Employment Contract Law PDF

EMPLOYMENT NATURE OF THE CONTRACT Employment is a contract i.t.o which 1 party (employee), in return for payment of remuneration by the other party (employer), puts his personal services at the disposal of the employer in such a way that the employer is entitled to define his...

EMPLOYMENT NATURE OF THE CONTRACT Employment is a contract i.t.o which 1 party (employee), in return for payment of remuneration by the other party (employer), puts his personal services at the disposal of the employer in such a way that the employer is entitled to define his duties and, at least to some extent, to control the manner in which he discharges them Parties Statutory limits on person’s freedom to employ whoever he wants I.t.o the Employment Equity Act, 1998: Employer may not in an employment policy/practice unfairly discriminate against an applicant for employment on any number of specified grounds (e.g. race, gender) Employment policy/practice = Recruitment procedure, advertising, or selection criteria and appointment process Every ‘designated’ employer must implement affirmative action measures for people from designated groups ‘Designated groups’= Black people, women and people with disabilities who: ▪ Are citizens of SA by birth/decent; or ▪ Became citizens of SA by naturalisation before 27 April 1994; or ▪ Became citizens of SA by naturalisation after 26 April 1994 and who would have been entitled to acquire citizenship by naturalisation prior to that date Affirmative action measures = Measures designed to ensure that suitably qualified people from designate groups have equal employment opportunities and are equitably represented in all occupational levels in the workforce of a designated employer Suitably qualified = Formal qualifications, prior learning, relevant experience, or capacity to acquire within a reasonable time the ability to do the job I.t.o the Basic Conditionals of Employment Act, 1997: Person must not require/permit a child to: ▪ Work, if child is under 15 years of age or under min school-leaving age ▪ Perform any work or provide any services that are inappropriate for a person of that age or which place at risk the child’s well-being, education, physical/mental health, or spiritual/moral/social development  ▪ Child = Person under 18 years of age Employer may be ordered to re-employ a former employee ELEMENTS Contract Parties may create an employment relationship only by concluding a binding employment agreement Remuneration 1. Consist of: a. Money b. Goods; or c. Partly in money and partly in goods 2. Agreement where one party provides services and the other provides accommodation = Innominate contract (NOT employment contract) 3. Amount need not be fixed (must be ascertainable by reference to some objective standard) Personal Services Agreement doesn’t have to spell out employee’s duties in detail HOWEVER, parties must reach agreement on type of work which he is to perform Services Defined and Controlled by Employer Employer should be entitled to prescribe to employee: ▪ What should he do? ▪ How should he do it? In deciding whether contract is one of employment, courts apply the ‘Dominant impression test’ ▪ Court weighs up factors which point towards an employer-employee relationship against factors which point the other way ▪ For purposes of this test, accepted that employee ordinarily: - Works for 1 employer only - Works in premises owned/controlled by employer and according to working hours fixed by employer - Member of employer’s organisation - Receives a salary/wage (portion at least fixed) - Member of and contributes to schemes established for employees  - Receives paid annual and sick leave ▪ Substance of parties’ relationship ▪ Relied upon to distinguish a contract of employment from other contracts to do work - Distinction important for whether employee is entitled to benefit under legislation protecting employees and delicts committed by employee Formalities At common law, no formalities required for formation of employment contract Can be in oral or non-verbal conduct Express/tacit agreement Basic Conditions of Employment Act obliges employer to supply employee, when employee commences his employment, with a written statement containing various particulars regarding the parties’ contract STATUTORY REGULATIONS Common law principles relating to employment are unsuited/inadequate to deal with employment conditions in modern commerce and industry 4 statues: ▪ The basic conditions of employment act 1997 ▪ The labour relations act 1995 ▪ The employment equity act 1998 ▪ The occupational health and safety act 1993 Basic Conditions of Employment Act, 1997 Purpose: ▪ Advance economic development and social justice by giving effect to: - The right to fair labour practices enriched in S23 of the Constitution - The obligations incurred by the Republic as a member state of the international labour organisation ▪ Establishes and regulates basic conditions of employment for all person falling within its provisions Empowers mister of labour to:  ▪ Determine any basic conditions of employment (consistent with purpose of act) ▪ Make sectoral determination establishing basic conditions of employment (e.g. minimum wage rate) ▪ Make regulations regarding any matter that may be necessary/expedient to achieve objects of the act ▪ Make regulations to prohibit or place conditions on work by children who are at least 15 Y/O and are no longer subject to compulsory schooling ▪ Issue codes of good practice to be considered when interpreting/applying act Conditions constitute a term of the contract except to the extent that it is varied, replaced or excluded in accordance with the act which provides a term that is more favourable to the employee Applies to all employees and employers (certain exceptions) An employee: ▪ Any person who works for another person/state and entitled to receive any remuneration (excluding an independent contractor) ▪ Any other person who assists in carrying on the business of the employer Person presumed to be an employee of another if the following factors are present: ▪ Manner in which the worker (W) works or his hours of work are subject to the other party’s (E) control/direction ▪ W is a member of E’s organisation ▪ W works/performs services only for E or economically dependent on E or has worked for E on average of at least 40 hours per month over the last 3 months ▪ E provides W with his tools of trade or work equipment Onus on ‘employer’ to prove that the relationship is not one of employment Person may qualify as an employee even if there is no binding employment agreement Persons excluded from act: ▪ Members of the state security agency ▪ Unpaid volunteers (charity) ▪ Vocational training ▪ Persons employed on vessels at sea governed by merchant shipping act Act doesn’t apply uniformly to all employees which fall within its provisions ▪ Expressly exempts specific categories of employees from a number of provisions Different categories of employees: ▪ Category A: Senior