Industrial-Relations-In-The-Times-Of-Covid-19:-What’s-Ne

Industrial Relations In The Times Of Covid-19: What’s New About This “New Normal?”

By Bongani Khanyile Ka Luthuli

Introduction

The novel coronavirus pandemic, commonly referred to as Covid-19, has changed the way industrial relations is conducted. The impact of this pandemic is yet to be quantified in an economy which was already volatile before the pandemic hit our shores.

The unprecedented lockdown which thrusted many into economic quagmire has as an inevitable comeuppance further stretching of the inequality, poverty and unemployment triple challenge into untold proportions.

What happened to the employees’ rights during alert level 5 lockdown? Was the Labour Relations Act, the primary labour legislative framework that regulates the rights of employees in the Republic suspended temporarily? Was the Basic Conditions of Employment Act which regulates the terms and conditions of employees in the country suspended during the lockdown?

This article seeks to provide clarity on the rights of employees and the obligations of the employer’s during this pandemic. It further seeks to clarify some anomalies and uncertainties during this period which is very much still within us. We may not know of the real effect this pandemic will have on us, but we are certain that industrial relations, post Covid-19, will never be the same again, I submit.

Are employees entitled to payment during lockdown?

When the President declared a state of emergency under the Disaster Management Act, with effect from 27 March 2020, our lives were never going to be the same again. Suddenly, and without warning, panic gripped the country as many feared that their bread was going to be taken away from them.

The contract of employment is based on a premise that the employee must tender her personal service to her employer. The employer has a corresponding duty to remunerate the employee for her services. This principle is based on the concept of letting and hiring as the employee lets herself to her employer.

During lockdown, employees could not tender their services to their employers. This was not through a fault of their own. Were the employees entitled to remuneration despite the fact that they had been deprived from working?

The simple answer is no. There was no legal obligation for employers to pay their employees during lockdown. The principle of “no work no pay” was applicable. This is still the case with some of the industries that have not been allowed to operate during this alert level 3 which is currently in operation.

Employees during this period had to claim their UIF (Unemployment Insurance Fund) to mitigate against the effect of having no remuneration for this indefinite period of time. Furthermore, employers could also apply for the TERS benefit which government implemented as a relief mechanism to allow employees to get some income which amounted to a fraction of their income to supplement their earnings or loss thereof.

This legal position was confirmed by the Labour Court in the case of Macsteel Service Centres SA (Pty) Ltd v National Union of Metal Workers of South Africa and Others . In this case, the employees had embarked on a strike action after Macsteel had cut their salaries by 20% for the months of May, June and July 2020 due to the effects of Covid-19.

Macsteel approached the Court on an urgent basis, seeking to interdict the strike action. The Court held that “the reality in law is that the employees who rendered no service, albeit to no fault of their own or due to circumstances outside their employer’s control, like the global Covid-19 pandemic and national state of disaster, are not entitled to remuneration and the Applicant could have implemented the principle of “no-work no pay”.

The irony about this case is that Macsteel, instead of not paying the employee’s due to them not working, decided to cut their salaries. This seems to be a better “evil” to employees as they could still get paid albeit reduced salaries as opposed to not being paid at all.

However, as a measure short of no pay at all due to no work, Macsteel opted for reduced salaries. It is this measure that the Court interpreted as being a unilateral change in terms and conditions of the employee’s employment conditions. To lawfully and fairly reduce salaries, the employer must consult with employees and employees must consent to this reduction. In this case, there was no consensus and the Court found that whilst Macsteel can be commended for paying its employees instead of applying the “no work no pay” principle, it ought to have sought consent from employees in order to reduce salaries. No good deed goes unpunished!

What of retrenchments based on operational requirements of the employer?

The Covid-19 pandemic has brought on the provisions of section 198 and 198A of the Labour Relations Act into scrutiny. The economy is bleeding jobs as employers are unable to keep many of their staff members due to the economic hardship and distress businesses are going through.

