bank (or whichever credit grantor you are with) and ask them to check. You may not have it for example if at the time you ceded another life policy to the credit grantor.

What are you covered for?

Check what the terms of your particular policy are, but the minimum cover required by National Credit Act Regulations (which only affect credit agreements entered into on or after 9 August 2017) is –

  • Death or permanent disability: The outstanding balance of your total obligations under the credit agreement is covered.
  • Unemployment or inability to earn an income: You are covered until you find employment or are able to earn an income, with a maximum of 12 months’ instalments. 
  • On temporary disability: You are covered until you are no longer disabled, with a maximum of 12 months’ instalments.

Exclusions – the Regulations allow a long list of exclusions to be incorporated in your policy so check which apply to you. Most of them are common sense – for example lawful dismissal, retirement or resignation from employment – but if you are told that a particular exclusion applies to you and you don’t agree ask your professional advisor for advice before conceding anything. Employers may be able to assist in this regard when structuring crisis outcomes with staff, but remember to do so only after taking your own legal advice! 

Self-employed people and pensioners should check what cover they have under their particular policy, and what terms apply to them.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

COVID-19: Small Businesses, Employment Laws, and Survival Support

By | Business, Employment and Labour Law

“The secret of crisis management is not good vs. bad, it’s preventing the bad from getting worse” (Andy Gilman)

We can only guess at how the COVID-19 coronavirus outbreak will end, but let’s all take whatever concrete steps we can right now to lessen its impact on our personal lives, on our businesses, and on our country. 

One of those steps is for businesses to find ways of continuing to operate as normally as possible, given of course the exceptional times we are living through. And as employers, many businesses will find themselves facing some novel challenges, particularly during the National Lockdown…

Small businesses – the new relief programs

A whole raft of support and relief programs has been announced. Some still need to be finalised and the situation is changing daily, so keep an eye on the media and incorporate into your business survival plan all relief channels you think may be open to you. At date of writing, these are the main ones –

  • The DSBD (Department of Small Business Development) will provide relief to businesses in several categories. Call the DSBD on its 0860 663 7867 hotline or email info@dsbd.gov.za to see if you quality. Apply at https://smmesa.gov.za/.
  • The DTI (Department of Trade and Industry) is set to provide relief for large businesses as well as small. Keep an eye on the DTI’s website for developments.
  • The Solidarity Fund has been set up with R150 million from the government to, amongst other things, assist and support those affected (contact details here).
  • Employer and employee relief: Access the “Easy Guide for employers on COVID19” here and read up on the “Temporary Employer/Employee Relief Scheme” and UIF benefits from a special R30bn National Disaster Benefit Fund. Confirmation that employees who fall victim to the virus will be paid through the Compensation Fund – details here.
  • Other funds and relief measures: The Rupert and Oppenheimer families have pledged R1 billion each to help struggling small businesses and employees – the details are not available at date of writing. Read the President’s speech here for more on planned or implemented measures involving tax relief, changes to the Competition Act, a fund to support the tourism sector, and more.

Employers – comply with the law! 

From a legal perspective, employers in particular need to have a solid action plan in place to ensure that they comply with all our many employment laws, which will continue to apply as is, unless and until government announces any new measures to the contrary.

Detailed planning will not be easy. With the situation changing daily, keep informed of developments and keep all your plans flexible.

In any event there is unfortunately no “one size fits all” answer to questions like “Can I dismiss an employee who tests positive for COVID-19?”, “Can my employees insist on working from home?”, “Can I start retrenching?”, “Can I prohibit employees from travelling abroad for personal reasons?”, “What steps must I take to ensure a safe working environment and what rules can I put in place to underpin them?”.

The list is endless and the answers to these questions will depend upon your Lockdown exemption status, your particular employment contracts, business circumstances, operational needs, and so on. 

