CCMAil
December 2004
CONTENTS
STATISTICS ..........................................................................................................................................................................................2
CASE ALERTS .....................................................................................................................................................................................3
LABOUR COURT AND LABOUR APPEAL COURT DECISIONS ......................................................................................................5
DECISIONS: OTHER DISPUTE RESOLUTION FORUMS ..................................................................................................................7
LABOUR WATCH
 Employee Remuneration or Benefit?...............................................................................................................................................9
 Businesses Should Guard Against the Extension of Normal Working Hours During Economic Viability ......................................11
 Termination of an Employment Contract .......................................................................................................................................14
 Time Off Work – A Prerequisite .....................................................................................................................................................17
 Labour Relations in Africa: Child Labour in Africa .........................................................................................................................20
GLOBAL TRENDS
 Family-Related Leave and Industrial Relations in Europe ............................................................................................................23
EDITORIAL TEAM
Sunita Parbhoo
Nersan Govender
Dorothy Khosa
Tshidi Letsoalor
Lucky Moloi
Sarah Modise
December 2004 – Page 1
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During the period 1 April to 31 December 2004, a total of 95800 new referrals were lodged with the CCMA – an average of 507 every
working day.
AVERAGE NUMBER OF REFERRALS PER DAY FROM APRIL 2003 TO DECEMBER 2004
Apr
May
Jun
Jul
Aug
Sep
2003/2004
Oct
Nov
Dec
Jan
Feb
Mar
2004/2005
REFERRALS BY ISSUE FROM 1 APRIL TO 31 DECEMBER 2004
Unfair dismissal
81%
Unfair labour practice
Mutual interest
Collectiv e bargaining
Sev erance pay
7%
4%
3%
2%
REFERRALS BY SECTOR FROM 1 APRIL TO 31 DECEMBER 2004
16%
Retail
Safety /Security (priv ate)
11%
10%
Domestic
Business/Professional serv ices
8%
Building/Construction
7%
Food/Bev erage (manufacture)
Agriculture/Farming
5%
4%
Constitutes the seven highest referring sectors
December 2004 – Page 2
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By Lucky Moloi
GA10936-04 Odirile S Letsogo v Peri Wiehahn –
Commissioner: Hlongwane
Legitimate expectation - Contract of employment - Applicant signed
fixed term contract stipulating appointment and termination dates
WE4516-03 Steenkamp & Others v Eskom Distribution Western
Cape – Commissioner: Everett
Benefit – Whether business vehicle scheme constituting benefit Provision of tool not creating a right to benefit.
The applicant’s fixed term contract of employment was not renewed
upon expiration. The applicant alleged that he had a legitimate
expectation that his contract would have been renewed. He further
alleged that he was not aware of the duration of the contract, as he
had not been afforded an opportunity to read the contract. He
contended that only two out of eleven fixed term contracts,
including the applicant’s, were not renewed.
A dispute was referred to the CCMA in terms of s 186(2)(a) of the
LRA. The applicants had alleged that the respondent’s
discontinuation of providing employees with a vehicle scheme had
constituted a residual unfair labour practice. They claimed that the
vehicle scheme constituted a benefit in that it arose out of the
contract of employment.
It was submitted on behalf of the respondent that the non-renewal
of the applicant’s fixed term contract did not constitute an unfair
dismissal in that no legitimate expectation had been created for the
renewal of the applicant’s contract.
Noted: That the contract specifically stipulated that “the employee
will have no legitimate expectation that the employer will provide
him/her with any further work”.
Held: That the termination of the contract had been effected in
accordance with the provisions of the contract.
GA 11003-04 Shelley Ann Rachbuch v Rosebank College –
Commissioner: Boyce
Independent contractor – Non-renewal of independent contract
The employee had concluded an independent contract with the
employer in 2001 and 2002. In 2003, the applicant also concluded
a fixed term contract which expired at the end of that year. Early in
2004, the respondent had offered the applicant an independent
contract to lecture for twelve hours per week. The applicant was
only prepared to lecture for six hours per week. As a result, the
respondent did not renew the applicant’s contract as an
independent contractor.
Noted: That the applicant did not have a reasonable expectation
that a fixed term contract would be renewed.
Also noted: That the employee had failed to discharge the onus
that she had reasonably expected the employer to renew her fixed
term contract as contemplated by s 186(1)(b) of the LRA.
Held: That the applicant had failed to prove a dismissal as there
had been no agreement concluded between the parties.
Case references
Antoinette McInnes v Technikon Natal (2000) 21 ILJ 1138 (LC)
Dierks v University of South Africa (1999) 20 ILJ 1227 (LC)
University of Cape Town v Auf Der Heyde (2001) 22 ILJ 2647
(LAC)
The employer argued that the discontinued provision of vehicles
was a dispute of interest which could not be arbitrated. The
respondent further argued that s 186(2)(a) applied only to benefits
to which employees were entitled to ex contractu or ex lege.
Noted: The commissioner noted that the employees were not
entitled to use s 186(2)(a) to create an entitlement to a benefit
which they did not have. The applicants had failed to demonstrate a
contractual or statutory right to the benefit.
Also noted: That the employer had provided vehicles to employees
so that they could perform their duties. It was, therefore, agreed
that when a tool is provided by an employer, it does not necessarily
create a right to its continued or future provision. As such, the
employer has the discretion as to which tool is appropriate and the
circumstances under which it can be provided.
Held: The scheme was found not to constitute a benefit as
envisaged in s 186(2)(a), and, therefore, the applicants had no right
to the vehicles.
Case references
Eskom v Marshall & Others (2002) 23 ILJ 2251 (LC)
HOSPERSA & Another v Northern Cape Provincial Administration
(2000) 21 ILJ 1066 (LAC)
Schoeman & Others v Samsung Electronics (Pty) Ltd (1997) 18 ILJ
1098 (LC)
KN8512-03 Majola v Moonsamy & Another – Commissioner:
Molony
Minimum wage - Where actual remuneration below minimum
prescribed by regulation computation must be based on prescribed
minimum rate
The applicant, a domestic worker, had been dismissed by the
respondent for the suspected theft of a cell-phone. She alleged that
she had been paid R250 per month, while the employer claimed
that she earned R400 per month.
December 2004 – Page 3
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Noted: That s 194(1) of the LRA requires compensation to be
based on the employee's remuneration, calculated at his/her rate of
remuneration at the date of dismissal.
Also noted: It was immaterial whether the employee was paid
R250 or R400 per month, as she still was not being paid in
accordance with the minimum requirements of Sectoral
Determination 7 for the domestic workers, namely R800 per month.
Further noted: That the CCMA could not uphold conduct by an
employer which would have had a negative effect of failing to
comply with the provisions of labour legislation. To do so would
perpetuate injustice and undermine the purpose of the LRA.
Held: That the applicant was entitled to six months' remuneration
based on the minimum rate of R800 per month.
WE 3354-04 SARPA obo Richard Bands & 2 others v SA Rugby
(Pty) Ltd: Commissioner - Pather
Non-renewal of fixed term contract - Respondent had no reason not
to renew contracts
It was common cause that the applicants had been playing
professional rugby for the provincial teams and for the national
team, the Springboks. Therefore, the applicants had contracts with
their respective provincial teams and separate fixed term contracts
with the respondent.
