Public Newsletter
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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 the Protection of Personal Information Act ("POPI") that became operational on 26 November 2013. We also look at three new cases: The first deals with the procedural fairness of leading evidence on skype, as well as considering if an inappropriate invitation automatically becomes sexual harassment. The second case looks at another case of sexual harassment where the Labour Court took a tough line. The third case looks at an employer's liability for severance pay if it rehires a retired employee on a new contract.
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RECENT CASES
Skyping in a disciplinary hearing
In an arbitration where one of the charges was sexual harassment, the complainant (who was not an employee) was in Australia. The arbitrator allowed her evidence to be led via skype. A video link could not be established and she testified and was cross-examined telephonically on the skype link. There were a number of breaks in transmission, and there were also pauses between questions and answers caused by the skype link.
On review at the Labour Court in Simmers v Campbell Scientific Africa (Pty) Ltd (C 751/2013) ZALCCT 9 May 2014, the employee (who had been dismissed for the alleged sexual harassment) argued that he had been prejudiced by the fact that, when the complainant testified at the arbitration, she did so over a long-distance link by telephone, and not in person or even by skype video as was initially indicated. He also argued that he was prejudiced by the fact that the complainant did not testify at the disciplinary hearing. He argued that the complainant had the benefit of delays caused by the broken connections and time to compose herself, think of her answers and reconsider the questions, and that she did not have to face the man she had accused. The arbitrator, he argued, could also not test her demeanour - an important factor in a sexual harassment case.
The Labour Court said that it must be borne in mind that arbitration proceedings are designed to be informal and conducted with the minimum of legal formalities. As the complainant was in Australia it would have been unacceptably costly and time-consuming for her to be flown back to South Africa to give evidence. The arbitrator allowed her evidence in the manner envisaged by section 138 (1) of the LRA, which provides that the arbitration may be conducted in a manner that the arbitrator considers appropriate in order to determine the dispute fairly and quickly. The accused was represented by counsel who had the opportunity to cross-examine the complainant telephonically. It was not an ideal situation, but it was one that is envisaged by the LRA. It did not prevent the employee from having a fair hearing. The Labour Court held that it did not constitute a reviewable irregularity.
The court was also asked to decide if the facts before it constituted dismissable sexual harassment. The incident happened away from the workplace, after a business dinner, involving a complainant who was not an employee. The complainant's evidence was that the employee said to her that he was lonely and asked her if she wanted to go for a walk alone with him or go to his room with him. She refused, and after asking her about her relationship with her boyfriend, he again asked her if she was sure she didn't want to spend some time with him. When she again declined, he reiterated the offer and said that if she changed her mind she could go to his room during the night. She was surprised by his advances and felt uncomfortable with his conduct.
The arbitrator had found that the employee's proposals constituted sexual harassment in the form of unwanted verbal sexual advances. The Labour Court said that the issue in question is whether the remarks by the employee constituted sexual harassment, not the fact that he made them - something he admitted that he did. The court said that to say, as the Commissioner did, that because the employee made the remarks he knew that they constituted sexual harassment is a finding that cannot be sustained. It is circular reasoning. This was a decision which a reasonable decision-maker could not have reached.
The court said that the words used were certainly inappropriate, albeit uttered "more in hope than expectation". The court said that the conduct did not cross the line from a single incident of an unreciprocated sexual advance to sexual harassment. The court recognised that a single incident of unwelcome sexual conduct can constitute sexual harassment. But it is trite that such an incident must be serious. It should constitute an impairment of the complainant's dignity, taking into account her circumstances and the respective positions of the parties in the workplace. The court held that this nearly always involves an infringement of bodily integrity such as touching, groping, or some other form of sexual assault; or quid pro quo harassment. In this case, it was a single incident. The court made an interesting reference to a remark of Justice Scalia in the US Supreme Court in Oncale v Sundowner Offshore Serives Inc,: "The prohibition of harassment on the basis of sex requires neither asexuality nor androgyny in the workplace; it forbids only behavior so objectively offensive as to alter the 'conditions, of the victim's employment."
The court's order was to reinstate the employee retrospectively, coupled with a final written warning valid for 12 months - which related to other, unrelated misconduct.
This case does more than clarify the use of skype in a disciplinary hearing or arbitration. It gives useful guidance on what constitutes unwelcome conduct of a sexual nature. It should be contrasted to the SA Metal Group case discussed below.
'Unwelcome' conduct of a sexual nature
The approach adopted by the Labour Court in the Simmers case above is to be contrasted with the facts facing the Court in SA Metal Group (Pty) Ltd v Commission for Conciliation Mediation And Arbitration and Others (C350/13) [2014] ZALCCT 15 (15 April 2014). A divisional director of a company was charged with sexual harassment of a subordinate female staff member. He was found guilty by the chairperson of an internal disciplinary hearing. At arbitration, the Commissioner found that the dismissal was substantively unfair and ordered the company to pay him eight months' compensation of R864,000.
