Before looking at these certain sections we need to be sure of what is meant by the term “earning in excess of R172 000 per annum”.  Earnings exclude allowances such as subsistence allowances, transport allowances, overtime pay, and achievement awards (?).

Earnings include deductions made by the employer for income tax purposes, pension or provident funds medical aid or any similar deductions.  It also includes an annual bonus and leave pay.

Employees earning over R172 000 per annum, which equates to R14 333 per month are not entitled to receive payment for:

v  Overtime worked over their normal hours of duty

v  Sunday work

v  Public Holiday work

In addition their hours of work are not restricted to a maximum of 45 hours per week, nor are their meal intervals or rest periods prescribed in the BCOEA.

Clearly such an employee may enter into an agreement with his/her employer where these matters are properly dealt with.  In the absence of such an agreement the employee falls under the control of his/her employer where he/she works overtime, or works on a Sunday or public Holiday.

Employers or Employees – Beware!!!!

By: Les Owen

The amendments will also provide more points for those organizations that support enterprise development and procurement from Black owned businesses.

At present businesses with an annual turnover of less then R5 million are automatically regarded as level 4 contributors to BEE.  This R5 million threshold is soon to be reviewed.

In addition, organizations whose annual turnover is between R5 million and R35 million presently have the option of being scored on any 4 of the 7 elements in the scorecard.  Each of the 4 elements is given 25 points.  This option of choosing any 4 will be amended and some of the 7 elements will be made compulsory.  Indications are that the ownership element will probably become compulsory.

Organizations who need more information or assistance in meeting BEE requirements should contact us.  We have assisted many business to improve their BEE status since 2005.

Les Owen

Act 70 of 2002 known as the Regulation of Interception of Communications and Provision of Communication-related Information Act covers same aspects as to when an employer may have access to the electronic communication of its employees.

The general rule is that an individual may intercept such communication if he or she is a party to the communication itself or if the information is in the public domain.

In the CCMA Award Sedick and Another / Krisray (Pty) Ltd. [2011] 8 BALR 879 (CCMA), the Operations Manager of the Company had placed disparaging remarks on his Facebook page about the company and its owners.

As a consequence the Operations Manager and another Senior Staff member were dismissed.  They argued the Facebook information was private and consequently they should not have been dismissed.

The Commissioner ruled that Facebook was in the public domain and the comments concerned the company and its owners.  The owners were entitled both to look at the information and to take appropriate action.  The dismissal was found to be fair.

Article by Leslie Owen

It may be of interest to read the entire judgment of the Labour Court as it concerns a common problem at our workplaces. This problem is the reporting for work under the influence of alcohol. It sets outs the distinction between alcoholism and non alcoholism.

Must an employer automatically approach an employee who reports for duty under the influence of alcohol as a possible alcoholic?

What does an employer do if the employee does not raise alcoholism as a defence? The judgment indicates that an employer must be careful in inferring that an employee who reports for work in an inebriated state is an alcoholic.

Reporting for work in such a state is an act of misconduct. Where the job that the employee performs is highly skilled, responsible, or hazardous, dismissal for a first offence in justified.

The defence was also raised that the employee had not committed an offence as the employee had not actually commenced working for the day. The court said this was an illogical defence.

In my view it’s a bit like being in the position where you know your bus driver is a bad driver but you allow him to drive as he has not had an accident yet. The emphases is on the yet.

This judgment makes clear that an employer has an obligation to take remedial action before such an accident takes place.

Although the judgment does not set out the criteria for determining whether a employee is guilty of being drunk at the workplace other judgments have indicated that there are three criteria that can be used by an employer.

The first relates to observation of the behavour exhibited. Is the speech slurred, are eyes bleary, is the walk unsteady, is there a smell of alcohol?

The second is that of a more objective chemical nature. Was an alcometer, or breathalyzer used or a blood test given?

The third is can an employee perform his/her job satisfactorily and in the normal acceptable way?

The judgment in the Transnet matter and the three criteria approach should guide employers and employees who are involved in alcohol related incidents.

By Leslie Owen

Employers who retrench employees and employees themselves need to be aware of what employers must do when retrenching employees.

The Labour Relations Act is quite clear on what an employer must do.  In summary the employer must:-

a)         Have a good valid reason for retrenching.

b)         Go through a good faith consultative process with employees with the specific    aim of:-

(i)         Avoiding retrenchment.

(ii)        Minimizing retrenchments

(iii)       Affecting the timing and effect of the retrenchment on employees.

In addition there is a specific letter which must be written to employees in terms of Section 189 (3) of the Labour Relations Act.  A proforma of the letter is attached to this notice as Section 189 (3).

Finally, retrenchment should be a measure of last resort.  There are several other options available to employers before retrenching employees e.g. introducing short time, introducing unpaid leave, introducing the taking of paid leave.

Please contact us for further advice.

Many travelers watch with trepidation as their overnight bag disappears on the conveyor belt. Will it be safe? Who will be wearing my new socks next week?