managerial employees  ▪ Category B: Sales staff who travel to premises of customers and regulate their own hours of work ▪ Category C: Work less than 24 hours a month ▪ Category D: Employees engaged in work which is required to be done without delay and cannot perform during normal hours of work ▪ Category E: Earning in excess of R205,433,30 per annum (regular annual remuneration before deductions and doesn’t include contributions) Labour Relations Act, 1995 Purpose: Facilitate collective bargaining Assist in the resolution of labour disputes Bearing on the content and consequences of a contract of employment: Where a collective agreement applies to employer and employees, it takes precedence over their contract of employment ▪ May not be paid lesser remuneration or be treated in manner or granted a benefit that is less favourable than that prescribed in the collective agreement ▪ Collective agreement = Written agreement concluded between employers and registered trade unions Every employee has the right not to be unfairly dismissed or subject to an unfair labour practice ▪ Employee may claim relief (reinstatement, re-employment or compensation) ▪ Courts guided by the Act, relevant codes of goods practice or collective agreement and applies a moral/value judgement Applies to all employees with exceptions to: ▪ Member of the national defence force ▪ Members of the state security agency Party who has no employment contract may qualify Employee in this act = Same as in basic conditions of employment act Employment Equity Act, 1998 Purpose is to achieve equity in the workplace by:  Promoting equal opportunity and fair treatment in employment through elimination of unfair discrimination Implementing affirmative action measures to redress the disadvantages in employment experiences by designated groups Effects on contract of employment: Requires employers to implement affirmative action measures when appointing employees Prohibits unfair discrimination against employees in any ‘employment policy or practice’ (e.g. recruitment procedures) Obliges designated employers to take ‘affirmative action measures’ to assist existing employees in designated groups Applies to all employees and employers Designated employer: Employs 50/more employees or has a total annual turnover that equals/exceeds a stipulated amount Municipality Organ of state Employer bound by collective agreement which appoints it as a designated employer Doesn’t apply to members of: National defence force National intelligence agency South African secret service South African national academy of intelligence Directors and staff of COMSEC Occupational Health and Safety, 1993 Purpose: Reinforce and supplement the common law duty of the employer to take reasonable care for the safety of employees Promote health and safety in the workplace Prevent accidents arising from use of equipment and machinery Creates a legal framework for setting and policing of safety standards Requires employers to: ▪ Eliminate/minimise hazards ▪ Train employees  ▪ Supply employees with info on existing dangers Applies to all employees (except employees in mining industry) THE EFFECT OF THE CONTRACT CONTENTS Range from relatively simple to extremely detailed Can include terms on: ▪ Annual bonus ▪ Annual leave ▪ Sick leave ▪ Pension ▪ Protection of employer’s confidential info ▪ Restraint of trade ▪ Safety rules ▪ Disciplinary procedures Terms of collective agreements are incorporated into each employee’s contract Employer can enter into a recognition agreement with a trade union established by the workers within the organisation to represent their interests DURATION The Period of Contract Parties have agreed on period of contract – Endures for agreed period or until notice is duly given Parties haven’t agreed on a period – Continues until terminated by notice given by either party Renewal of the Contract Employee remains in service after termination and employer continues to pay remuneration = Tacitly renewed the contract (same terms or modified terms) Certain case – Refusal to renew fixed term contract amounts to an unfair dismissal Termination of the Contract by Notice Common law – Employer may terminate contract by notice w/o a reason Labour relations act precludes the employer from exercising this power ▪ Dismissal on notice w/o a fair reason or not in accordance with a fair procedure constitutes an unfair dismissal  ▪ Entitles employee to obtain reinstatement, re-employment or compensation Termination is a unilateral act Doesn’t require the consent of the other party The other party can’t refuse to accept a resignation or decline to act on it The basic conditions of employment act regulates termination by notice of an employment contract (do not apply to employees in category C): ▪ Notice given in writing (except where employee is illiterate – Orally explain it in an official language) ▪ May not give notice during any period of leave to which employee is entitled (except sick leave) ▪ Instead of giving employee notice period, employer may pay the employee the remuneration he would have received if he had worked during the notice period ▪ Period of notice required varies (no agreement may require/permit an employee to give a period of notice longer than that required of the employer): - 1 year: 2 weeks - > 1 year or more: 4 weeks - Farm/domestic worker who has been employed for > 6 months: 4 weeks ▪ Special provisions for employee who resides in accommodation supplied by employer - If employer terminate contract before date on which he would have been entitled to do so by notice, must provide employee with accommodation for 1 month or until the contract of employment could lawfully have been terminated (longer period) - If employer terminates employee’s contract by payment in lieu of notice and employee elects to remain in the accommodation, the remuneration employer is required to pay is reduced by amount representing value of accommodation TRANSFER OF EMPLOYER’S BUSINESS Transfer where employer is solvent (employer transfers the whole or any part of his business, trade, undertaking, or service as a going concern to another employer) ▪ New employer substituted in place of old employer i.r.o all employment contracts in existence immediately before the date of transfer  ▪ All rights and obligations between the old employer and each employee at the time of transfer continue in force ▪ Anything done before the transfer by or in relation to the old employer considered to have been done by or in relation to the transferee ▪ Transfer doesn’t interrupt any employee’s continuity of employment ▪ New employer complies with his obligations if he gives employees terms which are not less favourable than those by the old employer ▪ Employee may be transferred to a different fund (e.g. pension fund) if new fund is reasonable and equitable and gives full recognition to the employee’s rights and benefits ▪ The old employer must: - Reach agreement with new employer on valuation of leave pay and severance pay - Written agreement with new employer specifying which employer is liable for paying amounts and provision made for such amounts - Disclose terms of written agreement to each employee - Take any other measure that may be reasonable ▪ For 12 months after transfer, old employer is jointly and severally liable with new employer to any employee who becomes entitled to receive payment of any amounts as a result of being dismissed ▪ Old and new employer jointly and severally liable for any claim concerning a term or condition of employment Transfer where the Employer Insolvent Employer’s business is transferred due to insolvency of employer or scheme of arrangement or compromise concluded to avoid winding up or sequestration for reasons of insolvency New employer automatically substituted in the place of old employer in all employment contracts in existence immediately before old employers winding up of business All rights and obligations between old employer and employees – Remain with old employer Anything done before transfer by old employer i.r.o each employee – Considered to be done by old employer Transfer doesn’t interrupt employee’s continuity of employment (continues) DUTIES OF THE EMPLOYEE The Duty to Enter and Remain in Service Employee obliged to enter the service of his employer and remain in it for the period of the employment  If employee refuses to work w/o justification – Repudiate the obligation to render continuous service (breach of contract) Additional breach of contract – Goes on leave w/o permission or by his conduct, puts it out of his power to render the promised service (prevention of performance) Employee may legitimately refuse to continue working – If employer refuses/fails to pay him the wages due to him for past service If employee breaches duty to render continuous performance – Employer has normal remedies for breach of contract ▪ To recover damages – Must prove he suffered a loss as a result of breach ▪ Court may grant an order compelling employee to honour his undertaking For cancellation of contract – Not every instance of absenteeism/unpunctuality is a good ground for cancellation (depends in each case upon degree of seriousness of breach) Basic conditions of employment act regulates employee’s duty to render continuous service Limits on regulation of working time (S7) ▪ Every employer obliged to regulate the working time of his employees considering: - Health and safety of employee - Code of good practice on regulation of working time - Family responsibilities of employee Ordinary working hours (Don’t apply to employees in categories A,B,C and E) (S9) ▪ Works 5 days or less per week: - Maximum daily hours = 9 and maximum weekly hours = 45 ▪ Works more than 5 days per week: - Maximum daily hours = 8 and maximum weekly hours = 45 Meal intervals (S14) ▪ Employee entitled to a meal interval of not less than 1 continuous hour after working continuously for 5 hours ▪ Work is regarded as continuous unless interrupted by an interval of at least 1 hour ▪ Can only require employee to perform if duties cannot be left unattended and cannot be performed by another employee ▪ Employer and employee may agree in writing: - Shorten the meal interval (not less than 30 minutes) - Dispense with meal interval if employee works fewer than 6 hours a day ▪ Provisions don’t apply to employees in category A,B,C and E Daily and weekly rest period (S15)  ▪ Employee is entitled to: - Daily rest period of at least 12 consecutive hours between ending and recommencing work; and - Weekly rest period of at least 36 consecutive hours which must include Sunday ▪ Parties may agree in writing: - Reduce daily rest period to 10 hours if he lives on premises where workplace is situated and meal interval of at least 3 hours - Substitute for employee’s weekly rest period, a bi-weekly rest period of at least 60 consecutive hours - Reduce the employee’s weekly rest period by up to 8 hours in a week if his next weekly rest is extended equivalently ▪ Provisions don’t apply to employees in category A,B,C and E Overtime (S10 and S12) ▪ Employee can’t be required/permitted to work overtime unless there’s an agreement (maximum overtime employee may agree = 10 hours a week) ▪ Agreement providing for overtime may not require/permit employee to work for more than 12 hours on any day ▪ Agreement regarding overtime concluded with employee within first 3 months of employment expires after 1 year ▪ Collective agreement may increase max permitted overtime to 15 hours a week (agreement may not apply for more than 2 months in a 12 month period) ▪ Collective agreement may allow overtime to be averages over 4 months - Employee not permitted to work more than an average of 5 hours of overtime in a week over the agreed period - Automatically lapses after 12 months ▪ Employees in categories A,B,C and E are exempt from the provisions Night work (S17) ▪ Employee may be required/permitted to perform night work (18:00pm – 6:00am) if: - Parties have agreed - Receives compensation for doing so (allowance or reduction of working hours) - Transportation is available between place of residence and workplace before and after shift ▪ If employer requires employee to work after 23:00 and before 6:00 on a regular basis, he must: - Inform employee in writing/orally in a language he understands of: o Any health and safety hazards o Right to undergo a medical examination  - Enable employee to go and pay for a medical examination concerning hazards - Transfer employee to suitable day work within reasonable time if it is practicable to do so and employee suffers from health condition associated with the performance of night work - Doesn’t apply to category A,B and C employees Sundays (S16) ▪ Forms part of employee’s weekly rest period (can agree otherwise) ▪ If employee works on Sundays = Overtime ▪ Doesn’t apply to category A,B,C and E employees Public holidays (S18) ▪ Employee not required to work on public holidays (can agree otherwise) ▪ If public holiday falls on Sunday = Following Monday becomes a public holiday ▪ May agree to exchange public holiday with another day ▪ Doesn’t apply to category A,B,C and D employees Annual leave (S20) ▪ Employee (except category C) entitled to 21 consecutive days of annual leave on full pay after each annual leave cycle - Employment by same employer for 12 consecutive months ▪ Employer may reduce 21 day period by number of days of occasional leave on full pay which was granted to employee at employee’s request during year ▪ 21 day period extended by 1 day for each public holiday falling within period and would’ve been an ordinary working day ▪ Must take annual leave at agreed time or at time determined by employer (must be granted not later than 6 months after end of annual leave cycle) ▪ Leave may not be granted concurrently with any other period of leave employee is entitled to or with a period of notice terminating the contract of employment ▪ May be granted concurrently with a period of unpaid leave if employee requests in writing ▪ Employer may not require employee to work for him during leave ▪ Employee will receive: - 1 day of annual leave on full pay for every 17 days on which he worked or was entitled to be paid - 1 hour of annual leave on full pay for every 17 hours on which he worked or was entitled to be paid ▪ Employer may not pay employee instead of granting leave Sick leave (S22)  ▪ Accrues to employee at a rate of 30 days (5 day week) or 36 days (6 day week) per sick leave cycle (36 months of employment with the same employer) ▪ During first 6 months of employment – 1 day for every 26 days worked ▪ If employee takes sick leave during first sick leave cycle – Employer may reduce entitlement to sick leave ▪ Does not apply to an inability to work caused by an accident or occupational disease Maternity leave (S25) ▪ Employee (except category C) entitled to at least 4 consecutive months’ maternity leave commencing: - At any time from 4 weeks before expected DOB; or - On a date which a medical practitioner or midwife certifies that the leave is necessary ▪ Employee must notify employer in writing of dates (commencement and return) - Given at least 4 weeks before commencement or when reasonably practicable Family responsibility leave (S27) ▪ Employee (except category C) who has been employed for longer than 4 months and who works at least 4 days a week for that employer is entitled, on request, during each annual leave cycle, to 3 days paid leave - Child is born or is sick; or - Event of a death of his spouse, life partner, parent, adoptive parent, grandparent, child, adopted child, grandchild or sibling ▪ May take part of a day as leave ▪ Unused leave lapses at end of annual leave cycle in which it accrues ▪ Collective agreement may vary number of days The Duty to Exercise Reasonable Skill and Diligence Employee impliedly warrants he is reasonably competent to carry out work by agreeing to perform particular type of work Exercise due skill and diligence in the performance of the various aspects of the work If inept/incompetent/fails to exercise requisite skills/care – Breach of contract Implied undertaking of compatibility of maintaining and will maintain harmonious working relationships with his co-workers The Duty to Serve the Employer in Good Faith Employee obliged to serve employer in good faith  Facets: o Devote all of his working hours to furthering the interests of the employer and may not work against those interests o May not appropriate employer’s property to himself or make unauthorised use of it for private enterprise o May not appropriate to himself confidential info acquired or use such info for his own benefit or disclose it to employer’s rivals even when employment comes to an end o If employee knows of misconduct committed by fellow employees which undermines business interests of employer, he must disclose what he knows to the employer o If employee occupies a fiduciary position (position of trust and confidence) may not: ▪ Place himself in a position where his interests conflict with those of the employer ▪ Make a secret profit at expense of employer ▪ Receive from a 3rd party a bribe/commission by reason of his position as employee o Does any of these things = breach of contract ▪ Must give employer any profits he has made The Duty to Obey the Instructions of, and Show Respect Towards, the Employer Employee must obey reasonable and lawful instructions of employer and behave in a respectful manner towards him and other superiors appointed Disrespect doesn’t constitute insubordination by itself Employee is not insubordinate for refusing to obey an unlawful instruction Employer may dismiss employee for insubordination if he refuses to obey a lawful and reasonable command and the refusal is wilful and serious or if refusal poses a serious challenge to employer’s authority The Duty to Refrain from Misconduct General duty to refrain from misconduct Conduct which is incompatible with the employer-employee relationship or contrary to the terms of the employment contract Misconduct doesn’t need to be intentional to amount to breach Directed at employer DUTIES OF THE EMPLOYER Duty to Receive the Employee and Retain him Employer bound to receive employee into his service and retain him Once employee engaged – Employer not bound to provide him with work except: o Employee’s remuneration is based on volume of work (salesperson) o Employee’s professional reputation would be adversely affected by his not working o One of the purposes of appointment is to provide employee with training and skills Once employee engaged in a particular position – Employer cannot w/o employees consent place him in a different post o If employer does, commits repudiation (entitles employee to ordinary remedies for breach of contract) Employee entitled to claim damages o Damages = Amount he would’ve earned i.t.o the contract if he had been received into employer’s service or if he had been wrongfully dismissed (deducted from whatever employee has earned) Duty to Supply the Employee with Written Particulars of his Employment Employer required to supply his employee, when commences employment, the following in writing: o Full name and address of employer o Name of employee o Occupation of employee o Place of work o Date employment began o Ordinary hours of work and days of work o Employee’s wage or the rate and method calculating wages o Rate of pay for overtime o Any other cash payments employee is entitled to o Any payment in kind that employee is entitled to and value of payment in kind o Frequency of remuneration payments o Any deductions to be made o Leave employee is entitled to o Period of notice required to terminate employment o Description of council or sectoral determination which covers employer’s business  o Period of employment with previous employer that counts towards employee’s period of employment o List of any other documents that form part of the contract of employment Must be in a language employee understand (or explained orally) If any changes – Employer must revise document and reflect change (supply employee with copy) Duty to Pay the Employee his Remuneration Employer and employee free to negotiate the amount to be paid as remuneration Employer bound to pay the employee agreed amount Common law – Amount not fixed = Reasonable remuneration Daily, weekly, fortnightly, or monthly (in each case not later than 7 days after completion of the relevant period) Pay in SA currency either by: o Cash (given in sealed envelope at workplace or at place agreed to by employee during employee’s working hours or within 15 minutes of commencement/conclusion of these hours*) o Cheque (*); or o Direct deposit Duty is conditional upon employee’s placing his service at the disposal of the employer for the entire period in question (once duly tendered services to employee for entire period = Employer is obliged to remunerate employee) Employer not entitled to retain wages earned for a period where he dismisses the employee on good grounds or the employee deserts (abandons work for no good reason) o Employer must remunerate employee S34 of basic conditions of employment act places restrictions on employer’s power to make deductions from employee’s remuneration. May not make any deduction unless the following is satisfied: o Deduction required/permitted by law, collective agreement, court order or arbitration award (E.g. PAYE) o Employee agrees in writing to the deduction i.r.o a debt specified in the agreement and if the debt is reimbursed for loss/damage Must make payment within 7 days of the deduction or end of the period Employer may not: o Require/accept any payment from employee or potential employee in return for employing/allocating work to him or another employee o Require employee or potential employee to purchase any goods, products, or services from employer or from any business or person nominated by the employer  Permissible for employment contract or collective agreement to require employee to participate in a scheme of involving the purchase of specific G/S (if not prohibited and employee receives financial benefit in scheme and price is fair and reasonable) If employer fails to pay remuneration or pays less – Employee may institute legal proceedings to recover amount due o May lodge a complaint with labour inspector Determining employee’s ‘normal’ wage: o Wage of employee by time (hourly wage) is calculated by reference to number of hours ordinarily worked (deemed to work max hours of work permitted in a day/week) o Employee’s monthly remuneration/wage is 4 and 1/3 times his weekly remuneration/wage o If computed on basis of time – Calculated with reference to employee’s remuneration/wage during the preceding 13 weeks Remuneration for overtime: o Rate of 1.5 times the employee’s normal wage o Parties may agree otherwise and employee will have either (time granted off must be within 1 month of employee becoming entitled to it): ▪ At least 30 minutes time off for every hour of overtime worked; or ▪ At least 90 minutes paid time off for each hour of overtime worked o Don’t apply to employees in categories A,B,C and E Remuneration for meal intervals: o Employer must pay employee ordinary wage for: ▪ Meal interval where employee required to work or required to be available for work; and ▪ Any portion of a meal interval that is in excess of 75 minutes o Don’t apply to employees in category A,B,C and E Remuneration for work on Sundays: o Ordinary shift: ▪ Double employee’s wage for each hour worked ▪ If employee ordinarily works on Sundays- 1.5 times employee’s wage o Less than ordinary shift: ▪ Greater of: Wage for work on Sunday for each hour worked; or Employee’s ordinary daily wage o Unless employer grants employee paid time off equivalent to additional amount payable to employee for work on Sunday Remuneration for work on public holidays:  o Ordinary working day for employee: Greater of: ▪ Double wage employee would ordinarily have received for work on that day of the week; or ▪ Employee’s ordinary wage for that day of the week plus amount earned by employee for time worked on that day o Not ordinarily working day for employee: Employee’s ordinary wage plus amount which he earned for work done on that day Remuneration during annual leave: o Employer must pay employee equivalent to remuneration he would’ve received for working for the period of leave o Employee’s rate of remuneration immediately before the period of annual leave o Employer must pay before the beginning of the period of leave or on employee’s usual pay day o Don’t apply to employees in category C Remuneration during sick leave: o Must pay employee ordinary wage to reduce amount payable o Employer may withhold payment if the employee: ▪ Is absent for more than 2 consecutive days or more than 2 occasions during an 8 week period; and ▪ Fails to produce a medical certificate issued and signed by a medical practitioner o Employer may not withhold payment if employee lives on his premises o Don’t apply to employees in category C Remuneration during maternity leave: o Determined by minister of labour and subject to provisions of unemployment insurance act o Employee who was employed for at least 13 weeks during the 52 weeks immediately preceding the expected date of confinement or DOB is entitled to maternity benefits ▪ Rate of 45% of normal weekly earnings at which she was last employed as a contribution ▪ Benefits continue for 26 weeks o Category C employees not entitled to benefits Remuneration during family responsibility leave: o Usual wage for period of leave o Employer may require reasonable proof of the event before paying Duty to Give the Employee Written Details of his Remuneration S33 of basic conditions of employment act require employer to give employee on each pay day in writing: o Employer’s name and address o Employee’s name and occupation o Period o Remuneration in money o Amount and purpose of any deduction made o Actual amount paid o Calculation of employee’s remuneration Info must be given to employee: o At workplace or at a place agreed to o During employee’s ordinary working hours or within 15 minutes of commencement/conclusion of hours Doesn’t apply to employer who employs less than 5 employees or an employee in category C Duty to Keep Prescribe Records S31 of basic conditions of employment act requires every employer to keep record containing: o Employee’s name and occupation o Time worked by each employee o Remuneration paid to each employee o DOB of any employee under 18 Y/O o Any other prescribed info Keep for a period of 3 years (even written particulars after terminating employee) Duty to Provide Safe Working Conditions Common law duty – Take reasonable care for employee’s safety in workplace Protect from physical and psychological harm (e.g. sexual harassment by co- employees) Media 24 V Grobler: o G employed by N (subsidiary of M) sued latter for damages iro psychological and psychiatric trauma that she had suffered as a result of sexual harassment by trainee manager employed by M o Court upheld claim –M under legal duty to its employees to take reasonable steps to prevent them from being sexually harassed by other employees in working environment and M had breach duty by failing to deal adequately with G’s allegations of failing to give warnings of dismissal to or act against guilty party  Common law duty supplemented by a great extent by occupational health and safety act o General standard employer must attain o Set up structures for monitoring and promoting health and safety in the workplace o Prohibit particular activities o Require machinery and equipment to comply with specifications o Compel the use of safety devices or protective equipment Employer must: o Provide work systems, plant and machinery that are safe and w/o risks to health o Take steps to eliminate any hazard to safety of employees o Establish what hazards there are and precautionary measures to be taken o Not permit any employees to do any work unless precautionary measures have been taken o General supervision by