Page 6 - KZN Chambers Business Sense - Vol4 No5

OPERATIONALLY JUSTIFIABLE

RETRENCHMENTS

Alexander Rocher, Cox Yeats progressed to the second phase Constitutional Court found
SACCAWU v Woolworths¹: of its conversion in accordance that Woolworths had failed to
The Constitutional Court Rules on Operationally with Section 189A of the LRA, show the retrenchments were
Justifiable Retrenchments and the Reinstatement during which phase 85 out of operationally justifiable on
of Employees 177 full-timers accepted one rational grounds. Woolworths'
of the voluntary options and operational requirements reason
ection 189A(19) of the eventually 92 such employees that it needed to operate with
Labour Relations Act, 1995, were forcefully retrenched. flexi-timers was achieved when
Sas amended (the LRA), When Woolworths consulted the 44 SACCAWU members
which regulates so called large with SACCAWU as required agreed to work on the flexible
scale retrenchments compelled by Section 189A of the LRA, basis, albeit on their full-timer
the Labour Court to find that an SACCAWU initially suggested employment conditions.
employee was dismissed for a fair that full-timers be converted to The Constitutional Court
reason if: flexi-timers working 40 hours found that Woolworths did not
(a) the dismissal was to give per week but retaining their properly explore SACCAWU’s Alexander Rocher
effect to a requirement based existing employment conditions alternative to retrenchment and
on the employers economic and being paid for working 45 also found that Woolworths did
logical, structural or similar hours per week. Towards the not properly consider alternatives
needs; end of the consultation process, such as natural attrition, wage
(b) the dismissal was SACCAWU varied its stance and freezes or ring fencing and, as
proposed that full-timers convert
such, that Woolworths was in
operationally justifiable on to flexi-timers working 40 hours
rational grounds; breach of Section 189A(19) of the
per week and paid for 40 hours LRA. The Constitutional Court
(c) there was a proper at their full-timer wage rates (an concluded that the dismissal of
consideration of alternatives; 11% reduction in wages). the 44 SACCAWU members
and were substantively unfair
When Woolworths gave notice
(d) the selection criteria were to terminate the 92 remaining because Woolworths failed to
fair and objective. prove that the retrenchments
full-timers for operational
Although Section 189A(19) was requirements, SACCAWU were operationally justifiable
on rational grounds or that it
removed from the LRA effective referred a dispute about properly considered alternatives
1 January 2015, the meaning procedural fairness (in terms of to retrenchments in terms
of operational justifiability and Section 189A(13)) and a dispute of Section 189A(19). Having
alternatives to retrenchments about substantive fairness to the reached the conclusion that the
were recently considered by Labour Court for adjudication on retrenchments were substantively
a unanimous decision of the behalf of its 44 members. unfair, the Constitutional Sunil Hansjee
Constitutional Court handed The Labour Court upheld Court then embarked upon an
down on 6 November 2018 SACCAWU’s challenge that the analysis of the suitable remedy LABOUR LAW TEAM
in South Africa Commercial, dismissals were substantively to award, namely, retrospective
Catering and Allied Workers and procedurally unfair and reinstatement or compensation lexander Rocher strike management, strike
Union (SACCAWU) & Others ordered Woolworths to reinstate (as the LAC had awarded). is head of the Cox interdicts, collective agreement
v Woolworths (Pty) Ltd (as yet the 44 dismissed employees AYeats Attorneys disputes and demarcation
unreported case CCT(275/17). retrospectively from the date of The Constitutional Court Labour Law Team and has disputes. Assisting Alexander
Until 2002, Woolworths’ their dismissal. On Appeal to restated that reinstatement is specialised in Employment in the Labour Law Team is
employees worked on a full- the Labour Appeal Court (LAC), the primary remedy that the and Labour Law since January Partner, Sunil Hansjee who has
LRA affords employees whose
time basis (full-timers) working the LAC upheld SACCAWU’s dismissals are found to be 2005. Alexander advises and specialised in Labour Law.
45 hours per week. In 2002, challenge that the dismissals substantively unfair, by referring represents corporate clients in They can be contacted on
Woolworths decided that in were substantively unfair but to the Equity Aviation Services all facets of employment law, Tel: 031 536 8500 or
future it will only employ workers changed the remedy from (Pty) Ltd v CCMA 2009 (1) SA both individual and collective
on a flexible basis (flexi-timers) reinstatement to an award of 390 (CC); 2009 (2) BCLR 111 disputes, such as dismissals, Email: arocher@coxyeats.co.za;
working 40 hours per week. By 12 months’ compensation. In (CC) decision which held that the unfair labour practices, shansjee@coxyeats.co.za.
2012, Woolworths’ workforce the Constitutional Court, ordinary meaning of the word employment equity litigation, Website: www.coxyeats.co.za. n
consisted of 16 400 flex-timers SACCAWU sought confirmation “reinstate” is “to put the employee retrenchments, transfers of
and only 590 full-timers. Full- that the dismissals were back into the same job or position businesses, implementing
timers earned better wages and substantively unfair and required [that] he or she occupied before changed working conditions,
enjoyed better benefits than a remedy of reinstatement. the dismissal, on the same terms mutual interest disputes,
flexi-timers. Full-timers and the The Constitutional Court and conditions.”
flexi-timers did the same work. analysed Woolworths’ decision

In 2012, Woolworths decided to dismiss against the elements The Constitutional Court SACCAWU members should be retrenchments are operationally
that its entire workforce should listed (above) in Section then grappled with whether reinstated into their full-timer justifiable and that there is a
consist of flexi-timers and to 189A(19) of the LRA. The a retrospective reinstatement positions held immediately full and proper consideration
convert the full-timers to flexi- Constitutional Court found of the 44 employees was before their dismissals in of alternatives to dismissals,
timers on the lesser employment that Woolworths gave only one appropriate, and, if so into which 2012 and that Woolworths and if this is not the case, that
conditions applicable to flexi- reason for the retrenchments, positions? The Constitutional and SACCAWU should be the courts will not hesitate to
timers. In order to do this, being that “the company needs Court observed that reinstating encouraged to continue award the primary remedy of
Woolworths first invited full- to be in a position to employ an employee means restoring consulting over the conversion reinstatement to any employee
timers to voluntarily become employees who are able to the employee to the position in from full-timers to flexi-timers. who has been unfairly dismissed
flexi-timers. Through a process be used on a flexible basis”. which he or she was employed for operational requirements. n
of voluntary early retirement, SACCAWU accepted the reason immediately before dismissal. The decision in SACCAWU
voluntary severance or for restructuring but proposed On this basis, the Constitutional v Woolworths sounds a firm ¹ South African Commercial, Catering
agreement to convert to flexi- that full-timers be converted to Court held that, not only were warning to employers to and Allied Workers Union (SACCAWU)
timers, Woolworths was left with flexi-timers on their full-timer the dismissals substantively properly consider substantive v Woolworths (Pty) Ltd (Cct275/17) [2018]
ZACC 44 (6 November 2018)
177 full-timers. Woolworths then employment conditions. The unfair, but that the 44 fairness to ensure that

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