When an employee’s alleged misconduct in the workplace comes to the employer’s attention, it is necessary to investigate.  This ensures that the employer makes an informed decision based on the facts.  The purpose of the investigation is to establish if there is enough evidence to prove the alleged misconduct, and if there are sufficient grounds for a dismissal.  However, employees are entitled to an expeditious finalisation of disciplinary proceedings.

Disciplinary hearings:  balance is key

Balance is key between conducting a thorough investigation in pursuit of relevant facts, and finalising the disciplinary process in a timely manner and avoiding unreasonable delays.  Failure to do so may result in both substantive and procedural unfairness towards an employee.  Preferably, an investigation must be without any delay and not unnecessarily dragged out. An investigation depends on the nature and complexity of the case, the amount of evidence, and the availability of witnesses and other evidence.

Don’t rush disciplinary hearings

Employers should be careful of rushing the proceedings to schedule and conduct a disciplinary hearing, as it can lead to:

• Incorrectly or poorly drafted charges – the charge sheet is very important, and all charges listed must be factually correct. Once all the information is obtained and the employer is satisfied that there is sufficient evidence to charge the employee with, it is time to formulate the charges.  Ensure that each charged misconduct contains enough detail of the actual offence, including the time, place and a brief description. An employee must be able to prepare for the disciplinary hearing based on these charges.
• Witnesses required to prove the misconduct being unavailable or insufficiently prepared to give evidence.

• Insufficient evidence presented at the hearing – take note that the chairperson can only make a finding based on the facts and evidence presented during the disciplinary hearing and cannot rely on speculation or make inferences in the absence of sufficient facts and evidence relating to the misconduct.

Avoid unreasonable delays

Unreasonable delays in the process should be avoided and whilst investigations into misconduct must be thorough, the employee’s right to have the matter finalised in a timely manner, must be borne in mind.  The Labour Court considers the following factors (to be applied holistically) in determining whether a delay in disciplinary hearings renders the process unfair:

• The delay in finalising the proceedings must be unreasonable. The longer a delay, the more likely it is to be found to be unreasonable;
• The employer must provide a reasonable explanation for the delay. An inexcusable delay will lead to a finding that the process was unfair;
• Any steps taken by an employee, or the failure to take steps during the disciplinary process, to assert the right of the employee to a fair and speedy process;
• Whether or not the delay caused material prejudice to the employee by considering the impact of the delay on the employee’s ability to present a proper case;
• The nature of the offence.

Suspension

If the employee’s conduct is of a very serious nature, the employer is entitled to suspend an employee on a precautionary basis pending an investigation, especially if there is a possibility that the employee can interfere with the investigation in any way, disrupt the employer’s operations, or intimidate possible witnesses.  Take note that precautionary suspension is with full pay and benefits and that the employee is not being punished.

Take note

Discipline is a vital aspect to ensure a workplace functions effectively.  An employer cannot dismiss an employee under any circumstances, even with valid reason, without first holding a disciplinary hearing. This will ensure that a fair procedure is followed and that there is substantive reason (proof) for the employee to be dismissed.

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There are different ways in which an employment contract may terminate. It can either be by way of the employee resigning, reaching the retirement age set in the workplace, the employee being dismissed for misconduct or retrenched due to operational reasons. There are certain requirements for the employer under each of these circumstances and it is important for an employer to understand what payments should be made to an employee upon termination to avoid non-compliance with legislation.

Resignation by the employee

If an employee resigns, it should preferably be in writing. If the employee resigns with immediate effect, the employer may institute civil action for any damages suffered as a result of the employee not working a notice period. The employer does not have to remunerate the employee for the notice period when an employee resigns with immediate effect, but the employer cannot withhold the employee’s final salary under these circumstances.  Payment for days worked and accumulated leave will be due to the employee.

Employee reaching retirement age

It is of paramount importance for an employment contract to be clear on the retirement age within the business. If there is no retirement age, the employer should institute a retirement policy. The statutory notice period is still applicable when an employee retires. The employee is paid for the notice period that they work. Accumulated leave will also be due to the employee. An employee is not paid for years of service. Any ex gratia (out of goodwill) payment is solely at the discretion of the employer and is not a legal requirement.

