Summary of the Labour Relations Act, no. 66 of 1995 (With Amendments)

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This Act sets out the laws that govern labour in South Africa. It is guided by Section 27 of the Constitution, which entrenches the rights of workers and employers to form organisations for collective bargaining. Together with the Basic Conditions of Employment Act, it also ensures social justice by establishing the rights and duties of employers and employees. It also regulates the organisational rights of trade unions deals with strikes and lockouts, workplace forums and other ways of resolving disputes. It provides a framework for the resolution of labour disputes through the Commission for Conciliation, Mediation and Arbitration (CCMA), Labour Court and Labour Appeal Court.

Contents

[edit] Who Is this Act for?

This Act applies to all employers, workers, trade unions and employers’ organisations. It does not apply to members of the:

  • National Defence Force,
  • National Intelligence Agency, or
  • South African Secret Service.

Some workers (e.g. domestic workers and members of the police) have restricted organisational rights.

[edit] Employer and Employee Organisations

All employees and employers have freedom of association, which means that they have the right to form, join and participate in the activities of registered organisations and they cannot be discriminated against because of membership. Strong trade unions and employer organisations are important for effective collective bargaining.

[edit] What’s the Difference Between a Registered and an Unregistered Union?

Unions registered with the Department of Labour (DoL) are governed by constitutions that embrace the principle of calling for a ballot before holding a strike or lockout. They must also rule against racial and gender discrimination within the union. Organisations do not have to be registered with the DoL, but registered unions have more organisational rights.

[edit] What Are Organisational Rights?

Bearing in mind that they cannot disrupt work activities, trade union representatives have the right to do the following:

  • to enter an employer’s premises in order to recruit new members;
  • to hold meetings and conduct ballots at the workplace;
  • to deduct trade union subscriptions from members’ salaries; and
  • to ask employers for relevant information (as long as it is not legally privileged).

If a workplace has a certain number of trade union members (not less than 10), representatives can be elected to exercise organisational rights. The more members a trade union has, the more representatives it can elect and the more rights it has in the workplace. If a union has organisational rights in the workplace, its representatives can oversee various functions:

  • They help employees in grievance and disciplinary hearings.
  • They monitor employer compliance with labour laws.
  • They report on any contraventions of the Act.

Representatives are also entitled to a reasonable amount of paid leave in order to perform these tasks. This is negotiated with the employer.

[edit] How Does a Union Get Organisational Rights?

To exercise any organisational rights in the workplace, registered trade unions first have to follow proper procedure. Employers must be given due warning of the union’s wish to exercise its rights, and the union must prove that there is sufficient support for its activities in the organisation.

If an agreement cannot be reached over the granting of organisational rights, the matter can be referred to the CCMA and a commissioner will try to resolve the dispute through conciliation. If the dispute cannot be resolved, either party can ask for it to be settled through arbitration.

The right to strike

A union can choose to strike instead of approaching the CCMA, but if it does so it will have to wait for one year before asking the CCMA to grant it organisational rights.

[edit] Union Security Agreements

There are two kinds of agreements that give the union more security and boost its bargaining power: the agency shop agreement and the closed shop agreement:

The agency shop agreementThe closed shop agreement
DefinitionThis is a system whereby non-union employees, who benefit from the union’s activities in the workplace or sector, are required to pay an amount into a special fund.In a closed shop agreement, the employer and union agree to compulsory union membership. Workers who do not want to join a union can face dismissal, and expulsion from the union will also result in dismissal.
Conditions
  • The system can only be set up if the majority of employees are members of the union.
  • The amount paid by non-union employees cannot be more than a normal member’s subscription.
  • The union can only use the fund to advance the socio-economic interests of employees. For example, money cannot be paid to political parties, but it can be used in a campaign against a VAT increase.
  • The union must be a majority union and it and the relevant employer must both agree to a closed shop system.
  • A ballot must be held among relevent employees, and two thirds of the employees must support the closed shop agreement.
  • The use of funds is also restricted to advancing the socio-economic interests of members.

[edit] What Happens if Employees Don’t Want These Agreements?