Your employee action plan

We need to get used to constant change and uncertainty, but there are steps you can take now to plan for as many eventualities as possible – 

  1. As a start, incorporate into your “COVID-19 Business Plan” all the possible scenarios you can think of, both during the National Lockdown and after it ends.
  2. Then brainstorm – with your employees where you can – a list of all the employment-related problems you and they might face. Use that in turn to make a list of questions you will need the answers to under each scenario.
  3. Then, make sure you are fully prepared to deal with whatever may come your way by taking specific legal advice on each and every one of those questions. 

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

How to Stop an Ex-Director from Competing With You

By | Company / Corporate / Compliance, Employment and Labour Law

“…the default position is that an executive director or a senior employee may not carry on business activities which fall within the scope of his company’s business during the time when he serves as director or works as employee.  The default position however changes on resignation.” (Extract from judgment below)

What happens if relations between you and your fellow company directors sour to the extent that a director leaves? Can he or she immediately open up a new business in direct competition to you? 

A recent High Court decision both addresses that knotty question, and highlights a quick and easy solution.

Fishing for business: “Big Catch” claims R24m

  • Big Catch Fishing Tackle (Pty) Ltd markets and hosts fishing and fly fishing tours in both local and international waters.
  • The company’s two directors and shareholders fell out, culminating in one director accusing the other of serious breaches of his duties as director. 
  • Although hotly disputing any wrongdoing he resigned his directorship (under, he says, duress and coercion). He remains a shareholder. 
  • Big Catch is now suing the ex-director for some R24m in “past” and “future” damages, relying on disputed claims of improper or unlawful conduct which include the channeling away of business from Big Catch, misappropriating stock, diverting payment of commissions and acting recklessly and without authority. Whether or not these allegations will be proved eventually will only be determined when the main case finally goes to trial. 
  • What is of interest to us at this stage is Big Catch’s interim application to the High Court to interdict the ex-director and his new business (Upstream Fly Fishing) from competing with Big Catch.

Ex-director off the hook 

  • Directors have a range of fiduciary duties towards their companies. They must at all times act in good faith and in the best interests of the company. They must avoid conflicts of interest. They cannot compete with the company nor make secret profits. “The default position”, as the Court in this case put it, “is that an executive director or a senior employee may not carry on business activities which fall within the scope of his company’s business during the time when he serves as director or works as employee.” 
  • Big Catch had to convince the Court that those duties survive resignation unchanged. But, held the Court, that “default position” changes on resignation and “the director or employee does not commit a breach of his fiduciary duty merely because he takes steps to ensure that, on ceasing to be a director or employee, he can continue to make a living even by setting up a business in competition with his former company or by joining a competitor and then pursuing opportunities similar in nature to those targeted by his former company.”
  • Although a director’s fiduciary duty does indeed survive departure, “the content of that duty does not remain the same … The duty will only be breached after resignation if it involves the use of confidential information or violates an interest of the company that is worthy of protection in some other way” (emphasis supplied). 
  • In other words, a company cannot simply say “our ex-director is breaching an ongoing fiduciary duty towards us”, it must go further and actively prove a right to protection. Big Catch in this case being unable to make out its case, the Court dismissed the application with costs and the ex-director is off the hook, at least for now.

Big Catch’s big mistake – no restraints of trade

Round 1 therefore to the ex-director; a victory made easier by Big Catch’s failure to put restraints of trade in place for all its directors and senior employees. 

As the Court put it “…in the absence of a restraint of trade, the onus shifts to the director’s former company to justify the interdict both in law and in fact” and “…a company that wishes to prevent a director or employee from competing with it after resignation should either do so by way of imposing a reasonable restraint of trade or it will have to persuade a Court that it has an interest worthy of protection, such as confidential information, client lists or connections, that justifies an interdict.”

Bottom line – make protecting your company easy with restraints of trade!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

How to Stop an Ex-Director from Competing With You

By | Company / Corporate / Compliance, Employment and Labour Law

“…the default position is that an executive director or a senior employee may not carry on business activities which fall within the scope of his company’s business during the time when he serves as director or works as employee.  The default position however changes on resignation.” (Extract from judgment below)

What happens if relations between you and your fellow company directors sour to the extent that a director leaves? Can he or she immediately open up a new business in direct competition to you? 

