UIF Compliance Certificate Mandatory for any Government Tenders

Originally mentioned in 2018 by the Department of Labour, rumour has it that it will become standard for entities trying to procure government work to have an UIF compliance certificate. The guidance on how to obtain this certificate is available on this link.

Critical to planning for this is the two week turnaround time to get the certificate so businesses may wish to apply on a regular basis or plan very well.

CCMA – Prescription and Holiday Pay

Editor’s Note: the risk in this instance can be managed with proper documentation and processes. HRTorQue’s HR support product is ideally positioned to help employers with this type of risk.

In a recent CCMA ruling, an arbitrator sided with an employee and argued that given the difficult financial climate, prescription periods should be relaxed and required an employer to pay the employee for disputed holiday pay. Central to the argument was the fact the employer could show no evidence that the employee had been shown and understood the company’s policy on holiday pay.

While the case may be referred, a precedent has been set.

It is critically important for employers to manage their potential liabilities by making sure of the following:

  • They have comprehensive up to date policies and procedures which are consistent with their contracts of employment
  • They have a proper induction process where employees are taken through the policies and sign the documentation; and
  • They have a proper exit process where the employee is once again taken through all exit steps and confirms their understanding of any final payments;

With the right steps in place, it is difficult for an employee to say they were not aware of something, even if many years have passed.

Amendments to LRA Create a New Basis for Strike Interdicts

Author: Neil Coetzer Aitken (source: Cowan Harper Madikizela Attorneys)

On 20 March 2019, the Labour Court handed down judgment in the cases of Mahle Behr SA (Pty) Ltd and NUMSA & Others (D448/19) and Foskor (Pty) Ltd v NUMSA & Others (D439/19). In those matters, the Labour Court interdicted NUMSA from engaging in strikes on the basis that the Union had failed to conduct a secret ballot, as required by section 19 of the Labour Relations Amendment Act 8 of 2018.

The Labour Relations Amendment Act came into effect on 1 January 2019 and made it compulsory for Unions and employers’ organisations to include in their constitutions certain provisions dealing with means to ensure that secret ballots are held prior to engaging in a strike or lock-out. In addition, section 19 of the Amendment Act placed an obligation on the Registrar of Labour Relations to consult with the Unions and employers’ organisations on the most appropriate means to amend their Constitutions and to issue a directive to those Unions or employers’ organisations setting out the date by which such amendments should be affected. The Registrar is required to do this within 180 days of the commencement of the Amendment Act.

Importantly, section 19 also provides, inter alia, that a Union must conduct a secret ballot of its member before engaging in a strike, until such time as it has complied with the Registrar’s directive. It was common cause in the matters before the Labour Court that NUMSA’s constitution did not comply with sections 95(5)(p) and (q) of the Labour Relations Act 66 of 1995, as amended (“the LRA”) in that it did not provide for certain requirements concerning balloting processes.

The Labour Court pointed out that while section 67(7) of the LRA provides that a failure of a Union to comply with a provision in its constitution regarding a ballot may not give rise to or constitute a ground for any litigation concerning the legality of the strike, this section only applied to Unions that had complied with the requirements of section 95. NUMSA had not complied with those requirements.

NUMSA argued that the provisions of section 19 constituted an infringement of the respondent’s constitutional right to strike and, further, that section 19 was in any event not applicable since the obligation to conduct a secret ballot arose only after the Registrar issued the directive.

The Court found that neither of these arguments had any merit. The Court held that in order for a Union to avoid the consequences of section 19, NUMSA simply had to comply with section 95(5)(p) of the LRA. Section 19 requires simply that the Union conduct a secret ballot of members and such a provision, the Court held, did not infringe the right to strike.

The Court also concluded that the provisions of section 19 are clear and unambiguous and the Court was obliged to give effect thereto. It found that the legislation’s purpose was to ensure that a secret ballot was conducted by a Union prior to engaging in a strike during the transitional period following the enactment of the Amendment Act. The Court held that the requirement is peremptory and applies only to registered Unions whose constitutions do not contain a balloting requirement.