The applicants’ union had alleged that its members had a
reasonable expectation that they would continue to play for the
Springboks for 2004; however, the respondent had failed to renew
their contracts on the same or similar terms. As a result, the union
had referred a dispute in terms of s 186(1)(b) of the LRA alleging
that it was evident that the applicants had a reasonable expectation
that their contracts would be renewed. It was further stated that in
terms of the LRA, once it is established that an employee has a
reasonable expectation that his/her contract will be renewed, it is
up to the employer to prove that the reason for not renewing the
contract is a fair reason related to the employee’s conduct or
capacity, or based on the employer’s operational requirements and
that the dismissal had been effected in accordance with a fair
procedure. The respondent had presented no evidence to prove
this.
The respondent claimed that on a proper analysis of the contract
that had been entered into between the parties, no one had the
authority, express or implied, or otherwise to give undertakings or
make promises to any of the individual applicants that they would
be offered contracts in 2004. Accordingly, none of the applicants
had been dismissed, and on the evidence, none of the applicants
could entertain any expectation, let alone a reasonable expectation,
that their contracts were to be renewed.
In its closing arguments, the respondent had raised two points in
limine, namely that the written contracts provided a procedure for
disputes to be referred to private arbitration and that the dispute
raised by SARPA was a dispute of interest. In response to the
union’s objections to the points being raised at such a later stage,
the respondent had indicated that those arguments were not the
basis of the respondent’s case and that the respondent had
submitted to the jurisdiction of the CCMA and that it would not be
necessary for the commissioner to deal with those arguments.
Noted: The commissioner had made reference to ss 186 (1)(b) and
192 (1) of the LRA.
Also noted: Principles of fairness and equity should apply equally
to professional rugby players and factory workers alike. In both
environments, employees are still susceptible to the unfair
treatment by employers. Even if employees are well paid, they still
need to be protected. Employees do not have to be destitute or
impoverished to be treated fairly. Furthermore, the salaries that
professional rugby players get paid must be seen in perspective to
their short employment lifespan and the high risk of injury. As a
result, if players are injured, at any stage, they will loose their salary
of R400 000.00. Therefore, in the interest of fairness and equity,
the surrounding circumstances of the case had to be considered by
the commissioner and the respondent ought to have justified the
dismissal of the applicants.
Further noted: In terms of s 192(1) of the LRA, the applicants had
discharged the onus of proving that they had been dismissed. The
commissioner, accordingly, found that the applicants had been
dismissed within the meaning of s 186(1)(d) of the LRA. No
significant evidence had been led by the respondent to discharge
the onus of proving that the dismissal of the applicants was for a
fair reason and in accordance with a fair procedure.
Held: That the applicants had been dismissed in terms of s
186(1)(b) of the LRA. Such a dismissal was considered to be unfair
in that the respondent had not proven that there was a fair reason
for failing to renew the contracts of the applicants and that their
dismissal had been effected in accordance with a fair procedure.
The respondent was ordered to compensate the applicants.
Case references
Cremark A Division of Triple P-Chemical Ventures (Pty) Ltd v SA
Chemical Workers Union & Others (1994) 15 ILJ 289 (LAC)
Dierks v University of South Africa [1999] 4 BLLR 304 (LC)
Mtshamba & others v Boland Houtnywerhede (1986) 7 ILJ 563 (IC)
National Automobile & Allied Workers Union (now known as
NUMSA) v Borg-Warner SA (Pty) Ltd (1995) 15 ILJ 509 (A)
SA Clothing & Textile Workers Union v Mediterranean Wooden
Mills (Pty) Ltd (1995) ILJ 366 (LAC)
December 2004 – Page 4
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By Sarah Modise
Labour Court: J1426/04
Ceramic Industries Ltd v CCMA & Another: Judge: Landman
Objection to “con-arb” process
The employee was dismissed and referred an unfair dismissal
dispute to the CCMA. The parties were informed in writing of the
date of the “con-arb”. The employee did not object to the process.
The matter was conciliated and remained unresolved. The
commissioner then postponed the matter for arbitration to a later
date. The employer then applied to the Labour Court for an urgent
interdict ordering the CCMA to remove the arbitration from the roll
on the basis that the commissioner had not been entitled to set the
matter down for arbitration in the absence of a request for an
arbitration form.
Noted: The con-arb process was introduced with the amendments
to the Labour Relations Act, which came into effect on the 1 August
2002. S191 (5A) stipulates that, “Despite any other provision in the
Act, the council or commission must commence the arbitration
immediately after certifying that the dispute remains unresolved. If
the dispute concerns:
(a) a dismissal of an employee for any reasons relating to
probation;
(b) any unfair labour practice relating to probation ,
(c ) any other dispute contemplated in subsection (5A ) in respect
of which no party has objected to the matter being dealt with in
terms of this subsection.”
Further noted: The Court argued that an employee could object to
the process in two ways. Firstly in terms of the LRA form 7.11 and
secondly in writing to the CCMA on receipt of the notice of set
down. Therefore, if a party objects to the process, the CCMA is
precluded from invoking s191 (5A). The CCMA may also not rely on
Rule 17 which provides for the conducting of the con-arb process
but should follow the old procedure where the employee must
request the CCMA to conduct an arbitration by completing the LRA
7.13 and serving it on the employer.
Held: The CCMA was directed to remove the matter from the
arbitration roll and not to schedule the matter until the employee
had requested arbitration by completing a 7.13 referral form
There was no order as to costs.
Labour Court: C117/01
Maartens & Others v South African National Park: Judge
Waglay
Practice and procedure- res judi
The applicants and another employee, Bantubonkwe referred
disputes against the respondent claiming constructive dismissal.
Bantubonkwe proceeded with his dispute independently from the
other applicants. The Court, in his case, held that his resignation
did not constitute a dismissal and the matter was accordingly
dismissed. The respondent in this case, raised a number of in
limine issues which are dealt with below.
Firstly, the respondent contended that the applicants’ dispute was
the same as Bantubonkwe’s dispute. Therefore, the decision taken
by the Court in the Bantubonkwe’s matter should have also been
applied in their matter, as the judgement handed down was a
judgement in rem.
Noted: A judgement in rem is “a judgment which is conclusive as
against all the world in whatever it settles as to the status of a
person or property, or as to the right or title to the property and as
to whatever disposition it makes of the property itself, or of the
proceeds of its sale. All persons regardless whether or not they are
parties to any legal proceedings are bound by a judgment in rem
and as such are stopped from averring that the status of persons or
things, or the right or title to property is other than what the court
has by its judgment declared or made it to be.”
Held: That the judgement in Bantubonkwe’s case did not deal with
the status of any of the persons who were party to that action nor
did it deal with any property. The judgement only needed to
establish whether Bantubonkwe had any claim against the
respondent.
Noted: The respondent further argued that should the Court find
that the judgement in Bantubonkwe’s case was not a judgment in
rem, the judgment would, however, still be binding as the applicants
were party to the dispute or could at least be regarded as privies of
Bantubonkwe.
Held: That the fact that the resignations were related was not
conclusive of whether or not the applicants’ resignations had
amounted to their dismissals. Factors such as their level of
employment could play a role, especially, since the Court in
Bantubonkwe’s matter had held that an “employer is entitled to treat
employees of different levels in a different manner”.