A recent High Court decision both addresses that knotty question, and highlights a quick and easy solution.

Fishing for business: “Big Catch” claims R24m
  • Big Catch Fishing Tackle (Pty) Ltd markets and hosts fishing and fly fishing tours in both local and international waters.
  • The company’s two directors and shareholders fell out, culminating in one director accusing the other of serious breaches of his duties as director. 
  • Although hotly disputing any wrongdoing he resigned his directorship (under, he says, duress and coercion). He remains a shareholder. 
  • Big Catch is now suing the ex-director for some R24m in “past” and “future” damages, relying on disputed claims of improper or unlawful conduct which include the channeling away of business from Big Catch, misappropriating stock, diverting payment of commissions and acting recklessly and without authority. Whether or not these allegations will be proved eventually will only be determined when the main case finally goes to trial. 
  • What is of interest to us at this stage is Big Catch’s interim application to the High Court to interdict the ex-director and his new business (Upstream Fly Fishing) from competing with Big Catch.
Ex-director off the hook 
  • Directors have a range of fiduciary duties towards their companies. They must at all times act in good faith and in the best interests of the company. They must avoid conflicts of interest. They cannot compete with the company nor make secret profits. “The default position”, as the Court in this case put it, “is that an executive director or a senior employee may not carry on business activities which fall within the scope of his company’s business during the time when he serves as director or works as employee.” 
  • Big Catch had to convince the Court that those duties survive resignation unchanged. But, held the Court, that “default position” changes on resignation and “the director or employee does not commit a breach of his fiduciary duty merely because he takes steps to ensure that, on ceasing to be a director or employee, he can continue to make a living even by setting up a business in competition with his former company or by joining a competitor and then pursuing opportunities similar in nature to those targeted by his former company.”
  • Although a director’s fiduciary duty does indeed survive departure, “the content of that duty does not remain the same … The duty will only be breached after resignation if it involves the use of confidential information or violates an interest of the company that is worthy of protection in some other way” (emphasis supplied).
  • In other words, a company cannot simply say “our ex-director is breaching an ongoing fiduciary duty towards us”, it must go further and actively prove a right to protection. Big Catch in this case being unable to make out its case, the Court dismissed the application with costs and the ex-director is off the hook, at least for now.
Big Catch’s big mistake – no restraints of trade

Round 1 therefore to the ex-director; a victory made easier by Big Catch’s failure to put restraints of trade in place for all its directors and senior employees. 

As the Court put it “…in the absence of a restraint of trade, the onus shifts to the director’s former company to justify the interdict both in law and in fact” and “…a company that wishes to prevent a director or employee from competing with it after resignation should either do so by way of imposing a reasonable restraint of trade or it will have to persuade a Court that it has an interest worthy of protection, such as confidential information, client lists or connections, that justifies an interdict.”

Bottom line – make protecting your company easy with restraints of trade!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Employees: Your New Rights to Paternity and Parental Leave

By | Business, Employment and Labour Law

“People who say they sleep like a baby usually don’t have one” (Psychologist Leo J Burke)

It has taken over a year of confusion and delay around when new changes will be implemented, but finally your extended rights to parental leave and to an Unemployment Insurance Fund (UIF) claim have fully commence.

Here’s an update/refresher –

  • New mothers are still entitled to 4 consecutive months’ maternity leave.
  • New “parents” (which would include fathers and same-sex partners) are entitled to 10 consecutive days’ “parental leave”.
  • An adoptive parent of a child under 2 years old is entitled to 10 consecutive weeks’ adoption leave. Where there are two adoptive parents, the other is entitled to only the 10 consecutive days’ “parental leave” (the two adoptive parents should decide between them who gets 10 weeks and who gets 10 days).
  • Commissioning parents in a surrogacy agreement have the same entitlements as adoptive parents.
  • The law does not force your employer to give you paid leave – the above entitlements are for unpaid leave only. So unless your employment contract entitles you to paid leave you are limited to claiming from the UIF (assuming you are a qualifying contributor). That will give you 66% of your salary subject to a standard earnings cap.