Employees who refuse to belong to a union on the grounds of conscience are called conscientious objectors, and they can ask for their contributions to be paid into a fund run by the DoL. In the case of closed shop agreements, conscientious objectors who are dismissed may challenge their dismissal in the Labour Court. (If the Court finds in favour of the objector, the union, and not the employer, will have to pay compensation.)

If, at least three years after a closed shop agreement was made, at least one third of the employees sign a petition to end the agreement, then a ballot must be held to determine whether the agreement should continue.

[edit] Collective Bargaining

The Act promotes what is called centralised collective bargaining. This is when employers in a sector (or area of work) join forces to bargain with one or more unions representing their employees. For example, a group of mining companies might get together to negotiate with mineworkers’ unions.

There are three systems for collective bargaining: collective agreements, bargaining councils and statutory councils:

Collective Agreements Bargaining Councils Statutory Councils
What it is This is a simple agreement between employers (e.g. Chamber of Mines) and a union or unions (e.g. the National Union of Mineworkers). The agreement only affects these two parties. Bargaining council agreements cover a wide range of issues (e.g. wages, benefits and grievance procedures) and extend to all employers and employees within the council’s scope of representivity, as long as certain requirements are met. This is a weaker version of a bargaining council, as it cannot be extended to parties outside of the council without the Minister of Labour’s approval
Conditions Both parties must agree to a collective agreement. To establish a bargaining council there must be enough representation in both the unions and the employers’ organisations. Representation must be acceptable to NEDLAC (the National Economic Development and Labour Council) To establish a statutory council, there must be 30% representation on both sides. This means that at least 30% of the employers in the sector must employ at least 30% of the workers.
Rights Bargaining council agents monitor and enforce any collective agreements and have the power to issue compliance orders, to publish the contents of collective agreements and to conduct investigations into complaints. Unions that are members of a statutory council will enjoy organisational rights of access, meetings, ballots and stop-order facilitites, even in a workplace that has no union members.

[edit] The Public Service Co-ordinating Bargaining Council

One of the most important bargaining councils is the Public Service Co-ordinating Bargaining Council (PSCBC), set up by Section 35 of the Act. The Council negotiates issues that are common to all public service employees and it has the right to set up further bargaining councils for particular sectors in the public service. For more information, see their website: http://www.pscbc.org.za.

[edit] Workplace Forums

The Act also makes provision for workplace forums, which encourage all employees (even non-trade-union members) to participate in furthering their interests in the workplace. These forums are made up of elected workers who meet with interested parties on a regular basis to discuss working conditions. The issues dealt with by workplace forums are better suited to resolution through consulation rather than through collective bargaining (e.g. job grading, criteria for increases or bonuses, education and training, mergers or transfers of ownership and product development plans).

The forum also has the right to present other proposals to the employer, and these must be given due regard. If rejected, the employer must supply the forum with concrete reasons.

Employers can also consult forums on certain issues and the aim of the forum is to set up a dialogue that will boost efficiency in the workplace. Although the forum does not take away the employers’ right to make unilateral decisions, it increases the employees’ representation in the workplace.

[edit] What Are the Joint Decision-Making Issues?

Certain workplace issues are set aside by the Act as joint decision-making issues. This means that employers must consult with the forum on these issues:

  • disciplinary codes and procedures,
  • workplace rules no related to the employees' conduct,
  • rules that govern social benefit schemes (e.g. provident or housing funds), and
  • affirmative action measures).
Employees cannot strike over any joint decision-making matters.

Issues can be added or removed from this list via collective agreements made between employers and representative trade unions.

Agreement must be reached on these issues, or they should be referred to the CCMA. If the matter is still unresolved, the employer can ask for it to be resolved through arbitration. Employees cannot strike over any joint decision-making matters.

[edit] How is a Workplace Forum Established?

Only a representative (and registered) trade union or group of unions may set up a forum, and forums may only be set up in workplaces with over 100 employees. The CCMA oversees the process and appoints a commissioner to help both parties to come to an agreement on the forum's functions. If agreement cannot be reached, then the CCMA will establish a forum that abides by this Act's rules.

Schedule 2 of the Act provides guidelines for the constitution of a workplace forum, particularly in relation to the process of electing a workplace forum.

