This treatise will therefore critically discuss fairness requirements in dismissal law within the context of the education sector from: i) the perspective of a dismissed employee; and ii) the perspective of an employer who wishes to dismiss employees fairly; and iii) the perspective of a deemed dismissal. It will be proper to flow this discussion from the premises of what should be considered procedural and substantive fairness in dismissals.

The LRA 66 of 1995 was established to give effect to section 23(1) of the Constitution of the Republic of South Africa, which guarantees that everyone has a right to fair labour practices. Amongst others, the purpose of the LRA is to advance economic development, labour peace and the effective resolution of labour disputes. At common law termination of employment was occasioned by the conduct of the employer or employee, in terms of which either party may terminate an employment contract by giving agreed notice or reasonable notice. The LRA broadened the common law concept of “repudiation” of a contract of employment in terms of which section 186 of the LRA now defines the term “dismissal” to mean various possible instances that can be caused by the employer or employee. Furthermore, section 185 of the same Act clearly states that a dismissal can be found to be unfair and makes provision for redress to an employee who would be aggrieved by a dismissal. Compensation is one of the remedies that can be awarded to an employee who is found to have been unfairly dismissed. Unlike the LRA of 1956 which gave the courts an unfettered discretion regarding the compensation that could be awarded, section 194 of the current LRA places a limit on the compensation amount that can be awarded. A decision hereon is determined with reference to whether the dismissal is found to have been procedurally, substantively unfair or both. The Act further requires that the compensation must be just and equitable. A challenge in applying section 194 of the Act in this regard is that there would be vast inconsistencies in terms of the amount of compensation to be awarded and that certain presiding officers could consider different approaches in considering factors to be determined when deciding on compensation. In many other instances compensation for unfair dismissal would be decided around the idea of solely punishing the employer. This research document is mainly concerned with identifying the said challenges through case law by considering the decisions of the commissioners and judges in interpreting the old and current provisions of section 194 of the Act. The old section 194 of the Act created a formula to be followed by presiding officers when making a determination on the compensation awarded. The interpretation of the section and its formula brought with it its own complications. The amended section 194 on the other hand, conferred a discretion on presiding officers to award compensation within the caps of 12 months and 24 months for procedurally and substantively unfair dismissal respectively, for as long as the compensation would be just and equitable in all circumstances. Relevant case law and the opinions of labour law experts have been of great assistance in interpreting the current section 194. The factors do not constitute an exhaustive list. They are a mere guideline to presiding officers so as to eliminate or minimize inconsistencies in awarding compensation.

