What is the biggest issue with labour law and how to fix it
Compliance with legislation can be intimidating, especially for business owners without a legal background. Labour law is not negotiable and poses a business risk to the employer. To comply with legislation is not a luxury, it is a must and can be overwhelming in terms of specialist knowledge, as well as time-consuming. Employers should, however, realise that legislation can also be used to protect your business and minimize risk by proactively positioning the business with regards to possible future disputes.
Labour legislation is applicable to all employers and employees and aims to regulate labour relations ensuring fairness in the workplace. The labour environment in South Africa is highly regulated which creates an extremely challenging working environment for employers.
One of the biggest challenges employers face is following the correct procedure when enforcing discipline in the workplace, especially when an employee is dismissed. It is vital for employers to have clear rules and guidelines in the workplace and ensure that every employee is aware of these rules. Employers must have an up-to-date disciplinary code that lists offences with the appropriate sanctions to use when rules and procedures are not followed.
Misconduct is one of the justifiable grounds for dismissal of an employee, however for such a dismissal to be fair, the employer must comply with the following two tests:
1. Substantive fairness
– a valid and fair reason for the sanction imposed. The employer must be able to prove the following on a balance of probability:
- Was there a rule in the workplace?
- Was the rule reasonable?
- Was the employee aware of the rule?
- Did the employee break the rule?
- Did the employer apply progressive discipline (consultation and warnings, according to the offence)?
- Did the employer apply discipline consistently?
- Did the misconduct justify the sanction applied?
2. Procedural fairness
– the required legal procedure before imposing a sanction. An employer cannot dismiss an employee under any circumstances, even with a valid reason, without holding a disciplinary hearing to ensure that a fair procedure is followed. The employer must be able to prove the following:
- A disciplinary hearing was held;
- The employee was notified in writing at least 48 hours (excluding weekends and public holidays) prior to the hearing to prepare for the hearing;
- All documentation (notice to attend the hearing and a procedural application form) contained all the necessary information required by legislation;
- The chairperson was informed and unbiased;
- The accused employee was given every chance to prepare for, state and defend his/her case;
- Aggravating and mitigating circumstances were taken into account;
- The outcome of the dismissal was based on the facts presented during the hearing;
- The sanction was appropriate according to the offence;
- The hearing and outcome was recorded in writing by the chairperson;
- The employee received the outcome in writing.
Most cases referred to the Commission for Conciliation, Mediation and Arbitration (CCMA) pertain to unfair dismissal. In general, arbitration awards in favour of the employee are due to incorrect procedures followed on the employer’s behalf. Possible awards against the employer can include the following:
- CCMA: 3-12 months’ salary and/or reinstatement;
- Labour court: 3-24 months’ salary and/or reinstatement.
Labour risk is a huge business risk and not following the correct procedures can lead to dire consequences with a huge financial impact. By addressing labour risk proactively, the employer can greatly contribute towards the business’s sustainability and profitability and ensure a working environment with reduced conflict, friction and misunderstanding, which in turn creates a structured environment receptive to growth.
Labour legislation sets strict requirements that employers must comply with and that is exactly what the LWO does – we assist you as the employer to comply with labour law and to use it to protect your business. The LWO Employers Organisation assists any employer, irrespective of size, industry or number of employees to comply with labour law. For more information visit LWO website.
To protect, lobby, promote and develop ethical franchising across all sectors in South Africa with specific focus on transformation.
