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Worklaw subscribers receive a monthly newsletter containing commentary on the latest labour law cases and trends. This newsletter contains an article on management responses to pornography and internet abuse. In addition to the number of cases dealt with in this month’s article, we look at two other new cases: the first deals with the substitution by the employer of one disciplinary sanction for another without a rehearing. The second looks at the fairness of FIFO (first in first out) as a selection criterion for retrenchment.
This public newsletter is a free edited version of the Worklaw subscriber newsletter.
Can an employer substitute its own decision over that of the disciplinary enquiry chairperson?
In an earlier newsletter (March 2007) we dealt with the circumstances under which an employer is entitled to have a second disciplinary hearing if it is unhappy with the sanction imposed by the chairperson of the first hearing. That article looked at the LAC judgement in Branford v Metrorail Services (Durban) & others (2003) 24 ILJ 2269 (LAC) which held that the law is simply this: an employer is entitled to hold a second disciplinary enquiry if it would be fair to do so. In the headnote to the case in the ILJ, the following comment was made:
"In the circumstances of this case it would be manifestly unfair for the company to be saddled with the quick, ill-informed and incorrect decision of one of its employees who misconceived the seriousness of the matter and hurriedly took the inappropriate decision to impose an equally inappropriate penalty ...."
In this newsletter, we explore this subject further by asking whether an employer can avoid a rehearing of the matter and just substitute a preferred sanction?
In a recent case a SARS employee pleaded guilty to the charge of twice referring to his team leader as a “kaffir.” He was found guilty of using derogatory and abusive language. The chairperson of the disciplinary inquiry, a panellist from Tokiso appointed in terms of a collective agreement regulating dispute resolution, sanctioned the employee with a final written warning valid for six months, suspension without pay for 10 days and referred him for counselling.
Dissatisfied with the outcome the employer, the South African Revenue Services (SARS) dismissed the employee without a further hearing. The employee submitted his dismissal dispute to the CCMA where the arbitrator found the dismissal of the employee to be unfair and awarded him reinstatement on the same conditions imposed by the disciplinary chairperson.
The matter was referred on review to the Labour Court in SARS v CCMA & others (LC case JR984/08, judgment 23 Oct 2009). The Labour Court held that the dismissal of the employee was substantively unfair because the decision to dismiss was not one that SARS could validly make; the collective agreement barred it from substituting the decision of the disciplinary chairperson. Procedurally, the dismissal was also unfair because the process of dismissing the employee was not available to SARS; if it was available, then SARS should have afforded the employee a pre-dismissal hearing. That it did not do. The court held that the CCMA award was therefore reasonable and not reviewable.
This case establishes the principle that where a collective agreement is silent about whether the employer can substitute the decision of the chairperson of the enquiry with its own decision, the most reasonable inference is that the parties did not intend to grant to the employer the power of substitution. To infer otherwise would be to interfere with the bargained agreement and make an agreement that the parties either never intended or could not make for themselves.
Selection criteria for retrenchment: is ‘First In, First Out’ fair?
During pre-retrenchment consultations the employer proposed the FIFO (first in, first out) criterion as opposed to the more usual LIFO (last in, first out) method of selecting employees for retrenchment. The employer justified this on the basis that it would lead to huge savings in an expensive department. FIFO was adopted, and the subsequent dismissals were challenged as unfair in the Labour Court and Labour Appeal Court.
In Screenex Wire Weaving Manufacturing (Pty) Ltd v Ngema and Others (JA 49/07)  ZALAC 10 (2 September 2009) the fairness of FIFO was roundly and loudly rejected. Sections 189(7)(a) and (b) of the LRA requires an employer, in selecting employees for dismissal for operational requirements, to select the employees to be dismissed on the basis of either agreed selection criteria or criteria that are fair and objective. The LAC said that it cannot be said that FIFO is fair and objective as required by s 189(7)(b) of the LRA, because it is easily open to abuse. This is because an employer who wants to get rid of a long serving employee can simply employ a new employee even if there is no clear need for another employee and, after a few months, argue that the workforce needs to be reduced by one employee for operational reasons.
It is clear from this LAC judgement that the use of FIFO as a selection criteria for retrenchments, will not be accepted.
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December 2009 / January 2010