Incapacity refers to when an employee is incompetent and inherently unable to meet fixed performance standards whether due to ill health or poor work performance.  When the employee cannot perform according to the employer’s required standard due to ill health, the employer should consider the nature of the employee’s job, period of absence, seriousness of the employee’s illness or injury, possibility of accommodating the employee’s disability and possibility of securing alternative employment within the business.

Employees who are unable to perform at the required standard have a huge impact on a business’s normal operations, as most employers don’t have the luxury of spare capacity concerning their workforce to compensate for this deficit.  Employers have the right to establish a fixed standard in the workplace in terms of quality and quantity and to give reasonable and lawful instructions.

It is vital that employers always follow the correct procedures as required by labour legislation:

The investigation process

When an employee is absent on a regular basis, the employer should keep a record of the dates and reasons for the absence on file. If it is continuously for the same reason, it may be that there is an underlying medical reason that should be investigated if it affects the operational requirements of the business.

If the employee brings to the employer’s attention that he/she has a medical condition, or the employer is of the opinion that the employee has a medical condition that affects the employee’s ability to do their job, a consultation process should be held with the employee.

The consultation process

Consult with the employee to determine what the medical condition is and how it is affecting the employee’s work. Discuss the way forward and determine whether it is necessary to send the employee for a medical examination. Ensure that all consultations held with the employee are kept on record and held in the presence of a witness.

The medical examination

The employer should request the employee to obtain a medical report. It is highly recommended that the employer provide the medical practitioner who will be doing the examination, with the employee’s required duties on a day-to-day basis.  The medical report should highlight the following:

• the cause of the incapacity;
• whether the medical condition is going to improve or worsen; and
• what is the expected period for the medical condition to improve.

If the employer requests the medical report, the employer may be liable for the costs thereof.  It is important to set a date by when the employee should provide the medical report.

The employee is entitled to obtain a second opinion. Likewise, if the employee obtained the medical report on their own account, the employer may obtain a second opinion. Furthermore, if an employee requests to proceed with further medical testing, allow them the opportunity to do so.

The assessment

On receipt of the medical report, the employer will be in a position to determine the way forward. The employee’s health and employer’s operational requirements need to be considered. If the employee recovers, it is not necessary to proceed with an incapacity hearing. The employer can however, continue to monitor the individual.

The incapacity hearing

At the incapacity hearing, it will be necessary to determine whether the incapacity is temporary or permanent. Discuss the following questions thoroughly at the hearing:

• Are the circumstances permanent or what is the expected duration of the incapacity?
• Is it clear how long the employee will be absent or unable to perform their duties?
• Is there a period of light duty prescribed by the medical practitioner?
• Does the employer have light duties available for the employee?
• Can the employer make use of a temporary worker until the employee is able to continue working?

If the incapacity is temporary, the employer should determine whether it is possible to accommodate the employee and further, whether the employer can reasonably adapt the work environment to accommodate the employee. Dismissal should only be reserved for, and reverted to as a last resort once all options have been explored. If the incapacity is permanent, which is confirmed by a medical practitioner, the employer may have no other option but to proceed with a dismissal.

If an employee is dismissed for incapacity after following a fair process, the employer should pay out any accumulated leave, salary up to the last working day (possibly sick leave if medical certificates were produced) and the notice period as agreed upon in the employment contract.

It is important that employers deal with issues in the workplace as quickly and effectively as possible, while taking care to act objectively and consistently.  By being proactive, 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.

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Retrenchment is the no-fault termination of an employee’s services and is governed by Section 189 of the Labour Relations Act, Act 66 of 1995 as amended (LRA).  It becomes necessary when there are operational requirements to reduce the workforce.  Operational requirements are defined as requirements based on economic, technological, structural or similar needs of the employer.

The retrenchment process

The retrenchment process is clearly set out in Section 189 and 189A of the LRA and must be followed to ensure that such process is both substantively and procedurally fair.

It is important for employers to take note that the retrenchment process must be instituted as soon as it is contemplated. This process can take a considerable amount of time as it depends on various factors such as the number of employees involved and the scale of the intended retrenchment. Employers are therefore warned not to leave it to the last minute to commence with the process.

All reasonable alternatives

Employers are encouraged to commence with the process well in advance to establish if there are any actions that can be taken to avoid retrenching any employees.  The process entails that all reasonable alternatives must be exhausted in order to try and prevent any retrenchments, and the courts have stated that retrenching any employee must be the last resort.

