Understanding statutory severance pay in SA

Understanding statutory severance pay in SA

Understanding statutory severance pay in SA

Statutory severance pay plays a crucial role in employment relations in South Africa, particularly when employment is terminated due to operational requirements.  It is essential for employers to be informed regarding the legal framework that governs severance pay, and specifically Section 41 of the Basic Conditions of Employment Act (BCEA), as it holds significant implications for both employers and employees.

Statutory framework

Statutory severance pay is not an arbitrary gesture by employers; instead, it is firmly grounded in the legal provisions of the BCEA. It is imperative to note that outside the statutory framework provided by the BCEA, there is no general right to severance pay. Section 41 of the BCEA delineates the circumstances under which severance pay becomes mandatory, primarily revolving around dismissals due to operational requirements.

Conditions for STATUTORY severance pay

According to Section 41 of the BCEA, employers are obligated to pay severance pay to employees dismissed for reasons based on operational requirements. The formula for calculating severance pay is stipulated in the section, requiring employers to provide at least one week’s remuneration for each completed continuous year of service.

Eligibility criteria

An important criterion for eligibility is that an employee must have completed at least one year of uninterrupted service with the employer. Once this condition is met, the employee becomes entitled to statutory severance pay, calculated at the rate of one week’s remuneration for each completed year of service. It is crucial to emphasise that an employee becomes eligible for statutory severance pay only after the retrenchment process has been concluded.

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Bargaining Council and main collective agreements

In cases where an employee is a member of a bargaining council, the severance package payable may be stipulated by the Bargaining Council and main collective agreements. This adds an additional layer of complexity, as the specific terms may vary based on the industry and agreements in place.

Operational requirements

Operational requirements leading to severance pay are defined broadly and encompass terminations resulting from the employer’s economic, technological, structural, or similar needs. These are often referred to as “no-fault” dismissals, indicating that they are unrelated to the employee’s performance but are a result of the business’s operational necessities.

Limitations on severance pay entitlements

While Section 41 of the BCEA outlines specific scenarios where severance pay is mandatory, it’s essential to understand that these provisions are not exhaustive. There may be other scenarios in which severance pay entitlements arise.

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In conclusion, statutory severance pay in South Africa is intricately linked to the legal framework provided by the BCEA, with Section 41 specifically addressing dismissals due to operational requirements. Employers must be well-informed about the eligibility criteria, calculation methods, and additional considerations such as Bargaining Council agreements. It is crucial for both employers and employees to navigate these legal differences to ensure fair and compliant practices in the termination of employment relationships. While the idea of receiving a “reward” for years of service is not broadly applicable in South African law, statutory severance pay serves as a protective measure, providing financial support to employees facing dismissal due to operational requirements.

 

Taking proactive steps to ensure your business adheres to relevant legislation in your sector is paramount for sustained success and legal compliance.

 

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Identifying labour inspectors

Identifying labour inspectors

Identifying labour inspectors

Ensuring compliance with labour law is crucial for both employers and employees to foster fair and equitable working conditions. In South Africa, the Department of Employment and Labour achieves this sentiment through their Inspection and Enforcement Service (IES). The Department’s inspectors play a pivotal role in monitoring and enforcing labour legislation and regulations.

 

Many employers are concerned about security due to people falsely posing as inspectors from the Department of Employment and Labour in order to gain access to the premises.  Insist on positive identification of the person who introduces him-/herself as an inspector and first verify the information before giving the person access to your premises.  Also remember that no inspector may charge a fee for the inspection, investigation, advice or any assistance.  The Department of Employment and Labour does not delegate any third party to conduct an inspection on behalf of the Department – none of the Department’s powers may therefore be delegated.  No inspector may sell posters, products, or information.

Key aspects of identification for labour inspectors

The Department of Employment and Labour inspectors will always carry official identification:

 

  • Official appointment certificate: In terms of Chapter 10 of the Basic Conditions of Employment Act, 75 of 1997 (BCEA), Section 63(3) provides that the Minister of Employment and Labour must provide each labour inspector with a signed appointment certificate stating the following: 
    • that the person has been appointed as a labour inspector,
    • the inspector’s name, serial number, identification number, signature, and the Department’s logo,
    • which legislation that labour inspector may monitor and enforce, and
    • which of the functions of a labour inspector that person may perform.

 

  • Obligation to produce identification: The BCEA creates a further obligation on labour inspectors to produce his/her official appointment certificate upon request. Section 66(3)(a) states that labour inspectors must produce the certificate when he/she is requested to do so.