Any dismissal of employees must pass two muster: procedural and substantive fairness. Procedural fairness means that there has to be a fair reason for the dismissal and procedural fairness means that employees must be dismissed after a fair procedure has been followed, as envisaged and prescribed by the Act.

Retrenchments or dismissals based on operational reasons of the employer, are not an exception. Section 189 provides the procedure to be followed for a retrenchment to be procedurally fair.

The Act provides that the employer, upon contemplating a dismissal based on operational requirements, must consult the employee or employee representative. The employer and employee must consult on the following:

Appropriate measures to:

Avoid the dismissals;
To minimize the number of dismissals;
To change the timing of the dismissals;
To mitigate the adverse effects of the dismissals;
The method for selecting the employees to be dismissed;
Severance pay;
The reasons for the proposed dismissals;
The alternatives the employer has considered before proposing the dismissals;
The number of employees likely to be affected;
The proposed method for selecting which employees to dismiss;
The time, when or the period during which the dismissals are likely to take effect;
Any assistance that the employer proposes to offer to the employees likely to be dismissed;
The number of employees employed by the employer; and
The number of employees that the employer has dismissed for the reasons based on its operational requirements in the preceding 12 months.

It must be stressed that this consultation must be a joint consensus-seeking process. This means that it should not be a fait accompli or predetermined, the retrenchment at this stage is supposed to be contemplated.

During the regulations, labour practitioners found themselves having to be innovative to ensure that proper consultations take place. Use of Zoom, Teams and WhatsApp calls are commonplace in conducting these consultations.

Despite social distancing having to be observed, a caveat must be sounded to employers and labour law practitioners that the requirement for a joint consensus-seeking process has not been waived and/or suspended.

Employees can still refer an unfair dismissal dispute based on operational requirements and challenge procedure and can do so successfully if the employers adopt merely a tick-box approach to this process as opposed to consulting adequately.

The need to consult flexibly on alternatives was recently emphasized by the Labour Court in SACU and Another v Telkom SA SOC Ltd wherein the Court stressed that there is no specific order in which issues must be disposed of in consultations, the sole requirement is that the issues listed in the relevant sections are meaningfully discussed under the auspices of a joint consensus-seeking process.

Regarding a fair reason requirement for the retrenchment, employers must prove, on a balance of probabilities, that there was a genuine operational requirement. Operational requirement is defined as requirements based on the economic, technological, structural, or other similar needs of an employer.

Without a doubt, Covid-19 has brought about an economic reason for the retrenchments of employees. This means that employees may find it difficult to rebut the genuine operational requirement of the employer.

Conversely, employers may with little difficulty then is under normal circumstances, meet the standard of proof which is on a balance of probabilities, to justify the dismissal as being one which is of a fair reason.

Covid-19 has not disarmed the CCMA or the Labour Court from substantively dealing with the fairness of dismissals based on operational requirements, it still remains an onus that employers must discharge. This article should not be construed as meaning that Covid-19 means anything goes and employers can willy-nilly dismiss employers and cite Covid-19 as being the reason for the dismissal when in fact that is not the case, other reasons may be behind the dismissal.

Conclusion

Although we are living in unprecedented times due to this pandemic, employees rights as entrenched in Section 23 of the Constitution of the Republic of South Africa of fair labour practices remains sacrosanct.

This right has not been suspended and the enabling legislations for this right to fair labour practices such as the Labour Relations Act and the Basic Conditions of Employment Act remain very much enforceable. We argue, in fact, that it is at times such as these that such rights must be jealously protected especially the vulnerable in the hands of unscrupulous employers who may want to use the pandemic to meet a narrow objective.

So what’s new about this new normal? Well with the exception of suffusing technology in the manner in which procedural imperatives are conducted and realized, there’s nothing new about this new normal, the requirements for procedural and substantive fairness remain a gospel industrial truth.

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