Employment law update

July 22nd, 2016
Monique Jefferson BA (Wits) LLB (Rhodes) is an attorney at Bowman Gilfillan in Johannesburg.

Monique Jefferson BA (Wits) LLB (Rhodes) is an attorney at Bowman Gilfillan in Johannesburg.

Automatic termination clauses in employment contracts

In National Union of Mineworkers obo Milisa and Others v WBHO Construction (Pty) Ltd [2016] 6 BLLR 642 (LC), the applicant employees were employed in terms of fixed term contracts of employment that provided that the duration of the contract was ‘the skills requirement of the project’. Prior to the completion of the project, the applicant employees were given letters of termination on the basis that their skills were no longer required. The employees argued that their dismissal amounted to an unlawful premature repudiation of the fixed term contracts as the project had not yet been completed. They also alleged that they had been unfairly dismissed and that the employer could not contract out of the unfair dismissal provisions contained in the Labour Relations Act 66 of 1995 (LRA). The employer on the other hand argued that the fixed term contracts had terminated by the effluxion of time as the applicants’ skills were no longer required for the project.

The Labour Court (LC) held that the automatic termination provisions in the fixed term contracts were in contravention of the LRA in terms of which employers may not terminate employees’ services at will. Furthermore, in terms of the fixed term contract the employer had an unfettered discretion to determine when the applicants’ skills were no longer required and there was no evidence led as to how the employer reached this decision. It was held that the employees had been dismissed for operational requirements and thus should have been consulted with in accordance with the LRA. The dismissals were accordingly substantively and procedurally unfair and compensation equal to three months’ wages was granted. In deciding that three months’ remuneration was fair and equitable in the circumstances, Lallie J considered the fact that the applicants had only been in the employ of the employer for about a year and were aware from the outset that their employment was not permanent.

Difference in pay based on geographical location

In Duma v Minister of Correctional Services and Others [2016] 6 BLLR 601 (LC) the LC was required to consider whether Ms Duma was unfairly discriminated against on an arbitrary ground as she was paid less than her colleagues who occupied similar positions but were located in a different province. She accordingly alleged that she was discriminated against on the basis of geographical location.

In defence, the employer did not attempt to justify the pay difference but instead argued that Ms Duma’s claim had prescribed as she had become aware of the pay difference since 2007. Ms Duma argued that the claim had not prescribed as the alleged discrimination was ongoing in that the difference in pay occurred from 2007 to date. The LC found that unfair discrimination claims under the Employment Equity Act 55 of 1998 do in fact prescribe and thus Ms Duma’s claim was limited to the three year period that immediately preceded her referral of the claim.

Given the fact that the employer just made a bald denial of the allegations and did not try and justify the difference in pay, Rabkin-Naicker J held that the discrimination based on geographical location was arbitrary and unfair. The employer was accordingly ordered to pay the employee the difference between the salary that she earned and the salary of those employees in similar positions in a different geographical area from August 2009 to the date of the order, as well as to adjust the employee’s salary upwards going forward. Importantly, this claim arose prior to the equal pay for work of equal value provisions being included in the Employment Equity Act.

Dismissal for racism

In the case of City of Cape Town v Freddie and Others [2016] 6 BLLR 568 (LAC), there was an altercation between the respondent employee and his manager following a meeting in which the employee had been provided with guidance on how to fill in reports to account for his time. The employee threatened the manager saying that he would deal with him. He then bombarded the manager with e-mails accusing him of incompetency and copying certain other employees in the e-mails. The employee continued sending various e-mails culminating in an e-mail in which he accused his manager of being racist and being ‘worse than Verwoerd’. After the receipt of this e-mail the manager felt that he could not work with the employee anymore and that the working relationship had been damaged beyond repair. The employee was then charged and dismissed for gross insubordination in that in various e-mail communications and as well as in a one-on-one situation he had acted insolent, provocative, aggressive and intimidatory towards his manager. He was also found guilty of sending a derogatory, insolent, racist, provocative and offensive e-mail in which he compared his manager to Verwoerd.

The employee referred a dispute to the bargaining council alleging that he was unfairly dismissed. The bargaining council was required to consider whether the sanction of dismissal was too harsh in the circumstances and thus whether the dismissal was substantively fair. The employee conceded that the e-mail was wrong but he did not think that the working relationship was damaged beyond repair. The arbitrator found that there was no evidence to support the allegations of racism towards the employee’s manager and these views seemed to be the subjective perception of the employee. Nevertheless, the arbitrator found that dismissal was too harsh in the circumstances given the employee’s length of service and his remorse. Reinstatement was consequently ordered. The arbitrator also noted that there had been no attempt to try reconcile the relationship and thus it could not be said that the working relationship was irretrievably broken down.

The employer took the award on review to the LC where it was argued that the arbitrator made a decision, which no reasonable decision maker could make especially given the fact that the evidence that the employment relationship had irretrievably broken down was largely disregarded. The LC placed emphasis on mitigating factors such as length of service, remorse, the fact that the employee could be accommodated elsewhere in the organisation and that he had already served three months’ suspension for sending the e-mail.

