HR Pulse

HR professionals can avoid sub-standard dismissals

It is often because of the quirks of the law that employers lose dismissal cases because procedures at the CCMA or in the Labour Court weren't followed. The inability of some HR professionals to make sense of the law of fair disciplinary procedure can be very costly for employers.

Making sense of South African labour law is a very big challenge for anyone as, while the Labour Relations Act (LRA) and the Basic Conditions of Employment Act (BCEA) obviously contain numerous provisions explaining the legal duties of employers, these statutes are inexact and confusing in many areas.

For example, the LRA and BCEA both list seven factors that render a worker or an employee covered by labour law rather than an independent contractor (someone who works for himself/herself). However, different arbitrators, faced with the exact same set of facts, are likely to arrive at a different view depending on their backgrounds, orientation and training.

This is especially so where there are strong factors in favour of both decisions. For example:

• Where the worker is totally reliant on the work provider for income and tools of trade but also works totally independently without supervision and without set working hours, arbitrators are likely to differ in their decision as to whether the worker is an employee or not.

The LRA is extremely unclear about what is meant by 'sufficient time'

This phrase is contained in item 6 of schedule 8 of the LRA:

• The employer is required to give 'sufficient time' to strikers not complying with the act before dismissing them.

According to sections 193 and 194 of the LRA, the awards and orders that can be made against the employer for unfair dismissal are as follows:

• The LRA requires the CCMA or Labour Court to reinstate the employee. This means that the firm must give the employee his/her job back and to pay the employee all remuneration calculated back to the date of the dismissal. The employer must also reinstate all the employee's benefits retrospectively.
  
  
• The LRA also permits the CCMA or Labour Court to order re-employment instead of reinstatement. This means that, while the company must give the employee his/her job back, this will not be with back pay.
  
  
• Even if the firm does not have to take the employee back, it may still have to pay compensation up to a maximum of 12 months' remuneration calculated at the employee's newest rate of remuneration.
  
  
• If the dismissal is deemed to be automatically unfair, the maximum compensation that may be awarded is 24 months' remuneration.
  
  
• Such compensation is payable in addition to all other payments due to the employee. These could include:
  - Notice pay,
  - Leave pay, and
  - Even payment for the unexpired portion of the employee's contract.

The Labour Court and CCMA have the power to make such additional awards by virtue of section 195 of the LRA and section 74(1) of the BCEA. Furthermore, the Labour Court has jurisdiction, in terms of section 77(3) of the BCEA, to determine any matter relating to a contract of employment.

More and more lawyers and consultants are therefore advising employers to offer reinstatement to dismissed employees where the employee disputes the dismissal procedure. That is, the employer's legal experts are advising employers to reinstate the employee before the matter gets as far as court or arbitration to avoid these heavy penalties being imposed by the CCMA or Labour Court.

For some time this reinstatement tactic was relatively effective:

• The firm, after realising it had made a mistake in the dismissal procedure, would take the employee back or declare the dismissal null and void, so cancelling out the procedural error.
• Then the firm would dismiss the employee again, but this time using the correct procedure.

However, the use of this tactic is becoming more and more risky for employers. For example, in the case of Unitrans Zululand (Pty) Ltd vs Cebekhulu the Labour Appeal Court was faced with such a decision:

• The employer retrenched Cebekhulu but, realising that the retrenchment procedure was faulty, withdrew the retrenchment and restarted consultation procedures.
• The court found that these new consultations were "merely an attempt to paper over the cracks" of the incorrect procedure followed during the first set of consultations.
• The court found that the employer's decision to "begin consultations afresh" was made in bad faith "only when it was advised that it had not complied with the LRA".

• The court therefore decided that the reinstatement of the employee could not correct the incorrect retrenchment procedure and awarded costs against the employer.

It is therefore not a safe option for HR professionals to implement retrenchments inexpertly and then hope to correct the error using the reinstatement tactic. The only route to follow is to obtain expert advice before dismissing employees for any reason and to make sure that you are getting the advice from a genuine labour law expert with solid experience in retrenchments.

Ivan Israelstam is the Chief Executive Officer of Labour Law Management Consulting. He is known as a leading practitioner in labour law and pragmatic labour relations management with many years experience in corporate human resources management. He has an honours degree from The University of the Witwatersrand and an IPM diploma in Personnel Management and in Training. Contact Ivan: This e-mail address is being protected from spambots. You need JavaScript enabled to view it. .