And a note for employers: if you haven’t already done so, take advice now on reviewing your maternity and parental leave policies.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Employees on Probation: Can You Dismiss for Poor Performance?

By | Employment and Labour Law

“… arbitrators should hesitate to interfere with employer’s decisions on whether probationary employees have attained the required performance standard, or with the standards themselves” (extract from judgment below)

Our laws allow employers to hire new employees on a probationary basis, and doing so can give both parties time to assess how good the “fit” actually is and whether the employee should become a permanent one.

Employers must however avoid falling into the trap of thinking that they can dismiss a probationary employee at will; on the contrary they must ensure both “substantive” and “procedural” fairness at all stages of the process. 

But how do you ensure fairness?

The Labour Relations Act’s “Code of Good Practice: Dismissal” provides important guidelines in this regard (note that what is set out below is of necessity only a summary so be sure to take full legal advice on how the Code’s detailed requirements will apply to your specific case) –

  • It entitles employers to require new employees to serve a probationary period “before the appointment of the employee is confirmed”. It must be for a “reasonable duration”.
  • The employer must use the period of probation to assess performance. What does that mean? Per the Labour Appeal Court (LAC) in the recent decision discussed below “…the purpose of a probationary period is not only to assess whether the employee has the technical skills or ability to do the job. It also serves the purpose of ascertaining whether the employee is a suitable employee in a wider sense. This allows consideration of matters of “fit” – aspects of demeanour, diligence, compatibility and character”. 
  • The employer must give the employee reasonable assistance, training and guidance.
  • An employer is entitled to extend the probationary period in order to complete any performance appraisal.
  • Importantly, a lower standard of substantive fairness applies during the probation period than would be the case with permanent employment: “Any person making a decision about the fairness of a dismissal of an employee for poor work performance during or on expiry of the probationary period ought to accept reasons for dismissal that may be less compelling than would be the case in dismissals effected after the completion of the probationary period.”

    That provision, held the LAC, “is a clear indicator that arbitrators should hesitate to interfere with employer’s decisions on whether probationary employees have attained the required performance standard, or with the standards themselves”. 

Let’s have a look at that LAC decision as it provides a good example of these principles in action…

Dismissed for poor work performance

  • A non-profit organisation employed a supply chain coordinator under an employment contract which required a 6 month probationary period to give the employer time to assess the employee for suitability for permanent employment.
  • Concerns over the employee’s performance arose during her probationary period, she was consistently made aware (in eight performance meetings and appraisals over a three month period) that her performance was not up to standard, and eventually a hearing concluded that she “lacked the understanding and ability to carry out her assigned tasks despite having been given assistance and a reasonable opportunity to improve”.
  • When she was dismissed for poor work performance she referred her dismissal to the CCMA (Commission for Conciliation, Mediation and Arbitration). The commissioner held her dismissal to have been unfair and ordered her reinstatement retrospectively to the date of dismissal. The Labour Court declined to reverse this decision.
  • Importantly, the commissioner had concluded that the employee automatically became a permanent employee when her probation ended (her actual dismissal took place only after expiry of the probationary period) and that this indicated that her employer was satisfied with her performance and that she had satisfactorily completed her probation period. Moreover, held the commissioner, the employer had not properly considered sanctions or remedies other than dismissal and the employee should have been retrained and her responsibilities adjusted.
  • Not so, held the LAC on appeal. When the probation period came to an end the employer was engaged in an ongoing review and evaluation process and by inference intended to extend the probation period until the review and evaluation process was completed. The lower standard of fairness accordingly applied and the evidence revealed “a performance problem that sufficiently justified the [employer]’s decision, after extensive evaluation, counselling and guidance, not to confirm [the employee]’s suitability for permanent appointment.” As an NPO with limited resources, the employer had no obligation to re-write the employee’s job description.
  • The dismissal was accordingly fair and the CCMA’s reinstatement award set aside.