 

  • Two forms of identification: The inspector’s appointment certificate can take two forms, the one being a certificate document (BCEA Annexure 14A) and the other being an inspector card (BCEA Annexure 14B).  It is noteworthy that in terms of Annexure 14A the inspector’s card (Annexure 14B) must contain the inspector’s photo and signature, as well as the signature of the provincial executive manager, for the office in which the inspector is based as well as the serial number which has been allocated to the inspector by the Department’s head office.

 

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Labour inspectors’ right to conduct inspections

In terms of BCEA Section 65(1) a labour inspector may, without warrant or notice, at any reasonable time, enter any workplace or any other place where an employer carries on business or keeps employment records, that is not a home, in order to enforce compliance with labour law.

 

Labour law further places a duty on persons to co-operate with and assist labour inspectors. Section 67(1) and 67(2) of the BCEA states that any person who is questioned by a labour inspector in terms of Section 66 must answer all relevant questions lawfully put to that person, truthfully and to the best of his/her ability.  Employers and employees must provide any facility and assistance at a workplace that is reasonably required by a labour inspector to perform the labour inspector’s functions effectively.

 

  • Scheduled inspections: Labour inspectors often conduct scheduled inspections, providing advance notice to employers. This allows businesses to prepare necessary documentation, such as employment contracts, payroll records, and health and safety protocols. Being aware of scheduled inspections helps in maintaining transparency and efficiency.

 

  • Random visits: In addition to scheduled inspections, inspectors may also conduct unannounced or random visits to workplaces. Employers should be prepared for such surprise visits and maintain ongoing compliance with labour laws to avoid potential penalties.

A labour inspector is empowered by legislation to arrive at a workplace with or without notice to conduct an inspection. The employer is similarly obligated to answer any questions put to him/her by the labour inspector and to provide the inspector with any assistance that he/she may require to perform his/her functions effectively.  South African labour legislation is extensive and non-negotiable.  Non-compliance can have a serious financial impact, putting your business at unnecessary risk.

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Contact the LWO for any advice or assistance!

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Protection orders against former employees

Protection orders against former employees

Protection orders against former employees

In today’s fast-paced business world, relationships between employers and employees can sometimes turn sour. When former employees pose threats or engage in harassment, employers need to take action to protect their assets, their employees, and their reputation. One crucial legal tool in such situations is obtaining a protection order against a former employee.

UNDERSTANDING PROTECTION ORDERS

Protection orders, commonly known as restraining orders, are court-issued documents that legally require an individual to maintain a specific distance from a designated person or location. These orders are instrumental in safeguarding victims from various forms of harassment, including physical violence, stalking, or intimidation. In the context of former employees, protection orders are often sought when they pose a threat to the organisation, its employees, or its clients.

PROTECTION ORDERS AGAINST FORMER EMPLOYEES

Protection orders against former employees are typically pursued when a company has justifiable concerns about their former employee’s behaviour. Some common examples include:

 

  • Threats of violence or harm: When a former employee has made explicit threats against the business, its employees, or its clients/customers/members, it is essential to take such threats seriously.
  • Stalking and harassment: Former employees may engage in stalking or harassment activities, including continuous phone calls, unwanted emails, or showing up at the business premises or employees’ homes.
  • Violation of non-disclosure agreements or intellectual property theft: If a former employee is suspected of stealing confidential information or breaching non-disclosure agreements, a protection order can help to prevent further damage.
  • Aggrieved former employees: Dismissed employees who are unhappy about their termination may resort to damaging the business’ reputation or spreading false information. Protection orders can restrict them from making defamatory statements.

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PROCESS OF OBTAINING A PROTECTION ORDER

btaining a protection order against a former employee is a legal process that should be taken seriously. The following steps are typically involved:

 

  • Consult with an attorney: The first step in seeking a protection order is to consult with an attorney who specialises in employment law or civil litigation. An attorney can help you assess the situation, gather evidence, and determine whether pursuing a protection order is the appropriate course of action.
  • Gather evidence: Gathering evidence is always crucial in obtaining a protection order. This may include written threats, emails, text messages, voicemails, or any other documentation that demonstrates the former employee’s harmful intent.
  • File a petition: Your attorney will help you file a petition in the appropriate court, detailing the reasons for seeking a protection order and providing evidence to support your case.
  • Attend a hearing: Once the petition has been filed, a court hearing will be scheduled to attend on a specific date. At the court hearing, both parties will have an opportunity to present their cases. The judge will evaluate the evidence and determine whether a protection order is warranted.
  • Issuing of the protection order: If the judge finds that the former employee poses a legitimate threat, they will issue a protection order that outlines the specific terms and conditions. This order can be temporary or permanent, depending on the circumstances.
  • Enforcement and compliance: Once a protection order is granted, it is essential to ensure that it is properly enforced. Violations of the order can lead to severe legal consequences for the former employee, such as arrest.

