The Labour Appeal Court recently considered whether the withdrawal of disciplinary proceedings against an employee before the proceedings were finalised could amount to an unfair labour practice. It found that it could not.
This bulletin outlines the employee’s case, the outcome of the final ruling by the Labour Appeal Court and highlights important points for employers to consider.
The Labour Appeal Court described the case as dealing with the important question of whether an aborted disciplinary process constitutes disciplinary action short of dismissal as contemplated in section 186(2)(b) of the Labour Relations Act. That section provides that -
“Unfair labour practice means any unfair act or omission that arises between an employer and an employee involving –
. . .
(b) the unfair suspension of an employee or any other unfair disciplinary action short of dismissal in respect of an employee . . .”
The Court found that the institution of disciplinary proceedings which are subsequently withdrawn does not amount to disciplinary action short of dismissal.
The background
The employee was a Director in the employ of the company. He had approximately 35 years of service at his employer.
The employee was served with a notice to attend a disciplinary hearing for misconduct. The allegations were predicated on the approval of payments of certain medical expenses for himself and other employees. The employer contended that, in so doing, the employee had contravened clause 2.2 of the Financial Delegation of Authority Guideline read with section 45(c) of the Public Finance Management Act.
The parties agreement that the dispute be disposed of through a pre-dismissal arbitration as envisaged in section 188A of the Labour Relations Act. In preparing for the hearing, the employee requested various documents and sought various admissions from the employer.
For various reasons these documents and admissions were not provided, which ultimately resulted in the employee bringing an application before the Labour Court to compel the discovery of the requested documents and to provide the requested responses.
Before the matter was heard by the Labour Court the employer withdrew all disciplinary charges levelled against him.
Aggrieved at having been forced to going to the expense of having to defend himself and to have his reputation harmed in the process, the employee referred an unfair labour practice dispute to the relevant Bargaining Council contending that -
- he was a senior employee of the employer and has been employed for a period of 35 years with an unblemished disciplinary record and was a mere 30 months away from retirement;
- the employer’s conduct had violated his constitutionally protected right to fair labour practices;
- his dignity had been impaired in the eyes of his peers and subordinates and he had suffered humiliation as a result by having been subjected to disciplinary action short of dismissal; and
- he had had to expend a substantial amount of money in order to defend himself against charges that had no merit, as clearly seen from the fact that the employer withdrew all charges against him.
The arbitrator found that the Bargaining Council did not have jurisdiction as the dispute did not fall within the definition of an unfair labour practice in terms of section 186(2) of the Labour Relations Act.
On review, the Labour Court disagreed and found that the employee had been treated unfairly and awarded him six months remuneration as compensation.
The issue central to the appeal was whether the Labour Court correctly determined that the Bargaining Council was endowed with jurisdiction to determine the unfair labour practice dispute. The crux of that enquiry was a consideration of the question whether an aborted disciplinary process constitutes disciplinary action short of dismissal as contemplated in section 186(2)(b) of the Labour Relations Act and therefore an act or omission which would qualify as an unfair labour practice within the meaning of the Act.
Over the years, the Labour Courts have understood the reference to “any other unfair disciplinary action short of dismissal” in section 186(2)(b) to include disciplinary action in the form of verbal and written warnings or any action intended to correct the employee’s conduct as opposed to dismissal which is a penalty of the last resort.
In this present case, the Labour Appeal Court was critical of the Labour Court’s attempt to distinguish between what it termed disciplinary “action” and a disciplinary “sanction” in order to justify a construction that the aborted pre-dismissal process constituted disciplinary “action” short of dismissal. This amounted to, as concluded by the Labour Appeal Court, a strained interpretation of the statutory provision if regard is had to the Code of Good Practice: Dismissal, and in particular Item 3 thereof.
Schedule 8, Item 3 bears the heading: “Disciplinary measures short of dismissal”. The word “measures” when used as a noun means “a plan or course of action taken to achieve a particular purpose.” Item 3 enjoins all employers to adopt disciplinary rules that establish the standard of conduct required of their employees. The form and content of the disciplinary rules vary according to the size and nature of the employer’s business. In general, a larger business will require a more formal approach to discipline. The Code goes on to state that our courts have endorsed the concept of corrective or progressive discipline. The purpose of discipline is recognised as a means by which employees are able to know and understand what standards are required of them. Efforts should be made to correct employees’ behaviour through a system of graduated disciplinary measures such as counselling and warnings. Schedule 8, Item 3(3) then puts the import of the phrase “disciplinary action short of dismissal” in section 186(2)(b) beyond doubt. It states:
“Formal procedures do not have to be invoked every time a rule is broken or a standard is not met. Informal advice and correction is the best and most effective way for an employer to deal with minor violations of work discipline. Repeated misconduct will warrant warnings, which themselves may be graded according to degrees of severity. More serious infringements or repeated misconduct may call for a final warning, or other action short of dismissal. Dismissal should be reserved for cases of serious misconduct or repeated offences.”
The Labour Appeal Court concluded that the phrase “short of dismissal” in section 186(2)(b) is linked to the “disciplinary action”. On the plain reading of the phrase “short of dismissal” in section 186(2)(b), conjunctively with Item 3 of the Code, it refers to a sanction less severe than dismissal. It means therefore that an employee would have been subjected to discipline resulting in a sanction other than dismissal. A disciplinary enquiry which had not commenced or has been abandoned without the imposition of a disciplinary penalty on an employee cannot be equated to a disciplinary action short of dismissal as contemplated in section 186(2)(b). It follows that the unfair labour practice, as set out in section 186(2)(b), does not embrace the dispute which the employee had referred to the Bargaining Council for resolution. The Labour Court erred in finding differently.
Having come to this conclusion, the Labour Appeal Court upheld the appeal and dismissed the employee’s claim.
