Legal prejudice and the CCMA

by Ivan Israelstam | Apr 20, 2020 | Jobs

BY Ivan Israelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on 011 888 7944 or 082 852 2973 or via e-mail address: [email protected].

The word ‘prejudice’ has a number of different meanings. Any employer needs to understand these meanings in the context of labour law because all South African employers are bound by very strict and numerous labour laws.

The first meaning of prejudice refers to an opinion formed before the receipt of the relevant facts. It appears that the word ‘prejudice’ has the same root as the word ‘prejudge’. Therefore, the chairperson of a disciplinary hearing or an arbitrator could be described as prejudiced if he/she makes a finding that is based less on the facts of the case than on their opinions of feelings towards the parties in the case. For example, the disciplinary hearing chairperson might find a driver guilty of damaging the company vehicle because the driver had once been rude to the chairperson. The chairperson therefore has a personal reason for disliking the driver. He/she might therefore make up his/her mind that the employee is guilty even before the hearing gets underway. This could result in a dismissal despite the fact that the complainant brings no proof at all of the driver’s guilt. Such prejudice or bias would be grounds for the employee to take the employer to CCMA.

It could also occur, for example, that an arbitrator might prejudge a case based on who the parties are even before hearing the evidence. That is, the arbitrator might decide right at the outset to find in favour of the employee because they are both of the same race or gender despite the fact that the employer then brought much stronger proof of its case. Should this occur the employer would have the right to take the arbitrator to Labour Court on review on the grounds of prejudice. The second meaning of ‘prejudice’ is related to the first one. It occurs at the workplace when, for example, an employer dislikes people of a certain race. This could result in mistreatment of employees who are members of that race and could lead to a CCMA case. The third meaning is used in the phrase ‘without prejudice’ and, where it appears in a letter, means that the writer is reserving his/her legal rights despite the content of the letter.

The fourth meaning of ‘prejudice’ means detriment. That is, if a party to a CCMA matter argues that it could suffer prejudice this means that the party believes it could suffer detriment or loss or be negatively affected in some way. For example, an employee who has referred a case late to the CCMA may argue that, despite his/her lateness, the CCMA should hear the case because failure to do so would result in prejudice to the employee. That is, the employee could argue that he/she would lose his/her opportunity for justice if the case is dismissed. Another example of this fourth meaning of ‘prejudice’ came up in the case of Dell vs Seton 2009, 2 BLLR 122). In that case the employer failed to keep to its own disciplinary code when dismissing an employee. However, the Labour Court found that the procedure that was followed, despite deviating from the disciplinary code, was not unfair and that the deviation did not result in any prejudice to the employee.

This meant that the deviation form the code did not, in itself, result in any detriment to or negative effect on the employee. The Court therefore upheld the fairness of the dismissal. In the case of Slabbert vs Ikhwezi Truck Tech (Pty) Ltd (2008, 1 BALR 75) two different meanings of the concept of ‘prejudice’ came up. The company’s managing director was fired for allegedly taking a bribe. The dismissed employee claimed:

• that the chairperson of the disciplinary hearing was prejudiced because he had wanted the employee’s position of MD and dismissed him in order to clear the way for his own move into the post of MD. In this sense the word ‘prejudiced was used to mean bias; and
• that the chairperson’s refusal to allow him a legal representative at the hearing prejudiced his chances of a fair hearing. In this sense the word ‘prejudiced was used to mean negatively affected.

In this case the arbitrator did not accept either of the employees arguments and upheld the dismissal. That is, the arbitrator found that:

• the chairperson had not been prejudiced (biased) because of wanting the the MD’s position for himself; and
• the refusal to allow the employee a legal representative at the hearing did not prejudice (negatively effect) his chances of a fair hearing.

Employers should be sure that they not only understand the different meanings of the concept of ‘prejudice’ but also train their management to avoid infringing the law in respect of these concepts. This requires intensive training of managers in the chairing of disciplinary hearings, handling of CCMA cases and the management of employees.

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Buckshot dismissals are risky

by Ivan Israelstam | Apr 14, 2020 | Jobs

If you can’t pinpoint the culprits be careful of firing the lot!

BY Ivan Israelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on 011 888 7944 or 082 852 2973 or on e-mail address: [email protected].

Employers frequently know for certain that serious misconduct has occurred but are unable to prove which employee or employees are responsible. This can occur in a variety of circumstances. For example:

• Stock may go missing from a warehouse or retail store where any of a number of employees had access to the stock and opportunity to remove it
• Damage may have been caused to business machinery in a workshop used by numerous employees
• Confidential information may have been leaked
• There may be cash shortages in tills or other cash storage points
• Computers or other equipment may have gone missing
• Production or other materials may have been wasted or unnecessarily discarded.