In a globally competitive market place companies strive to become as efficient as possible. Absenteeism is a worldwide problem as it impacts on company efficiency and cost effectiveness. A large portion of absenteeism can be attributed to ill health absences. Companies have prioritized the need to find ways of managing and reducing absenteeism. In South Africa such processes have to occur within the confines of a constitutional right to fair labour practices and other prescriptive labour legislation. The issue is somewhat complicated by the fact that employees have a right to paid time off due to illness. It is thus clear that not all ill health absenteeism can be deemed problematic. A balancing act needs to occur between the operational needs of the employer and the rights of employees. Ill health absenteeism becomes problematic once a threshold is reached at which point it becomes intolerable for the employer, thus deemed excessive. Excessive ill health absenteeism is not a difficult concept to understand, however it is not specifically defined. A universal concept of when absence is deemed to have reached the threshold of excessiveness does not exist and varies from one employer to the next. Excessive ill health absence is a multi-facetted concept (as a result of the various types of ill health absence) and thus a universal process cannot be adopted to deal with all types of excessive ill health absenteeism. In an attempt to deal with the different types of ill health absenteeism it is pertinent to categorize the issues. The author suggests various ways of dealing with ill health absenteeism, depending on the facts of each case. A misconduct process should only be applicable in instances where it can be proved that sick leave is used inappropriately or the reason for absence is unknown. Although case law suggests the prevalence of dealing with ill health absence as misconduct, especially in the case of persistent short term absence, these cases rarely prove that abuse is taking place. Suspicions regarding abuse without proper evidence to support such claims will not satisfy the substantive fairness requirements. In the event that illness is of a medium to long term nature, an ill health incapacity process may be the most appropriate process to apply, as in such instances a clearly distinguishable illness exists, which makes accommodation less problematic. Such a process is less suited to persistent short term absence as this can be the result of many illnesses or injuries. In the case of persistent short term absence, the individual may be fully capable of performing their duties upon returning to work, however their frequent absence causes unreliability and inefficiency. It is clear in this instance that accommodation cannot take place due to the unpredictable nature of the absences. The concern with persistent short term absence is less with the illness or illnesses displayed and more with the absences itself. The author suggests that it may be appropriate to deal with such absences on the basis of incapacity due to poor work performance. This assertion is based on the fact that the concern is with frequent short term absence that causes the employee to be unreliable; however the illnesses are not of such a nature that it can warrant accommodation. If it is accepted that the employee is not malingering or if the malingering cannot be proved the employee has failed to meet a performance standard (attendance standard). It is suggested that as part of any incapacity investigation consideration should be given to whether the illness or injury can be deemed a disability. This is necessary as disabled individuals are afforded special protection and treatment. A dismissal of an incapacitated individual that is actually deemed “disabled” could be held to be automatically unfair and therefore it is pertinent that this is established at the outset.

This treatise sets out and evaluates recent developments in the area of large-scale retrenchments in South Africa. Dismissals are considered to be a source of great controversy, but more so large scale retrenchments. It was with this in mind that the various role players sought an amendment in 2002 so as to address the concerns by both employers and employees. The applicable legislation, namely section 189A of the Labour Relations Act 66 of 1995, was enacted to ensure the smooth operation of this genre of retrenchments. In this treatise, section 189A will be evaluated. Section 189A stipulates what procedure should be utilized, for dismissals necessitated by operational requirements. The inclusion of this provision was an attempt to address the concerns of both employers and employees. Chapter 1 provides us with an overview with regard to why change with regard to retrenchment legislation was necessary. In Chapter 2 the definition of operational requirements will be unpacked as well as what definition the courts have attached to the term "operational requirements‟, and more importantly the issue relating to substantive fairness. Chapter 3 examines when the applicable provision is triggered, whether or not an employer can stagger retrenchments, the facilitation process, and the regulations pertaining to facilitations. The facilitation process itself and the consultation aspect of the facilitation process are recounted. The meaning of „consultation‟ is evaluated, and it should be noted that section 189 and section 189A are interrelated when topics of consultation are considered. Chapter 4 addresses the instance when no facilitator is appointed and the mechanisms of section 189A(7) and (8); further discussions relating to subsection 13, and 19 will furthermore be evaluated with reference to case law. Chapter 5 sets out the various viewpoints on whether or not section 189A has been successful, and the chapter questions the effectiveness of the provision to provide a realistic view of large-scale retrenchments and whether the enactment thereof was an effective mechanism protecting the rights of employees faced with possible unemployment. The implementation of the training lay off system will be looked at and the statistics of the CCMA will be used as a measure to determine the effectiveness of section 189A. Chapter 6 concludes the thesis, by highlighting lessons learnt from case law for both employees and employers.

