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In essence I think the case National Union of Metal Workers of South Africa and Others vs Aveng Trident Steel and Another, CCT 178/19 is a most appropriate case. This judgement was handed down in the Constitutional Court on the 27th October 2020.
In essence Aveng had advised some of their staff members that they wished to facilitate alternatives to retrenchment before embarking on an actual retrenchment. The Union said that the alternative offer which was less than the current terms and conditions of employment was unfair and was the true reason for the actual retrenchment. The Company could show that there was actual operational reasons to make the lesser proposals. If the staff and the Union did not accept the lesser proposals they were going to continue with the retrenchment process. Previously this had been illegal but this constitutional case now sets the law very clearly. That is, the reduction of pay refusal can lead to a retrenchment. However, in order to win, the employer has to prove that the pay reduction as being essential in view of operational requirements.
MICHAEL BAGRAIM
I think the Labour Appeal Court did get it right in that retirement was done and dusted and he then was an ordinary employee.
Michael Bagraim
Unfortunately this has to be allowed in that the CCMA will postpone and it will affect another Respondent. This is routinely done where a Joinder Application is brought against another Respondent.
MICHAEL BAGRAIM
CAN EMPLOYEES WAIVE THEIR RIGHTS TO SEVERANCE PAY?
Unfortunately the severance payment is something contained in the Basic Conditions of Employment Act as one week per year of service, and one cannot waive their rights in terms of the Basic Conditions of Employment Act.
Michael Bagraim
WHAT IF FINANCIALLY STRESSED EMPLOYERS CANNOT AFFORD TO RETRENCH?
In essence if an employer can’t afford to retrench they need to enter into an agreement with the staff which must be reduced to writing. That agreement would allow the employer to pay off the retrenchment packages over a period of time. I have been doing this on a regular basis right throughout the pandemic. Most employees fully understand the nature of the situation.There are other options which can be explored. Obviously temporary layoffs can be done especially if they belong to a bargaining council. Otherwise the temporary layoff has to be negotiated with the staff or the trade union. This is similar with regard to short time.
Unilateral layoff and short time can be explored during the pandemic and the lockdown as it seems to have become common practice throughout. There does not seem to be any law giving employers permission to do this unilaterally but as I said it seems to have been a common approach. We will be seeing many court cases and judgments on this over the next few years.
Michael BagraimMICHAEL – CAN EMPLOYERS FORCE EMPLOYEES TO TAKE LEAVE
Employers can, in terms of the Basic Conditions of Employment Act, determine a leave date. Section 20(10) of the BCEA is absolutely clear.
However, the situation in the Janse Van Vuuren court case can be differentiated from the provisions of Section 20(10) as the flight captain was instructed to remain at home due to an operational reason of the employer. This, in my view, amounted to a type of suspension and certainly wasn’t leave in the sense intended in section 20(10).
Michael Bagraim
The very reason given by the employer shows that in fact it was a retrenchment.
Once people have passed their retirement age, you can’t willy nilly invoke the retirement clause retrospectively.
To invoke Section 187(2) is the same as claiming that it was a retirement, in other words the argument is merely repeated.
MICHAEL BAGRAIMLABOUR BROKER OR CONTRACTOR
It is understood and seems to be the norm that all the Judges tend to lean to define the relationship as one of a labour broker as opposed to external service provider.
Many employers and their clients obviously want the service to be deemed to be an external contractor so that they are not obliged to actually put the people on their list as employees with all the attendant issues arising therefrom.
Often employers slip up when they use the numbers for employment equity to show how many previously disadvantage employees they employ and by counting in those from contracted service providers.
If in fact the contract service provider offers a full turn key operation such as catering or transport then they are truly contracted service providers.
Michael Bagraim
In essence Covid-19 lockdown did not in any way change our labour laws. If people are working full time they are entitled to their full salary unless they have bi-laterally agreed to receive less.
Michael Bagraim
I do not believe that Nepotism can in any way amount to discrimination. In essence, the only time it can be challenged is if it is in terms of a public entity or against the rules and regulations of an employer.
There are thousands of family businesses that appoint family members in order to keep the business running. This is common practice in the SME Sector and if it is in any way deemed to be an unfair labour practice it would literally destroy the small business sector.Michael Bagraim
While I don’t think the persons who have the businesses have a claim against the DOEL, it is the employees who would have the claim.
Michael Bagraim
Employers do not have to apply for the disaster assistance which does not necessarily help them as a means of avoiding retrenchment. The company itself, with the nine employees may embark upon the Section 189 process and, as an alternative, they can suggest the three-month layoff. The staff are probably correct to request that the company applies for the temporary employee relief scheme. The company does not require any resources to make these applications and, in fact, the Department of Employment and Labour has asked for the company to apply rather than the employees. One does not understand the reasoning given by the company, but in fact the employees could, as a last resort, apply by themselves.
One of the real issues is that we are not sure if the Department is going to be functional in paying out these funds and, over and above this, they have the right to reject the application at any stage.
There is a rather convoluted agreement that every company is expected to sign as part of the application. This agreement is badly written and is almost impossible to decipher. It could be interpreted to mean a whole lot of things including that, if an employer applies for relief, it cannot go ahead with the retrenchment. If this is fact the meaning of the agreement it would tie the hands of every company in terms of being able to retrench if they believe the situation is so bleak that there won’t be jobs in the future.
Michael BagraimThe brandishing of sticks and sjamboks would in a western context mean that the crowd is ready for violence. However, in South Africa it has been traditional for people to dance with the sticks and sjamboks and invariably does not lead to violence. I believe the Labour Appeal Court was incorrect and have taken the local custom into account.
I believe the matter will go back to the Constitutional Court for reassessment.
Michael BagraimOur labour laws are all subservient to our constitution. Our constitution calls for fairness in all respects.
Our courts have been absolutely adamant that the concept of “audi uletram partem” should be respected at all stages. The reality is that every employee has a right, and in fact a duty, to test all allegations and to put his/her version to the accuser. The right to cross examine is a golden thread throughout our entire legal system.”
Michael Bagraim
