What is a pre-dismissal arbitration?
- Published on 22 Nov 2013
- HR Pulse News Desk
Section 188A of the Labour Relations Act 66 of 1995 (LRA) provides for pre-dismissal arbitrations (PDA) , which take the place of disciplinary enquiries.
Characteristics of a PDA:
- The charges in a PDA are generally more serious and employees are usually suspended pending the case outcome.
- A PDA does away with the disciplinary process and may save the employer time and the costs of extensive litigation. A PDA is a voluntary procedure and both the employer and employee must agree to this process.
An employee who earns above the amount set out in s 6(3) of the Basic Conditions of Employment Act, No 75 of 1997 - currently R193 805.00 per month - can contractually consent to a PDA in terms of his or her contract of employment. Aside from getting an employee's consent, an employer is required to complete the prescribed form and pay the prearranged fee. Thereafter, CCMA will appoint an independent arbitrator.
The independent arbitrator's PDA award is final and binding
Therefore, an employee may not refer a dispute to the CCMA on allegations of unfair dismissal or unfair labour practices after a PDA award is handed down as the PDA award can’t be appealed. A dissatisfied party's only option is to have the PDA award reviewed and set aside in terms of s145 of the LRA.
What is the disadvantage of a PDA?
If the employer is unsuccessful with the PDA, the employee will remain in its employ and the employer will have to continue paying the employee until the PDA award
is reviewed and set aside.
On the other hand, if an employee is dismissed before a dispute is referred to the CCMA, there is no obligation to pay the employee while the CCMA proceedings and the review application are pending.
At first glance, a PDA might seem fast tracked and cost efficient, however to a large extent, an employer loses control of the process and relies on the CCMA to appoint an independent arbitrator.