December 2004 – Page 5
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The Court also held that in order for the applicants to be privies of
Bantubonkwe, they should have derived their rights to the action
against the respondent from Bantubonkwe or Bantubonkwe from
them. Therefore, one does not become a privy simply because of
having a claim against a common respondent based on the same
cause of action.
The Court further cited Hoffmann and Zeffer, Horowitz v Brock and
Others 1988 (2) SA 160 (AD) as well as Kommissaris van
Binnelandse Inkomste v ABSA Bank Bpk 1995 (1) SA 653(AD) and
contended that for an applicant to succeed in an exceptio rei
judicata, it must satisfy the following factors:





That the judgement was a final or definite decision;
That a competent court had handed down the judgment;
That the judgement was given in earlier proceedings
between the same persons;
That the judgement pleaded was about the same thing
(eadem res) as that which was demanded in the latter
proceedings, and
That the cause of action in the proceedings in which the
defence was raised was the same as that on which a
final judgement was given in earlier proceedings.
Concluded: The point in limine was dismissed with costs.
Case references
Barlow v Regent Estates Co Ltd (1949) 2 KB 475, (1949) 2 All ER
118 (CA) at 122,
Horowitz v Brock and Others 1988 (2) SA 160 (AD)
Kommissaris van Binnelandse Inkomste v ABSA Bank Bpk 1995 (1)
SA 653 (AD)
Jamela v Accord (2000) 21 ILJ 2463 (LC)
Labour Court: C153/03
Catlin v CCMA & Others: Judge Ngcamu
Agency agreement –concluded between employee and employer
The employee worked for the employer as an executive consultant.
He retired and concluded an agency agreement with the employer.
In terms of the agreement, the employee would continue doing the
same work but at reduced targets. The employer, however,
terminated the contract after 4 years. The employee then referred
an unfair dismissal dispute to the CCMA. The employer, at the
arbitration, contended that the employee was not an “employee” as
defined by the Labour Relations Act (LRA). The commissioner
agreed with the employer and the matter was accordingly
dismissed. The employee then applied to the Labour Court for a
review, alleging that the commissioner had ignored material
evidence and misconstrued the law.
Noted: The Court contended that in order for the employee to
qualify as an “employee” he would have been required to consider
the definition of an employee as stipulated in the LRA. This
however, does not mean that the contract of employment should
have been ignored.
Further noted: That the employee was permitted to canvass for
products marketed by other companies. He was also paid
commission from premiums paid by policyholders and was required
to take out an insurance policy against losses of monies collected
by himself on behalf of the employer.
Held: The commissioner had correctly examined the contract in the
light of relevant case law; therefore, his conclusion could not be
faulted.
The application was dismissed with costs.
Case references
Goldberg v Durban City Council 1970 (3) SA 325 (N)
Liberty Life Association of Africa Ltd v Niselow (1996) 17 ILJ 660
(LAC)
Niselow v Liberty Life Association of Africa Ltd 1998 (4) SA 163
(SCA)
SABC v McKenzie (1999) 20 ILJ 585 (LAC)
Labour Court: D433/03
Cassim v SAPS & Others: Judge Pillay
Unlawful delegation-Suspension- without pay- Review of CCMA
award
The applicant was suspended without pay by the area
commissioner pending charges of corruption that had been brought
against him. He referred a dispute to the CCMA. The arbitrator held
that the suspension did not constitute an unfair labour practice. The
applicant then applied to the Labour Court for a review of the
commissioner’s award, on the basis that the powers of the national
and provincial commissioner to suspend an employee without pay
could not be delegated and that the employer also did not comply
with regulations pertaining to the suspension of employees.
Noted: The employer relied on regulation 15 (1), which permits the
delegation of power to suspend officers on conditions determined
by national or provincial commissioners. This, however, was not
applicable to when suspension was without pay.
Held: That the documentation on which the employer relied on to
prove that there had been a lawful delegation had not been
sufficient.
Further held: That the arbitrator had failed to apply his mind
properly in interpreting the regulations thus this constituted a gross
irregularity.
Concluded: The award was set aside and the employer was
ordered to pay the applicant’s remuneration from the date of his
suspension.
Case references
Folata v Minister of Safety and Security & Others
Nkulande & Others vs Assistant Commissioner Pretorius NO &
Another, unreported case no 97/03448888.
December 2004 – Page 6
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By Tshidi Letsoalo
Metal and Engineering Industries Bargaining Council, Johannesburg: MEGA 7090
National Union of Metal Workers of SA obo Swanepoel v Oxyon Services: Arbitrator Gevisser
Dismissal – Incapacity
The respondent, a labour broker, contended that the applicant had suffered a permanent back injury. He had been off work for nine months.
A medical certificate indicated that he was fit for light duties. The applicant was summoned to an internal disciplinary hearing which the
employer had referred to as an “investigation” to determine the existence of light duties that the applicant could have undertaken within the
company. The applicant had no effective representation in the “investigation”. The client had indicated that they had no light duties available
and as a result, the applicant’s services had been terminated. The applicant contested the fairness of his dismissal on procedural and
substantive grounds. The applicant wished to be reinstated.
Noted: The arbitrator noted that according to the LRA, Schedule 8, items 10 and 11, in order to ensure fairness in dismissal based on
incapacity, the employer should first enquire as to whether the injury is permanent or not.
Also noted: That the actual employer should play a greater role in dissuading the third party from deciding whether the employee cannot
be employed. The respondent, in the current matter had not tried hard enough to retain the applicant employment in its employment.
Effective representation in the “investigation” would have been of utmost importance considering the fact that the applicant was illiterate.
Further noted: Reinstatement could not be ordered as the respondent argued that, in terms of compensation legislation, it could not
reinstate the applicant until it had a medical report that the applicant was fit for duty.
Held: The arbitrator took into account that the applicant had received 75% of his salary through compensation without attending work. The
arbitrator, therefore, ordered the respondent to pay the applicant the equivalent of eight months’ salary.
Case references
Davies v Cleane Deale CC (1992) 13 ILJ 1230 (IC)
Lebowa Platinum Mines Ltd v Hill (1998) 19 ILJ 1112 (LAC)
Mnguni v Imperial Truck Systems (Pty) Ltd t/a Imperial distribution (2002) 23 ILJ 492 (LC)
Safety and Security Sectoral Bargaining Council, Potchefstroom: PSSS 254-03/04
S N Teledimo v South African Police Services: Arbitrator - Louw
Unfair Labour Practice- Irregularity in appointment or promotion
The applicant referred a dispute of unfair labour practice relating to irregularity in his appointment or promotion. The Council had to
determine whether the respondent had implemented the correct promotion date for the purposes of his promotion, and if so, whether the
deductions which were subsequently made from his monthly salary were valid or not.
Noted: That the respondent correctly determined the applicant’s date of promotion. The applicant should have alerted the respondent to the
obvious mistake with his promotion date instead of taking advantage of the situation.
Held: That the applicant was not entitled to any payment as a result of his promotion. The arbitrator further held that if the applicant had
been unhappy with the deductions, to his salary, he should have taken whatever steps he wished to another forum.