It is the right of every employee in South Africa not to be unfairly dismissed. According to the Labour Relations Act 66 of 1995 an employer may fairly dismiss an employee on the grounds of conduct, capacity or operational requirements. In addition, the employer is required to also comply with a fair procedure before effecting a dismissal. The requirement of procedural fairness is, however, not as stringent as it was under the previous dispensation established by the former Industrial Courts in terms of the earlier Labour Relations Act. The question as to whether or not a reason for dismissal is fair, is to be established by the facts of each individual case, and the suitability of dismissal as an appropriate remedy. It remains a challenge to establish if dismissal would be an appropriate sanction in a particular case of misconduct. The test is whether the award is one that a reasonable decision-maker could arrive at taking into account the evidence to be considered. It is no longer the employer’s view that is dominant, but “[u]ltimately, the commissioner’s sense of fairness is what must prevail”. The notion of fairness however applies equally to employer an employee and it involves balancing the competing and, every so often, inconsistent, interests of the employer on the one side, and the employee on the other side. The relative weight afforded to the particular interests creates very specific challenges, but nonetheless depends essentially on the overall circumstances of each individual case. Whether dismissal for misconduct is for a fair reason would established by the facts of the case, coupled with the appropriateness of dismissal as a sanction. Dismissal as a penalty should be reserved for cases involving serious misconduct and repeated disciplinary infractions. A crucial question would be whether the misconduct is of such a serious nature that it goes to the core of the employment relationship and makes any possible continued employment relationship intolerable. Additionally, apart from aspects like the importance of the rule breached and the harm caused by the employee’s breach, certain considerations should also be accounted, like length of service disciplinary history, and the employee’s personal circumstances, as well as the particular circumstances surrounding the infringement. Dishonest conduct by an employee that destroys the goodwill, trust and confidence an employer holds towards an employee, would normally be deemed as a significant breach which may justify a sanction of dismissal. The test is whether or not the misconduct was of such serious nature that it would make a continued employment relationship intolerable; “whether or not respondent’s actions had the effect of rendering the continuation of the relationship of employer and employee intolerable”. It still remains for the employer to present evidence that a continued relationship would be intolerable and not to merely liken serious misconduct with such a finding. Relatively recent case law seems to suggest that employers are entitled to a strict attitude towards dishonesty as a ground for dismissal. The objective of the CCMA Guidelines on Misconduct Arbitrations, effective from 1 January 2012, is to ensure that arbitrators issue consistent awards on dismissals involving misconduct. The questions that the guidelines seek to address are, inter alia, (i) how an arbitrator should conduct the proceedings; (ii) the valuation of evidence for the purpose of making an award; (iii) assessing the procedural fairness of a dismissal; (iv) assessing the substantive fairness of a dismissal; and (v) determining the remedy for an unfair dismissal. The Guidelines are peremptory in that arbitrators will have to take them into account and will have to provide an explanation if they deviate. It is undoubtedly a useful tool in guiding employers on what they need to present to commissioners at arbitration.

In terms of section 193 of the Labour Relations Act 66 of 1995, there are basically three remedies for unfair dismissal and unfair labour practice, namely reinstatement, re-employment and compensation. In disputes of unfair labour practice an arbitrator may determine a dispute on terms that the arbitrator deems reasonable, including the abovementioned three remedies. For example, in an unfair labour practice dispute relating to promotion or appointment, an arbitrator may order that the process of appointment be started afresh, if is found that the process was flawed. The right to fair labour practice is a right that is enjoyed by everyone and it is a right upon which every employee enjoys not to be unfairly dismissed is entrenched in section 23 of the Bill of Rights. The rights of every employee contained in the Labour Relations Act give content and effect to the right to fair labour practice contained in section 23 of the Bill of Rights. Every trade union, employer’s organisation and employer has a right to engage in collective bargaining, which includes but not limited to the formulation of disciplinary policies in the workplace, which should be observed by every employee. Our constitution mandates the Legislature to enact legislation that regulates collective bargaining. One of the purpose of our Labour Relations Act is to promote collective bargaining and the effective resolution of labour disputes. The remedies for unfair dismissal and unfair labour practice therefore give content and effect to the purpose of the Act, which is to promote effective resolution of labour disputes. The Legislature has given a legislative and policy framework, in terms of which the labour disputes may be resolved. In order to restrict the powers of the arbitrators and courts, section 193 of the Act provides that in ordering the reinstatement and re-employment of dismissed employee, they must exercise a discretion to order reinstatement re-employment, not earlier than the date of dismissal. The remedy of compensation is an alternative remedy, which must be ordered if the circumstances set out in section 193(2)(a) to (d) are applicable. Some arbitrators have made a mistake of treating this remedy as part of the primary remedies. However, our courts have clarified the intention of the Legislature in crafting the remedies for unfair dismissal.