Trade unions recognised by employers as the bargaining agent for all employees have special rights. They may apply to the CCMA to set up a trade union based workplace forum. This means that the union can appoint forum representatives without holding an election.

Workplace forums may only be dissolved if there is a private agreement that allows for this. If there is no private agreement, a workplace forum can only be dissolved if a representative trade union requests a ballot which results in a majority vote in favour of dissolving the forum.

What Rights do Forum

Representatives Have?

  • Each member of the forum must be given a reasonable amount of time off to conduct duties and/or receive training (with no deductions from salary)
  • The employer must provide facilities for the forum to operate
  • Forums may invite experts to attend meetings
  • Office bearers and officials of the representative trade union can attend the forum meetings.

[edit] How Do Workplace Forums Operate?

Forums operate by holding three kinds of meetings. These are:

  1. Regular meetings with representatives
  2. Regular meetings with the employer, during which the employer must present a report on the company's performance and financial situation. (Once a year, the employer must also report on the company's financial and employment situation and any future plans.)
  3. Meetings with other employees in the workplace to report on activities and any joint decisions made by it and the employer.

The meetings take place during working hours, and workers are entitled to full wages.

[edit] Industrial Action

The Labour Relations Act regulates all industrial action, including strikes, lockouts and picketing. It provides for employees' constitutional right to strike and gives effect to employers' right to seek recourse via lockouts.

When Can a Worker Strike and an Employer Lock Out?

Strikes and lockouts may be held over disputes about matters of mutual interest between employers and their employees.

These include:

  • wage increases,
  • a demand to establish or join a bargaining council,
  • a demand to recognise a union as a collective bargaining agent,
  • a demand for organisational rights,
  • a demand to suspend or negotiate unilateral changes in the workplace,
  • any unprotected lockout or strike by the other party, and/or
What Is a Lockout?

A lockout is when an employer decides to withhold work from employees or closes down the workplace during a labor dispute.

Workers have a constitutional right to strike, but they must follow proper procedure.
Workers have a constitutional right to strike, but they must follow proper procedure.
  • in some circumstances workers may strike over retrenchments.



[edit] Strikes

Refusal to work only constitutes a strike if two or more workers participate. The workers may, however, work for different employers, as long as the refusal to work has a common work-related purpose. So, a domestic worker cannot strike alone, but mineworkers working for different employers can.

There are varying degrees of strike action, including the following:

  • go-slows (where workers decrease the rate of productivity),
  • work-to-rule, (where employees do no more than the minimum required by the rules of a workplace),
  • intermittent strikes (where employees stop and start the same strike over a period of time), and/or
  • overtime bans (where workers refuse to do any voluntary or compulsory overtime work).

There are also two types of strike action: protected strikes and unprotected strikes.


[edit] Protected Strikes

Protected strikes give workers some security; they cannot be dismissed for striking (unless they engage in misconduct during the strike) and employers cannot get a court interdict to stop the strike. Employers are also not allowed to seek any damages because of lost production during the strike, and they must continue to provide food and accommodation if it is part of the employees' wages (although employers can reclaim money for these by going to the Labour Court once the strike has ended.


According to the Labour Relations Act, to go on a protected strike, workers must follow certain steps:

  1. The issue over which workers wish to strike must first be referred to the CCMA or to a bargaining or statutory council.
  2. The CCMA or council must try to resolve the issue through conciliation within 30 days.
  3. If the matter cannot be resolved, then a certificate to this effect must be issued.
  4. The employer must be given 48 hours' notice of the intended strike. (If the employer is the State, then seven days' notice is required.)

Union members can force a registered union to hold a ballot before holding a protected strike. There is also a special procedure for disputes about refusals to bargain. In these cases, workers must get what is called an advisory award before the strike. This award cannot force parties to bargain.

Exceptions

There are some situations in which workers don't need to follow procedure. These include:

  • if the strike is a response to an unprocedural lock-out;
  • if the strike is allowed according to the conditions of a collective agreement;
  • if the parties to the dispute are memebers of a council and the matter has been dealt with according to the council's constitution; and/or
  • if the employer unilaterally changes the workers' employment conditions.

