Discipline and Dismissal

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Ivan Israelstam

Employers frequently know for certain that serious misconduct has occurred but cannot prove which employee or employees are responsible. This can occur in a variety of circumstances.

For example:

  • Stock may go missing from a warehouse or retail store where many employees had access and the opportunity to remove it.
  • Damage may have been caused to machinery in a workshop used by numerous employees
  • Confidential information may have been leaked.
  • There may be cash shortages in tills or other cash storage points.
  • Computers or other equipment may have gone missing.
  • Production or other materials may have been wasted or unnecessarily discarded.
 

Employers are often tempted in such cases to discipline everyone who could possibly have been involved in such misconduct. This buckshot approach by employers may be motivated by a number of factors including the thinking that if we fire the lot, we will be sure to get rid of the culprit, and that everyone was probably involved. Even if many employees were not directly responsible they probably knew about the misconduct and failed to report it. Some case law has given the impression that such group dismissals may be justified. In NUSFRAW obo Gomez & others v Score Supermarkets a group of managers was dismissed as a result of stock losses amounting to R6-million.

While there was no proof that these managers had stolen the missing stock, they were held responsible for the losses and disputed their dismissals at the CCMA. The arbitrator found that the markedly poor management of the business by the dismissed employees (and others) had led to the losses and that this had justified the dismissal. In FEDCRAW v Snip Trading the arbitrator ruled in favour of group dismissals. Here, the employer had a policy which held every employee responsible for stock losses.  When stock disappeared several employees were fired despite the fact that the employer had not proved that any one of these employees were guilty of the stock losses.

The employer and union agreed to go to private arbitration where the arbitrator was to decide whether employees as a group could be held liable for stock losses. Surprisingly the arbitrator found that the concept of group responsibility for stock losses was not unfair under the circumstances where the employer's interests had to be taken into account. The outcomes of these two cases have misled a number of employers into believing that group dismissals are fair. However, this is, at best, likely to hold true only in exceptional circumstances. It will depend on the extent to which the employees specifically have responsibility for prevention of losses and have the means of preventing losses. It will also depend on the viewpoint of each individual arbitrator.

At the CCMA, arbitrators have more than once found against the concept of group punishment. In NUM & others v RSA Geological Services 15 employees were dismissed after kimberlite was found dumped down a borehole. The CCMA found in favour of the dismissal of five of the employees because there was some evidence of their individual guilt. However, the arbitrator ordered the re-instatement of the other 10 employees as there was insufficient proof that they had been implicated in the dumping of the kimberlite. And in SAGAWU obo Cingo & Another v Pep SA Limited the entire staff of one store was dismissed for stock losses.

The CCMA found that the group dismissal was unfair because the employer had failed to prove that the dismissed employees were guilty of misconduct. The dismissed employees were reinstated with full retrospective effect. The apparent lack of consistency in case law and the powerful laws protecting employees from unfair dismissal sound a strong warning to employers not to act against employees before they fully understand their legal rights. The correct actions of the employer will differ from case to case depending on a number of legal subtleties and interpretations.

        

  • Ivan Israelstam is chief executive of Labour Law Management Consulting. Contact him on 011-888-7944 or via email:  
  • Our appreciation to Ivan and The Star newspaper for permission to publish this article.

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