Labour law in South Africa has evolved over the past century at an ever increasing pace. The establishment of a democratic government in 1995 has been the trigger for a large number of labour law statutes being promulgated, particularly with reference to the laws governing the employment relationship and dismissal. From very humble and employer biased dispute resolution application under the common law of contract, labour law in this country has evolved through the various acts culminating in a labour law system which is highly regulated and codified. Dismissal for medical incapacity in this treatise is reviewed with regard to the applicable statutes and the various codes of good practice as the law has evolved and developed from the period covered by the common law through that covered by the 1995 LRA up to and including the current period. Particular attention is paid to both substantive and procedural requirements as well as the remedies applicable under the different legal regimes and the pertinent tribunals and courts. Regard is also given to the duration and causes of incapacity and the effect this may have on the applicable remedy applied by these tribunals. It will become apparant that the medically incapacitated employee occupied a relatively weak and vulnerable position under the common law as opposed to the current position under the 1995 LRA. The influence of the remedies applied by the tribunals under the 1956 LRA are clearly evident in the current regulations and codes under the 1995 LRA which contain specific statutory provisions for employees not to be unfairly dismissed. Distinctions are drawn between permissible and impermissible dismissals, with medical incapacity falling under the former. Furthermore, a distinction is drawn statutorily between permanent and temporary illhealth/injury incapacity with detailed guidelines for substantive and procedural fairness requirements to be met by employers. The powers of the specialist tribunals (CCMA, Bargaining Councils and Labour Courts) are regulated by statutory provisions and deal with appropriate remedies (reinstatement and/or compensation) a wardable in appropriate circumstances. Certain specific areas nonetheless still remain problematic for these tribunals and hence questions that require clear direction from the drafters of our law are: How to distinguish misconduct in alcohol and drug abuse cases? What degree of intermittent absenteeism is required before dismissal would be warranted? In certain other areas the tribunals have been fairly consistent and prescriptive in their approach and remedies awarded. Included here would be permanent incapacity, HIV cases and misconduct. It will emerge, however, that under the 1995 LRA the position of employees and the protections afforded them have been greatly increased.