Examples of reasonable alternatives can include short time, reduction in salaries, transferring employees to other departments, reducing overtime, bumping and voluntary separations just to mention a few.  It is important for employers to discuss the alternatives with employees in order to obtain their consent before it can be implemented.

Follow the procedure

The below procedure must be followed when the employer contemplates the possibility of retrenchment (for the purpose of this article we’ll only look at Section 189 and not Section 189A-large scale retrenchments).

1.  Issue a notice of possible retrenchment consultation in terms of Section 189 of the LRA

This notice must contain the date, place and time of the meeting and other specific details, which include:

• Reason for possible retrenchments
• Alternatives that have been considered by the employer
• Number of employees and job categories that will most likely be affected
• Proposed method of selecting employees to retrench
• When the retrenchment will most likely take effect
• Proposed severance pay
• Assistance that can be offered by the employer
• Possibility of future employment
• Number of employees employed
• Number of employees dismissed for operational requirements in the past 12 months

This notice must be issued to the following persons:

• All employees that are most likely to be affected by the retrenchment
• Any person whom the employer must consult with in terms of a collective agreement, if none the notice must be issued to the workplace forum
• The trade union representative if the employees are represented by a trade union

2.  Proper consultation

Proper consultation must be held with employees that will most likely be affected by the retrenchment, or with their trade union representative.  During the consultation, all aspects as contained in the notice must be discussed in full.  The employees, or representative, must be granted the opportunity to provide their feedback on all aspects, as well as alternatives that can be considered in order to prevent retrenchment.  This could entail that further consultations must be scheduled to continue discussing possible alternatives or any other aspect that must be clarified.

The retrenchment process is a consensus seeking process during which the parties must try and reach an agreement on how the retrenchments (and its effects) can be avoided and mitigated as far as possible.

If there are no reasonable alternatives that can be implemented, and retrenchments cannot be avoided, notice of retrenchment must be issued to the affected employees.

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Parental, adoption and commissioning parental leave came into effect on 1 January 2020 under the Labour Laws Amendment Act, Act 10 of 2018.  Many employers in the agricultural industry however get confused about leave given the pending Constitutional Court case judgement on maternity and paternity leave which may likely introduce changes to these forms of leave in the future.

Parental leave

An employee who is a parent of a child is entitled to at least 10 consecutive days of unpaid parental leave. This leave must commence on the day the employee’s child is born, or in the case of adoption on the date an adoption order is granted or when a child is placed in the care of a prospective adoptive parent by a competent court, pending the finalisation of an adoption order.

Note that currently both male and female employees may qualify for parental leave depending on the circumstances.  If the employee gave birth to the child however, she would not qualify for parental leave but would be entitled to four months’ unpaid maternity leave.

Adoption leave

An employee who is an adoptive parent of a child under the age of two years old is entitled to at least 10 consecutive weeks of adoption leave. Adoption leave may commence on the date an adoption order is granted or the date a competent court places the child in the care of a prospective adoptive parent pending the finalisation of an adoption order, whichever occurs first.

If an adoption order is granted to two adoptive parents, one parent may apply for adoption leave while the other may apply for parental leave. The choice of leave must be decided by the two adoptive parents. Similarly, if a competent court places a child in the care of two prospective adoptive parents pending the finalisation of an adoption order, one prospective parent may apply for adoption leave, and the other may apply for parental leave, with the decision on leave being made at their discretion.

Commissioning parental leave

An employee who is a commissioning parent in a surrogate motherhood agreement is entitled to at least 10 consecutive weeks of commissioning parental leave which may commence on the date the child is born as a result of the surrogate motherhood agreement.

If a surrogate motherhood agreement involves two commissioning parents, one parent may apply for commissioning parental leave, while the other may apply for parental leave. The decision regarding leave allocation must be made at the discretion of the two commissioning parents.

Should employees notify the employer

Yes, employees are required to notify their employer in writing of the date on which their leave will commence and when they will return to work. This notice must be provided at least one month in advance of the expected birthdate of the child, or the date the adoption order is expected to be granted, the placement of the child with a prospective adoptive parent, or the birth of the child under a surrogacy agreement. If notice cannot be provided within the required period, then it must be given as soon as practically and reasonably possible.

Are the abovementioned leave types paid or unpaid?

Currently in terms of labour legislation any parental, adoption or commissioning parental leave taken would be unpaid. The employer is not obliged to remunerate the employee for these leave days, and the employee can submit a claim to the Unemployment Insurance Fund (UIF).

