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     Substantive Fairness

    Jan du Toit

    In deciding whether to dismiss an employee the employer must take code 8 of the Labour relations Act into consideration. Schedule 8 is a code of good practice on dismissing employees and serves as a guideline on when and how an employer may dismiss an employee. An over simplified summary of schedule 8 would be that the employer may dismiss an employee for a fair reason after following a fair procedure. Failure to do so may render the dismissal procedurally or substantively (or both) unfair and could result in compensation of up to 12 months of the employee’s salary or reinstatement.

    Procedural fairness refers to the procedures followed in notifying the employee of the disciplinary hearing and the procedures followed at the hearing itself. Most employers do not have a problem in this regard but normally fails dismally when it comes to substantive fairness. The reason for this is that substantive fairness can be split into two elements namely;

    • establishing guilt; and
    • deciding on an appropriate sanction.

    This seems straight forward but many employers justify a dismissal based solely on the fact that the employee was found guilty of an act of misconduct. This is clearly contrary to the guidelines of schedule 8: “Dismissals for misconduct"

    Generally, it is not appropriate to dismiss an employee for a first offence, except if the misconduct is serious and of such gravity that it makes a continued employment relationship intolerable. Examples of serious misconduct, subject to the rule that each case should be judged on its merits, are gross dishonesty or wilful damage to the property of the employer, wilful endangering of the safety of others, physical assault on the employer, a fellow employee, client or customer and gross insubordination. Whatever the merits of the case for dismissal might be, a dismissal will not be fair if it does not meet the requirements of section 188.

    When deciding whether or not to impose the penalty of dismissal, the employer should in addition to the gravity of the misconduct consider factors such as the employee’s circumstances (including length of service, previous disciplinary record and personal circumstances), the nature of the job and the circumstances of the infringement itself.”

    Schedule 8 further prescribes that;

    Any person who is determining whether a dismissal for misconduct is unfair should consider-

    (a) whether or not the employee contravened a rule or standard regulating conduct in, or of relevance to, the workplace; and

    (b) if a rule or standard was contravened, whether or not-

    (i) the rule was a valid or reasonable rule or standard;

    (ii) the employee was aware, or could reasonably be expected to have been aware, of the rule or standard;

    (iii) the rule or standard has been consistently applied by the employer; and

    (iv) dismissal was an appropriate sanction for the contravention of the rule or standard.

    Looking at the above it is clear that substantive fairness means that the employer succeeded in proving that the employee is guilty of an offence and that the seriousness of the offence outweighed the employee’s circumstances in mitigation and that terminating the employment relationship was fair.

    The disciplinary hearing will not end with a verdict of guilty, the employer will have to in addition to proving guilt, raise circumstances in aggravation for the chairman to consider a more severe sanction. The employee must be on the other hand given the opportunity to raise circumstances in mitigation for a less severe sanction.

    Many employers make the mistake and rely on the fact that arbitration after a dismissal will be de novo and focus their case at the ccma solely on proving that the employee is guilty of misconduct, foolishly believing that the commissioner will agree that a dismissal was fair under circumstances. The Labour Appeal Court in County Fair Foods (Pty) Ltd v CCMA & others (1999) 20 ILJ 1701 (LAC) at 1707 (paragraph 11) [also reported at [1999] JOL 5274 (LAC)], said that it was “not for the arbitrator to determine de novo what would be a fair sanction in the circumstances, but rather to determine whether the sanction imposed by the appellant (employer) was fair”. The court further explained:

    “It remains part of our law that it lies in the first place within the province of the employer to set the standard of conduct to be observed by its employees and determine the sanction with which non-compliance with the standard will be visited, interference therewith is only justified in the case of unreasonableness and unfairness. However, the decision of the arbitrator as to the fairness or unfairness of the employer’s decision is not reached with reference to the evidential material that was before the employer at the time of its decision but on the basis of all the evidential material before the arbitrator. To that extent the proceedings are a hearing de novo.”

    In NEHAWU obo Motsoagae / SARS (2010) 19 CCMA 7.1.6 the commissioner indicated that“the notion that it is not necessary for an employer to call as a witness the person who has taken the ultimate decision to dismiss or to lead evidence about the dismissal procedure, can therefore not be endorsed. The arbitrating commissioner clearly does not conduct a de novo hearing in the true sense of the word and he is enjoined to judge “whether what the employer did was fair.” The employer carries the onus of proving the fairness of a dismissal and it follows that it is for the employer to place evidence before the commissioner that will enable the latter to properly judge the fairness of his actions.”

    In this particular case referred to above Mr. Motsoagae, a Revenue Admin Officer for SARS, destroyed confiscated cigarettes that were held in the warehouses of the State without the necessary permission. Some of these cigarettes found its way onto the black-market after he allegedly destroyed them and was subsequently charged with theft. Interestingly the commissioner agreed with the employer that the applicant in this matter, Mr. Motsoagae, was indeed guilty of the offence but still found that the dismissal was substantively unfair. The commissioner justified his decision referring to an earlier important Labour Court finding, reemphasizing the onus on the employer to prove that the trust relationship has been destroyed and that circumstances in aggravation, combined with the seriousness of the offence, outweighed the circumstances the employee may have raised in mitigation, thus justifying a sanction of dismissal.

    "The respondent in casu did not bother to lead any evidence to show that dismissal had been the appropriate penalty in the circumstances and it is not known which “aggravating” or “mitigating” factors (if any) might have been taken into consideration. It is also not known whether any evidence had been led to the effect that the employment relationship between the parties had been irreparably damaged – the Labour Court in SARS v CCMA & others (2010) 31 ILJ 1238 (LC) at 1248 (paragraph 56) [also reported at [2010] 3 BLLR 332 (LC)], held that a case for irretrievable breakdown should, in fact, have been made out at the disciplinary hearing.

    The respondent’s failure to lead evidence about the reason why the sanction of dismissal was imposed leaves me with no option but to find that the respondent has not discharged the onus of proving that dismissal had been the appropriate penalty and that the applicant’s dismissal had consequently been substantively unfair.

    The respondent at this arbitration, in any event, also led no evidence to the effect that the employment relationship had been damaged beyond repair. The Supreme Court of Appeal in Edcon Ltd v Pillemer NO & others (2009) 30 ILJ 2642 (SCA) at 2652 (paragraph 23) [also reported at [2010] 1 BLLR 1 (SCA) – Ed], held as follows: 

    “In my view, Pillemer’s finding that Edcon had led no evidence showing the alleged breakdown in the trust relationship is beyond reproach. In the absence of evidence showing the damage Edcon asserts in its trust relationship with Reddy, the decision to dismiss her was correctly found to be unfair.”

    Employers are advised to consider circumstances in aggravation and mitigation before deciding to recommend a dismissal as appropriate sanction. In addition to this the employer will have to prove that the trust relationship that existed between the parties deteriorated beyond repair or that the employee made continued employment intolerable. Employers should also remember that there are three areas of fairness to prove to the arbitrating commissioners; procedural fairness, substantive fairness – guilt, substantive fairness – appropriateness of sanction.

    Employers are advised to make use of the services of experts in this area in order to ensure both substantive and procedural fairness.

    Contact Jan Du Toit – This email address is being protected from spambots. You need JavaScript enabled to view it.

     

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