[edit] Unprotected Strikes

A strike won't be protected if proper procedure is not followed or if any of the following apply:

  • The issue being disputed is protected from strike action by a collective agreement.
  • According to this Act, or to any collective agreement, the matter must be referred to arbitration or to the Labour Court.
  • An aribtration award, collective agreement or sectoral determination regulates the issue.
  • The parties are involved in providing an essential service(e.g. SAPS, and any service that protects personal or public safety) or maintenance service (i.e. where the interruption of that service will physically destroy the working area).

[edit] Lockouts

A lockout occurs when an employer prevents workers from entering the workplace in an attempt to force them to accept a demand. As with strike action, there are protected lockouts and unprotected lockouts.

[edit] Protected Lockouts

A protected lockout means that workers cannot apply to the court to get an interdict against the action, and the lockout does not constitute a breach of contract on the employer's part. As with protected strikes, employers don't have to pay wages during a protected lockout, and workers cannot sue their employers for any loss. However, an employer cannot dismiss any worker who has been locked out, and replacement labour can only be used if the lockout is in response to a strike and then for the duration of the lockout. The same rules apply to food and housing as in the case of protected strikes.

In order for a lockout to be protected, employers must follow proper procedure – which is the same as the procedure for holding a protected strike:
  1. The issue in dispute must first be referred to the CCMA or to a bargaining or statutory council.
  2. The CCMA or council must try to resolve the issue through conciliation within 30 days.
  3. If the matter cannot be resolved, then a certificate to this effect must be issued.
  4. The employer must give at least 48 hours' notice in writing of the intended lockout to the trade union or workers. (If the employer is the State, then seven days' notice is required.)
Exceptions

As with protected strikes, there are some cases in which this procedure does not have to be followed. These include:

  • when the parties to the dispute are members of a council that has dealt with the dispute in its constitution;
  • when the lockout has been allowed by the procedures in a collective agreement; and/or
  • when the lockout is in response to an unprocedural strike.

[edit] Unprotected Lockouts

As with unprotected strikes, a lockout won't be protected if proper procedure is not followed or if any of the following apply:

  • The issue being disputed is protected from strike action by a collective agreement.
  • According to this Act, or to any collective agreement, the matter must be referred to arbitration or to the Labour Court.
  • An aribtration award, collective agreement or sectoral determination regulates the issue.
  • The parties are involved in providing an essential service (e.g. SAPS, and any service that protects personal or public safety) or maintenance service (i.e. where the interruption of that service will physically destroy the working area).

[edit] Picketing

Only a registered trade union has the right to authorise a picket and it can only be held in a public place outside of the workplace (unless the union has the employer's permission to picket). The picket must be peaceful and must follow the Code of Good Practice on Picketing issued by NEDLAC.

[edit] What Happens if a Person Is Treated Unfairly at Work?

The Labour Relations Act lists the following as types of unfair labour practice:

  • unfair conduct relating to the benefits, promotion, demotion, probation or training of a worker;
  • unfairly suspending an employee or unfairly subjecting them to any form of disciplinary action;
  • failing to re-employ or reinstate a worker when there is an agreement in place; and
  • treating an employee unfairly when they've disclosed unlawful conduct in the workplace (i.e. contravening the Protected Disclosure Act).

Disputes about unfair labour practice may be brought before the CCMA and attempts will be made to resolve them first through conciliation and then arbitration. Remedies include reinstatement, re-employment and/or compensation (but only up to the equivalent of 12 months' salary).

If a worker alleges that he or she has been treated unfairly in contravention of the Protected Disclosures Act, 2000, the dispute may be brought before the Labour Court.

[edit] Dismissal and Disciplinary Procedure

[edit] What Is Dismissal?