Dismissal of an employee

Firstly, before any form of dismissal may take place, a disciplinary hearing must be held. Once the employee has been found guilty and there are sufficient grounds to proceed with a dismissal, an employer may proceed with a sanction of this nature. When an employee is dismissed, the employee should receive his/her salary up to the last working day, including the finalisation of the disciplinary hearing. Accumulated leave will also be due to the employee. No notice period is applicable when an employee is dismissed for misconduct.

Retrenchment of an employee

Correct procedures have to be followed before an employee may be retrenched. A retrenched employee is entitled to accumulated leave, notice pay (if applicable) and severance pay. If an employee is not required to work a notice period, the employee should be paid for this period. An employer must pay an employee severance pay equal to at least one week’s remuneration for every completed year of service. Only when an employee is retrenched, is it a legal requirement for the employer to pay for years of service.

The employer has an obligation to provide an employee with a certificate of service and final salary advice upon termination of employment. A UI19 document has to be completed and submitted to the Department of Employment and Labour.

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Employers are often faced with employees who simply stay away from work. The question then, is how to deal with it. If an employee does not report for work, the employer has an obligation to take all reasonable steps to determine why the employee is absent.

THE FIRST STEP

The employer’s first step is to contact the employee on all numbers available. If the employee does not answer, attempt to contact the employee again at a later stage.  If this remains unsuccessful, send the employee a message informing him that he is absent without permission, and if his absence is due to an illness, he must confirm this as soon as possible.

The second step

The second step is to inform the employee that he must report back for work as he is absent without permission and/or a valid reason. Provide the employee with a specific date and time when he must report back. Generally, the date will be the next business day.

If the employee still does not report for work, and no communication is received regarding his absence, contact the employee again to warn him that he is still absent without permission and/or a valid reason.

An ultimatum

If the employee is absent for five consecutive days/shifts, send the employee an ultimatum with the following information:

• the date from when he is absent without permission and/or a valid reason;
• that he is absent for five consecutive days/shifts, which is an indication of his desertion with no intention of returning to work;
• that the employee is given an ultimatum to return to work;
• specified date and time at which the employee must report back for work;
• a warning that further disciplinary action may be taken, which includes a disciplinary hearing and possible dismissal.

NOTICE of hearing

If the employee does not comply with the ultimatum, and still does not report back for work, serve the employee with a notice of disciplinary hearing. The notice can be served by hand, email or electronic message (“SMS” or “WhatsApp”). The notice must also specifically warn the employee that the hearing may continue in his absence if he chooses not to attend.

The general rules regarding a disciplinary hearing are valid and must still be followed, even if an employee fails to attend the hearing. If the employee is found guilty of desertion during the disciplinary hearing, this can lead to his immediate dismissal.

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It is a common occurrence for employers to alter the reason for termination on an employee’s UI-19 certificate in order for them to qualify to claim Unemployment Insurance Fund (UIF) benefits, but is it legal?

The UI-19 certificate is a crucial requirement for any unemployed person to enable them to claim benefits from the UIF. The reason for termination on the certificate assists the fund to identify and categorise an employee’s right to claim benefits. However, more and more employers are being requested (and complying) to change the reason for termination on former employees’ UI-19 certificates. The reasons for these requests are mainly due to the employees being refused to claim from the fund as the termination reason on their UI-19 certificates disqualifies them from claiming benefits.

Disqualification

Employees are generally disqualified to claim benefits from the fund if they have resigned, retired, are dismissed due to abscondment, or if they have been barred from claiming benefits in terms of the Unemployment Insurance Act 63 of 2001 (UIA). When employees are refused, they turn to employers to change the reason on the certificate to enable them to claim benefits.