Employers are often tempted in such cases to discipline everyone who could possibly have been involved in such misconduct. This buckshot approach by employers may be motivated by a number of factors including the thinking that:

• if we fire the lot we will be sure to get rid of the culprit
• everyone was probably involved
• even if many of the employees were not directly responsible they probably knew about the misconduct and failed to report it to management
• some case law has given the impression that such group dismissals may be justified. This impression has been given by two important cases; those involving Snip Trading and Score Supermarkets.

In the case of NUSFRAW obo Gomez & others vs Score Supermarkets (2003, 8 BALR 925) a group of managers were dismissed as a result of stock losses amounting to six million rand. While there was no proof that these managers had stolen the missing stock they were held responsible for the losses and disputed their dismissals at the CCMA. The arbitrator found that the markedly poor management of the business by the dismissed employees (and others) had led to the losses and that this justified the dismissal.

Again in the case of FEDCRAW vs Snip Trading (Pty) Ltd the arbitrator ruled in favour of group dismissals. Here, the employer had a policy which held every employee responsible for stock losses. When stock disappeared several employees were fired despite the fact that the employer had not specifically proved that any one of these employees were guilty of the stock losses. The arbitrator found that the concept of group responsibility was fair under the circumstances as the employer’s interests had to be taken into account.

The outcomes of these two cases have misled a number of employers into believing that group dismissals are fair. However, this will not always be the case. It will depend on the extent to which the employees specifically have responsibility for prevention of losses and have the means of preventing losses. It will also depend on the viewpoint of each individual arbitrator. In the case of FEDCRAW obo Mthimunye vs Rewmoor Investments 543 (Pty) Ltd (2008, 2 BALR 142) the entire staff working the retail store were dismissed after the employer suffered serious stock losses. The CCMA found that:

• The notion of collective guilt was repugnant
• Despite the existence of a clause in each employee’s contract to the effect that prevention of stock losses formed part of their conditions of employment, the employer had failed to prove that the dismissed employees were responsible for the stock losses.

As a result all the employees were reinstated with full back pay. The apparent lack of consistency in case law and the powerful laws protecting employees from unfair dismissal sound a strong warning to employers not to act against employees before they fully understand their legal rights. The correct actions of the employer will differ from case to case depending on a number of legal subtleties and interpretations.

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CON-ARB at CCMA has pros and cons

by Ivan Israelstam | Apr 7, 2020 | Jobs

BY Ivan Israelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on 011 888 7944 or 082 852 2973 or on e-mail address: [email protected].

When employers and employees receive notices to attend at the CCMA they need to look very carefully to see what type of process has been set down. No party wants to arrive at CCMA thinking that they will only be facing only a mediation process and then find that the court case (arbitration hearing) occurs on the same day.

The CCMA is constantly overloaded with cases hearing in excess of 190 000 cases a year. This can result in backlogs and delays in resolution of disputes. As a consequence the Labour Relations Act (LRA) as amended provides for a speedier dispute resolution process called con-arb which stands for conciliation-arbitration. This hybrid process is most frequently used and the old system of conciliation now and arbitration later is seldom applied in the normal course of events.

Regardless of whether the old or the new system is applied the process always begins with conciliation. This is a peace-making process whereby a CCMA or bargaining council (BC) mediator tries to assist the employer and employee to reach an out-of-court agreement. It is an exercise that is intended to end in a settlement agreement . The commissioner has no authority to make an award (judgement).

On the other hand Arbitration is a judicial-type process that usually occurs if a conciliated settlement is not achieved. That is, it is Step 2 in the process if Step 1 (conciliation) fails to resolve the matter. At arbitration the employer and employee do not negotiate an agreement. Instead, they bring and present evidence as in any court case. Then the arbitrator, after hearing all the evidence, makes a finding as to which party was in the wrong.

Con-arb is when, instead of scheduling the arbitration for a later date, it is held on the same day, the very MINUTE that conciliation fails! The employee is not required to apply for arbitration; it occurs automatically the very moment the conciliator declares that conciliation has failed. Thus, the parties have no time after the conciliation meeting to prepare their evidence and arguments for the arbitration! Con-arb is not compulsory for all types of dispute. It is compulsory when the dispute concerns:

• The dismissal of an employee for any reason relating to probation
• Any unfair labour practice relating to probation.

