This is an attempt to consolidate and summarise thoughts on the above topics and generate a general discussion.

PROCEDURE & NOTICE

As a general rule South African law requires a fair procedure prior to termination of employment.

The LRA has a statutory procedure when the reason is based on operational requirements (genuine economic, technological or structural needs) unrelated to the employee’s conduct or capacity.   It is unlawful to ignore that procedure.

In all other instances the Code of  Good Conduct: Dismissal in schedule 8 to the LRA applies and does allow for exceptional circumstances when it will not be unfair to provide the employee with a right to be heard.

The BCEA forbids employers from terminating on notice during any period of leave, such as sick leave but does not prevent employers from terminating the contract lawfully without notice during such a period.

Some employers are forced to terminate summarily during sick leave if they genuinely suspect the employee is exploiting and aiming to prevent the employer from conducting a proper investigation by allowing the employee a right to be heard.

The Labour Appeal Court has allowed an employer to offer the right to be heard before an independent neutral person after the employer decided to terminate the employment of a receptionist/secretary without affording her the prior opportunity to be heard.

SUBSTANCE

Termination of employment is governed by the common law, the BCEA and the LRA and a lawful, valid and fair reason to terminate employment is required.

Lawfulness is governed by the common law and the BCEA and validity and fairness by the LRA.

LAWFUL

Employers may only terminate employment without notice (or payment instead of notice) upon clear and convincing proof that the reason for termination was the employee’s material breach or repudiation of the contract (referred to in the BCEA as ‘a cause recognised by the law’).

Examples would include gross or serious misconduct, theft, wilful dishonesty, unlawful possession of property, unprovoked assault, gross insubordination.

Cautious and sensible employers should terminate on notice (pay or allow employee to work out the notice) unless they are completely satisfied that they will be able to convince a reasonable arbitrator that the employee materially breached the contract, warranting a summary termination (without notice).

VALID

The reason must be:

  • Related to conduct (employee’s behaviour – an element of intent).
  • Related to capacity (employee’s; lack of ability; ill health; injury).
  • Based on employer’s operational requirements, as defined.

Recently the Labour Appeal Court correctly noted that the decision to terminate is part of risk management and operational requirements in the broad sense.

FAIR

Logically the reason can be a combination of all three but it is really the consequences, or effect on the employment relationship, of the conduct or capacity that are important.

Did the conduct genuinely destroy or seriously damage the employer’s trust in the employee?

Did the performance genuinely destroy or seriously damage the employer’s confidence in the employee’s ability to do the job?

REVIEWING AWARDS

The Labour Court should only review and set aside an award:

  • Made by the improper exercise of discretion (discretion).
  • Made unjustifiably (process).
  • That could not have been made by a reasonable arbitrator (outcome).

Commissioner’s must exercise their discretion:

  • Rationally.
  • Without misdirection or irregularity.
  • Without being capricious.
  • By applying the correct legal principles.
  • In good faith.
  • Fairly in respect of the parties.

The arbitration process involves justification rather than correctness.   The following findings are likely to be reviewed and set aside:

  • Unreasonable for lack of any supporting evidence.
  • Speculative.
  • Entirely disconnected from the evidence adduced.
  • Supported by evidence insufficiently reasonable to justify the finding.
  • Made in ignorance of contradicted evidence.

The case law clearly states that the outcome is not about what a reasonable employer could have decided, assuming

  • The discretion properly exercised.
  • The process was justifiable.

Any comments or thoughts will be welcome.