December 2004 – Page 7
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Public Health and Welfare Sectoral Bargaining Council: Polokwane: PSHS 188-04/05
NEHAWU obo M J Rakgoale v Provincial Department of Health – Limpopo: Arbitrator – Mulima
Applicant had waived opportunities that were afforded to him in order to receive disciplinary hearing notice
The applicant had been dismissed for charges of misconduct that is for, insubordination and/or insolence, theft and/or fraudulent practice
and negligence. The disciplinary hearing was held and finalised in the absence of the employee. The employee, therefore, contended that
he had not been afforded an opportunity to present his case, in that he had not been served with the charge sheet nor had he been
informed of the date, time and venue of the disciplinary hearing. He challenged the substance and procedure of his dismissal.
The respondent advanced that it had made numerous attempts aimed at informing the applicant about the intended disciplinary hearing.
The applicant never made himself available to receive the disciplinary hearing notice.
Noted: The arbitrator noted that the applicant had waived the opportunities that had been afforded to him in order to receive the disciplinary
hearing notice.
Further Noted: The arbitrator further noted that the charges had been drafted in good time. The applicant had refused to sign for the
charges and the applicant had also been aware of the rules and the consequences of not adhering to such rules.
Held: The arbitrator held that the dismissal of the applicant had been found to be both procedurally and substantively fair.
Case Reference
County Fair Foods (Pty) Ltd v CCMA (1999) 20 ILJ 1701 (LAC)
Private Arbitration, Humansdorp (No case number provided)
Jacobs v JDG Trading (Pty) Ltd: Arbitrator - Grogan
Substantive Fairness in Dismissal- Repeated late coming and absenteeism
The applicant, then a driver at the respondent’s store, had been dismissed for being absent from work for five days without permission. The
applicant claimed that he had been ill and that it was not possible for him to inform his manager of the reasons for his absence. The
respondent contended that the applicant had breached his condition of service and the applicable disciplinary code by failing to inform
management of his absenteeism.
Noted: That the first two days of that period were covered by a medical certificate, which the applicant had handed in to his manager. The
respondent did not contest the validity of the certificate. Desertion or absenteeism had been listed in the respondent’s disciplinary code, as
among other offences which may warrant dismissal. The arbitrator noted that the applicant had been correctly found guilty of absenteeism
in that he had failed to discharge the onus of proving that he had a justifiable reason for his three-day absence. It had also been noted that
wilful absenteeism is a serious offence because it inconveniences the employer.
Further noted: The arbitrator further noted that, the applicant had been absent from work without permission on no fewer than six
occasions. Those absences had resulted on the issuing of a final written warning. The applicant contended that the final written warning
which had been valid for six months, had expired at the time of dismissal. The arbitrator also noted that the unauthorised absence for which
the applicant had been ultimately dismissed for had commenced within the six months’ time limit of the final written warning. Therefore, the
final written warning was, accordingly, still in place.
Held: The dismissal was upheld and the applicant had not been entitled to any relief.
Case References
Shoprite Checkers (Pty) Ltd v Ramdaw NO & Others (2000) 21 ILJ 1232 (LC)
NUM & Another v Armcoal Colliery t/a Arnot Colliery & Another (2000) 8 BLLR 869 (LAC)
December 2004 – Page 8
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EMPLOYEE REMUNERATION OR BENEFIT
By Sarah Modise
The employment relationship between employers and employees is a reciprocal relationship. On the
one hand, employers employ employees to render their services in order to contribute to the
business objective of the employer for the purpose of making a profit or to produce commodities.
While, on the other hand, employees provide their labour in exchange for remuneration. The payment
of wages plays an integral part of the contract of employment between employers and employees.
The duty of the employer to pay and the commensurate right to remuneration do not only result from
the actual performance of the work but also from the tendering of service, except in instances, where
the employee is on paid leave.
Details on the method that should be used to calculate remuneration are set down in section 35 of
the Basic Conditions of Employment Act (BCEA). Section 32 of the BCEA provides the following
related to the payment of any remuneration; that the money should be in South African currency and
must be paid daily, weekly or monthly as required by the contract of employment. It should also be
paid in cash, by cheque or by direct deposit into an account designated by the employee. If paid in
cash or by cheque, it must be paid at the workplace and within 15 minutes of the commencement or
conclusion of working hours in a sealed envelope, which becomes the property of the employee.
The BCEA in section 34 further prohibits deductions from an employee’s remuneration unless the employee has agreed to it in writing, in
respect of a specific debt, or unless deduction is required or permitted by law, collective agreement, court order or arbitration award, or to
reimburse the employer for losses sustained at the fault of the employee only after a fair hearing has been held.
The difference between remuneration and benefit
It has become common for employers today to structure the wages of employees into “packages” that are effectively taxed. This includes
substituting different benefits for a cash component of the salary and using these to estimate the total wage of such an employee. Examples
of such benefits include, housing and car allowances, non-repayable or low-interest loans for education, entertainment etc. This has
resulted in making it difficult to distinguish between “extras” and payments in money or in kind that fall within the definition of remuneration.
The word “benefit” is not explained in the Labour Relations Act and, as a result, its inclusion has extended the possible scope of unfair
labour practices against which employees may claim under the protection of the Act. It has also become difficult for the courts to define the
precise meaning of the term “benefit” and how it should be distinguished from remuneration. The following judgements serves as examples
of how the different courts have tried to deal with this issue.
In the matter of Northern Cape Provincial Administration v Commissioner Hambridge NO & Others (1999) 20 ILJ 1910 (LC), the employee
was requested to act in a higher position for almost two years and was not paid an acting allowance. She was also unsuccessful when
applying for the position. She then referred a dispute to the CCMA claiming unfair labour practice, alleging the “non” payment of an acting
allowance. The CCMA commissioner found that the employer had committed an unfair labour practice and ordered that the employer
should pay the employee an allowance consisting of the difference in salary between the employee’s own position and that of the acting
position. The Court, in the case, tried to distinguish between remuneration and “extras” and held “that remuneration is an essential part of
the contract of employment. While other benefits accruing to an employee are termed naturalia to differentiate them from the essentiala.
Some naturalia, are as a, result of individual or collective bargaining, while law confers others.” (Grogan, 2003:235).
The Court further held a “fringe” benefit is a supplement for which no work is done and, therefore, an acting allowance was accordingly not
a benefit.
The Labour Appeal Court in HOSPERSA & Another v Northern Cape Provincial Administration (2000) 21 ILJ 1066 (LAC) held the same as
the above case and concluded that if an acting allowance does not form part of the actual contract of employment or collective agreement it
should not be regarded as a benefit.
According to Grogan (2003) it has become artificial in these days of “packaged” benefits to distinguish remuneration from benefits as
benefits still amount to employment costs to the employer and naturalia of an employment contract are still enforceable by law.
December 2004 – Page 9
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In the matter of Schoeman & Another v Samsung Electronics SA (Pty) Ltd (1999) 20 ILJ 200 (LC), the Court held that commission does not
form part of a benefit as contemplated by the section 186(b) but forms part of the salary. The Court further contended that remuneration
was different from a “benefit” which is something extra apart from remuneration. Therefore, the reduction in commission does not fall under
any of the disputes that are related to unfair labour practice. Grogan: (2003)
The issue as to whether a provident fund forms part of employee’s remuneration has also been under dispute. In the Case of GA 1731-0:
NUFAW on behalf of Mgijima & Others v Friedlein & Co (Pty) Ltd, the commissioner found that the employer’s contribution to the provident
fund did form part of remuneration when the employer calculates remuneration.