a person who is trained and has relevant authority o Provide info, instructions, training and supervision to employees o Take necessary steps to ensure employees comply with requirements of Act More than 20 employees – Appoint a safety representative Workplace is a shop/office – 1 safety representative for every 100 employees More than 1 safety representative – Establish a safety committee Employer obliged to report to an inspector relating to any workrelated incident involving death, serious injury or illness or if health and safety of employee was endangered Employee may obtain an interdict to prevent employer from implementing or continuing with an unsafe or unhealthy practice or from breaching a duty imposed by Act If employee comes under compensation for occupational injuries and diseases act – Cannot recover delictual damages Failure of employer to register and make prescribed payments to compensation fund as required by compensation for occupational injuries and diseases act – Constitutes offences No person may unfairly discriminate against an employee in any employment policy or practice Not unfair – Take affirmative action measures consistent with purposes of act Harassment of employee – Form of unfair discrimination and prohibited Unequal pay for substantially the same work or work of equal value – Unfair discrimination Act prohibits medical and psychological testing of an employee Duty not to Interfere with Employee’s Statutory Rights Employer may not: o Prevent employee from exercising rights or participating in any proceedings i.t.o statute o Require employee not to exercise rights o Favour or promise to favour, employee in exchange for not exercising his rights o Act to the prejudice of or discriminate against the employee because he exercises his rights or participates in proceedings Duty to Implement Affirmative Action Measures (Designated Employer Only) Designated employer must implement affirmative action measures for people from designated groups Must consult with interested parties, conduct an analysis, prepare an employment equity plan and report to the director general of progress made in implementing plan Duty to Inform Employee of his Rights S30 of basic conditions of employment, employer must display at the workplace where it can be read by employees a statement of the employee’s rights In prescribed form and official language Person who employs fewer than 5 employees or category C employees don’t need to Duty to Make Certain Payments on Termination of the Contract Basic conditions of employment act Payments i.r.o time off and leave not taken: o Must pay employee remuneration for any paid time off or annual leave which he was entitled to and has not taken Severance pay: o Pay an employee who is dismissed for reasons based on the employer’s operation requirements, whose contract of employment terminates or is terminated severance pay equal to at least 1 week’s remuneration for each completed year of service with that employer o No amount – Less than a year o Employee not entitled – Unreasonably refuses to accept employer’s offer of alternative employment with himself or any other employer Duty to Provide a Certificate of Service Common law does not require employer to provide character reference on termination Knowingly gives false reference – Liable in delictual damages by employee or subsequent employer if he acted upon this reference S42 of basic conditions of employment obliges employer upon termination to provide employee with certificate of service: o Employee’s full name o Name and address of employer o Description of any council or sectoral employment standard o Date of commencement and termination o Title of job o Remuneration o Reason for termination if requested by employee Doesn’t apply to employee in category C UNFAIR DISMISSAL Labour Relations Act curtails common-law power of employer to terminate the employee’s contract by notice or by summary dismissal The meaning of Dismissal Wider meaning than common law S186, employee is dismissed where any of the following occurs: o Termination by the employer (with or w/o notice) o Less favourable, or no renewal or retention ▪ Employee employed on a fixed term contract of employment and reasonably expects employer to: Renew contract on similar terms but employer offers less favourable terms or doesn’t renew it Retain him in employment indefinitely but employer offers it on less favourable terms or doesn’t offer it at all o Refusal to allow the resumption of work after maternity leave o Selective re-employment ▪ Refuses to re-employ employee ▪ Employee must be aware employer is re-employing previously dismissed employees o Constructive dismissal ▪ Employee terminates contract due to employer making continued employment intolerable for him or after transfer, employer provided employee with less favourable conditions at work  ▪ Test – Employer’s overall conduct, judged reasonably and sensibly, employee couldn’t have been expected to put up with it ▪ Employee must prove employer’s conduct made continued employment intolerable ▪ It doesn’t need to be shown that employer’s conduct was such that the employee had no choice but to resign Strategic Liquor Services V Mvumbi NO: o S employed R as regional manager o S’s biggest customers had complained about R o S gave R a choice of resigning with 1 month’s salary and good reference or being warned and placed on a poor work performance programme with training o R chose to resign o Court held – R had been constructively dismissed Asara Win Estates V Van Rooyen: o V resigned from employment after being given choice of facing disciplinary enquiry for poor performance management or resigning o V subsequently claimed he was constructively dismissed o Court held – If there is a reasonable alternative to resignation there can be no constructive dismissal ▪ Sexual harassment = Intolerable (Personally by employer or employer failed to take reasonable steps to deal with it happening to employee) Automatically Unfair Dismissals Infringement of a fundamental right Employer acts contrary to S5 o Prohibits employer from discriminating against an employee for exercising any rights conferred in the Act o No person may advantage or promise to advantage an employee in exchange for his not exercising any right conferred by the Act Other automatic unfair dismissals: o Employee participated, supported (or indicated intention to) a protected strike or protest action that complies with the provisions of the Act o Employee refused (or indicated intention) to do any work normally done by another employee who is taking part in a protected strike or locked out o Employee refused to accept a demand i.r.o any mutual interest between employee and employer  o Employee took action (or indicated intention) against employer by exercising any right conferred by the Act or participating in any proceedings i.t.o the Act o Employee’s pregnancy, intended pregnancy, or any reason related to her pregnancy o Employer unfairly discriminated against an