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Labour Laws Constrict Employers

BY Ivan Israelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on (011) 888-7944 or 0828522973 or via e-mail address: ivan@labourlawadvice.co.za. Website address: www.labourlawadvice.co.za.

South Africa’s labour legislation
provides very heavy protection for employees. That is, numerous and imposing
obstacles in the law and in the legal system make it extremely difficult for
employers to dismiss those employees who deserve to be dismissed. These
obstacles include:

  • A plethora of procedures that must be followed
    before a dismissal can be considered to be fair
  • Stringent and numerous criteria for deciding
    whether the reason for a dismissal is fair
  • Broad discrepancy between judges and arbitrators
    as to the interpretation of the labour law
  • The provision that, where a dismissal is
    adjudged to be unfair, the arbiter may reinstate the employee or impose a heavy
    compensation order (up to 24 months’ pay in some cases) on the employer
  • The employer is automatically considered guilty
    of unfair dismissal until it has proven otherwise; but despite this is still
    required to present its case first at the unfair dismissal hearing
  • Despite the fact that many employers do not have the expertise to defend cases at the CCMA, the law makes it difficult for them to use legal experts as representatives.
  • The Labour Relations Act effectively bans the
    use of fixed-term contracts except in cases where the employer can prove that
    the job itself is temporary.

Therefore, in an attempt to
circumvent all this onerous legislation, employers attempt to avoid having to
dismiss undesirable employees by hiring workers on fixed-term contracts. Then,
if the employee is seen as unsuitable, the employer merely allows the contract
to lapse at its expiry date. However, this is a dangerous tactic because labour
law has virtually closed this loophole. That is, if the employer gives the
employee a “reasonable expectation” that the contract will be renewed on
expiry, the arbitrator could force the employer to renew the contract.

In the case of King Sabata
Dalindyebo Municipality vs CCMA and Others (2005, 7 BLLR 696) the employer made
a habit of regularly renewing fixed term contracts. But then it allowed the
last contracts to lapse even though there was still available work for the
terminated employees. The Labour Court found that the employees had a
reasonable expectation of having their contracts renewed again and forced the
employer to renew the contracts.

In the case of Pretorius vs Sasol
Polymers (2008, 1 BALR 10) Ms Pretorius was appointed on a fixed-term contract
to act in place of the permanent incumbent. When Ms Pretorius’s contract
expired the employer advertised the post to be filled on a permanent basis and
refused to renew Ms Pretorius’s contract. She referred an unfair dismissal
dispute to the bargaining council because she claimed to have had a reasonable
expectation that her contract would be renewed. The arbitrator found that:

  • The employer had a policy that required a
    fixed-term employee occupying a permanent post to be made permanent if
    management approved.
  • The fact that management had advertised the post
    constituted management approval
  • This policy gave the employee a reasonable
    expectation of renewal of her contract
  • The employer’s failure to give the employee the
    permanent post constituted an unfair dismissal and the employee was
    retrospectively reinstated.

 Another method
used by employers to bypass the tough labour legislation is the use of temp.
agencies and labour brokers. These agencies are referred to in the Labour
Relation Act (LRA) as “temporary employment services” (TES)

Trade unions, who find
this arrangement to be a thorn in their sides, call it ‘Atypical Employment’
and have launched a campaign that has succeeded in severely curtailing it. Employers
are now finding it very much more difficult to use fixed-term contracts and
labour brokers to evade the heavy constraints of labour legislation. All
employers now, more than ever before, need to use reputable labour law experts to
sharpen their skills in running productive workplaces despite the ever
increasingly restrictive labour legislation.

To access our free labour law
expert debate page please go to http://labourlawadvice.co.za/wp-admin/,
click on the Labour Law Debate tab on the home page and subscribe
by clicking on “Register here”. For enquiries please contact Ivan Israelstam
via ivan@labourlawadvice.co.za or 011-8887944.

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