Dismissal means any of the following:

  • an employer has terminated a contract of employment with or without notice;
  • an employee reasonably expected the employer to renew a fixed term contract of employment on the same or similar terms but the employer offered to renew it on less favourable terms, or did not renew it;
  • an employer refused to allow an employee to resume work after she took maternity leave in terms of any law, collective agreement or her contract of employment, or was absent from work for up to four weeks before the expected date, and up to eight weeks after the actual date, of the birth of her child;
  • an employer who dismissed a number of employees for the same or similar reasons has offered to re-employ one or more of them but has refused to re-employ another; and
  • an employee terminated a contract of employment with or without notice because the employer made continued employment intolerable for the employee.

[edit] When Can a Worker Be Dismissed?

A worker can only be dismissed for misconduct, incapacity or business-related (i.e. operational) reasons, but proper procedure for dismissal must always be followed.

Misconduct means that a work has deliberately or carelessly broken a rule at the workplace (e.g. stealing). In such cases, a person may only be fired once the employer has followed proper procedure for dismissal due to incapacity.

Incapacity means that the worker has been unable to perform his or her duties properly because of ill health or lack of skills (inability). If a person is not doing their job properly, he or she can only be fired once the employer has followed proper procedure for incapacity.

Dismissal for operational reasons means that the company has to fire a person because of downsizing or alteration to the business set-up, and not because of a failing on a part of the worker. It is usually referred to as retrenchment. The 2002 Amendments Act distinguishes between different types of retrenchement, and there are various procedures for retrenchment which must be followed.

There are special procedures for dismissal during probation periods.

[edit] Disciplinary Procedure

The employer must maintain a fair and consistent disciplinary procedure and make sure that all employees are aware of acceptable and reasonable standards of behaviour expected of them at the workplace.

All employers should adopt disciplinary rules that establish the standard of conduct required of their employees. Their rules must be clear and must be consistently applied. The courts have endorsed the concept of corrective or progressive discipline. Efforts should be made to correct employees’ behaviour through a system of graduated disciplinary measures such as counsellings and warnings.

Each employer should keep disciplinary records for each employee. These should specify the nature of any breach of rules, the actions taken by the employer and the reasons for the actions.

Before deciding what form of disciplinary action is appropriate, the management must first meet the employee concerned and explain the nature of the rule that has allegedly been broken. The employee must be given an opportunity to explain his or her conduct. Note that this meeting does not constitute a formal hearing.

Unfair Dismissal

It is never permissable to fire a person for any of the following reasons:

  • because they participated in or supported a strike or protest action;
  • because they refused to do any work normally done by an employee who at the time was taking part in a strike or was locked out (exceptions are made for work that is necessary to prevent an actual danger to life, personal safety or health);
  • because the employee refused to accept a demand or offer on any matter of mutual interest between the employer and employee (e.g. a wage increase);
  • because the worker takes (or intended to take) action against the employer by exercising any right or participating in any proceedings in terms of the Act;
  • because of transfer of business;
  • because of pregnancy, intended pregnancy, or any reason related to her pregnancy;
  • because of race, gender, sex, ethnic or social origin, colour, sexual orientation, age, disability, religion, conscience, belief, political opinion, culture, language, marital status or family responsibility.

[edit] Informal procedure

For minor misconduct, the employer or supervisor, may informally advise, caution and/or reprimand the employee. It is not necessary to issue a written warning.

Offences (if first time) that call for informal action include incompetence, absence without permission, working under the influence of alcohol, and arriving late at work.

[edit] Formal procedure

Under the Act, damaging company property calls for formal action.
Under the Act, damaging company property calls for formal action.

The employer must have a disciplinary code that ensures that the discipline is meted out progressively. Offences that call for formal action include:

  • refusal to carry out a lawful instruction;
  • fighting;
  • threat of violence;
  • actions that are a threat to the well-being and/or safety of self and/or others;
  • damage and/or misuse of company property;
  • disruption of the employer's activities;
  • presenting and/or making false information for personal gain;
  • falsifying, misrepresenting or defrauding the employer;
  • negligence;
  • unauthorised possession;
  • illegal industrial action;
  • loafing and slack time-keeping;
  • failure to adhere to rules;
  • incompetence;
  • bribery and corruption;
[edit] Written warnings

Written warnings are appropriate when a worker doesn’t respond to verbal warnings or if the offence is serious. The appropriate manager may only issue a written warning after meeting with the employee concerned. This warning must briefly describe the nature of the breach of conduct. It must be properly served to the employee and he or she should be asked to sign acceptance of receipt of the notice. If they refuse to sign, the employer should record this fact on the notice and state the date, time, and place where the notice was served. Written warnings remain valid for six months.