employee on an arbitrary ground ▪ Discriminatory dismissal may be fair if it is based on an inherent requirement of a particular job (e.g. certain retirement age) o A transfer or reason related to a transfer ▪ Safeguard interests of transferring employees where the employer’s business is transferred o Contravention of the Protected Disclosures Act 2000 by the employer on account of the employee having made a protected disclosure defined in the Act (e.g. on the conduct of the employer or another employee) Other Unfair Dismissals S188 dismissal that’s not automatically unfair is unfair is the employer fails to prove that: o Reason for dismissal is a fair reason to the employee’s conduct or capacity or based on the employer’s operational requirements; and o Dismissal in accordance with a fair procedure 3 grounds for justifying dismissal: o Misconduct o Incapacity o Operational reasons If employer fails to prove any one of the 3 grounds = unfair Dismissal for misconduct or incapacity is dealt with in a code of good practice Dismissal because of operational requirements is dealt with in S189 and in a code of good practice issued by NEDLAC Operational requirements: o Requirements based on the economic (financial management of business), technological (introduction of new technology), structural (restructuring of employer’s enterprise) or other similar needs of an employer Dismissal for Misconduct General principles: o All employers should adopt disciplinary rules that establish the standard of conduct required of their employees  o Employer must apply the concept of corrective or progressive discipline (i.e. correct employee’s behaviour through a system of graduated disciplinary measures) o Formal procedures don’t have to be invoked every time a rule is broken or a standard is not met (e.g. for minor violations) o Dismissal is not an appropriate penalty for a first offence unless the offence is of such gravity that it makes a continued employment relationship intolerable (e.g. theft or gross dishonestly) o Relevant factors in determining whether dismissal is appropriate – Employee’s personal circumstances, nature of job, circumstances of the infringement itself o Employer must apply the penalty of dismissal consistently o Employers should keep records for each employee specifying the nature of any disciplinary transgressions committed by employee, actions taken by employer, reasons for actions taken Guidelines for determining unfairness: o Par 7 o Person adjudicating must first consider whether employee has contravened a rule or standard which regulates conduct in the workplace (question of fact) o Employer must prove contravention on the balance of probabilities o If employee did contravene standard/rule, consider the following: ▪ Was the rule/standard valid and reasonable? ▪ Was the employee aware of the rule/standard or if not, could he reasonably have been expected to be aware of it? ▪ Has the rule/standard been consistently applied by the employer? ▪ Was dismissal an appropriate sanction for the contravention? Procedural fairness: o Par 4 o Employer should normally conduct an investigation to determine whether there are grounds for dismissal o If discipline is envisaged against a trade union representative or office bearer or official of a trade union – Must first inform and consult with trade union o Employer should notify employee of allegations against him using form and language that employee can reasonably understand o Employee given reasonable time to prepare his response o Employee allowed to state a case in response to the allegations against him ▪ Attend inquiry ▪ Lead witnesses  ▪ Cross examine witnesses o An inquiry in camera may be justified o Employee entitled to assistance of a trade union representative or a fellow employee (No right to be represented by a lawyer) o Person conducting inquiry should be impartial o Employer should inform employee, preferably in writing, of the decision taken (after inquiry) ▪ If dismissed – Reason given and reminded of right to refer matter to a bargaining/statutory council or the Commission or to any dispute resolution procedures established o In exceptional circumstance, employer may dispense with pre-dismissal procedures Dismissal for Incapacity (Poor Work Performance) General principles: (par 8) o Employee shouldn’t be dismissed for unsatisfactory performance unless: ▪ Employer given appropriate evaluation, instruction, training, guidance counselling. ▪ Allowed reasonable time for improvement; and ▪ Employee continued to perform unsatisfactorily Guidelines for determining unfairness (par 9) o First consider – Whether or not employee has failed to meet a required performance standard o If employee has failed to meet performance standard consider: ▪ Was employee aware of the standard, or ought to have reasonably been aware of it? ▪ Was the employee given fair opportunity to meet the standard? ▪ Was dismissal an appropriate sanction for breaching the standard in question? Procedural fairness (par 8): o Investigation should be conducted into the following: ▪ Why the employee has not performed satisfactorily ▪ How the matter may be remedied w/o dismissing the employee o Employee entitled to be heard, and assisted by a trade union representative or fellow employee Probationary appointments: o Newly-hired employee to serve a period of probation before the appointment of the employee is confirmed o Purpose: Give the employer an opportunity to evaluate the employee’s performance o Period is determined in advance (reasonable duration)  o During probationary period, employer should assess employee’s performance o Give employee reasonable evaluation, instruction, training, guidance, or counselling o May extend period only for a reason that relates to the purpose of probation o May accept reasons for dismissal that are less compelling than would be the case in dismissals effected after completion of probationary period Dismissal for Incapacity (Ill health or Injury) General principles (par 10): o Incapacity renders employee temporarily unable to work – Employer should investigate the extent of incapacity o Incapacity is permanent – Employer should ascertain the possibility of securing alternative employment for the employee or adapting his duties o Degree and cause of incapacity is relevant Guidelines for determining unfairness (par 11): o Consider whether or not employee is capable of performing the work and if not: ▪ Extent to which work circumstances might be adapted to accommodate disability ▪ Availability of any suitable alternative work Procedural fairness (par 10(2)): o Employee should be allowed the opportunity to state a case in response and to be assisted by a trade union representative or fellow employee Dismissal Based on the Employer’s Operational Requirements (Retrenchment) Par 2 No fault dismissals (not employee who is responsible for dismissal) Regarded as unfair if anyone of the following occurs: o Decision to dismiss is mala fide (not based on any commercial rationale) or