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Remedies in unfair discrimination dismissals

By Talita Laubscher and Monique Jefferson, Bowman Gilfillan  

 

In Arb Electrical Wholesalers (Pty) Ltd v Hibbert [2015] 11 BLLR 1081 (LAC), Mr Hibbert contended that he was forced to retire at the age of 64. He contended that his retirement was not in accordance with s 187(2) of the Labour Relations Act 66 of 1995 (LRA) as he had not agreed to retire at that age. He therefore claimed that he was dismissed and that his dismissal was automatically unfair as it was based solely on his age. He instituted a claim in the Labour Court (LC) for an automatically unfair dismissal in terms of the LRA and for this he sought 24 months’ compensation. He also claimed damages and compensation for the alleged unfair age discrimination in terms of the Employment Equity Act 55 of 1998 (EEA).

 

The LC, per Lagrange J, held that there was no agreement that Hibbert would retire at the age of 64 and that the respondent had unilaterally decided to retire him when he reached that age. In the circumstances, Hibbert’s dismissal was automatically unfair. The court accepted that this amounted to unfair age discrimination.

 

As regards the remedy to which Hibbert was entitled, the LC held that he could not claim compensation under both the LRA and the EEA. Furthermore, the court was of the view that the unfair discrimination Hibbert complained of was not the most egregious type of automatically unfair dismissal and an award for compensation equal to 24 months’ remuneration would, therefore, be excessive. Therefore, taking into account Hibbert’s own expectation that he would have retired at the age of 65, the court awarded him compensation equal to 12 months’ remuneration.

 

The LC recognised that while compensation may not be awarded under both the LRA and the EEA, the position is different when it comes to damages. This is because the EEA specifically empowers the LC to make an award for damages in the case of unfair discrimination claims, while the LRA does not recognise damages claims. However, in order to be successful with a damages claim, the employee must prove that he suffered damages and must prove the quantum of damages suffered. In this case, Hibbert failed to prove his damages and the court was accordingly unable to hold the respondent liable for damages.

 

Arb Electrical appealed and Hibbert cross-appealed. The Labour Appeal Court (LAC), per Waglay JP, Ndlovu JA and Coppin JA, summarised the law on remedies in the case of unfairly discriminatory dismissals as follows:

  • The primary remedy in the case of a dismissal is reinstatement. Reinstatement must be ordered unless the exceptions set out in s 193(2) apply.
  • Reinstatement implies being placed back in employment from the date of dismissal and the employee is, therefore, entitled to his full salary from the date of dismissal to the reinstatement date. With regard to re-employment, this can be ordered from any date after the date of dismissal.
  • Payment from the date of dismissal to the reinstatement date (or in respect of back-dated re-employment) is not compensation for purposes of the LRA. It is payment of the salary the employee would have received had he not been dismissed unfairly.
  • Under the LRA, where reinstatement or re-employment is not ordered, compensation may be ordered. Such compensation is not aimed at making good any patrimonial loss the employee had suffered. It is monetary relief for the injured feeling, humiliation and impairment of the human dignity that the employee suffered at the hands of the employer.
  • Compensation under the LRA must be just and equitable. In determining the amount of compensation that may be ordered, factors such as the nature and seriousness of the infringement, the circumstances in which it took place, the behaviour of the employer and the extent of the complainant’s humiliation or distress would be relevant.
  • Compensation under the LRA is limited to 12 months’ remuneration in the case of ‘ordinary’ dismissals, and 24 months’ remuneration in the case of discriminatory dismissals.
  • The EEA permits the payment of compensation, as well as damages. Damages may be awarded in respect of patrimonial losses suffered and proved. Compensation is monetary relief for the affront of human dignity arising from the unfair discrimination suffered by the complainant. The amount of compensation that may be awarded in terms of the EEA is not limited and must be just and equitable.
  • There is no bar to an employee to claiming compensation under the LRA for an automatically unfair dismissal based on having been discriminated against, and to claiming compensation under the EEA for having been unfairly discriminated against. The employee may bring these claims in the same action.
  • Where the employee’s dismissal is found to have been automatically unfair in terms of the LRA and that he had been subjected to unfair discrimination under the EEA, the court must ensure that the employer is not penalised twice for the same wrong. In seeking to determine compensation under the LRA and the EEA, the court must not award separate amounts as compensation, but must consider what is just and equitable for the indignity the employee has suffered.
  • If the claim is under the LRA only, the court must determine the amount of compensation that is just and equitable. If this amount exceeds the limits in s 194, the amount must be reduced accordingly. The amount does not have to be reduced if the claim is both under the LRA and the EEA, because the EEA prescribes no limit to the amount of compensation that may be awarded. This recognises the employee’s right to claim under both the LRA and the EEA and at the same time, the employer is not penalised twice for the same wrong, because a single determination is made as to what is just and equitable in the circumstances of the case as a whole.

 

The LAC then turned to consider the relief ordered by the court a quo, namely 12 months’ remuneration as compensation. The LAC held that because the court a quo exercised its discretion in determining ‘just and equitable’ compensation, it was not open to the LAC to interfere, unless the discretion was not properly exercised. The LAC held that the court a quo had properly exercised its discretion with reference to all the relevant facts and that the compensation amount of R 420 000 was therefore not unreasonable. As regards the claim for damages, LAC noted that Hibbert had failed to prove his patrimonial losses and in the circumstances, the court a quo was correct in not awarding any damages under the EEA. The appeal and the cross-appeal were accordingly dismissed.

 

This article first appered in De Rebus, the South African Attorneys’ Journal, for more information please visit www.derebus.org.za

Article published with the kind courtesy of Bowman Gilfillan, for more information please visit www.bowman.co.za   

 

 

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