On this basis, the Labour Court interdicted NUMSA from engaging in any strike.

The judgment may be controversial for a number of reasons, including the Court’s interpretation of section 67(7) of the LRA. Nevertheless, it is likely that other employers may also now seek to interdict Unions and their members from engaging in strikes until such time as the Unions’ Constitutions have been amended to comply with the provisions of section 95 of the LRA. To that extent, the judgment is a positive development signalling an important shift towards improved governance and accountability for Unions.

The Future of Work – Big Data, Data Analytics & Artificial Intelligence (AI)

Editor’s note: Industry 4.0 is coming. The purpose of our series is to get employers thinking about ways to use this new technology to improve their business; and for HR professionals to understand the impact this might have on the workforce and their own roles requiring greater analytical abilities.

In our third edition of the Future of Work, we look at the evolution of the “social enterprise” with an increased external focus for all members of the organisation combined with increased collaboration by employees within teams.

Historic Model

The traditional organization is very hierarchical with significant energy wasted by most employees on inward focused activities with little connection to the end customer.

The Social Enterprise

With the support of technology, it is anticipated the Future of Work will allow successful businesses to be much more focused on the end customer. This will be accompanied by increased collaboration between employees, with employees likely to be organized in a multi-functional “network of teams” as opposed to hierarchical structures. The team dynamic is anticipated to support greater problem solving, improved decision making and flexibility.

Impact on HR

According to a 2019 Deloitte study the impact on HR is to look at employees differently with a focus on:

  • Accessing capabilities not just people;
  • Embedding learning into all parts of an employee’s role to improve decision making abilities;
  • Promoting mobility as a means of development and engagement; and
  • Leveraging technology

Where We are Today

Collaboration tools and other technology are already available in theory to promote improved interaction between teams and to set up teams into more flexible units. The challenge in practice and particularly in South Africa seems to be the following:

  • Recruitment & Leadership – finding the right talent and leadership to be able to manage nimble teams;
  • Organisational memory and established businesses – for many of the established businesses a change of this magnitude comes with significant risk and corporate memory tends to come with its own inertia;
  • Training – while there are better online and augmented reality tools emerging, training for problem solving as opposed to traditional topics is not quite there yet;
  • Cultural and legacy barriers – the Social Enterprise model assume an inclusive organisation where diverse views and people are encouraged with the aim of improving problem solving and creating a better connection to end consumers. There is much that still needs to be done in this area.

Derivative Misconduct – Constitutional Court Ruling

The Constitutional Court recently handed down an unanimous judgement in the matter between NUMSA and Dunlop which dealt with the concept of derivative misconduct, providing clarity on this issue and the tests to be considered particularly where employees cannot be individually identified as being part of an incident. 

Employees, all members of NUMSA, embarked on a protected strike pursuant to a wage dispute. As the strike continued it became increasingly violent with many of the employees committing serious acts of misconduct. An interdict was sought and granted in an effort to deter the violence and misconduct, alas to no avail.

The employer subsequently dismissed all the striking employees pursuant to their alleged misconduct during the strike on the basis of derivative misconduct. Challenging the fairness of the dismissals, NUMSA brought the matter before an arbitrator at the CCMA, and the arbitrator in coming to his decision distinguished the dismissed employees into three different categories:

  • Those positively identified as committing violence;
  • Those identified as present when the violence took place but who did not physically participate; and
  • Those not positively and individually identified as being present when the violence was being committed.

The Arbitrator found that the first two groups had been fairly dismissed, but that the third group’s dismissal was substantively unfair and ordered their reinstatement. On review in the Labour Court (LC), the court set aside the Arbitration Award and found that the employees had been fairly dismissed. NUMSA then lodged an appeal before the Labour Appeal Court (LAC) where the LAC upheld the LC’s decision.

NUMSA then brought the matter before the Constitutional Court (CC) where the court considered the historical understanding of the concept of derivative misconduct as that of a common law duty on the employee to act in good faith and in the best interests of the employer (the reciprocal duty), while in return the employer has the general duty of fair dealing with its employees.

