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Can dismissal be used to compel employees to accept demands?

In this case:

• Wehncke was provided a company vehicle when he was employed with Surf4cars, of which he had unrestricted use.
• There was no written contract of employment which governed the relationship between the parties and/or the use of the vehicle.
• Six months later, Wehncke was presented with a written contract, which made provision for payment, by him, of any excess on insurance claims if the vehicle was involved in an accident. As a result, Wehncke refused to sign the contract unless this term was removed. Due to his refusal to accept this term, he was dismissed.

Solidarity, on behalf of Wehncke, instituted proceedings in the Labour Court, claiming that the dismissal was automatically unfair.

The basis of Wehncke's claim was grounded in s187(1)(c) of the Labour Relations Act, No 66 of 1996 (LRA), which provides that a dismissal is automatically unfair if the reason for the dismissal is to compel the employee to accept a demand about any matter of mutual interest between the employer and employee.

In adjudicating the matter, the Labour Court found that:

• Wehncke had failed to prove that the employer had dismissed him to compel him to sign the contract of employment, and
• The court found that there was consequently no demand from Surf4cars.

As a result, the Labour Court dismissed Wehncke's claim.

On appeal, the Labour Appeal Court noted that the reach of s187(1)(c) had been decided in Fry's Metals v NUMSA & others [2003] 2 BLLR 140 (LAC) and CWIU & others v Algorax (Pty) Ltd [2003] 11 BLLR 1081 (LAC). These cases were decided on the basis that for a dismissal to fall within the scope of s187(1)(c), the dismissal must be 'conditional'. This means that the dismissal would be withdrawn if the employee accepted the demand.

In the case at hand, the dismissal was not conditional. The dismissal was final and irrevocable. While it was based on Wehncke's unreasonable refusal to accept a term in the contract, there was no conditional offer to reinstate him should he accept the demand.

Wehncke's appeal succeeded on the following basis, not on the basis that his dismissal was automatically unfair:

When adjudicating an automatically unfair dismissal claim, which on the facts appears to be a matter that should have been referred to the Commission for Conciliation, Mediation and Arbitration (CCMA) for the arbitration – such as a dismissal for misconduct - the Labour Court has the power to:

• Stay the proceedings,
• Refer the matter for arbitration or,
• Arbitrate the matter itself.

In this matter, the dismissal was not arbitrated by the CCMA and as such, the Labour Appeal Court decided to refer the matter for arbitration.

Accordingly, the appeal against the Labour Court's ruling that the dismissal was not automatically unfair was dismissed. The court ordered that the matter be referred to the CCMA for arbitration, in terms of s158(2)(b).

If the amendments to the LRA had been in effect, the case outcome may have been different. In terms of the amendments, s187(1)(c) no longer requires the employer to have intended to compel the employee to accept its demand – the requirement is merely that the employee was dismissed for rejecting the employer's demand.