On review in the Labour Court, the court considered the evidence. There was a great deal of email banter that was flirtatious and reciprocated. The director hugged the employee, but then he hugged many employees. She did not protest. He kissed her once on the cheek. She did not protest. When, on a second occasion, while kissing he tried to insert his tongue into her mouth, she showed her displeasure and he backed off immediately.
One of the main arguments made on behalf of the director was this: "Until such time as the alleged offender is made aware that the conduct is unwelcome, there can be no sexual harassment". He submitted that he backed off as soon as she made him aware that his conduct was unwelcome, and that there was no prior indication of this.
The Labour Court held that this proposition cannot be sustained given the definition of sexual harassment in the 2005 code. The definition puts emphasis on how the victim subjectively experiences the conduct, to be balanced against the other factors. The employee claimed that the impact of the director's conduct was serious. The Labour Court also criticised the Commissioner for drawing a negative inference from the passive coping strategies of the complainant and making a credibility finding against her on the basis that she ought to have made it explicit to the director that the banter and hugging constituted sexual harassment in her view - particularly as she was an HR practitioner..
The Labour Court held that CCMA commissioners must apply the 2005 Code when they preside over arbitrations dealing with dismissals for alleged sexual harassment. The Commissioner failed to take into account the correct definition of sexual harassment, and was not guided by the principles and guidelines set out in that Code when he evaluated the respective testimonies of the complainant, and the alleged perpetrator.
Another fault found with the arbitration award was that the Commissioner failed to have adequate regard to the power imbalances between the complainant and the director. She explained in the arbitration that she failed to report the harassment earlier, as she was trying to ensure that she preserved her position as a newcomer in the applicant's employ. The judge commented that the Commissioner did not seem to have taken into account that the director had "an obligation placed on him in his senior managerial position to refrain from any conduct which would contribute to a hostile work environment".
The Labour Court therefore ruled that the award should be set aside. Having come to the conclusion that the director's conduct constituted sexual harassment, the court found that the dismissal was fair.
What do we learn from these cases? We think they give us clear insights into when unwelcome sexual advances may constitute sexual harassment. In the Simmers case the court took into account that the complainant was not an employee, that it was after a social function away from the workplace and there was no power differential. The court recognised that sexual chemistry may exist at the workplace. In SA Metal Group the power differential was an important factor, outweighing conduct that was mutually flirtatious and stopped as soon as it was made clear that it was unwelcome. We take the main lesson to be that anyone with managerial authority puts themselves at risk by engaging in any conduct which may be interpreted as sexual, even if there is no immediate communication that it is unwelcome.
The dangers of re-employing a retired employee
There is a danger lurking in s 84(1) of the BCEA which says:
"For the purposes of determining the length of an employee's employment with an employer for any provision of this Act, previous employment with the same employer must be taken into account if the break between the periods of employment is less than one year".This section becomes important in the calculation of severance pay and an employer is obliged to take into account the full length of service of the employee.
But what if an employer offers a retired employee a new contract to mentor new employees or retain scare skills? If the employer needs to retrench this re-hired employee, is s/he entitled to a severance package based on all their years of service? This was the situation in Rogers v Exactocraft (Pty) Ltd (C 1142/10) ZALCCT 16 April 2014.
The applicant worked for the employer for 21 years. He retired when he reached the compulsory retirement age of 65. The next day he entered into a fixed term contract for two years with the employer, terminable on three months' notice. The employer recognised him as a highly skilled and valuable employee and the fixed term contract after his retirement was in order to retain his skills.
The employer dismissed the applicant for operational requirements on three months' notice. He claimed that the dismissal was not for a fair reason or in accordance with a fair procedure as envisaged in s 189 of the LRA. He claimed compensation for unfair dismissal in terms of s 194 of the LRA, severance pay in terms of ss 41 and 84 of the BCEA, and damages for short notice.
The employer argued that the dismissal was for a fair reason, namely its precarious financial position; and that it had followed a fair procedure in terms of s 189 of the LRA. Whilst this case investigated the procedural and substantive circumstances of the retrenchment, our discussion focusses on the amount of severance pay for which the employer was liable.
The Labour Court described severance pay as both a form of compensation for a no-fault termination of the contract of employment as well as recognition of the employee's 'investment' in the employer's enterprise. Severance pay is for an unexpected termination of one's expectations. In this situation the employee's expectation was for just two years of further employment. The court held that it would be anomalous if a right to severance pay for the 20 years prior to retirement could be created simply by re-employment when there was never a right to severance pay on retirement. In terms of the purposes of severance pay as outlined above, there was no need to compensate the employee on retirement because this was not a dismissal but a termination of the contractual relationship. The employee's investment in the company was taken care of through the provident fund.
The Labour Court departed from the literal interpretation of s 84 of the BCEA. This judgment is a sensible and fair decision and one that frees employers to enter into post-retirement contracts without the fear of becoming liable for a disproportionate severance package.
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Bruce Robertson
May 2014
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