Case study – UI-19 certificate changes

Changing the reason for termination on the UI-19 certificate has been discussed in the recent case of Swanepoel v KPMG Services (Pty) Ltd (J494/19) [2021] ZALCJHB 457 whereby the Applicant sought an order compelling the Respondent to change the reason for his termination from ‘involuntary resignation’ to ‘retrenchment’, in order for him to claim UIF benefits.

The court ruled as follows:

[13] There are two hurdles confronting the applicant. Firstly, the jurisdiction of the Labour Court is regulated by Section 66 of the UIA which provides that: ‘Unless this Act provides otherwise, the Labour Court has jurisdiction in respect of all matters in terms of this Act, except in respect of an offence in terms of this Act’.

While Section 64 of UIA provides that:

‘(1) No person may-

• knowingly make a statement or cause a statement to be made which is materially false or which results in an incorrect payment of benefits in an application for benefits in terms of this Act;
• wilfully make any false entry on a contributor’s record card or any other book, record or document relating to either a contributor’s employment history or to a contributor’s claim for benefits; or
• contravene, or refuse or fail to fully comply with any provision of this Act or of any regulation or notice issued in terms of this Act.

(2) Any person who contravenes Subsection (l)(a), (b) or (c) is guilty of an offence.

[14] Given my finding that the applicant’s contract of employment terminated on mutual basis in terms of the settlement agreement, the recordal of ‘involuntary resignation’ in the UI-19 form obviously constitutes a false entry in terms of Section 64(1)(b) and a criminal offence in terms of section 64(2) of UIA. As mentioned above, this Court lacks jurisdiction to deal with criminal offences in terms UIA. 

Fine and/or imprisonment

As seen from the court’s ruling, such false entries made by employers will not only constitute an offence in terms of the UIA but will also constitute a criminal offence. Section 65 of the UIA states that “Any person convicted of an offence in terms of this Act is liable to a fine or imprisonment, or to both a fine and imprisonment.”

Employers should thus be wary of the risks involved when changing the reason for termination in order to assist an employee to claim UIF benefits, as any such actions could lead to severe consequences.

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Business is conducted in a challenging environment where every workplace is unique. Employees form an integral part of the work environment and are diverse in terms of personality, frames of reference, value systems, culture, motivation, and so on.  Misconduct in the workplace is a common phenomenon and can have a negative influence on any business if it is not proactively managed and handled in line with labour legislation.

Ask the question

When it is necessary to take disciplinary action against an employee, the first and probably most important question to be asked, is whether the employer has implemented a disciplinary code or policy related to the employee’s misconduct. Without evidence of this, disciplinary action taken against such an employee may be considered unfair by the Commission for Conciliation, Mediation and Arbitration (CCMA) or Labour Court.

Section 3(1) of schedule 8 of the Labour Relations Act, which deals with dismissal, stipulates that all employers should have a disciplinary code that sets out the standard of behaviour expected of employees. This section further states that the standard of behaviour must be clearly set out in a way that is easily understandable and accessible to all employees.

Applying discipline

A complete disciplinary code sets out the various offenses with appropriate sanctions. Keep the following in mind:

• Discipline in the workplace aims to adjust and improve behaviour through correction, consultations, and warnings, rather than punishing or dismissing an employee. Dismissal should always be the last option.

• There are different types of misconduct in the workplace ranging from less serious violations to very serious violations, which are influenced by the employee’s type of work and responsibility, the (possible) consequences of the misconduct, as well as the impact of the misconduct on the employee-employer relationship of trust.

• Rules in the workplace apply to all employees and the employer must consistently apply discipline in line with the disciplinary code’s provisions. Although the code serves as a guideline, it may not be lightly deviated from and a heavier or lighter sanction can only be applied in exceptional cases.

Case study

In the case of Mushi v Exxaro Coal (Pty) Ltd Grootegeluk Coal Mine, an employee was dismissed after being found guilty of misconduct. The employer’s disciplinary code stipulated that the sanction for this type of misconduct is the issuing of a final written warning. However, the employer dismissed the employee.

