The issue of dismissal in the workplace is a contentious one and can be be difficult to navigate. If not correctly handled, the consequences of an unfair dismissal could prove to be a timely and costly affair for businesses. Luckily the Labour Relations Act and the Codes of Good Practice outline what constitutes a fair and unfair dismissal process. We examine this in more detail below.
What is a dismissal?
In simple terms, a dismissal occurs when an employer terminates an employee’s employment contract before the agreed date of termination. The dismissal process is set out in the Code of Good Practice: Dismissals. The Labour Relations Act (LRA) 66 of 1995 states that every employee has the right not to be unfairly dismissed. This means that an employer cannot dismiss an employee at the drop of a hat and that there needs to be a substantive reason for dismissing an employee, and fair procedure needs to be followed. For a dismissal to be lawful, it needs to be fair. This fairness is based on substantive fairness (was there a fair reason for dismissal) and procedural fairness (was the procedure used in the dismissal lawful and fair). We examine the three main grounds for dismissal below.
3 Grounds for dismissal?
In accordance with the LRA, there needs to be sufficient grounds for a dismissal to be fair. These grounds include the following:
This often references misconduct relating to breaches of business rules, standards, policies, procedures and codes of conduct on the employee’s behalf and includes:
- Whether or not the employee contravened a rule or standard regulating conduct in, or of relevance to, the workplace
- If a rule or standard was contravened
- Whether or not the rule was a valid or reasonable rule or standard
- If the employee was aware, or could reasonably be expected to have been aware, of the rule or standard
- The employer has consistently applied the rule or standard
- Dismissal with an appropriate sanction for the contravention of the rule or standard
- An example of this would be if an employee signed a non-disclosure agreement and went to a competitor business and disclosed vital information which is a breach of contract.
According to the Code of Good Practice in Chapter 8 of the LRA, incapacity is categorised into two different categories in relation to dismissal. These include poor work performance and ill health or injury and relate to the employee’s capability to do their job. The following elements must be considered for a dismissal based on these grounds.
- Did the employee fail to meet a performance standard
- Was the employee aware of the required performance standard and given the right training to meet these standards
- Did the employee have a fair opportunity to meet the required standard
- Is dismissal the appropriate action for failing to meet the performance standard
- What other solutions could be put in place instead of dismissal.
Ill health or Injury:
This is divided into temporary and permanent ill health or injury. In both cases, the employer must:
- Investigate the extent of the incapacity
- Consider the time that the employee will be off work and determine if this is unreasonably long for the circumstances
- Examine whether the employer is capable of performing
- Investigate dismissal alternatives that include the nature of the job, the period of absence, securing temporary replacement as well as the availability of alternative work or adaptations to accommodate the employee
- The degree of incapacity is relevant to the fairness of any dismissal. The cause of the incapacity may also be relevant. For example, in the case of certain kinds of incapacity like alcoholism or drug abuse, counselling and rehabilitation may be appropriate steps for an employer to consider
- Particular consideration should be given to employees who are injured at work or who are incapacitated by work-related illnesses. The courts have indicated that the duty on the employer to accommodate the incapacity of the employee is more onerous in these circumstances
Operational requirements are defined in Section 213 of the LRA as “requirements based on the economic, technological, structural or similar needs of an employer”. In this case, the employer might find themselves in financial trouble which may require a restructure and retrenchment of staff. It must be mentioned that this should be the last option for any employer.
Procedures that need to be considered and followed for a fair dismissal
There are also a number of procedures that need to be followed for a fair dismissal. These procedures include:
- An investigation by the employer to determine whether there are grounds for dismissal – this does not necessarily need to be a formal inquiry.
- The employer should notify the employee of the allegations using a form and language that the employee can understand and follow
- The employee should be allowed to state a case in response to the allegations
- The employee should be entitled to a reasonable time to prepare the response and have the assistance of a trade union representative, fellow employee or legal advice
- After the inquiry, the employer should communicate the decision taken and provide the employee with a written notification on the inquiry’s outcome and the decision made.
- If the employee is dismissed, they should be given the reason for dismissal and reminded of any rights to refer the matter to a council with jurisdiction or to the Commission for Conciliation, Mediation and Arbitration (CCMA) or to any dispute resolution procedures established in terms of a collective agreement.
- In exceptional circumstances, if the employer cannot reasonably be expected to comply with these guidelines, the employer may dispense with pre-dismissal procedures.
It must be noted that elements relating to the employee’s length of service, disciplinary record in relation to the grounds for dismissal should be considered by law.
What constitutes an unfair dismissal?
A dismissal will be regarded as automatically unfair if the reasons for the dismissal impacts the employees right to exercise the rights provided by the LRA or if the employee’s rights to belong and participate in a trade union are not met. These elements often fall under the categories of substantive and procedural fairness.
Section 187 of the LRA outlines a list of reasons that are regarded as automatically unfair and include:
- Participation in or support of a legal or protected strike or protest action
- Taking action or indicating an intention to take action against the employer
- Direct or indirect discrimination against an employee based on sex, race, religion, health status etc.
- A transfer of a business or a reason related to transfer
- Pregnancy or intended pregnancy
- A contravention of the Protected Disclosures Act
Legal consequences for unfair dismissal
Employees who feel that they have been unfairly dismissed are able to go to the CCMA, bargaining council or labour court and lodge a dispute against the employer, challenging the dismissal. If the employer is found to have unfairly dismissed the employee, there are several consequences.
Often the employer will have to reinstate or re-employ the employee. Reinstatement is a preferred solution due to the high unemployment rates in South Africa. This means that the employee will be returned to the position they held at the time of dismissal. The employee may also be placed in a new position upon their return.
If the employee does not wish to be reinstated or the working relationship has been irreparably damaged, the court may insist that the employer provide compensation to the employee. This could include anything from 12 to 24 months of remuneration. This number is dependent on different factors relating to the procedural or substantive fairness of the dismissal and the court’s findings.