The LC concluded that the arbitrator reached a decision that a reasonable decision maker could make. The LC, however, found that the employee was not entitled to backpay given the fact that the misconduct was serious. Furthermore, the order of reinstatement was made subject to a final written warning valid for 12 months with effect from the date on which he resumed his duties.

On appeal, the LAC held that referring to someone as worse than Verwoerd was an unacceptable racist slur, which is serious as it constitutes hate speech and is prohibited under the Constitution. The LAC found that given the serious nature of racism it generally warrants dismissal and thus this was a factor that generally outweighed any mitigating factors such as length of service. The LAC was also of the view that the employee had not shown genuine remorse as he had continued to write offensive e-mails about the manager after the dismissal. This said, even if there had been genuine remorse on the part of an employee it would not necessarily be enough to save an employee form dismissal where there had been serious misconduct.

It was held that the decision of the arbitrator was not a decision that a reasonable decision maker could make in light of the evidence. The award was therefore set aside and substituted with an order that the dismissal was substantively fair.



Moksha Naidoo BA (Wits) LLB (UKZN) is an advocate at the Johannesburg Bar.

Moksha Naidoo BA (Wits) LLB (UKZN) is an advocate at the Johannesburg Bar.

Ability of the Labour Court to use the rules of the High Court

South African Post Office SOC Ltd v CCMA and Others (unreported case no J254/16, 27-5-2016) (Lagrange J).

On the strength of an arbitration award in its favour, the Communication Workers Union (acting on behalf of 35 of its members) obtained a writ of execution against the South African Post Office (SAPO).

SAPO approached the Labour Court on an urgent basis seeking to stay the writ pending the finalisation of an application to review and set aside the arbitration award.

The matter was enrolled for hearing on 11 May 2016. On that particular day SAPO had two matters set down for hearing in two different court rooms.

While waiting in one court room the union’s representative was informed by his client that Prinsloo J had delivered a final order in SAPO’s favour in another court room. It was only then that the union’s representative realised he was sitting in the wrong court room.

The union thereafter made an application in terms of r 8(10) of the Labour Court Rules.

Rule 8(10) reads:

‘Unless otherwise ordered a respondent may anticipate the return date of an interim interdict on not less than 48 hours’ notice to the applicant and the registrar.’

However, when the application was argued before Lagrange J the union formulated its argument around r 6(12)(c) of the Uniform Rules of the High Court, which reads:

‘A person against whom an order was granted in his absence in an urgent application may by notice set down the matter for reconsideration of the order.’

The court firstly considered whether, in the absence of a provision in the Labour Court Rules, which makes for the same or similar provision as r 6(12)(c) of the Uniform Rules of Court, there was any reason why r 6(12)(c) should not be adopted into the Labour Court Rules.

Acting in accordance with r 11(3) of the Labour Court Rules, which allows the court to adopt any procedure it deems appropriate when addressing a situation not contemplated for in the rules, the court held the following:

‘There is no equivalent of the High Court rule 6(12)(c) in Rule 8 of the Labour Court [R]ules dealing [with] urgent applications. Clearly, the High Court provision was designed to allow an expeditious rescission of an order granted on an urgent basis to avoid the party against whom it was made from having to bring a rescission application on notice of motion. No doubt, if there is no adequate explanation provided for the party’s absence at the original proceedings that will play a part in the deliberations of the court reconsidering the matter.

In any event, there is no reason why the Labour Court should not entertain applications to reconsider urgent orders on the basis provided for in the High Court rule.’

Having made this point the court turned to the application before it. The union’s notice of motion and supporting affidavit made no mention of bringing the matter back to court for reconsideration in terms of r 6(12). In fact the specific relief sought was to ‘anticipate the interim order’ of 11 May with the view of discharging it.

The legal hurdle for the union was that the order by Prinsloo J was final, which meant there was no return date to anticipate. In addition to this and from a reading of the union’s application, SAPO could not have been expected to argue whether the order should be reconsidered when the papers before it made no mention of such relief. The court held:

‘The purpose of a notice and a supporting affidavit is to set out the basis of the case the respondent party has to meet. When the notice is couched as the anticipation of a non-existent return day, then the application turns out to be a re-consideration of the matter, it is understandable the respondent party should be caught off guard. I am inclined to dismiss the application brought ostensibly under Rule 8(10) because the true legal nature of the application, which was a reconsideration of the matter under a different rule was not disclosed in the third respondent’s notice or founding affidavit. It is not simply a question of formality: the nature of an application for anticipation of a return date presupposes that the court made an interim order, whereas an application to reconsider the matter does not.’

The court dismissed the union’s application with costs. In doing so and without assessing the substantive merits of the union’s argument, the court did, however, find there was nothing preventing the union from bringing an application in terms of r 6(12)(c) to have the final order reconsidered.

These articles were first published in De Rebus in 2016 (Aug) DR 48.