http://www.polity.org.za
Deepening Democracy through Access to Information
Home / Press Office / Labour Law Management Consulting RSS ← Back
Close

Email this article

separate emails by commas, maximum limit of 4 addresses

Verification Image. Please refresh the page if you cannot see this image.

Sponsored by

Close

Article Enquiry

What Is An Employment Benefit?

Verification Image. Please refresh the page if you cannot see this image.
Close

Embed Video

What Is An Employment Benefit?

30th November 2018

SAVE THIS ARTICLE      EMAIL THIS ARTICLE

Font size: -+

What does and does not constitute a benefit has not been defined in any act and this leaves the answer open to the interpretation of arbitrators.

The courts themselves are unable to agree with each other. For example, in HOSPERSA  & Another vs Northern Cape Provincial Administration (CLL Vol. 15 No.1 August 2005) the Labour Appeal Court found that an acting allowance was not, in that case, a ‘benefit’ for purposes of the LRA because the right to it did not arise from statute or from a contract between employer and employee.

Advertisement

However, in Protekon (Pty) ltd vs the CCMA & others (CLL Vol. 15 No. 1 August 2005) the Labour Court departed form the Labour Appeal Court’s view. The Court found that, even where there was neither a statutory provision nor an express contractual provision in place the CCMA may still have jurisdiction. That is, where an employer has unfairly exercised its discretion as regards a benefit the CCMA would have jurisdiction to arbitrate the matter.

While the wording of this finding is confusing it appears to mean that the jurisdiction of the CCMA would be based on the grounds that the discretion was exercised unfairly and that the employer has a tacit contractual duty to act fairly.

Advertisement

Another question is how we separate ‘remuneration’ from ‘benefit’ in the light of the LRA failure to clarify this difference. Whilst it may be clear that salary, commission and overtime pay fall under the heading of remuneration, and that leave, medical aid and pension are benefits there are many other terms of employment that do not fall neatly into either category. For example, what are Christmas bonuses, long service awards, vehicle allowances, housing subsidies, leave pay, share options, acting allowances and canteen privileges?

One method of distinguishing these concepts might be to accept traditional usage or definitions. That is, historically, salary, overtime and commission have been seen as remuneration. Perhaps then, all other entitlements directly related to these payments should be seen as remuneration while all the rest should, for the sake of simplicity, be classed as benefits.

For example, using this approach, an acting allowance would be part of remuneration because it involves a payment of money to the employee for doing extra work in a similar way to that in which overtime is paid. On the other hand other employment conditions such as performance incentives, housing benefits and Christmas bonuses could be seen as benefits as they are add-ons rather than part of the direct remuneration for work done.

Until recently, where an employer withheld any part of an employee’s remuneration payment the employee could not refer such a dispute to the CCMA. Instead the dispute had to be referred to the Department of Labour or to a court. However, I have recently heard of cases where the CCMA accepted jurisdiction for salary based disputes. This means that it may no longer be so important to be able to distinguish between benefits and remuneration.

To get a free viewing of our ongoing Labour Law Debate go to www.labourlawadvice.co.za and click the Labour Law Debate item in the menu.

Written by Ivan Israelstam, 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. Go to: www.labourlawadvice.co.za.

EMAIL THIS ARTICLE      SAVE THIS ARTICLE ARTICLE ENQUIRY

To subscribe email subscriptions@creamermedia.co.za or click here
To advertise email advertising@creamermedia.co.za or click here

Comment Guidelines

About

Polity.org.za is a product of Creamer Media.
www.creamermedia.co.za

Other Creamer Media Products include:
Engineering News
Mining Weekly
Research Channel Africa

Read more

Subscriptions

We offer a variety of subscriptions to our Magazine, Website, PDF Reports and our photo library.

Subscriptions are available via the Creamer Media Store.

View store

Advertise

Advertising on Polity.org.za is an effective way to build and consolidate a company's profile among clients and prospective clients. Email advertising@creamermedia.co.za

View options
Free daily email newsletter Register Now
Register Close