|
| Editor's Note |
In this edition we look at recent court rulings including confirmation that CCMA enforcement awards are enforceable; and additional protection of garnishees by providing that garnishee orders can only be confirmed by a Magistrate in an employee's jurisdiction.
We once again deal with the issue of delays by SARS in making tax refunds.
Finally, we remind clients of the important employment equity filing deadline (not too far away) and invite our Johannesburg clients to attend an employment equity seminar in Sunninghill on the 7 November.
As usual, should you require any further detail on any of these topics, please feel free to contact us.
We do offer a referral scheme for new clients sent in our direction so if you know of anyone looking for outsourced payroll services then please let us know*.
*Terms and conditions apply. |
| Top of Page |
| |
| Table of Contents |
1. Are CCMA arbitration awards enforceable?
2. More Protection for Garnishees - Approval by a Magistrate
3. Tax Refunds - Big delays in receiving payment from SARS
4. Employment Equity Workshop - Coming soon in Johannesburg
5. Employment Equity Filing Deadline
6. Contact HRTorQue |
| Top of Page |
| |
| 1. Are CCMA arbitration awards enforceable? |
| Author: Johan du Toit, Johan du Toit Attorneys, Centurion |
Editor: The Courts have ruled CCMA arbitration awards are enforceable. Given the uncertain nature of arbitrations, we would really encourage employers to improve their internal dismissal process and manager training to reduce the likelihood of their appearing before the CCMA.
The amended section 143 of the Labour Relations Act that came into operation at the beginning of 2015 reads as follows:
| 1. |
An arbitration award issued by a commissioner is final and binding and it may be enforced as it was van order of the Labour Court in respect of which a writ has been issued, unless it is an advisory award. |
| 2. |
... |
| 3. |
An arbitration award may only be enforced in terms of section (1) if the director has certified that the arbitration award is an award contemplated in subsection (1). |
Court Interpretation
The interpretation of section 143(1) and (3) came under scrutiny in MBS Transport CC V CCMA and Others (Case no J1807/15 - Labour Court), and CCMA v MBS Transport CC and Others (Case JI807/15- Labour Appeal Court).
Dustin Julius (the employee) approached the CCMA to have his award enforced in terms of section 143. Once the award was certified the employee delivered same to the relevant sheriff to execute on. The employer approached the Labour Court for an order to stay the enforcement of the award pending the review of the award. The Court made the following order: "It is declared that the CCMA does not have jurisdiction to issue writs of execution in respect of the arbitration awards issued by it. Having examined section 143, and taking into consideration that the CCMA was not a court of law; the court found that the CCMA was not assigned the statutory power to issue writs.
The CCMA appealed the finding at the Labour Appeal Court (LAC). The LAC examined the history and context of section 143 and came to the following conclusion (delivered on 28 June 2016):
| 1. |
In the original enactment of section 143 an arbitration award could only be enforced by an application in terms of section 158 to the Labour Court. |
| 2. |
This proved largely ineffective due to both time and cost factors. |
| 3. |
The 2002 amendment of section 143 provided the opportunity to issue a writ at the Registrar of the Labour Court on the strength of the certified award by the CCMA. |
| 4. |
The procedure still required the employee to approach the Labour Court. |
| 5. |
The proper interpretation of the further amendment of section 143 in 2014, that came into operation at the beginning of 2015, provided that, once an award has been certified, it could be presented to the sheriff for execution. The LAC found that the words "as it was an order of the Labour Court" in section 143(1) created a fiction that the CCMA is at liberty to issue a writ, despite the fact that the CCMA is not a court of law. |
| 6. |
The LAC held that the legislature intended to make it "easier, inexpensive, effective and accessible for a person to enforce a certified arbitration award". |
For these reasons the LAC set aside the Labour Court's finding.
What does this mean in practice?
Any arbitration can lead to unusual results, which can now be enforced by the CCMA. It would be advisable to avoid this situation by making sure you manage your dismissal process to reduce the likelihood of being subject to the CCMA. Line managers should be trained to conduct proper pre-investigations. It might also be a good idea to make use of external specialists to chair formal disciplinary hearings of a complex nature. |
| Top of Page |
| |
| 2. More Protection for Garnishees - Approval by a Magistrate |
| Author: Jonathan Aitken |
More Protection for Garnishees - Approval by a Magistrate in an employee's jurisdiction only.
Editor: HRTorQue does offer an extra service to validate garnishee orders and make sure vulnerable employees are not paying too much. Feel free to contact us if you would like to know more.
In September 2016 the Constitutional Court handed down judgment for emolument attachment orders ("EAO") to require judicial oversight to determine if they are just and equitable, and if the amount is appropriate.
An EAO, commonly known as a garnishee order, is a court order that compels a debtor's employer to pay his/her debt from their salary.
The judgment followed a series of judgements made by the Western Cape division of the High Court covering the questions of whether adequate judicial oversight was being provided over the issuing of garnishee orders and whether an employer was required to enforce a garnishee orders against employees where the garnishee order was obtained in another jurisdiction.
The University of Stellenbosch Legal Aid Clinic had first brought the case forward to the Cape Town High Court, to fight garnishee orders issued to applicants by clerks of the court.
Judgement
The Constitutional judgement mandates the following:
| • |
Judicial oversight is required during the garnishee order issuing process. This oversight requires a Magistrate (rather than simply a Clerk of the Magistrates' Court) to review new garnishee orders, determining if they are just, equitable, and if the amount is affordable. |
| • |
All new garnishee orders received from an area not within the residence or employment district of the debtor will be invalid. |
What is the likely impact?
