In Apollo Tyres SA (Pty) Ltd v CCMA & Others (unreported case DA1/11 [2013] ZALAC) a benefit was said to be any advantage or privilege to which an employee was entitled or offered, in terms of an existing policy or practice, and which was granted at the employer's discretion.

The Labour Appeal Court rejected the contention that a 'benefit' as contemplated in s186(2) of the Labour Relations Act, No 66 of 1995 (LRA) is limited to only an entitlement which arises ex contractu or ex lege and accordingly dismissed the proposition that the Commission for Conciliation, Mediation and Arbitration (CCMA) did not have jurisdiction to determine the dispute.

The definition of an 'unfair labour practice' given at s186(2) of the LRA includes any unfair act or omission that arises between an employer and an employee involving unfair conduct by the employer relating to the provision of benefits to an employee, and such a claim may be referred to the CCMA or a bargaining council for adjudication. Any discretion exercised by an employer in respect of the provision of benefits, as this term is so broadly interpreted in Apollo, is subject to the scrutiny of the CCMA or a bargaining council under the unfair labour practice jurisdiction.

The judgment in Apollo has recently been applied by the Labour Court in SARS v Ntshintshi & Others (unreported case (C546/12) [2013] ZALCCT 17) where the court held that the provision of a discretionary travel allowance in terms of the employer's travel allowance policy amounted to a benefit.

The Apollo decision, which initially appeared to bring some clarity on what constitutes a benefit, will undoubtedly open the flood gates for any disgruntled employee to refer a dispute to the CCMA relating to privileges and advantages awarded by an employer. Previously, disputes relating to privileges or advantages which were not founded in contract or statute were addressed or resolved through industrial action.

On consideration of the principles established in Apollo, it is clear that not only would the decision not to grant a benefit fall within the ambit of s186(2), so too would the decision not to offer a certain privilege or benefit to particular employees. In Apollo an offer was made to employees between the ages of 46 and 59 to apply for early retirement which would be granted at the employer's discretion. The employee in that case satisfied the requirements prescribed by the employer, but was nevertheless refused entry into the scheme by the employer who maintained that it was simply exercising its discretion.

Is the inevitable result of Apollo that a practice or policy which does not make provision for a particular benefit or advantage to a certain group of employees is adjudicable by the CCMA?

Using the facts in the Apollo case, would the 49 year old employee have been entitled to refer an unfair labour practice dispute to the CCMA even in the event that the employer's policy had provided that eligibility to enter the scheme was dependent on employees having attained the age of 50? Apollo states that a benefit includes an existing advantage or privilege which an employee is granted in terms of a policy or practice subject to the employer's discretion. In the aforementioned scenario, there is an existing policy which provides for an advantage to certain employees and the employer has exercised its discretion in granting the benefit to only select employees at the exclusion of others. It therefore seems that an employee in these circumstances would therefore be entitled to refer an unfair labour practice dispute to the CCMA.

It was held in Protekon (Pty) Ltd v Commission for Conciliation Mediation and Arbitration & Others [2005] 7 BLLR 703(LC) that unfair labour practice jurisdiction 'cannot be used to assert an entitlement to new benefits, to new forms of remuneration or to new policies not previously provided by the employer. To permit that would allow an employee to use the unfair labour practice jurisdiction to establish new contractual terms; something the LRA clearly contemplates should be left to a process of bargaining between the parties.' This is cold comfort to an employer who, for example, wishes to grant performance bonuses on a discretionary basis and has a policy or practice in place regulating such bonuses. The decision not to grant such a bonus could be the subject of an unfair labour practice claim in the CCMA. This is true even where the decision not to do so is based on a pre-determined performance management system. The employer will nevertheless have to prove the fairness of its conduct in exercising the discretion.

We therefore anticipate countless disputes being referred to the CCMA and bargaining councils which relate to the provision of "benefits", as this term is defined in Apollo.

Written by Mandlakazi Ngumbela, Associate, Employment, Cliffe Dekker Hofmeyr