The above judgments are an indication of the difficulty experienced in drawing a distinction between remuneration and benefit. Therefore, it
could be said that the new schedule on the calculations of remuneration, which came into effect in July 2003, was enacted to assist in
clarifying what should be deemed as remuneration.
The schedule stipulates that the following should be included in the employee’s remuneration for the purposes of calculating pay for annual
leave in terms of section 21, payment instead of notice in terms of section 38 and severance pay in terms of section 41:






Housing or accommodation allowance or subsidy or housing or accommodation received as a benefit in kind;
Car allowance of provision of a car, except to the extent that the car is provided to enable the employee to work;
Any cash payments made to an employee, except those listed as exclusions in terms of this schedule;
Any other payment in kind received by an employee, except those listed as exclusions in terms of this schedule;
Employer’s contribution to medical aid, pension, provident fund or similar schemes; and
Employer’s contribution to funeral or death benefit scheme.
The schedule further stipulates the following items as not forming part of remuneration:
 Any cash payment in kind provided to enable the employee to work (for example, an equipment, tool or similar allowance or the
provision of transport or the payment of a transport allowance to enable the employee to travel to and from work);
 A relocation allowance;
 Gratuities (for example, tips received from customers) and gifts from the employer;
 Share incentive schemes;
 Discretionary payments not related to an employee’s hours of work or performance (for example, a discretionary profit-sharing scheme);
 An entertainment allowance; and
 An education or schooling allowance.
The above schedule is intended to serve as guidelines when calculating remuneration only related to leave pay, severance pay and
payment instead of notice. It does not, however, indicate whether payments not indicated in the schedule would not necessary form part of
remuneration. Furthermore, it does not provide a clear differentiation between a benefit and remuneration and because it is still new, it is yet
to be interpreted by the Courts.
Case references
GA 1731-01 NUFAW on behalf of Mgijima & others v Friedlein & Co (Pty) Ltd
HOSPERSA & Another v Northern Cape Provincial Administration f (2000) 21 ILJ 1066 (LAC)
Northern Cape Provincial administration v Commissioner Hambridge NO & Others (1999) 20 ILJ 1910 (LC)
Schoeman & Another v Samsung Electronics SA (Pty) Ltd (1999) 20 ILJ 200 (LC)
References
Grogan,J. .2003. Workplace law (7th edition). Landsdowne Juta law
Mischke,C. .2004. Employment Benefits. IRNetwork.co.za. Accessed December 2004.
Republic of South Africa Schedule on the Calculation of Employee’s Remuneration in terms of section 35(5) of the Basic Conditions
of Employment Act 75 of 1997. Published 23 May 2003.
Republic of South Africa. Basic Conditions of Employment Act 75 of 1997. Pretoria: Government Printers.
December 2004 – Page 10
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BUSINESSES SHOULD GUARD AGAINST THE EXTENSION OF NORMAL
WORKING HOURS DURING ECONOMIC VIABILITY
By Lucky Moloi
Festive season is the time of the year when the viability of business places pressure on businesses/employers to make more profits.
During this time, employers’ demands for flexible working hours are normally increased. They wish to maximise the use of equipment
by increasing the number of hours per day or the number of days in operation, which usually involves new shifts or working on public
holidays. The same can be said, in some service sectors, regarding the opening hours of shops and offices. This is, especially, the
case in the domestic, security, transport, and wholesale/retail sectors. Employers also seek greater capacity to adapt to fluctuations
in demand through an irregular distribution of the hours or days of work. This situation, results in businesses seeking to amend terms
and conditions of employment relating, inter alia, to the working hours. In embarking on the implementation of a managerial
prerogative, employers must be sensitive to the impact these changes might have on its employees and their families.
Definition of ordinary working hours
Working hours are governed by the BCEA, sectoral determinations, and collective agreements. Working hours can accordingly be
defined as the time when the employee is at the disposal of the employer. According to the BCEA, ‘‘ordinary hours of work’’ means
the hours of work permitted in terms of section 9 or in terms of any agreement in terms of sections 11 or 1”.
The impact of the BCEA
Chapter 2 of the BCEA stipulates that the regulation of working time does not apply to senior managerial employees, employees
engaged as sales staff who travel to the premises of customers and who regulate their own hours of work, workers who earn more
than R115 5721 per year, and to employees who work less than 24 hours a month for an employer. Chapter 2 of the BCEA also
excludes those employees who are covered by a bargaining council agreement. The exclusion of certain employees from the
provisions of the BCEA, does not mean that employers can unilaterally impose or amend their working times at will. That is,
employers should act within the requirements of the BCEA. This very same issue was dealt with in the case of NUMSA & Others v
Alfred Teves Technologies (Pty) Ltd (2002) 10 BLLR 995 (LC) where the respondent, which was subject to the main agreement of
the Bargaining Council of the Iron, Steel and Engineering Industry, had altered its shift patterns in various departments of its plant.
This had an impact inter alia of reducing overtime. Therefore, employees claimed that the new shift system constituted a unilateral
change to their terms and conditions of employment.
The Court noted that the only change that was effected was to their starting times. Their hours of work remained unaltered. They still
performed the same work. Moreover, changes to working hours were permitted by the main agreement. Insofar as the shift change
resulted in a reduction of overtime, such change fell within the managerial prerogative.
The managerial prerogative & the design and evaluation of shift systems
The employer's managerial prerogative embodies the application to the employment relationship of such powers as are necessitated
by the nature of the enterprise for its direction. The employer’s prerogative means the employer's right to determine employment and
working conditions unilaterally, in so far as they are not determined by some other source (law, collective agreement or individual
contract of employment). This right is put into effect through instructions, orders, guidance and other unilateral acts. In doing this,
employers should take into consideration its operational requirements and the Code of Good Practice on arrangement of working
time. The objective of this Code is to provide information and guidelines to employers and employees concerning the arrangement of
working time and the impact of working time on the health, safety and family responsibilities of employees.
As in the case of SA Chemical Workers Union obo Mhlongo v Silicon Technology (Pty) Ltd (2002) 23 ILJ 2134 (CCMA), the
applicants had been given additional duties to perform over weekends that had initially been performed by factory assistants. They
refused to perform the tasks, alleging that the change had amounted to a unilateral change to their terms and conditions of
employment. The arbitrating commissioner distinguished between 'terms and conditions of employment', which referred to the core
1
This earning threshold may vary as it is determined by the Minister of Labour.
December 2004 – Page 11
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rights and duties of employees under their contracts of employment, and 'work practices' that is now widely recognised to fall within
the managerial prerogative and can be introduced unilaterally. To determine whether a particular aspect of an employment
relationship constitutes a condition of service or a work practice requires an examination of the employees' contracts of employment,
any documents incorporated into the contract such as collective agreements, job descriptions, procedures, etc., any additional items
that can be implied from conduct or from custom and practice.