In addition, if neither party objects to con-arb then con-arb is likely to take place even if probation is not involved, provided that the dispute concerns:

• A non-strike dismissal for conduct or capacity
• Constructive dismissal
• The employer’s failure to substantially preserve the employment conditions of employees when transferring them in terms of section 197 of the LRA
• An employee who does not know the reason for the dismissal
• An unfair labour practice.

Therefore, on receiving any con-arb notice a party who does not want con-arb must lodge a formal objection at least 7 days in advance of the set hearing date. However, such an objection will not be valid if the dispute concerns an unfair dismissal relating to probation or an unfair labour practice relating to probation. It is essential for employers and employees who receive con-arb notices to:

• Realise straight away that it is a con-arb that has been scheduled
• Understand what con-arb means for them in practice
• Begin immediately with preparations for the con-arb.

This is particularly so because the parties seldom get more than 14 days advance notice of a con-arb. The parties need to enter into intensive preparations the moment they receive a con-arb notification because 14 days is very little for purposes of preparation. Included in these preparations should be:

• The preparation of the witnesses of truthful, relevant and accurate testimonies
• Collecting and preparing documentary and other evidence
• Responses to anticipated evidence that the opposing party could bring
• Preparation of case arguments and case law.

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Panic is close second to the Corona curse

by Ivan Israelstam | Mar 30, 2020 | Jobs

BY Ivan Israelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on 011 888 7944 or 0828 522 973 or on e-mail address: [email protected].

It is understandable that business owners feel panicky because of the toll Corona is taking on business income. However, many businesses realise that if they implement wholesale retrenchments they will not only lose valuable skills but will also reduce the buying power of the public. This would then further reduce the business’s ability to earn an income.

Many businesses with stressed finances are therefore seeking, in consultation with employees, ways of avoiding retrenchment. These include, amongst possible others, the working of short time, pay cuts and temporary layoffs. These employers are also finding out about the Department of Labour’s Corona Disaster assistance schemes.

While the operation of these schemes is still unclear it appears that employer’s that temporarily lay employee’s off without any pay can apply to the Department of Labour’s for TERS benefits through which employees may qualify for state payments of up to R17000 per month for a maximum of three months. the Department of Labour’s COVID 19 TERS EASY AID guide states that employers may email their TERS benefit applications to [email protected]. together with the following documents:

• Letter of Authority, on an official company letterhead granting permission to an individual specified to lodge a claim on behalf of the company
• MOA (completion of the agreement between the state and the employer)
• Prescribed template that will require critical information from the employer Evidence/payroll as proof of last three months employee(s) salary(ies)
• Confirmation of bank account details in the form of certified latest bank statement.

Employers that need information regarding available funding can enquire via the following email address: [email protected]. or phone 012 337 1997. It appears that the new TERS benefit is confined to cases where employees are not been paid at all over a specific period.

The Department of Labour’s guide states that it will also assist through other UIF benefit schemes that already exist including Illness and Reduced Work Time benefits. Where employers are successfully able to assist employees with obtaining these benefits this could go a long way to alleviating their financial hardships and keeping the business going.

This is a most important alternative to business liquidations and or retrenchments. Employers are warned that, where retrenchments are truly unavoidable, these must be implemented according to the requirements of section 189 of the LRA. However, the panic attached to Covid 19 has a high potential to result in hasty and legally non-compliant retrenchments. At Labour Court the employer has the duty of proving that:

• There was a genuine and valid reason for retrenching
• The employees chosen for retrenchment were fairly chosen
• The retrenchment procedure as laid down in the LRA has been followed properly and in good faith by the employer
• The employer has shared with the targeted employees (or their representatives) all documentary and other information pertinent to the retrenchment.

In the case of NUMSA and others vs Dorbyl Ltd and another (2004, 9 BLLR 914) the plant at which the 122 applicant employees worked was closed down and they were retrenched. The Court found that the decision to retrench was taken before the employer consulted with the employees regarding the retrenchments. The employer was required to pay each of the 122 retrenchees two months’ remuneration in compensation.

As I have repeatedly warned employers, the courts see retrenchments as no-fault terminations. This means that the employee is losing his/her job through no fault of his/her own. In addition, the unemployment rate in South Africa is extremely high and Corona will ensure that it will be close to impossible for many retrenchees to find new jobs. For these reason the courts have no hesitation in protecting the rights of retrenchees and making employers pay heavily where they deviate from the law.

Thus, while Corona is currently the employer’s primary enemy, panic comes a close second. To book for our 5 April Johannesburg seminar on CHANGES AND DANGERS IN LABOUR LAW please contact Ronni via 084 521 7492 or [email protected].