Employers should note that these provisions might change again in the near future pending the decision of a court case that was recently heard in South Africa’s apex court, the Constitutional Court. These leave types as introduced by the Labour Laws Amendment Act are however still currently in force and employers should take note of the leave provisions and requirements to ensure compliance and to support their workforce effectively.

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To uphold the constitutional rights of trade unions and employers’ organisations to engage in collective bargaining, legislation has been enacted to establish the framework within which this process occurs.

The Labour Relations Act 66 of 1995 (LRA)

The LRA lays the groundwork for collective bargaining by establishing the framework for bargaining councils. According to Section 27 of the Act, registered trade unions and registered employers’ organisations may form a bargaining council for a specific sector and area. Additionally, the Act allows for the state to be a party to a bargaining council.

The primary objective of trade unions and employers’ organisations in forming a bargaining council is to regulate industrial relations matters between employers and employees within their respective sectors and areas.

Purpose of bargaining councils

Case law has affirmed that the primary functions of bargaining councils are to conclude and enforce collective agreements concerning terms and conditions of employment or matters of mutual interest, as well as to prevent and resolve labour disputes within the workplace.

Collective agreements

The outcome of collective bargaining between employers’ organisations and trade unions is the negotiation and conclusion of collective agreements. Collective agreements can be defined as agreements between trade unions and employers’ organisations that regulate matters of mutual interest and conditions of employment.

A collective agreement concluded in a bargaining council binds the parties to the bargaining council who are also parties to the collective agreement. A bargaining council may request, in writing, that the Minister of Employment and Labour extend the collective agreement to non-parties within its registered scope, as identified in the request and subject to certain requirements set out in the Act. Once the Minister extends the agreement to non-parties, any employer not originally party to the agreement will be obligated to comply with its provisions and register with the relevant bargaining council.

Collective agreements are concluded for a specific period, with the validity period clearly stipulated in the agreement. Once this period has expired, the agreement will no longer be binding on the parties unless it has been extended for an additional period or a new collective agreement has been concluded.

Dispute resolution

Another key function and power of a bargaining council is to perform dispute resolution functions, typically provided for by the collective agreement and within their jurisdiction, similar to the Commission for Conciliation, Mediation, and Arbitration (CCMA). Common types of disputes presided over by a bargaining council include unfair labour practice and unfair dismissal disputes.

Monitoring compliance

Bargaining councils also monitor compliance with labour legislation in general, and specifically with the provisions of any collective agreements in force within their respective industry and area.

According to the LRA, the Minister of Employment and Labour, at the request of a bargaining council, may appoint designated agents to promote, monitor, and enforce compliance with any collective agreement. These designated agents are empowered to ensure compliance by publicising the contents of agreements, conducting inspections, investigating complaints, and performing other functions as assigned by the bargaining council.

Bargaining councils play a crucial role in establishing terms and conditions of employment or addressing matters of mutual interest within a specific industry. They also work to prevent and resolve labour disputes within the workplace.

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The idea of receiving a “payment for years of service” is a very common query, especially after an employee’s termination of service. Many employees, particularly those with many years of service, expect and anticipate being rewarded for their loyalty and dedication to an employer, sometimes believing that this is an automatic entitlement created by law. However, this is not true for the most part and employers must be clear on the legal requirements regarding such payments under South African labour law as legislation is very specific about when and how such payments are applicable.

The legal framework: severance pay under the BCEA

The primary legal foundation for “payment for years of service” in South Africa comes from Section 41 of the Basic Conditions of Employment Act 75 of 1997 (BCEA), which provides for severance pay.

When is severance pay due under the BCEA?

Section 41 of the BCEA stipulates that severance pay is only due to an employee when their dismissal is due to the employer’s operational requirements. These are situations where business’s operational requirements, such as economic, technological, or structural changes, force the employer to reduce their workforce.

Under these circumstances, the employer must provide the employee with severance pay equal to at least one week’s remuneration for each completed year of continuous service. This payment is calculated in terms of BCEA Section 35, which details how remuneration should be calculated.

Fixed term contracts and long service

In cases involving fixed term contracts, the situation can be slightly different. According to Section 198B of the Labour Relations Act 66 of 1995 (LRA), employees on fixed term contracts, who earn below the earnings threshold, and when the contract exceeds 24 months, may be entitled to severance pay upon their contract expiring.

It’s crucial for employers to understand that there is no general right to a “payment for years of service” outside of the provisions for severance pay under the BCEA and LRA. Employees are not entitled to such payments simply because they have worked for the business for many years.