The Security Company operating at O.R Tambo airport has taken this issue head on. According to the January edition of the Industrial Law Journal the Company, Khulani Fidelity Security Services, has an agreement with the Union SATAWU that requires all employees to undergo quarterly polygraph tests. Those who fail are moved to other positions or offered retrenchment.

However another Security Company did not have a Collective agreement but used polygraph testing and retrenched. When this matter went to the Labour Court on the issue of costs, the Court felt that in the absence of an agreement polygraph testing was not a fair criteria for selecting employees for retrenchment.

The case in question is: National Union of Mineworkers & others v Coin Security Group (Pty) Ltd t/a Protea Coin Group (2011) 32 ILJ 137 (LC)

The lesson is that it is preferable to have a Collective Agreement on such matters.

For help in this regard please contact us.

Article by Les Owen

On the 17^th December 2010 The Director General of the Department of Labour published 4 Bills all of which will have a direct impact on employers and employees.

The 4 Bills are:-

• Labour Relations Amendment Bill
• Employment Equity Amendment Bill
• Basic Conditions of Employment Amendment Bill
• Employment Services Bill

Our Comments:

Whilst the Bills must still be further discussed and debated at Nedlac comments from The South African public will be accepted by The Department of Labour up to the 17^th February 2011.

It is interesting to note the completely different responses to the 4 Bills by employer bodies and the Trade Union movement.

The Trade Union movement believe that the Bills will create employment opportunities.  The employer bodies indicate that the Bills will decrease employment opportunities.

What we can see is the following:-

The International Labour organization is placing emphasis on the provision of decent work in member states.  Some aspects of the Bills are clearly there to meet South African’s obligations in terms of its membership of the ILO.

Some Strange Aspects:

However there are some aspects which do seem somewhat strange.  For example employees earning over an annual remuneration determined by the Minister will not be allowed to refer their dismissal to the CCMA for resolution and adjudication.  This applies also to any dispute concerning such a person’s promotion or demotion.  In our view this aspect may simply be unconstitutional.  This situation already exists in some Countries e.g. Australia.

A further aspect of concern relates to the practicality for every employer reporting all vacancies to The Department of Labour 14 days after the vacancy occurs.  The Department will act as an employment agency and send suitable applicants to the employer.

Although a similar practice exits in Western Europe, in South Africa this has traditionally been the domain of the private sector.

The employment of employees on a fixed term basis will also be affected if the Labour Relations Bill became Law.  This emphasizes that the employer must have a fair and legally valid reason for using a fixed term contract of employment.  The amendments stress that all employment should be on a permanent basis.

Conclusion:

Many commentators in the past have indicated that our Labour Laws are restrictive and reduce something called “Labour flexibility”.    Our research shows that there are some countries e.g. The United Kingdom, Australia where the Labour Laws were changed, and employment numbers increased.  These changes will be the subject of our next article.

Article by Les Owen

Several of our clients have had a most thorough and meticulous audit of Employment Equity performed by the Task Team.

Gone are the days when you as an employer could treat Employment Equity as something of an irritant.

The Task Team specifically looks at:-

-       Do you have a properly working Employment Equity Forum?

-       Do you have a well prepared Employment Equity Plan?

-       Have you set realistic numerical goals?

-       Are you serious about changing the gender and racial profile of your employees?

Our consultants have experience of these matters and have worked with the Task Team.  Given the power that the Department of Labour has to impose a compliance order it will be in your interest as an employer to raise the importance of Employment Equity in your business.

The Employment Equity Act requires an employer to take into account the Regional and National Economically Active Population figures when determining the employers own demographic employee profile.

We reproduce here the figures taken from Statistics South Africa’s quarterly report dated 1^st May 2010.

For more information please contact us on 031 7003151

By: Leslie Owen

We have read articles in the press predicting that South Africa would lose its investor friendly image.  Trade Union leaders have been criticized for leading their members into a strike in which they will lose more than they gain.  It has been suggested, that many workers are not actually aware of the implications of their strike action.  They have been duped into engaging in strike action. During strikes Trade Union Officials receive their pay whist the unthinking workers earn nothing.

Let me put the strikes into some context

How does South Africa fare in comparison to other countries?  To discover this we need a common measurement for strikes.  This is difficult for a variety of obvious reasons.  These relate to the number of people in formal employment, the size of the economically active population, the size of the population, the level of unionization, the legal framework etc.

Strikes are normally measured by taking the number of employees on strike and multiplying by the number of days in that strike’s duration.  This gives an absolute figure.

Figure one, produced by our own Department of Labour, shows the number of strikes in South Africa since 2005.  The trend is downwards.

Figure two tells a different story.  It reflects the number of days lost to the economy through strikes.  The country hit a spike of 9,528, 945 in 2007.

To find a comparative measure I have taken the number of strike days lost to the economy in 2008 and divided by the population of each Country.  This gives strike days lost per million of population.