Protection orders against former employees serve as a vital legal mechanism to safeguard businesses, their employees, and their interests from potential harm, harassment, and damage. When a former employee’s behaviour raises concerns, it is imperative to consult with legal counsel and follow the appropriate steps to obtain a protection order. By taking action, businesses can mitigate the risks associated with aggrieved former employees and ensure the safety and security of their operations.

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Counselling as a form of progressive discipline

Counselling as a form of progressive discipline

Counselling as a form of progressive discipline

Counselling as a form of progressive discipline in the workplace and its value is often overlooked. The Labour Relations Act (“LRA”) defines progressive discipline as follows:

The approach of progressive discipline in the workplace considers the purpose of discipline as a measure for employees to know and understand which standards are required of them. Reasonable steps must therefore be taken to improve or change employees’ behaviour through the systematic use of warnings and consultations.
The LRA recognises counselling in the form of consultations as a method of progressive discipline. Discipline in the workplace aims to correct and improve the behaviour of employees. The most common example of progressive discipline is issuing written warnings following an employee’s transgression of a workplace rule or procedure. Drafting and issuing a written warning is a quick and simple way of applying progressive discipline. The employee receives a written description of his misconduct followed by a concise explanation of the facts that led to the written warning.
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But, is issuing a written warning always the most appropriate and effective form of progressive discipline?

A written warning informs the employee that a workplace rule or procedure has been transgressed and that should the specific act of misconduct be repeated within a specific time frame, further and more serious disciplinary steps may follow. The issuing of a written warning does not necessarily imply that the employee understands the employer’s disciplinary code and the consequences of the misconduct for the employer and fellow employees.
Counselling is an appropriate form of discipline in instances where the employee’s conduct does not comply with a rule or standard of the employer, or the employee is not aware of a rule that regulates conduct, and in instances where the misconduct is not of a serious nature.

A good example is an employee who regularly reports late for work. According to the disciplinary code an employer is entitled, after the first instance of reporting late for work, to issue the employee with a written warning. After the third instance of late-coming and following the issuing of a final written warning, an employee may be dismissed (after holding a disciplinary hearing). The employee will be fully aware that the continuous late reporting for work is unacceptable to the employer and the employer has applied progressive discipline as a result thereof. But the question is whether the employee truly realises why it is important to report on time for work.
In such instances, counselling as a form of progressive discipline can be beneficial for both the employer and employee. During a formal counselling consultation the employer can outline the negative impact and consequences of reporting late for work. The employee will also be given the opportunity to provide reasons why he or she is frequently late for work. Solutions and suggestions to solve the issue can also be discussed.
It is essential to keep a record of counselling consultations with an employee and any decisions and suggestions made must be put into writing. This serves as proof that the employer has applied counselling as a form of progressive discipline. If the employee’s misconduct persists the employer will be left with no choice but to apply other forms of progressive discipline in the form of written warnings.

When is it not appropriate?

Counselling as a form of progressive discipline will, however, not be appropriate in instances of serious misconduct, for example theft, gross negligence and dishonesty. These transgressions amount to serious miscondut and usually lead to an irreparable breakdown of the employer and employee relationship.
Progressive discipline, and more specifically counselling, can be applied successfully in the workplace if the employee makes a genuine attempt not to repeat the misconduct and rectify his/her behaviour.

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Theft and dismissal

Theft and dismissal

Theft and dismissal

Prevention and Combating of Corrupt Activities Act, 12 of 2004 (“PCCA”)

In the realm of employment law and corporate governance, the Prevention and Combating of Corrupt Activities Act, 12 of 2004 (“PCCA”) holds significant importance, particularly when it comes to addressing employee misconduct involving theft, fraud, extortion, or forged documents. This legislation introduces a crucial dimension that employers must consider when contemplating the dismissal of an employee for theft.
When an employee is found guilty of theft of funds belonging to their employer, the standard protocol often involves a thorough investigation and appropriate disciplinary procedures. Depending on the severity of the offence, the employee may be dismissed in accordance with established guidelines as set out in Schedule 8 of the Labour Relations Act, 66 of 1995 (“LRA”). However, in cases involving significant monetary amounts, employers must now tread carefully due to the provisions as outlined in section 34(1) of the PCCA.
As of July 31, 2004, the PCCA instituted a reporting obligation on employers who are privy to knowledge, or even suspicion, of an employee’s involvement in theft, fraud, extortion, or uttering a forged document amounting to R100 000.00 or more. This mandate necessitates that employers report such knowledge or suspicion to the South African Police Service, even before a dismissal is considered. The scope of this requirement underscores the legislature’s commitment to combatting corrupt activities within the corporate and employment sector.
Failure to adhere to the reporting obligation imposed by the PCCA carries serious consequences for employers. Section 34(2) of the Act criminalizes an employer’s failure to report knowledge of employee’s misconduct, exposing them to potential fines or even imprisonment for up to 10 years. This underscores the gravity with which the South African legal system views the reporting obligation and the imperative for employers to exercise due diligence.
The PCCA underscores the significance of a holistic assessment of the circumstances surrounding an employee’s alleged theft. Employers must carefully consider factors such as the intent, the amount, and the nature of the misconduct. This deliberation helps determine an appropriate course of action, whether it be disciplinary measures or compliance with the reporting obligations. The principle of proportionality should guide employers in striking a balance between punishment and the pursuit of justice.
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Framework for employers