The court described the expected duty on the employee to disclose the misconduct of fellow employees; while the employer had the obligation to offer protection and guarantee the employee’s safety while doing so. The court found that the reciprocal duty argument had failed due to the absence of appropriate safety and protection by the employer once an employee came forward.

In determining derivative misconduct, the chain in determining whether an employee is guilty or not, is a lengthy one. In determining this one should consider that the most probable inference was that each employee was:

  • present when the violence was committed;
  • would have been able to identify those who committed the violent acts;
  • would have known that the employer needed that information from them;
  • with possession of that knowledge, failed to disclose the information to the employer; and
  • did not disclose the information because they were guilty.

The most probable inference in this case was found to be that only some of the employees were present and therefore to dismiss all in the absence of individual identification would not be justified.

Dunlop’s expectation of its employees to come forward with information regarding those who had committed acts of misconduct, coupled with its failure to ensure their safety and protection thereafter was ultimately what lead to its loss before the Constitutional Court. Furthermore, Dunlop’s case failed on the consideration of probable inference, and the court found that to dismiss all employees in the absence of individual identification would not be justified. The Arbitration Award therefore stood, and the third group of employees were ultimately reinstated.

Labour Court Issues Cost Order against Union and Union Official

(Source: Cowan Harper Madikizela Attorneys)

The Labour Court in May handed down Judgment in the matter of Teti Traffic (Pty) Ltd v National Union of Metalworkers & Others (case no. J558/19) in which it ordered that the costs of an urgent application to the Labour Court declaring a strike unprotected was to be paid by NUMSA and its National Organiser.

In summary, the employer and NUMSA had negotiated a collective agreement which contained an agreement to, inter alia, establish a task team to explore the possibility of implementing a provident fund, medical aid scheme and the payment of a bonus. Several months later, after several meetings of the task team, no agreement on those issues could be reached and the Union referred another mutual interest dispute to the CCMA. It did so despite the fact that the issues were regulated by the collective agreement. The employer then approached the Labour Court on an urgent basis and obtained an interim Order declaring the strike unprotected and interdicting NUMSA and its members from participating in any strike.

On the return day, NUMSA conceded that the issue in dispute was regulated by the collective agreement and that the strike was unprotected. The employer nevertheless sought an Order directing NUMSA and the Organiser who had represented NUMSA throughout the relevant period to pay the employer’s legal costs, jointly and severally. The Labour Court was particularly critical of the Official’s conduct and found that the circumstances warranted an appropriate costs order. 

Orders directing a Union or its officials to pay an employer’s legal costs are rarely made, particularly in circumstances where there is an ongoing relationship with the employer. The Judgment is therefore unique and indicates that the Labour Court is prepared to grant costs orders in appropriate circumstances. The Judgment is important and serves as a stern warning to Unions and their officials to pursue only legitimate disputes or run the risk of adverse costs orders being made against them.

The Future of Work – Big Data, Data Analytics & Artificial Intelligence (AI)

Editor’s Note: Industry 4.0 is coming. The purpose of our series is to get employers thinking about ways to use this new technology to improve their business; and for HR professionals to understand the impact this might have on the workforce and their own roles requiring greater analytical abilities.

In our second edition of the Future of Work, we look at Big Data, Data Analytics and AI. How is this connected to the Future of Work you ask? It plays directly into what work is done by employees by focusing attention on using tools and software to access data that can be analysed to drive efficiencies in all parts of the business.

Let me give you a few examples:

Example 1 – Time and Attendance:

Time and attendance systems currently perform one of two functions, viz. time recording for payroll and access control. With new technologies however, the next step in time and attendance could be the introduction of facial recognition software to track employee movements around the operation. 

This data could then be analysed to identify a number of key operational issues:

  • At a basic level how much time is spent on non-productive tasks e.g. smoke/tea breaks / walking around finding equipment / setting up equipment etc.
  • At a more sophisticated level top performers could be analysed to see what they do differently. This could be combined with Six Sigma to better design work stations to improve the output per shift.

Note: This example is purely about using data to improve existing work conditions. It does not look at using robotics and AI to perform specific tasks. There are already cameras with this type of functionality. The next step will be building these into applications which can be rolled out to meet specific client requirements. 