Strike Days Per 1 Million Of Population – 2008

1. Denmark – 373 820
2. Uruguay – 292 166
3. Brazil – 75 095
4. Peru – 52 446
5. France – 40 179
6. Canada – 26 534
7. Argentina – 21 034
8. Korea – 17 285
9. India – 14 432
10. Italy – 12 460
11. South Africa – 10 151
12. Turkey – 9 985
13. USA – 6 365

Table one shows the results of that computation.  You will see that Denmark has the highest number of strike days lost per million of population at a remarkable figure of 373, 820 days.  South Africa is quite low actually at 10,151 days lost per million of population.  Even India and Brazil our IPSA partners lost more days than we did in 2008.  We lost even fewer days in 2009.  We will lose more strike days in 2010 than in 2009.  However we will probably still be relatively low on the 2010 version of table one.

Have a good look at the countries that lose more strike days than we do.

All are regarded as democratic countries with the trappings that go with that label.  Perhaps there is a correlation between strikes and the level of democracy in a country.  We cannot even find strike statistics for repressive regimes.  Strike figures for Zimbabwe, China, Cuba, or any of the countries in the Middle East including Libiya are very difficult to find or are non-existent.

Trade Unions have a specific role to play in all democratic countries.  Their job is to protect the interests of their members and to improve the income and quality of life of their members.  They are also democratic organizations.  Union Officials are compelled to listen to the views of their members.  To say that Trade Union members, even unskilled general workers, are not aware of the sacrifices they make in a strike is to denigrate and belittle those workers.

The decision to embark on a  strike is a decision which requires a great deal of debate, discussion and a process of thinking through the consequences.  It took over a week for the Public Service Unions to respond formally to the Government’s last offer.  The reason it took over a week was due to the intensive discussion and debate which took place amongst union members.

Clearly the violence, destruction of property, intimidation and bad behavior of some strikers is to be abhorred.  However most strikers behaved themselves.

In my view, potential investors who in the main are thinking people would prefer to invest in a democratic open society as to opposed to a closed non democratic regime. The level of strike activity is but one of several indictors considered by investors.  Political stability, economic growth, the condition of our infrastructure are probably of much more importance than this year’s strikes.

When our Deputy President visited the UK recently our strike record was not seen as a limiting factor for investment.  Would Walmart consider paying a reported R30 Billion for Massmart if they were concerned about our strike record?

Once union members decide to engage in a lawful strike it is the job of the Union organizers to ensure that the strike’s momentum is not lost.  They probably work harder during a strike.  Surely they are entitled to be paid for performing the tasks for which they were employed.

As the late judge Otto Kahn – Freund stated:-

“The relation between an employer and an isolated employee or worker is typically a relation between a bearer of power and one who is not a bearer of power”

The role of a Trade Union is to help increase  employee power so that it balances that of the employer. A strike is simply an effective way of ensuring the employer realizes this power balance.

The State is the largest employer in South Africa.  It employs ± 1.3 Million individual South Africans.  It is a powerful organization.  It expected its 7% wage offer to be accepted.  For the unionized employees to stand up and say “no, we reject your offer” seems to me to have been a brave decision. Employers have more power than individual employees.  Proper negotiations can take place when there is a balance of power between the negotiating parties i.e. the Unions and the State.

Strike action by Union members is an acceptable democratic first world way of ensuring the proper balance exists. The Trade Unions and the Public Servants in particular have showed the State that it is not as powerful as it thought.  I believe this to be something of value – perhaps as ordinary South Africans should be thankful for the courage they displayed!

Leslie Owen is a Lecturer in Industrial Relations on the MBA Programme at the Graduate School of Business, University of KwaZulu Natal, is a Senior Commissioner at the CCMA in Durban and practicing I.R Consultant.

By:  Leslie Owen

However employers should be very careful before suspending such an employee.

Our Labour Court has made clear that such a suspension must have good valid reasons before the court will recognize that it is legitimate.  In addition the principle of Audi Alteram Partem must be observed by the employer.  The Audi Alteram Partem principle means that the accused employee must be able to give his version before a decision is made to suspend.

Simply put the employer must do the following before suspending an employee pending  a Disciplinary Hearing:-

a)         have a good valid reason for wanting to apply the suspension.

b)         clearly inform the employee of this valid good reason.

c)         allow the employee time to consider the reason.

d)         obtain a response from the employee as to why the employee believes he/she     should not be suspended.

In addition after following these steps, the employer still intends suspending the employee, this should be done in such a way that the employee’s dignity is preserved.

To quote from the Labour Court:-

“the prejudice that an employee may suffer in a case of suspension is not limited to financial prejudice in the case where the suspension is without pay.  Suspension with pay also has substantial prejudicial consequences relating to both social and personal standing of the suspended employee.  In my view any suspension with or without pay has to bring into question the integrity and dignity of the suspended person particularly where the suspension is based on allegations of dishonesty.”

“Dince & Others v the Department of Education, North West Province & Others (2010) 31 ILJ 1193 (LC”.