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BY   lvan lsraelstam, Chief Executive of Labour Law Management Consulting. He may be contacted on (011) 888-7944 or 0828522973 or on e-mail address: ivan@labourlawadvice.co.za. Web address: www.labourlawadvice.co.za. This article first appeared in The Star.

It is a frequent need for employers to change working conditions because:

  • Work volumes may drop requiring the need to amend working processes
  • New technology may result in changes in working hours
  • Market shifts may require changes to the place of work for some employees
  • Operational needs may require longer working hours or new shift systems
  • Spiralling costs of employee benefits may require ceilings to be set for the employer’s contributions to retirement and medical aid schemes
  • A takeover or merger mayrequire standardisation of employment conditions.
  • It is not a disciplinary offence for an employee to disobey an unreasonable instruction. And it would not normally be unreasonable for an employee to refuse to work according to new terms and conditions unless this has been agreed to by the employee or his/her representative
  • In a takeover of a going concern the employer is compelled to retain the terms and conditions of employment of the employees concerned
  • The Labour Relations Act (LRA) prohibits unfair acts on the part of the employer as regards employee benefits
  • Section 187(1)(c) prohibits the employer from firing employees who refuse to agree to changes in terms and conditions of employment. Specifically, this section provides that:

 

  • The retrenchments could have been avoided or minimised if the employer had got rid of a number of contractors
  • The employer’s firm and consistent statements that the employees would be taken back if they agreed to the new shift system showed that the employer had ulterior motives
  • The dismissals did not constitute a genuine retrenchment but was instead a ploy to get the employees to agree to a change in their terms and conditions of employment
  • The dismissal was therefore automatically unfair in terms of section 187(1)(c).
  • All the employees were to be re-employed with effect from the date of the court order.
  • Court decisions are made on the basis of the fairness of each case taking into account the unique circumstances of each one
  • Therefore, before risking the infringement of section 187(1)(c) employers need to have their specific cases analysed by a labour law expert. This is particularly so because the wording, and thus the meaning of section 187(1)(c) will be changed soon resulting in a major change in this legal provision.

In today’s world of rapid economic change all of the above problems are commonplace. Yet many employers have no idea as to how to go about making the changes.

Added to the employer’s lack of knowledge is the fact that labour law severely restricts the employer’s right to make such changes without the employees’ consent. For example:

“A dismissal is automatically unfair if an employer, in dismissing the employee, acts contrary to section 5 or if the reason for the dismissal is …. to compel the employee to accept a demand in respect of any matter of mutual interest between the employer and employee…”. This applies where the employer threatens the employee that, if he/she does not agree to a change in terms and conditions of employment, the employee will be dismissed. If the employee then refuses to agree to the change and is consequently dismissed this could be seen to be automatically unfair.

However, what if the employer needs to change the work circumstances due to its operational requirements? That is, what if, for example, client work circumstances are such that a new shift system is required but the employees are not willing to agree to the change? Is the employer entitled to go into a retrenchment process with a view to hiring employees willing to accept the new terms and conditions of employment?

In the case of CWIU and others vs Algorax (Pty) Ltd) (2003 11 BLLR 1081) the employer needed to switch to a new shift system but the employees refused to accept this. The employer then retrenched its employees but consistently said that it would re-employ them if they would change their mind and agree to the new shift system. The Labour Appeal Court found that:

However, in the case of Fry’s Metals (Pty) Ltd vs NUMSA & others (2003 2 BLLR 140) the employer also wanted to change its shift system. When the employees refused they were retrenched. In sharp contrast to the Algorax decision, the Labour Appeal Court found that the employer had been entitled to do this because the retrenchment had not been used to compel the employees to accede to its demands.

The strongly opposing outcomes and the severe consequences of these two court findings in the same year show that:

To attend our 13 March 2014 seminar in Durban on CHANGES AND DANGERS IN LABOUR LAW please contact Ronni at This email address is being protected from spambots. You need JavaScript enabled to view it. or on 0845217492.