There is a considerable judicial authority supporting the principle that courts and adjudicators will be reluctant, in the absence of
good cause clearly shown, to interfere with the managerial prerogative of employers in the implementation of new shift systems, and
even working hours. Thus, the commissioner was satisfied that the additional tasks constituted work practices. The employees’
contention totally disregarded the company's job evaluation policy which was collectively agreed to. The employees' recourse lay in
the procedures set out in that policy, not in an unprocedural strike action. Should the union and its members not be satisfied with
those procedures the solution lay at the bargaining table.
Bargaining collectively
Grogan (2003) states that bargaining councils may alter, by agreement, some basic conditions in the sector over which they have
jurisdiction, provided such agreements do not reduce hours of work below the statutory maximum. This may be true if one looks at
sections 10, 11, 12 and 14 of the BCEA. These sections require parties, to the employment contract, to enter into a written
agreement in order to alter the requirements of these sections within the workplace. The first two such agreements will lapse after 12
months but can thereafter be made permanent should both parties agree to it.
Grogan (2003:64) notes that, even though, there is some work that should be done without delay due to circumstances for which the
employer 'could not reasonably have been expected to make provision', this will not be regarded as overtime. However, the
employer should note that Schedule 1 of the BCEA asserts that the 45 hours stipulated in section 9 is not the ultimate goal. Instead,
the Schedule indicates a programme by which these hours can be gradually reduced to 40 through the process of collective
bargaining. In other words, the Schedule makes hours of work a compulsory bargaining topic if a negotiating party introduces it as a
subject matter for negotiation and requires the Employment Conditions Commission and the Department of Labour to investigate and
report to the Minister.
The impact of sectoral determinations
Grogan (2003:63) states that at common law parties are free to regulate working hours. In terms of the BCEA, and subject to certain
exceptions (collective agreements, bargaining council agreements, wage determinations and sectoral determinations), no employer
may require or permit an employee to work longer than 45 hours a week, or nine hours a day, if the employee works five days or
fewer per week, and eight hours per day, if the employee works more than five days a week.
According to the BCEA all work beyond this is to be considered overtime, but Grogan (2003) states that employees who serve
customers may be required by agreement to work an extra 15 minutes per day at normal rates, but not more than 60 minutes in a
week to complete their work. As such, when maximum hours of work are stipulated in the contract or collective agreement, the
employer may require the employee to work additional hours when circumstances so require. Although employees do not breach the
contract if they refuse to perform non-contractual overtime, it has been held that employers may dismiss workers who persistently
and unreasonably refuse to work overtime. That is, sections 9, 10(1), 14(1), 15(1), 17(2) and 18(1) do not apply to work which is
required to be done without delay owing to circumstances for which the employer could not reasonably have been expected to make
provision and which cannot be performed by employees during their ordinary hours of work. Some of the exceptions mentioned
above include sectoral determinations that are set in sectors where there is no centralised collective bargaining, and which require
detailed and specific regulations, for example, the domestic, and wholesale/retail sectors.
Sectoral determinations set minimum terms and conditions of employment, including working hours. Sectoral determinations may
have different conditions to those in BCEA. The conditions in the sectoral determinations will override the conditions in the BCEA.
For example, in the Sectoral Determination 6: Private Security Sector, a security officer category A is required to work 48 hours in a
week, and 12 hours on any day. In the same sectoral determination, category B security officers are required to work 50 hours in any
week, and 12 hours on any day. It is evident that these hours of work are different from what is indicated in the BCEA.
Conclusion
The number of employees working more hours per week than stipulated by the BCEA usually grows around the festive season. More
than half of these are non-managerial wage and salary earners, that is, those that are protected by the BCEA and the sectoral
determinations.
December 2004 – Page 12
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Many link this rise in working hours to social problems including:
 Declining quality of working life,
 Increased stress, fatigue and isolation, giving rise to adverse health consequences,
 A general deterioration in the quality of life outside work as a result of both the encroachment of work on family, community and
social life, and a decrease in the degradation of common leisure time, and
 An effective pay cut as a result of the breakdown between hours worked and hours paid for.
The objective is to reduce the incidence of unreasonably long working hours. The basic approach is to establish a regulatory
framework for dealing with unreasonable working hours. The objective of the Code of Good Practice on the arrangement of working
time is to provide information and guidelines to employers and employees concerning the arrangement of working time and the
impact of working time on the health, safety and family responsibilities of employees. This open-ended approach is designed to allow
for variations in terms and conditions of employment in different industries and workplaces, but this should be done bearing in mind
the managerial prerogative and work practices.
Case references
Magnum Security (Pty) Ltd v PTWU & others [2004] 7 BLLR 693 (LAC)
NUMSA & Others v Alfred Teves Technologies (Pty) Ltd (2002) 10 BLLR 995 (LC)
SA Chemical Workers Union obo Mhlongo v Silicon Technology (Pty) Ltd (2002) 23 ILJ 2134 (CCMA)
References
Grogan, J. 2003. Workplace Law, 7th edition. Lansdowne: Juta Law.
CCMA. 2002. Working Time Information Sheet. Johannesburg: CCMA, Information and Operations Department.
Republic of South Africa. Basic Conditions of Employment Act, 75 of 1997. Pretoria: Government Printers.
Republic of South Africa. Code of Good Practice on the Arrangement of Working Time. Vol. 401, No 19453, 13 November.
Republic of South Africa. Labour Relations Act, 66 of 1995. Pretoria: Government Printers.
Republic of South Africa. Regulation No 1440 of 1998. Pretoria: Government Printers.
December 2004 – Page 13
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TERMINATION OF AN EMPLOYMENT CONTRACT
By Dorothy Khosa
Employment contracts entered into by an employer and an employee are as important as labour legislation that governs any country.
This legally binding agreement between the two parties acts as an instrument that establishes the employment relationship.
Employment contracts are a vital source of rights for both employers and employees (Mischke, 2004(a) & Moloi, 2003). This means
that parties can use employment contracts to structure their employment relationships.
The employment contract can be defined as a binding set of promises exchanged between parties but with some exceptions. An
example of these exceptions could be a contract entered into with an unlawful purpose. Lawful contracts are enforceable by the
courts (Mischke, 2004(b)), unlike the former which are not enforceable by the courts.
Employment contracts can either be written or verbal. However, a written contract would be able to provide the courts with guidance
in a situation where a dispute arises as a result of the employment relationship. As a result, it is important for the parties involved to
record their agreement in writing. An agreement between the parties is a requirement for the validity of an employment contract. This
means that both parties must have the capacity to enter into a contract.
WHAT THE LAW SAYS ABOUT TERMINATION OF EMPLOYMENT
There are as many methods of entering into a contract, as there are to terminate
them. Grogan (2003) states that contracts of employment may be either terminated
through consensus between the parties or unilaterally. Certain procedures must be
followed when either an employer or employee wishes to terminate an employment
contract. The procedures are stipulated in the Basic Conditions of Employment Act
(BCEA), Act 75 of 1997. The procedures are specifically dealt with in chapter five
of the BCEA. The application of these procedures does not apply to employees
who work less than 24 hours per month.
Notice of Termination of an Employment Contract
A notice of termination of an employment contract must be given in writing, except
when it is given by or given to an illiterate employee. This may also be given in an
official language that the employee reasonably understands.