The Labour Appeal Court found that even though the employer’s disciplinary code was a guideline, its purpose is to create a degree of certainty and consistency in the application of discipline in the workplace. The court further argued that any deviation from a disciplinary code may not take place without good reason and that there must be a justifiable and fair reason why an imposed sanction differs from the prescribed sanction in terms of the disciplinary code.

Implementing rules:  have proof

Rules are implemented through the disciplinary code, policies, and procedures. It is essential that the employer must be able to prove that employees are aware of the workplace’s rules (with appropriate sanctions) before the employer can consider any disciplinary action against an employee for violations.

To avoid a situation where an employee can claim that he/she was not aware of the employer’s rule(s), the disciplinary code and any policies or procedures must be in writing and the employer must have physical proof that these rules were communicated to all employees. The employer can do the following:

• Implement an existing or new disciplinary code through a consultation with all employees. The employees may be required to complete an attendance register to confirm that the disciplinary code has been explained to them and that they are aware of its content.

• Bring a new policy or procedure to the attention of employees by sending the policy or procedure to employees via email. The e-mail will then serve as written proof that employees have been informed and are aware of its content.

The vast majority of cases referred to the CCMA are following “unfair dismissal”, of which the majority of these cases are related to misconduct that led to dismissal. Generally, arbitration orders granted in the employee’s favour are directly linked to the employer failing to follow the correct procedure. The CCMA can grant orders of up to 12 months of an employee’s salary against the employer. It is important that employers correctly understand and apply the principles of discipline in order to avoid unnecessary CCMA headaches.

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Labour legislation strictly regulates any deductions made from an employee’s remuneration, and employers must guard against deducting any money without following the correct procedure.  Various types of deductions can be made ranging from statutory deductions (unemployment insurance, income tax, a court or arbitration order), additional deductions specific to the business industry, and other general deductions (loss of or damage to property, loans, provident or pension fund, union fees and the like).

WARNINGS, DEDUCTIONS AND DOUBLE JEOPARDY

Can an employer recover damages from an employee due to negligence and issue the employee with a warning for the same misconduct, or will this constitute double jeopardy?  Yes, the employer may do so.

Where damages or losses are caused by an employee, the employer is entitled to recover damages based on a civil claim in terms of the common law and the misconduct can be dealt with by way of disciplinary actions as established by the business’ disciplinary code.  The employer must include the sanctions for misconduct in the disciplinary code, and if an offence does occur, the employer must act accordingly. The appropriate sanction for an offence is typically some sort of warning, or in very serious cases, dismissal (but only once a disciplinary hearing has been held).

The employer’s right to recover damages or losses from the employee, as well as issuing the appropriate warning to the employee for the same misconduct, was confirmed by the judgement of Solidarity obo Mohammed / Air Traffic and Navigation Services Ltd [2011] JOL 27921 (CCMA).

DEDUCTIONS FOR DAMAGE RECOVERY

Section 34 of the Basic Conditions of Employment Act, 1997 (Act 75 of 1997), or the BCEA, states that deductions are only permitted if the employee has given his or her consent, or if the deduction is authorised through a collective agreement, statutory provision (legally prescribed deduction), court order or arbitration award.

Subject to due process being followed, the employer is authorised to deduct a certain amount from the employee’s remuneration to recover damage to the employer’s property. The BCEA stipulates the following requirements before the employer can make such a deduction:

• The employee must consent in writing to the deduction and the amount must be specified.
• The loss or damage must have occurred in the course of employment, and as a result of the employee’s intent or negligence.
• The procedure the employer follows must be fair and the employee must be given a reasonable opportunity to state his or her case, including why the deduction should not be made.
• The employer may only deduct a maximum of 25% of the employee’s remuneration at a time.
• The total amount the employer deducts may not exceed the amount of the actual loss or damage the employer suffered.

AVOID THIS MISTAKE

Employers often make the mistake of simply informing the employee of the damage to be recovered without first having followed the correct process. Another mistake is to deduct more than 25% of the employee’s remuneration in one go, with or without permission.

This can result in the employee approaching the Commission for Conciliation, Mediation and Arbitration (CCMA) by declaring an unfair labour practice dispute.