not justifiable on rational grounds o Retrenchment is not the only reasonable alternative o Criteria used to select employees to be dismissed were either not agreed to by the consulting parties or not fair and objective ▪ Selection criteria that infringe a fundamental right protected by the Act ▪ Selection criteria that are neutral on the face of it should be carefully examined (don’t have a discriminatory effect)  ▪ Criteria generally accepted as fair include length of service, skills and qualifications ▪ Last in, first out principle Procedural fairness: o Consultation (par 3): ▪ Process of consultation ▪ Employer must consult: Any person i.t.o a collective agreement Workplace forum and registered trade union Employees likely to be affected by the proposed dismissals ▪ S189 – employer must issue a written notice inviting other consulting party ▪ Consulting parties obliged to engage in a meaningful joint consensus-seeking process aimed at reaching agreement on appropriate measures to avoid dismissals, min number, change their timing, or mitigate their adverse effects ▪ Also agree on method for selecting employees to be dismissed and severance pay o Providing info: Employer must disclose in writing to other consulting party all relevant info: ▪ Reasons for proposed dismissals ▪ Alternatives employer has considered ▪ Reasons for rejecting each alternative ▪ Number of employees employed ▪ Number of likely effected employees and job categories ▪ Number of employees dismissed for reasons based on operational requirements in previous 12 months ▪ Proposed selection criteria ▪ Time when dismissals will take place ▪ Severance pay proposed ▪ Assistance employer proposes to offer ▪ Possibility of future re-employment o Dealing with representations: ▪ Employer must allow other consulting party to make representations about any relevant matter ▪ Consider and respond to representations made ▪ Employer must state reasons for disagreeing ▪ Made in writing o Severance pay: Employer obliged to pay o Rehiring of retrenched employees (par 12):  ▪Employees should be given preference if employer again hires employees with compatible qualifications ▪ Employees express a desire to be rehired ▪ May be subject to a time limit ▪ Must take reasonable steps to inform employee of the offer of re- employment o Consultations in retrenchments by employers of 50/more employees: ▪ Special provisions ▪ Applies where employer contemplates retrenching at least: 10 employees (employs between 50 – 200) 20 employees (employs between 200 – 300) 30 employees (employs between 300 – 400) 40 employees (employs between 400 – 500) 50 employees (employs 500+) ▪ Employer may request a facilitator to assist parties engaged in consultations The Procedure for Resolving Disputes Regarding Dismissals Conciliation: o If dismissal disputed – May refer dispute in writing to a bargaining or statutory council having jurisdiction or the Commission for conciliation, mediation and arbitration o Made within 30 days of dismissal o Period may be extended on good cause shown o Copy of referral served on employer o Attempt to resolve dispute through conciliation (includes mediation) o Help parties reach an accord by identifying areas of common interest and by exercising powers of persuasion Arbitration by council or the commission: o Employee must refer matter to arbitration by council or the commission if he alleges the following: ▪ Reason for dismissal related to employee’s capacity/conduct; or ▪ Reason for dismissal was intolerable employment made by employer ▪ Employee doesn’t know reason o Award is final and binding (not subject to appeal by may be reviewed) Dismissal is for reason relating to probation – Combined conciliation and arbitration (con-arb) process Adjudication by the labour court: o Automatically unfair dismissal o Based on employer’s operation requirements  o Employee’s participation in a strike that doesn’t comply with provisions of act o Because employee refused to join, was refused membership of, or was expelled from, a trade union that is party to a close shop agreement o Made within 90 days The Onus in Dismissal Disputes Employee must establish that he was dismissed Then onus is on employer to show that the dismissal is fair Remedies for Unfair Dismissal Reinstate the employee Re-employ the employee Pay compensation to the employee UNFAIR LABOUR PRACTICE Unfair conduct relating to promotions, demotions, probations, or taring of employee Unfair suspension of an employee or any other unfair disciplinary action short of dismissal Failure to reinstate or re-employ employee in terms of agreement Protected disclosures act Refer within 90 days of act of ULP and if no resolution after 30 days refers to arbitration Corn-arb if employee is on probation THE LABOUR RELATIONS ACT, 1995 Trade unions and employer organisations are key players in collective bargaining Trade union must be registered and requirements for registration include a name, a constitution which complies with the act and be registered Strikes A partial or complete concerted refusal to work, or the retardation or obstruction of work, by persons who are or have been employed by the same employer or different employers, for the purposes of remedying a grievance or resolving a dispute of any matter of mutual interest between employer and employee Limits on strike action: o Essential service employees i.t.o the essential services act o If person bound by determination i.t.o BCEA o If person is bound by arbitration award or collective agreement  o If matter should be referred to arbitration or labour court Procedural requirement for a strike action: o Refer matter to council or commission ▪ Must issue a certificate ▪ Period of 30 days after referral must elapse (or any period as agreed upon by the parties) o 48 hours in writing must be given to employer and several days i.r.o state o No requirements to follow process if: ▪ Parties have their own agreement on process of strike ▪ Parties are members of a council and council has dealt with the dispute in accordance with its constitution ▪ The strike is in response to a lock out Strike procedure: o The employer has failed to comply with a demand made after employer has unilaterally changed the conditions of employment o Compliance with procedure renders a strike protected with the consequences that employees may not be dismissed, the dismissal is automatically unfair (the principle of no work no pay applies though) Strikes and consequences: o Non-compliance: ▪ Interdict may be obtained against employees ▪ Order of just and equitable compensation ▪ Dismissal Secondary Strikes Strike in support of a strike by other employees against their employer Lock-outs When employer excludes employees from the workplace for the purposes of compelling them to accept a demand i.r.o any matter of mutual interest Picketing A registered trade union may authorise a picket by its members in support of a strike action or in opposition to any lock out Permission must be sought from employer