Worker employed for…
Notice Period
6 months or less
1 week
More than 6 months, but less than 1 year
2 weeks
1 year or more
4 weeks*
Table 1: The calculation of notice period in terms of the BCEA
*A collective agreement may reduce the 4-week notice period to not less than 2 weeks.
Source: Department of Labour Internet site
Notice may not be given during leave or run concurrently with leave, except sick leave.
Payment instead of Notice
An employer may pay the employee for the notice period without requiring work. The employee must be paid for the notice period,
unless both parties agreed otherwise (CCMA Information Sheet, 2002).
December 2004 – Page 14
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Accommodation Provided by Employer
There are situations where employees are provided with accommodation by the employer. Such an arrangement changes when the
employment contract is terminated between the two parties. This means that the employee will have to vacate the accommodation,
but certain procedures will have to be followed. The employer must continue to provide accommodation for a month or until the
contract could have legally ended, which ever is longer, if the employer terminates employment before the end of the required notice
period or gives payment instead of notice.
Employees sometimes remain in the accommodation of the employer after the expiry of the notice period. Under such
circumstances, the agreed value of the accommodation for that period may be deducted from the money owed to the employee. If an
employee still refuses to vacate the accommodation even long after the expiry period, the employer may not take the law into its own
hands. An application must be made to a court for an order to compel such an employee to vacate the premises (Grogan, 2003).
Occupiers of land at the employer’s premises are also protected by the Extension of Security of Tenure Act 62 of 1997 (ESTA). The
Act was enacted to curtail unfair evictions, promote security of tenure of land occupiers while balancing the interests of the state and
landowners. ESTA stipulates that in cases where an employee or occupier of land has been dismissed but challenges that dismissal
as unfair at the CCMA or the Labour Court, the right of residence does not terminate until and unless the dismissal has been
confirmed by arbitration or the Labour Court adjudication.
Payments on Termination
The employer must pay all the money due to an employee on termination of employment. The payments may include time off
accumulated but not taken (e.g. overtime worked) and leave accumulated, but not taken. The case of Jardine v Tongaat-Hulett
Sugar Ltd [2003] 7 BLLR 717 (LC) seems to be relevant in this regard. In this case, the applicant who had accumulated 48 days
leave at the time of the termination of his employment was paid out for only 40 days. The applicant then claimed payment of the
balance of the leave. The respondent argued that the BCEA did not apply because the respondent’s leave provisions were more
generous than those provided for in the Act and because employees could not accumulate more than 40 days’ leave in terms of the
respondent’s policy. The Court acknowledged that the respondent’s policy was more favourable to the applicant than the applicable
provisions of the BCEA. However, the Court emphasised that the BCEA provides that on termination of services employees must be
paid for any period of annual leave due that has not been taken. The BCEA sets no ceiling on the amount of leave that may be
accumulated, and therefore superseded the respondent’s leave policy. As a result the Court held that the applicant should have
been paid for all accumulated leave on termination of the employment contract. The argument clearly shows how important it is for
employers to ensure that employees take leave when due.
Severance Pay
It sometimes happens that an employer decides to embark on a retrenchment
process as a result of the operational requirements of the business. The term
operational requirements for the purpose of this discussion means the
economic, technological, structural or similar needs of an employer.
An employee who is retrenched is entitled to severance pay. Severance pay
must equal at least one week’s pay for each completed year of continuous
service. “Previous employment with the same employer, but broken by
periods of less than one year, is still regarded as continuous service (unless
there was a previous retrenchment)” (CCMA Information Sheet, 2002: 1).
Employers sometimes offer the employees alternative employment instead of
being retrenched. This type of an offer is sometimes not accepted by
employees for whatever reason. As a result, an employee who unreasonably refuses an offer of alternative employment is not
entitled to severance pay. A case relevant to this issue was Freshmark (Pty) Ltd v CCMA & Others [2003] 6 BLLR 521 (LAC). In this
case, an employee who unreasonably refused offer of employment on new terms was not entitled to severance pay. Other affected
employees accepted the new terms because of the changes that occurred in the operation of the business.
It sometimes happens that employees voluntary sign agreements to terminate their employment relationship and accept severance
pay from the employer and thereafter claim to have been dismissed. Such a claim was heard in the case of Chiloane & Others v
Rema Tip Top Industires (Pty) Ltd [2002] 11 BLLR 1066 (LC). The Court, after perusing all the arguments, held that it was plain from
the common cause facts that the applicants had all voluntarily signed written agreements terminating their employment relationship
December 2004 – Page 15
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with the respondent. They had all accepted voluntary retrenchment packages. They had all been aware of their rights when they
acted in that way.
One should note that payment of severance pay does not affect an employee’s right to any other payments due. For example,
overtime payment and leave days due.
CONCLUSION
Contracts of employment are important to have in employment relationships since they act as a vital source of rights for both
employers and employees. The validity of a contract of employment ceases to exist when the employment relationship between the
parties involved has expired. Such expiration involves following certain procedures as stipulated in the BCEA. These involve giving
notice by either party of the intention to terminate the employment contract. The employer may pay an employee for the notice period
without rendering any service.
The employer is required to pay the employee all outstanding money due at the end of the employment contract. The payment could
include, accrued leave not used and overtime worked. Employment contracts sometimes come to an end because of the operational
requirements of the business. These operational requirements usually give rise to the retrenchment of employees. Such processes
have to be communicated and negotiated with employees or their representatives in order to implement it fairly. Employees that are
retrenched should receive severance pay as per the requirements of the BCEA.
Case References
Chiloane & Others v Rema Tip Top Industires (Pty) Ltd [2002] 11 BLLR 1066 (LC)
Freshmark (Pty) Ltd v CCMA & Others [2003] 6 BLLR 521 (LAC)
Jardine v Tongaat-Hulett Sugar Ltd [2003] 7 BLLR 717 (LC)
References
CCMA. 2002. Termination of Employment Information Sheet. Johannesburg: CCMA, Information and Operations Department.
Department of Labour. Basic Guide to Termination. www.labour.gov.za/basic_guides/bguide_display.jsp?guide_id=5768.
Accessed in December 2004.
Grogan, J. 2003. Workplace Law, 7th Ed. Juta Law: Lansdowne.
Mischke, C. 2004(a). “Employment Contracts”. IRNetwork. www.IRNetwork.co.za. Accessed December 2004.
Mischke, C. 2004(b). “Importance of the Employment Contract”. IRNetwork. www.IRNetwork.co.za. Accessed in December 2004.
Moloi, M. 2003. “The Contract of Employment and Employment Relationship”. CCMA: Johannesburg.
Republic of South Africa. Basic Conditions of Employment Act, 75 of 1997. Pretoria: Government Printers.
December 2004 – Page 16
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TIME OFF WORK – A PREREQUISITE
By Tshidi Letsoalo
Introduction
Employees are required to take leave occasionally. There are different situations in which an employee may want to take leave: to go on
holiday, to recover from illness, to nurse a sick child or to have a child. In some cases, the employer is obliged to pay the employee whilst
on leave (Todd, 2001)
According to the Basic Conditions of Employment Act, the application for leave does not apply to an employee who works less than 24
hours a month.
