by Ivan Israelstam
You might find yourself in the situation of needing to change employment terms and conditions because, for example, new technology may result in changes to working hours and in today’s world of rapid economic change, this is commonplace. However, many employers have no idea about how to make the necessary changes. Labour law severely restricts your right to make such changes without the employees’ consent so you need to know what you’re legally allowed to do.
- It isn’t an offence, which merits a disciplinary hearing, for an employee to disobey an unreasonable instruction. Normally, it wouldn’t be unreasonable for an employee to refuse to work according to new employment terms and conditions unless this has been agreed to by the employee or his/her representative.
- If you take over a going concern, you will be forced to keep the employment terms and conditions of the original employees of that going concern.
- The Labour Relations Act (LRA) prohibits unfair employers performing unfair acts regarding employee benefits.
- Section 187(1)(c) of the LRA prohibits the employer from firing employees who refuse to agree to changes in employment terms and conditions. Specifically, this section provides that:
“A dismissal is automatically unfair if an employer, in dismissing the employee, acts contrary to section 5 or if the reason for the dismissal is …. to compel the employee to accept a demand in respect of any matter of mutual interest between the employer and employee…”.
This applies if you threaten one of your employees that, if he/she doesn’t agree to a change in employment terms and conditions, you’ll dismiss them. If the employee then refuses to agree to the change you dismiss them because of this, the dismissal could be seen to be automatically unfair.
How to change employment terms and conditions because of operational reasons
This could happen if, for example, client work circumstances are such that a new shift system is required but the employees aren’t willing to agree to the change. Is the employer entitled to go into a retrenchment process with a view to hiring employees willing to accept the new terms and conditions of employment?
In the case of CWIU and others vs Algorax (Pty) Ltd) (2003 11 BLLR 1081):
- The employer needed to switch to a new shift system but the employees refused to accept this.
- The employer then retrenched its employees but consistently said that it would re-employ them if they would change their mind and agree to the new shift system.
- The Labour Appeal Court found that:
– The retrenchments could’ve been avoided or minimised if the employer laid off a number of contractors.
– The employer’s firm, and consistent statements that the employees would be taken back if they agreed to the new shift system, showed that the employer had ulterior motives.
– The dismissals didn’t constitute a genuine retrenchment but was instead a ploy to get the employees to agree to a change in their terms and conditions of employment.
– The dismissal was therefore automatically unfair in terms of section 187(1)(c) of the LRA.
– All the employees were to be re-employed with effect from the date of the court order.
However, in the case of Fry’s Metals (Pty) Ltd vs NUMSA & others (2003 2 BLLR 140):
- The employer also wanted to change its shift system.
- When the employees refused they were retrenched.
- In sharp contrast to the Algorax decision, the Labour Appeal Court found that the employer had been entitled to do this because the retrenchment hadn’t been used to force the employees to give into their demands.
The strongly opposing outcomes, and the severe consequences of these two court findings, show that:
- Court decisions are made on the basis of the fairness of each case, taking into account the unique circumstances of each matter.
- Therefore, before risking the infringement of section 187(1)(c) of the LRA employers need to have their specific cases analysed by a labour law expert especially since the impending new amendments to the LRA will soon make workplace changes more difficult and dangerous than they already are.
This article first appeared on HR Pulse.