Many well established employers, especially the larger ones are starting to develop an understanding of labour legislation and are trying to comply with it. However, there is a growing number of smaller or new age employers which are too busy with the stabilisation of company finances, market penetration and growth to realise that they are not labour law compliant.

The result is that, while the company is trying to become established and to grow it is bypassing labour legislation and landing up at the CCMA or bargaining council. Therefore, they need to be made aware that Labour Relations Act (LRA) codifies several principles which will substantially affect the ability of the new employer to manage its employees. Some important provisions of the LRA are:

• The definition of dismissal includes the employer’s failure to renew a fixed term contract on equal terms where the employee expected the contract to be renewed. Many new employers make extensive use of fixed-term contractors. However, because, unbeknown to the uninitiated employer, the LRA protects fixed-term employees, new employers land up spending their valuable time and money at the CCMA.

• The LRA obliges arbitrators and Labour Court judges presiding over dismissal disputes to reinstate/re-employ unfairly dismissed employees as the chief remedy for such dismissals. This is in sharp contrast to traditional practice which often saw employees receiving financial compensation instead of reinstatement.

• Compensation for unfair dismissal is very costly for employers. For example, certain unfair dismissals could cost the employer up to 24 months’ pay.

• An employer who unfairly demotes an employee, for example, as part of the penalty for misconduct, could find itself at the wrong end of an unfair labour practice arbitration hearing.

Those employers who wish to operate within the bounds of the law while still controlling employees effectively should implement the following strategy:

==> Provide ongoing training of management/supervision in labour law, IR, leadership and disciplinary skills.

==> Redesign disciplinary policies so that the implementation of discipline is based on constructive, effective but legally acceptable corrective measures.

==> Develop a culture of responsibility and self-discipline on the part of management and employees.

==> Use the services of a qualified expert to assist with the implementation of the above. Such an expert will also be required to advise on the legal and practical aspects of discipline. For example, specialist advice will be required on the changes to be made to policies, procedures, practices, letters of appointment, induction programmes and training courses related to the disciplinary approach of the organisation. Expertise will be required in the combining of the requirements of the LRA with affirmative action legislation on the one hand, and the practical requirements of an effective disciplinary and HR policy on the other hand.

To attend the November 4 seminar on 'Changes and Danger in Labour Law 2011' please contact Ronni on ronni@labourlawadvice.co.za or on 0845217492 or (011) 782-3066.

Written by Ivan Israelstam, Chief Executive of Labour Law Management Consulting
Tel: (011) 888-7944
Cell: 0828522973
E-mail: labourlaw@cinet.co.za.

This article first appeared in The Star.