The highly competitive environment in which companies functions prompts the need to review their operations which may include reconsideration of the manning levels, and or changing terms and conditions of employment in order to be able to survive and prosper economically. The difficulty arises when the employers have to respond to the challenges. By law the employers are legally prohibited from unilaterally effecting the changes to the terms and conditions of employment. Furthermore, changing terms and conditions of employment is dealt with through collective bargaining and as such, the dismissal is outlawed as a legitimate instrument to coerce the employees to concede to the proposals. So the employers have to obtain an agreement or consent with the affected employees. In terms of the 1956 LRA the employer could justifiably terminate the contract of employment within the context of collective bargaining. For the employer to avoid offending the lock out provisions in terms of the 1956 LRA, the lock-out dismissal had to be effected in order to achieve a specific purpose, and it had to be conditional. Unlike its predecessor, the 1995 Labour Relations Act introduced section 187(1)(c) which renders the so-called lock-out dismissal by an employer, within the context of collective bargaining, automatically unfair. Section 187(1)(c) categorises a dismissal as automatically unfair, if the reason is a refusal by employees to accept a demand in respect of any matter of mutual interest between them and their employer. The employers are however permitted in terms of the 1995 LRA, to dismiss the employees based on operational grounds, as long as the requisite process has been adhered to. The employers need to restructure their operations in order to ensure that terms and conditions of employment are responsive to operational needs. Where the employees’ terms and conditions of employment are not in line with the company operational requirements, the need to terminate the employment contracts of the employees may arise. The employers are within their right to terminate the service of the employees who refuse to accept changes to their conditions of service based on the employers’ operational requirements. The court in Schoeman v Samsung Electronics confirmed that employer’s right to run its business in a successful manner, which includes affecting changes to the existing terms and conditions of employment to be aligned with the market demand. The dismissal is outlawed as a mechanism to coerce the employees to acceptance the employer’s demand relating to matters of mutual interest. At the same time, the employers are within their rights terminate the service of the employees who refuse to accept changes to their conditions of service based on the employers operational requirements. There is a clear tension between sections 187(1) (c), 188(1) (ii) and 189 of LRA. When the employers seek to review the terms and conditions of employment, the tension between these sections becomes more common, as it involves the matters of mutual interest which are dealt with through the collective bargaining arena and the dispute of right through arbitration. In Fry’s Metals v Numsa the court rejected the notion that there is tension between section 187(1) (c) and section 188(1) (a) (ii) of the LRA. Instead the court was of the view that, there is a historical context to section 187(1) (c) which is the now repealed 1956 Labour Relations Act. The 1956 LRA included in its definition of a lock-out the termination by the employer. Secondly, the court interpreted section 187(1)(C) to only give protection to employees who are dismissed in order to compel them to accept a demand on a matter of mutual interest, and only where the dismissal was of a temporary nature. The court interpretation in Fry’s metals implied that, section 187(1)(c) will only come to the defence of employees if they are dismissed for the purpose compelling them to accept a demand on a matter of mutual interest, and if the dismissal was of a temporary nature. Where a permanent dismissal is effected because employees would not accept its demands, section 187(1) (c) could not come to the employees’ protection. Considering that the lock out provided for in terms of the 1995 LRA is not a preferred option by most of the employers, they will rather resort to use the loophole created by the narrow interpretation of section 187(1)(c) to circumvent having to secure consensus from the affected employees and rather dismissed them based on operational requirements. This study seeks to deal with the questions relating to the relationship between collective bargaining related dismissals in particular the automatically unfair dismissal in terms of section 187(1) (c) and business restructuring related dismissal. As such the relationship between sections 187(1) (c) and dismissals based on operational requirements will be central to this study.

The small business sector has been identified as a target by government to reduce South Africa’s unemployment problem. There is existing research that most companies, including small business, avoid taking on new employees to avoid, perceived, stringent labour legislation. This research investigates whether small businesses adopt alternative employment strategies to labour as a means to avoiding labour legislation. The questionnaire was distributed to over 9000 small businesses in the metal and engineering manufacturing sectors. Of the 214 responses only 194 could be used. The results of the research point to a prevailing perception by those surveyed that labour legislation is stringent in South Africa and that small businesses, in their efforts to avoid compliance, chose to employ in the temporary and labour broker employment market. Mechanisation is also an option used by small business to avoid legislation. Legislation is, however, not always the only driver when businesses decide to mechanise. / Dissertation (MBA)--University of Pretoria, 2014. / pagibs2015 / Gordon Institute of Business Science (GIBS) / Unrestricted

71 Invalid and Apparent Termination of Employment by the Employer Abstract This diploma thesis deals with an everlasting issue: invalid and apparent termination of employment by the employer. The text of the thesis is divided into five chapters, further segmented into subchapters, some of these consisting of even lower level chapters. The first chapter covers the historical development of labor law and its separation from civil law into a separate branch of law with its own code. The following chapter defines the basic legal concepts, which are employment and legal transaction, as well as the invalidity and appearance of legal transactions. The second chapter also contains a reflection on the meaningfulness of the legal institute of appearance of a legal transaction. In the third chapter are analyzed specifics of the invalidity of legal transactions in labor law and the consequences of invalidity of the employment termination. The core of the diploma thesis is formed by the fourth and fifths chapters, containing a non- exhaustive list of reasons for invalidity and apparent termination of employment by the employer and a more detailed definition of these reasons, including a thorough analysis of some contentious issues. It was also necessary to cover the ineffective delivery of a document which leads to the...