Example 2 – Office Based Performance

There are already a number of tools available to operations to track performance and create data points for improving efficiencies e.g. logistics companies have software to track routes, fuel usage, speeds, weather conditions etc.

There are fewer tools available for improving office performance and most look at ways to improve communication between and within teams. 

A potential use of data analytics and AI in the future would be for companies to collect data on employees using their PC’s and then use AI tools to analyse this data and report key outcomes to HR (This type of analysis would be naturally too cumbersome for an individual IT technician to repeat on an economic scale). 

These could include:

  • At a basic level, identifying time spent working vs trawling the internet;
  • Identifying training needs e.g.
    • assuming excel is still used extensively, identifying those employees who would benefit from additional training to improve their output; or
    • checking grammar or tone of emails to identify employees requiring soft skills training; or
    • gauging customer reactions to employee emails to identify ways to improve communication and identify customer relationship issues early on;
  • Improving security by identifying early on any security breaches;
  • Identifying behavioural changes (stress related); or
  • Monitoring key performance metrics real-time;

Example 3 – 5G

5G networks are being rolled out in several countries in 2019. The advantage of these networks is the increased speed through the cellular network enabling downloads of >20MBPS and in some cases up to 100MBPS. While not clear when this might be available in South Africa, the 5G roll-out creates the opportunity for every smartphone or compatible device to be used as a monitor for specific activity. This immediately provides an opportunity to collect data on the workforce and assets even if they are not contained within a smaller operational area. 

The key takeaways for employers with these tools will be:

  • Identifying where value is currently created/lost in the organisation and workforce;
  • Identifying metrics and data linked to these value items;
  • Using tools (Monitors/AI/Data Analytics/Business Intelligence) to collect and analyse data to monitor and report on these metrics to improve these areas.

When can a medical certificate be requested?

An employee who is off sick for more than two consecutive days (in other words, 3 days or more) is required to produce a medical certificate signed by a medical practitioner or any other person who is certified to diagnose and treat patients, and who is registered with a professional council established by an Act of Parliament.

In other words, a medical certificate signed by a clinic sister or traditional healer is not acceptable (unless they are registered). If the employee does not produce the required medical certificate as above, then the employer is entitled to treat the period of absence as unpaid leave, although the employee is entitled to request that it be taken as paid annual leave.

It is unlawful for an employer to insist that an employee produce a medical certificate for an absence on a Friday, or on a Monday, or on the Friday and the Monday, or for an absence on the day before or the day after a public holiday.

That said, if an employee is absent on more than two occasions (even if only for one day) during the same eight-week period, then for any further absence, the employer is entitled to insist on a medical certificate, even if the absence is for only one day, and if it is not produced, then the employer is entitled to treat that absence as unpaid leave.

Substantive Fairness in Dismissal

(Source: IR Network LexisNexis)

South African Commercial, Catering and Allied Workers Union obo Maribe / Flamingo Casino – (2019) 28 CCMA 8.37.5 (CCMA) also reported at [2019] 4 BALR 433 (CCMA).

Subject Matter Classification:

Substantive fairness in dismissal – Misconduct – Racist language – Employee warning colleagues that they faced dismissal because they were black after colleague dismissed by white presiding officer – Dismissal fair. 

Mini Case Summary:

The applicant employee was dismissed for declaring while defending a colleague in a disciplinary hearing that “this is a racist issue” and telling employees afterwards that they faced dismissal because they were black. The employee denied making a statement about a racist issue during the disciplinary hearing but admitted that he had told employees afterwards that they faced disciplinary action because they were black.

The Commissioner accepted that the employee had uttered the words “this is a racist issue” and had also told employees that they faced dismissal because they were black. There was clearly a link between the two comments. The employee had not been charged with racism, but with uttering comments which clearly had racist connotations because they were uttered immediately after an employee had been dismissed by a white presiding officer. Moreover, the applicant had previously been warned for making racially charged comments. Dismissal was, accordingly, appropriate in the circumstances.

The dismissal was upheld.