Unpacking Labour Law For Employers

Unpacking Labour Relations For Small Businesses

Unpacking Labour Relations For Small Businesses

In this labour law guide we will introduce employers to labour laws that will affect them in the running of their businesses, including:
– Employment contracts
– Employee misconduct
– Employee dismissals

1. Employment contracts

A contract of employment is an agreement between an employee and an employer, wherein the employee undertakes to render service to the employer. The employer may be a person or an organisation. The employer will pay the employee a determined- or determinable remuneration for the service rendered by the employee and the employer will acquire authority over- and regulate the services rendered by the employee.

A contract of employment is a very important document in that it confirms the employment relationship between the employee and the employer and also the conditions which applies to the employment. The conditions of employment may include the remuneration, the working hours, the leave the employee is entitled to, notice periods upon termination of service, etc.

Without a contract of employment, either party will have a very hard time proving any particulars of employment, should a dispute regarding this arise.

The contract of employment is a physical document, containing the particulars related to the employment relationship, which gets signed by the employee, the employer, as well as a witness(es).

The consequences if this is not in place:
Section 29 of the Basic Conditions of Employment Act prescribes that the employer must have certain particulars of the employee in writing. Should the employer fail to adhere to this, they could face a hefty fine or even imprisonment.

2. A workplace disciplinary code

A disciplinary code in the workplace serves as a guideline to the employee, identifying certain types of action as misconduct. The code informs the employee how the employer will treat the different forms of misconduct, should any occur.

Your disciplinary code establishes the rules regarding misconduct in you workplace, as well as the process which will be followed, should they fail to adhere to the rules. It is important for your employees to be aware of the consequences, should they commit misconduct. This will also prevent them from claiming ignorance should he/she be caught doing something which should not have been done.

A disciplinary code is a document containing a list of the different types of misconduct, which are categorised according to their seriousness and states how the employer will treat each one of the offences. It is important that the disciplinary code is fair. If the prescribed punishment for a specific misconduct is unreasonable, it will be regarded as unfair – despite the fact that it is in the code.

The consequences if this is not in place:
If you do not have a disciplinary code in your workplace, it does not mean that you cannot take disciplinary action against your employees. However, having a disciplinary code supplies much needed substance to the steps that you do take and also creates certainty as to what type of conduct is accepted in the workplace.

3. Managing misconduct

It is of utmost importance that the employer manages the misconduct in their workplace fairly and effectively. Legislation dictates that misconduct should be dealt with in a progressive manner. This means that your employee must be given the opportunity to correct his/her behavior and to, in a sense, rehabilitate themselves. More serious types of misconduct do, however, justify summary dismissal for a first offence.

Why is it important:
You will get the type of behavior from your employees which you tolerate. Failing to act upon misconduct will lead to an increase in undesirable behavior by your employees. Unless you are lucky enough to have employees with high integrity, you will have to take correctional action against your employees in order to instill discipline in your workplace.

4. The process of dismissals

Dismissal refers to the termination of the employment agreement between the employer and employee. An employer is required to follow a specific procedure before dismissing any of their employees. Types of dismissal include dismissal for misconduct, -operational requirements, and dismissal for incapacity – either for poor work or -ill health. There is a different prescribed procedure for every type of dismissal.

It is vital for the employer to follow the correct procedure for the type of dismissal in question, in order to ensure that the dismissal of an employee will be regarded as fair.

5. Consistency and procedure

The manner in which the employer treat an act of misconduct will create a precedent in the workplace. It is therefore crucial that disciplinary action be applied consistently.

Should more severe disciplinary action be taken against one employee than against another employee for the same misconduct, the more severe action will be regarded as unfair. All employees must be treated equally for committing similar misconduct.

A dismissal which is inconsistent (where other employees are not dismissed for the same misconduct) will be regarded as being substantially unfair. Despite disciplinary action which is regarded as fair, it could still be procedurally unfair. This means that the employer must follow the correct prescribed procedure before taking disciplinary action against employees.

Procedural fairness means that you have implemented the correct progressive discipline (issued the right warnings) and that you have given the employee an opportunity to state his/her case (having a disciplinary hearing) before dismissing the employee.

The consequences if this is not in place:
Failing to comply with the substantive- and procedural requirements prior to a dismissal will result in an unfair dismissal. An employer could face a severe award against them (equal to 12 months of the employee’s remuneration) should the employee be unfairly dismissed.

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Contributor Tersia T. Landsberg
Contributor Tersia T. Landsberg
Tersia Landsberg is a content producer for SEESA with over 5 years' experience in South African business labour legislation and business solutions. She is affiliated with SEESA (Pty) Ltd, a professional legal and business service provider for South Africa’s business owners. SEESA specialises in business software, Labour, UIF and Compensation Commissioner, Skills Training, BEE, Consumer Protection and POPI.