[edit] Final Written Warning

Final written warnings are appropriate if a worker has received a written warning(s) for the same or similar breach of rules, or if a written warning is considered to be inappropriate because of the seriousness of the breach of rules. The appropriate manager may issue a final written warning after meeting with the employee concerned or after a disciplinary hearing.

Again, the warning must briefly describe the nature of the breach and the notice must be properly served to the employee. The employee must sign acceptance of receipt of the notice. Refusal to sign should be recorded on the notice. Always state the date, time, and place where the notice was served.

Employees who dispute a final written warning when there has been no disciplinary hearing may ask for a formal hearing, to review the warning within seven days of receiving it. Final written warnings remain valid for 12 months. The appropriate manager must inform the employee that a failure to heed a final written warning may result in their being fired.

[edit] Disciplinary Inquiry

A disciplinary hearing must be held if action stronger than a written warning is warranted (in the opinion of the appropriate manager), or if a worker has received a final written warning and requests a formal hearing.

An employee may be suspended on full pay pending such a hearing if the presence of the employee at the workplace jeopardises any investigation into the alleged misconduct, or poses any threat to the safety or well-being of any employee, including management.

The appropriate manager must give the employee at least three working days’ notice of the time and date of a hearing, and the charge against him or her. The notice must be properly served and the employee should be asked to sign acceptance of receipt of the notice. If they refuse to sign, the employer should record this fact on the notice, stating the date, time, and place where the notice was served. Employees must be informed that they are allowed to have a representative at the hearing (a fellow employee or shop steward). The following persons must be present at the hearing:

  • a chairperson (the director/general manager or a nominee);
  • a management representative, who will present the evidence against the employee charged;
  • the employee charged;
  • the employee’s representative (a fellow employee or a shop steward)
  • any witnesses that management or the employee wishes to call;
  • an interpreter, if the employee requires one.
The employee must be informed in writing of decisions to take disciplinary action with seven days of a hearing.
The employee must be informed in writing of decisions to take disciplinary action with seven days of a hearing.

At a hearing, employees charged and their representatives must be given a full opportunity to present their case and to cross-examine any witnesses called in support of the charge. They must also have reasonable access to documents and objects relevant to the charge.

The absence of the person charged and/or the representative at the hearing shall not invalidate the proceedings, if good cause can be shown for not attending.

At the conclusion of the hearing the chairperson shall make a finding of guilty or not guilty. In the event of a staff member being found guilty, the chairperson must ask both the employee or the representative and the management to make submissions on the appropriate disciplinary action. The chairperson will then decide what disciplinary action should be taken. The employee must be informed of this decision in writing within seven days.


Employees may be dismissed with notice, in terms of the notice periods prescribed in their conditions of employment, or they may be summarily dismissed (i.e., dismissed with no notice). Employees who are dismissed must be informed of their right to appeal, or to refer the dispute within 30 days of the date on which they were dismissed.

The parties may include in their disciplinary provisions that if the employee is not happy with the outcome of the disciplinary inquiry, the dispute can be referred to arbitration for a final and binding decision. Alternatively, appeals must be noted in writing within five days of the decision. The appropriate management may decide to hear further evidence or allow further submissions to be made. They will then confirm, vary or uphold any appeal. If the dismissal is confirmed, the date of dismissal shall be that date on which the original decision to dismiss was given.

[edit] Appeal

An appeal may be lodged in writing with the employer within seven days of receipt of notice of intended disciplinary action. The employee must forward reasons why an appeal is sought. Once the appeal has been considered and granted, it must be heard within seven days from the day the request was made.

Further action If the employee is not happy with the employer's decision he or she may refer the matter to the Bargaining Council or to the Commission for Conciliation, Mediation and Arbitration (CCMA) in terms of the Labour Relations Act, 66 of 1995.

If a private arbitrator is decided on, the parties will also have to agree about the payment of costs.