This is an important step to protect vulnerable employees from inequitable garnishee orders. While employers are required to make deductions from employees, they often don't have the time or resources to check the validity or aggregate amount of the deductions.
What is not yet clear is whether this will tie up magistrates' time in approving garnishee orders increasing court backlogs, or reduce the incidence of unscrupulous practices by creditors. |
| Top of Page |
| |
| 3. Tax Refunds - Big delays in receiving payment from SARS |
| Author: Dave Beattie |
Editor: This is an extremely frustrating issue for many taxpayers. We wish there was some way to improve it. Alas the only solutions are for the taxpayer to go through due process. Just know that in the background SAICA and SAIT are trying to push SARS to sort this out.
We have been receiving a large number of complaints relating to SARS "policy" to delay paying tax refunds. We have experienced these challenges personally and we understand your frustration. Most of the problems that we have encountered fall into the following three categories:
| 1. |
The taxpayer or tax practitioner submits all the supporting documentation required by SARS via Efiling. The case is resolved after a couple of weeks and a 'completion' letter received. The taxpayer expects to receive their tax refund within a week or two but this does not happen. Contact is made with SARS and the taxpayer / tax practitioner is told that there is a 'special stopper' on the account. The taxpayer is told that they have to come in personally with their proof of address, ID, banking details and all the supporting documentation used to complete their return. The reason provided for this is the high probability of fraud on the taxpayer's account. |
| |
|
| 2. |
Tax returns are submitted with there being no request for verification. Taxpayers then receive a verification request some weeks later. Supporting documentation has to then be uploaded to SARS and in the process delaying the release of a potential refund by 3-4 weeks. |
| |
|
| 3. |
Taxpayers after meeting all compliance requirements find that they do not receive their tax refund. After enquiring with SARS they are told that their banking details need to be validated. The taxpayer then has to personally go into SARS to perform this process. This is particularly irksome where banking details have not changed and have been on the system for many years. |
It is understandable that taxpayers / tax practitioners are becoming frustrated with 'deferral procedures' that do not seem to adhere to standard procedures. Many of the tax bodies have raised this matter with both SARS and the Tax Ombudsman's Office, with one going as far as to suggest that the State may be borrowing money from taxpayers by delaying refund payments. SARS have however responded with 'whilst it is understood that taxpayers have been inconvenienced with this process, SARS had to proceed accordingly in order to prevent possible fraud'.
SARS added that of the 3.5 million personal tax returns received to date only 5% were identified for verification of personal details. SARS have also suggested that in the majority of these cases the verification is necessary because of mismatches between third-party data and the information submitted to SARS (Note: this is an odd statement to make as in most of these cases 'completion' letters were sent to the taxpayer. If there were indeed mismatches why were assessments not raised?)
This matter is certainly not going to go away. Both SAIT and SAICA will be addressing this with SARS at future stakeholder meetings. |
| Top of Page |
| |
| 4. Employment Equity Workshops |
An introduction to the Employment Equity Act, Reports and Committee Responsibilities
Half Day Workshop with Dennis Cogzell
The workshop will be led by Dennis Cogzell, an HR Consultant, registered as a Chartered HR Professional with the South African Board for People Practitioners (SABPP). He has more than 35 years' experience within the Human Resources field, and has provided consulting and training services to numerous small and large companies.
At the end of the workshop, learners will be able to:
| • |
Understand the various requirements of the Employment Equity Act in respect of discrimination and affirmative action. |
| • |
Understand the requirements for completing and submitting the Employment Equity Report. |
| • |
Have the ability to review policies, practices and working conditions with the view of identifying barriers to employment equity and affirmative action. |
| • |
Understand the Amendments to the Employment Equity Act. |
| • |
Understand the workings of an Employment Equity Committee. |
| Date: |
7 November 2016 |
| Time: |
08h30 to 12h30 |
| Venue: |
6 Kikuyu Road, Sunninghill, Johannesburg |
| Cost: |
R995.00 |
To book, please contact Harusha on 031 564 1155 or [email protected].
BOOKINGS ARE NOT CONFIRMED UNTIL BOOKING CONFIRMATION HAS BEEN RECEIVED.
Please Note:
• All costs exclude VAT.
• All workshops can be presented in house at your premises. |
| Top of Page |
| |
| 5. Employment Equity Filing Deadline |
| Author: Jonathan Aitken |
Editor: We really encourage employers to get organised to submit their employment equity reports on time. As mentioned in previous editions this is a real area of focus for government to levy fines and penalise employers.
Submit Employment Equity Reports by 15 January 2017
Failure to comply could result in a fine of up to R1.5m.
Employment Equity is a legislative requirement for all companies deemed to be designated employers. A designated employer means: a.
| • |
A person who employs 50 or more employees. |
| • |
A person who employs fewer than 50 employees but has a total turnover that is equal to or above the applicable annual turnover of a small business in terms of Schedule 4 of this Act. |
If you have more than 50 employees your organisation is deemed to be a designated employer and is therefore required to comply with the Employment Equity Act.
As designated employers, you are required to comply with the following in terms of the Employment Equity Act:
1. Submit Employment Equity Reports and Income Differential statement, manually by
1 October, or submit electronically by 15 January 2017
2. Assign a Senior Manager
3. Establish a Consultative Forum
4. Prepare an Employment Equity Plan |
| Top of Page |
| |
| 6. Contact HRTorQue |
Head Office (Durban)
Phone: 031 564 1155 • Email: [email protected] • Website: www.hrtorque.co.za
Address: 163 Umhlanga Rocks Drive, Durban North, KwaZulu-Natal
Johannesburg Office
Ground Floor, West Wing, 6 Kikuyu Road, Sunninghill, 2191 |
 |
|
|
|