A final thought – as always, our labour laws being so complex and the penalties for getting them wrong so severe, take specific legal advice on your particular matter!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

What is Poor Work Performance? A Case of Missed Sales Targets

By | Employment and Labour Law

“…the employer has a duty to investigate all possible alternatives short of dismissal, and this duty accords with the onus of proving the fairness of the dismissal” (extract from judgment below)

An employee who fails to perform adequately at work is by definition not fulfilling his or her side of the employment bargain, but that doesn’t mean that dismissal is necessarily an appropriate remedy.

Guidelines for dismissal

The onus is on you as employer to prove that the dismissal was fair, and the “Code of Good Practice on Dismissals” provides these guidelines –

“Any person determining whether a dismissal for poor work performance is unfair should consider –

  1. Whether or not the employee failed to meet a performance standard; and
  2. If the employee did not meet a required performance standard whether or not – 
    1. The employee was aware, or could reasonably be expected to have been aware, of the required performance standard; 
    2. The employee was given a fair opportunity to meet the required performance standard; and 
    3. Dismissal was an appropriate sanction for not meeting the required performance standard.”

A good example of how that works in practice comes from a recent Labour Law judgment…

The sales reps fired for missing their targets
  • A group of sales representatives failed to meet their (newly-introduced) sales performance targets.
  • They were given letters warning of poor work performance, followed a month later by a final ultimatum giving them the opportunity to make written representations with reasons for failing to meet their targets. 
  • They did so, referring to a list of challenges they said they were faced with, but the employer found their explanations unacceptable and they were served with notices to attend performance enquiries which resulted in their dismissals.
  • The CCMA (Commission for Conciliation, Mediation and Arbitration) found the dismissals to have been substantively unfair (although procedurally fair) and ordered the employer to reinstate the employees with full back pay. 
  • On review in the Labour Court the employer argued that the performance targets were reasonable and achievable (other employees were achieving them) and that it had to introduce the targets in order to “improve cash flow for survival.” 
  • The Court in the end result confirmed the reinstatement order, finding that –
    • The employer failed to show that the employees were given sufficient training, guidance, support, counselling and reasonable time to improve their performance. 
    • The employees had genuine concerns that were outside their control and could have been managed with the employer’s assistance. 
    • The employer had failed to explore alternative measures short of dismissal, like training. 
  • The employer had accordingly failed to show that dismissal was an appropriate sanction.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Employers: What is Your Duty to Accommodate Religious Beliefs?

By | Employment and Labour Law

“The employer has a duty to reasonably accommodate an employee’s religious freedom unless it is impossible to do so without causing itself undue hardship. It is not enough that it may have a legitimate commercial rationale. The duty of reasonable accommodation imposed on the employer is one of modification or adjustment to a job or the working environment that will enable an employee operating under the constraining tenets of her religion to continue to participate or advance in employment” (Extract from judgment below)

Our law makes a dismissal automatically unfair if ‘… 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 or family responsibility” (emphasis added).

Employers need to tread with extreme caution here, as a recent Labour Appeal Court decision once again warns…

Dismissed for refusing to work on Saturdays 
  • A manager was required, along with all other managers, to work on Saturdays doing stock-taking.
  • She refused on the basis that she was a Seventh Day Adventist, a religion requiring her to observe the period between sundown on Friday and sundown on Saturday evening as the holy Sabbath, during which time she was not permitted to work. Her various suggestions on how she could be accommodated were rejected by her employer. 
  • She was dismissed for “incapacity” and her dispute over the fairness of that dismissal eventually reached the Labour Appeal Court.
  • The Court held her dismissal to have been automatically unfair, and ordered her employer to pay her 12 months’ remuneration plus costs.
Who must prove what? 

The actual outcome of this particular case was largely dependent on its specific facts, so as always take legal advice on your own situation.