Navigating employee expectations

Employers often face difficult conversations with employees who feel entitled to a “reward” for long service, particularly in the context of retirement or termination. While it might be beneficial for businesses to recognise long-standing employees through awards or other incentives, employers should not confuse this with a legal obligation.  Employers should be careful not to create expectations of entitlement in the minds of employees with regards to payment for years of service.  Employers should ensure that their workplace policies clearly outline the conditions under which severance pay is applicable and should provide training to managers on how to handle such requests.

The notion that employees should automatically receive a ‘big payday’ for their years of service is often rooted in the employee’s mistaken beliefs or expectations, and is not legally required unless specified in an employment contract, or in the context of retrenchment or other specific legal conditions.

Conclusion

In summary, while the notion of compensating employees for their years of service may seem like a normal form of recognition, it is not an automatic right under South African law. Employers are only required to pay severance pay under specific conditions, primarily when an employee is dismissed due to the employer’s operational requirements and upon the expiration of a fixed term contract as set out above. As long as employers adhere to the legal framework outlined in the BCEA and LRA, they can avoid misunderstandings and disputes over payments for years of service.

This article focusses on employment under the BCEA and there might be different laws applicable to your industry, which might be governed by a sectoral determination or collective agreement with different provisions regulating severance pay, and therefore employers are encouraged to seek legal advice when dealing with these issues, especially in cases of retrenchment or fixed term contract terminations, to ensure compliance with the right laws and avoid unnecessary claims or disputes.

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Negligent conduct or actions of employees can cause the employer damage, including financial damages. In such instances the employer might consider taking disciplinary measures and as such should investigate the matter to determine whether the employee’s actions constitute negligence.  If so, the employer should further determine if the employee’s actions constitute gross negligence to ensure that the correct disciplinary process is followed and implemented.

Why? What’s the difference?

It is vital to determine the appropriate procedures to follow in terms of workplace policies and disciplinary codes.  Generally, if an employee is found guilty of negligence, the type of negligence (i.e. negligence vs. gross negligence) will have different sanctions.  Depending on the disciplinary code in the workplace, gross negligence might be met with a sanction of dismissal after a disciplinary hearing is concluded, as opposed to ‘ordinary’ negligence which might only lead to the employee being issued a warning.

Negligence

In his book titled Workplace Law (11th edition), John Grogan states the following in consideration of an employee’s negligence:

“In labour law, negligence bears the same meaning as it does in other areas of law: the culpable failure to exercise the degree of care expected of a reasonable person. In the workplace context, the ‘reasonable person’ would be a responsible employee with experience, skill and qualifications comparable to the accused employee. Negligence can manifest itself in acts or omissions. The test is whether a reasonable person in the position of the accused employee would have foreseen the possibility of harm and taken steps to guard against that harm.”

Gross negligence

Gross negligence can be described as an act or omission that is so careless or reckless that it shows a complete disregard for safety or well-being.  It occurs when an employee’s conduct deviates from the reasonable person’s standard to such an extent that it may properly be categorised as extreme. Our courts have held that it must demonstrate, in cases where there is conscious risk-taking, a complete lack of awareness or concern, and in the absence of conscious risk-taking, it demonstrates an absolute failure by the employee to exercise care.

Gross negligence is an elevated level of risk beyond typical neglect.  It emphasises a foreseeable possibility of severe harm if appropriate care is not taken, and/or a conscious and voluntary disregard for applying reasonable care, which is likely to result in severe injury or harm.

An objective test

From these descriptions we see that an objective test is used to determine negligence, and for gross negligence it needs to be assessed whether the employee demonstrated a high degree of reckless disregard for his/her acts or omissions, and a failure to exercise the standard of care that was reasonably expected of an employee with their degree of knowledge, skill and experience.

It is important to remember that onus lies with the employer to prove that the employee is guilty of negligence and/or gross negligence.  Where the employee is dismissed on grounds relating to gross negligence, the employer must be able to prove that dismissal was substantively and procedurally fair in consideration of the merits of the case.

Conclusion

Distinguishing between negligence and gross negligence is crucial in determining the appropriate disciplinary action in the workplace. Gross negligence involves a higher degree of reckless disregard for the safety or well-being of others, showing a departure from the standard of care expected of a reasonable employee. Employers must conduct thorough investigations to assess whether an employee’s conduct meets the higher set standard, as gross negligence often justifies more severe sanctions, including dismissal. The employer bears the burden of proving both the occurrence of gross negligence and the fairness of any dismissal that may follow, ensuring that disciplinary measures align with both substantive and procedural fairness.

The content in this article is for informational purposes only and should not be construed as legal advice. Please contact the LWO for advice and/or assistance.

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