The PCCA represents a crucial framework for employers in South Africa to combat financial misconduct within their organisations. While the Act mandates reporting in cases of substantial theft or fraudulent activities, employers must also uphold fairness and due process during disciplinary proceedings. As employers navigate the intricacies of the Act, they are reminded of their dual responsibility to safeguard their interests and uphold the principles of justice and accountability.

Theft is serious misconduct

Theft in the workplace is a serious misconduct that places additional pressure on a business in terms of profitability and sustainability. In most cases of theft, dismissal as a sanction is appropriate as the rule against theft is not only well known, but goes to the root of the employment relationship that binds an employee to act in good faith and to further the employer’s interests. This misconduct can negatively impact the employment relationship, rendering trust irreconcilable. Always follow the correct procedures with regards to labour matters, especially dismissal and general discipline in the workplace.

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“It was just a joke”

“It was just a joke”

“It was just a joke”

It often happens that an employee will try to excuse inappropriate behaviour by saying that it was just a joke. The management of human relations in a work environment is particularly complex and a ‘joke’ can have serious and far-reaching consequences for which the employee can be held accountable.
The workplace is an extremely diverse environment in terms of culture, religion, beliefs, values, political views, frames of reference, work ethics, opinions and the like. Not everyone will always get along with those around them and when conflict does arise, the employer must step in and assist in resolving the conflict before it escalates.
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Bad behaviour disguised as a joke

Thanks to modern technology, equipment that can record incidents or conversations are highly accessible to those who wish to use it. Coupled with the fact that the workplace is a highly regulated environment in terms of legislation, employees ought to think twice about engaging in an inappropriate ‘joke’.

Typical examples of this behaviour include:

  • Discriminatory references to race, gender, religion, disability, age, sexist comments, sexual harassment, and so on.
  • Pranks and games. When it comes to tools, vehicles and machinery, no games or pranks can be afforded. Injuries can easily occur during pranks while working in close proximity to a tractor or hammer mill, for example.
  • Teasing.
  • Horseplay. This entails rough or rowdy games or pranks at the workplace and can include activities such as pranks involving physical contact, playing around, racing, grabbing, social pressure to engage in unsafe acts, harassment and unauthorised competitions.
  • Information shared on social media platforms such as WhatsApp.
  • Threats. When one employee threatens to harm another, including verbally and non-verbally (for example an intimidating look or hand gestures that make you feel unsafe).

A so-called ‘joke’ that goes awry will expose the employer to various risks, including injuries on duty, damage to property, damage to team dynamics when workplace relationships break down, damage to the employer’s public image, grievances, referrals to the Commission for Conciliation, Mediation and Arbitration (CCMA), and court cases.

Disciplinary action

Every workplace must have a relevant disciplinary code ensuring that clear rules with appropriate sanctions are followed. The workplace disciplinary code provides for various types of offences relating
to inappropriate behaviour or a ‘joke’, including disorderly behaviour, abusive behaviour, damage or misuse of the employer’s property, breach of trust, and offences relating to alcohol or drugs.
Humour is a necessary outlet for alleviating underlying tensions in the workplace, and this type of behaviour therefore often begins with harmless intentions. However, the employer must consider the seriousness of the offence and apply discipline accordingly.
The type of work an employee does, along with his or her level of responsibility, the (possible) consequences of the offence, and its impact on the employee-employer trust relationship all
determine the seriousness of an offence. The offence will also be considered serious if an employee’s dignity has been affected.

Be proactive

Most workplace accidents can be prevented by being aware of hazards and following safety rules. Boundaries should be set from the beginning of the employment relationship to avoid any uncertainties going forward. Employers must make sure they follow the correct procedures when taking disciplinary action or holding consultations.

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