But the Court’s findings provide a good example of how our laws on automatic discrimination are applied in practice –

  • Firstly, it was for the employee to show that her religion was the “true or real or dominant reason for her dismissal and that a sufficient [connection] exists between her dismissal and her religion”. She had to produce evidence “which is sufficient to raise a credible possibility that an automatically unfair dismissal has taken place”, whereupon the employer could “prove the contrary by producing evidence to show that the reason for the dismissal did not fall within the circumstances envisaged … for constituting an automatically unfair dismissal”.
  • The Court rejected the employer’s claim that the employee’s refusal to do the stock take was the dominant reason for the dismissal rather than her “personal convictions that underlay it”. She was, it held, “dismissed and discriminated against for complying with and practicing the tenets of her religion”.
  • Next, said the Court, “the decisive enquiry … is whether the discrimination is fair, rationally connected to a legitimate purpose and does not unduly impair or impact on [the employee’s] dignity”, it being up to the employer to prove such a defence. 
  • In particular, a dismissal “may be fair if the reason for the dismissal is based on an inherent requirement of the particular job”, but then the employer would also have to prove “that it is impossible to accommodate the individual employee without imposing undue hardship or insurmountable operational difficulty”.  
  • On the basis of the evidence available to it, the Court found that the employer did not “reasonably accommodate” the employee. The dismissal was accordingly automatically unfair.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Equal Pay for Equal Work – Can You Differentiate Without Unfairly Discriminating?

By | Employment and Labour Law

“Prohibition of unfair discrimination: No person may unfairly discriminate, directly or indirectly, 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, birth or on any other arbitrary ground” (from the Employment Equity Act)

Our employment laws and labour courts come down heavily on any unfair discrimination in the workplace, but it’s not always easy to decide whether “differentiation” between employees is or is not “unfair discrimination”.

Take for instance a recent Labour Court case where a black female employee complained to the CCMA (Commission for Conciliation, Mediation and Arbitration) about the higher salary paid to her white male colleague.

They were both employed as “surveillance auditors” in a casino with the same job descriptions, doing the same work on a daily basis, graded at the same level, and reporting to the same surveillance shift manager. Nevertheless her remuneration package was nearly half of her colleague’s – unfair discrimination, she said, on the grounds of race and gender.

The CCMA agreed with her and ordered her employer to (1) place her in the same salary bracket as her colleague and (2) pay her a once-off amount of the annual difference in their packages.

Requirements and defences

The Labour Court however set aside the CCMA’s award and ordered a re-hearing before a different commissioner. Its decision, although based on “reviewable irregularities” in the CCMA (in itself a topic of interest to labour lawyers more than to their clients) neatly summarises the legal principles as they applied in this case. Principles important to both employers and employees –

  1. Where unfair discrimination is alleged, the onus is on the employer to prove that the discrimination did not take place or that any discrimination that did take place was rational and not unfair, or is otherwise justifiable.
  2. There is a general requirement on employers to “ensure that employees are not paid different remuneration for work of equal value based on race, gender or disability”.“Work of equal value” means work that –

  1. Is the same as the work of another employee of the same employer, if their work is identical or interchangeable;
  2. Is substantially the same as the work of another employee employed by that employer, if the work performed by the employees is sufficiently similar that they can reasonably be considered to be performing the same job, even if their work is not identical or interchangeable;
  3. Is of the same value as the work of another employee of the same employer in a different job, if their respective occupations are accorded the same value …”.(In this case of course there was no dispute that the first category – same work – applied, so the other categories were not analysed by the Court, but in many workplaces they will be highly relevant.)

  1. Where there is differentiation, an employer can raise various defences to justify it – seniority, length of service, qualifications and the like. In this case the employer relied on the male employee’s superior (30 years’ worth) relevant experience in security, much better qualifications and “market forces” which it said forced it to match his existing package in order to recruit him.The commissioner’s failure to adequately address these defences was central to the Court’s decision here, but the practical issue is that as an employer, whatever defence/s you raise, you will have to prove “rationality, fairness or other justifiability”.

As always, our labour laws being as complex as they are (the above is of necessity just a brief summary of a particular case), and the penalties for getting them wrong potentially so costly, take specific legal advice in any doubt!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

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