[edit] Remedies for unfair dismissals

The onus is on the employer to prove that the dismissal is fair. If the dismissal is unfair, the Labour Court or arbitrator may re-instate or re-employ the employee in other suitable work from the date of dismissal unless any of the following apply:

  • the employee does not wish to be re-employed or reinstated;
  • the circumstances surrounding the dismissal are such that a continued employment relationship would be intolerable;
  • it is not practical or reasonable for the employer to re-instate or re-employ the employee;
  • the dismissal is only unfair because the employer did not follow a fair procedure.

If a dismissal is automatically unfair, or if a dismissal based on the employer's operational requirements is found to be unfair, the Labour Court may also make any another appropriate order

[edit] Compensation

If a dismissal is unfair because the employer did not follow fair procedure, compensation must be equal to the remuneration that the employee would have been paid between the date of dismissal and the last day of the hearing of the arbitration or adjudication. This compensation should be calculated at the employee's rate of remuneration on the date of dismissal.

However, if the employee caused unreasonable delay in initiating the claim, compensation is not payable for that period of delay.

If the dismissal is automatically unfair, the compensation must be just and equitable. However, it should not be more than 24 months’ remuneration calculated at the employee's rate of remuneration on the date of dismissal.

If the dismissal is unfair because the employer did not prove that the reason for dismissal was fair and relating to the employee's conduct, capacity or the employer's operational requirements, compensation must be just and equitable, i.e., not less than the remuneration that employee would have been paid from the date of dismissal until the last day of the hearing (calculated at the employer’s rate of remuneration on the date of dismissal) and not more than 12 months’ remuneration calculated at the employee's rate of remuneration on the date of dismissal.

An award of compensation is in addition to, and not a substitute for, any other amount that the employee is entitled to in terms of any law, collective agreement or contract of employment.

[edit] Transfer of contract of employment

Transfer of a contract of employment is discussed in Section 197 of the Labour Relations Act. Contracts of employment may not be transferred to another employer without the worker's consent, unless:

  • The whole or part of a business, trade or undertaking is transferred by the old employer as a going concern (i.e., a business that is making a profit)
  • The whole or part of a business, trade or undertaking is transferred as a going concern while being wound up, sequestrated, or insolvent • The whole or part of a business, trade or undertaking is transferred as a scheme, arrangement or compromise to avoid winding-up, sequestration or insolvency Unless otherwise agreed, the rights and obligations between the old employer and each employee at the time of the transfer continue in force. Anything done before the transfer by the old employer remains valid for each employee. Transfers do not affect the continuity or conditions of employment.

[edit] Referring Disputes

Any party may refer a dispute in writing within 30 days of the date of the dismissal to a council (includes a bargaining council, and a statutory council formed in terms of Chapter 3 of the Labour Relations Act) if the parties fall within the registered scope of that council. If no council has jurisdiction, the dispute may be referred to the Commission for Conciliation and Mediation (CCMA).

The party who refers the dispute must satisfy the council or the CCMA that a copy of the referral has been served on all the other parties involved. The council or the CCMA will then try to resolve the dispute through conciliation.

If the dispute remains unresolved, or if 30 days has expired since the referral and the dispute remains unresolved, the council or the CCMA must arbitrate the dispute at the request of the employee if:

  • The employee has alleged the reason for dismissal is related to the employee's conduct or capacity
  • The employer made continued employment intolerable
  • The employee does not know the reason for dismissal

An award (decision or outcome) is usually made within 14 days of referral to arbitration. The time limits are designed to ensure that disputes are dealt with as swiftly as possible. The employee may refer the dispute to the Labour Court for adjudication if he or she has alleged that the reason for dismissal is:

  • Automatically unfair
  • Based on the employer's operational requirements
  • The employee's participation in a strike

At the request of any party, the Director of the CCMA must refer the dispute to the Labour Court, if he or she considers it to be appropriate.

Parties may object referral to the Labour Court within five days of receipt of the application, together with the grounds for objection.

The Labour Court has the power to order reinstatement or compensation, but their power is not limited to this.

The arbitrator has the power to determine any dispute referred to it on reasonable terms.

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