Annual Leave
Annual leave is the time every employee is entitled to take time off work, for no apparent
reason other than to take a break. It is often referred to as “holiday leave”. The BCEA
requires that an employer should grant an employee at least 21 consecutive days of annual
leave each year. The 21 consecutive days includes weekends and if a public holiday falls in
the period of such leave, it must be extended by a day. The method of taking annual leave
may be changed by agreement to one day’s leave for every 17 days worked, or one hour for
every 17 hours worked.
The only dilemma related to annual leave, is that both the employer and employee should
agree on its timing. If they cannot agree, the employer then makes the final decision. Though
annual leave is considered to be management’s prerogative, lots of companies are dealing
with internal grievances daily, whereby an employer has failed to grant such leave.
Employers can only pay workers instead of granting annual leave when employment is
terminated and leave may not be taken during a period of sick leave or while the employee is
serving a notice of termination.
Employees generally look forward to their annual leave, and most take it when they can. But occasionally, for financial reasons or as a
favour to their employers, some employees forego that right in a particular year. When they do so, they usually expect that leave would
accumulate and that, ultimately, they would either take longer leave or claim cash in lieu of leave not taken, when they ultimately resign or
retire. Questions which then follow, are whether and at what stage can annual leave be forfeited (Grogan, 2004).
The Labour Court has given two different judgements on the forfeiture of leave. In the first case, Jardine v Tongaat – Hulett Sugar Ltd
(2003) 7 BLLR 717 (LC), the Court held that an employee who has not taken leave due in terms of the BCEA may claim payment in lieu
thereof for all the days accumulated since the commencement of employment. At the time of his dismissal, the applicant had accumulated
48 days’ leave. He sought an order compelling the company to pay him for the remaining eight days. The company had only paid him 40 of
these days. Tongaat-Hulett argued that their company policy precluded employees from accumulating more than 40 days’ leave. The Court
further held that if the employer had to pay out for leave not taken when the contract had been terminated, it had only itself to blame as
employers are entitled to insist that employees take their full annual leave during a particular cycle. The Court also noted that, although
employers are obliged by section 20(2) of the BCEA to grant employees annual leave within six months of the end of a particular leave
cycle, the BCEA does not expressly prohibit the accumulation of leave.
In the second case, Jooste v Kohler Packaging Ltd (2003) 12 BLLR 1251 (LC) (which was decided two months later without reference to
Tongaat-Hulett case), the Court held that only leave not taken during the current leave cycle and that immediately preceding it, may be
claimed. The applicant had at the time of his resignation accrued 141 days’ leave. Kohler Packaging paid him out for only 50 days. The
applicant claimed payment for the balance. Similar to Tongaat–Hulett matter, Kohler Packaging relied on its contract with the employee.
The applicant’s position was complicated by the fact that some of the leave he claimed had accrued before the commencement of the
current BCEA. That portion of his claim was therefore regulated by the BCEA, of 1983. However, like the current BCEA (section 40), the
1983 BCEA (section 12) version provided that leave not taken must be paid for on termination of employment. The Court then concluded
that in its view, both section 40 and section 12 (4) of the respective Acts contemplate payment only in respect of leave accrued in the cycle
immediately preceding that during which termination takes place (apart of course from the pro rata entitlement for the then current cycle).
December 2004 – Page 17
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Grogan held that in Tongaat-Hulett, the Court adopted a literal approach to the statute; since the act says nothing about forfeiture of leave
not taken during spent leave cycles, the judge assumed that a general right to claim pay for accumulated leave, supercedes section 20 of
the BCEA, which extends the right to take leave. In Kohler Packaging, the Court paid more attention to the relationship between sections 40
and 20 of the BCEA. The judge noted, in particular, that section 20 (4) compels employers to grant the full period of annual leave provided
by the Act “not later than six months after the end of the annual leave cycle”.
Grogan also stated that the question of which judgement to take is worth considering, because the issue can only be finally determined by
the Labour Appeal Court, the Supreme Court of Appeal, or the Constitutional Court.
Sick Leave
Employees are entitled to take the number of days that they would normally work in a 6-week period for sick leave on a full pay in each 3year cycle. During the first six months of employment an employee may take one day’s paid sick leave for every 26 days worked.
An employee may be requested to produce a valid medical certificate if he/she has been absent from work for more than two days in a row.
If the employee does not have a valid medical certificate, the employer might not be obliged to pay. Todd (2001) states that some
employees are regularly sick on Monday and Friday. This can be very annoying to an employer, and disrupt production.
The BCEA provides that a medical certificate must be issued and signed by a medical practitioner or any other person who is certified to
diagnose and treat patients and who is registered with a professional council established by an Act of Parliament. Where the employee lives
on the premises the employer must provide “reasonable assistance”, if necessary enable the employee to get a medical certificate.
Healy (2004) indicates that while sick leave is a necessary statutory benefit that
rightfully should be accrued by employees, abuse is an ever-present dilemma,
which challenges employers daily. Sick leave fraud is on the rise. A recent UK
survey showed that only one in three employees who embark on sick leave are
truly sick to the extent that they are unable to attend work or it would be
reckless for them to do so as their infectious condition could be detrimental to
colleagues. In the US, it has been submitted that a similar pattern of growing
sick leave abuse is a result of employees endeavouring to gain a better work
life balance. A number of factors need to be incorporated into the calculation of
costs associated with sick leave. To begin with there are the direct costs of the
unproductive remuneration of the sick employee for the days in question.
Further indirect costs include overtime to other employees and the costs of
hiring temporary staff.
Research conducted in South Africa during 2002 surveyed 959 950 public
servants of which 752 665 were employed at a provincial level and 207 285
were at a national level. The report established that absenteeism between the
periods 1999 to 2000 had cost the South African government R631 million in sick leave. In Gauteng province the cost of sick leave to the
Department of Finance was estimated at R29 million in 2000 and approximately R54 million in 2001 (Parbhoo, 2003).
An employee who exhausts his sick and annual leave as prescribed by the Act but still needs to take days off due to sickness may be
terminated due to incapacity. It would be deemed substantively fair if the following principles are adhered to before dismissing an employee
for incapacity:





The employee has been counselled, and his medical condition and the problems arising from it have been discussed with him,
The employee’s medical condition makes it impossible for the employee to perform his normal duties,
The employee’s prognosis is poor,
The employee had a fair opportunity to contest the employers’ conclusion about his medical condition and prognosis, and
The employee’s working conditions cannot be adapted, or alternative work is not available.
Maternity Leave
Pregnant workers are entitled to at least four consecutive months of maternity leave. They may take their leave one month before their due
date, or earlier or later as agreed or required for health reasons. Such workers may not go back to work within 6 weeks after the birth unless
their doctor or midwife had said it is safe. Employees who are pregnant are protected by all labour legislations. Based on section 26 of the
BCEA, a worker who is pregnant or nursing may not do work that is unsafe for her or her child. According to the Employment Equity Act
section 6 (2), no person may directly or indirectly discriminate against an employee on the ground of pregnancy.
December 2004 – Page 18
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Furthermore, section 187 (1)(e) of the Labour Relations Act states that, a dismissal is considered to be automatically unfair if the reason for
dismissal is due to the employee’s pregnancy, intended pregnancy, or any reason related to her pregnancy. In the case between), Lukie v
Rural Alliance CC t/a Development Specialist (2004) 8 BLLR 769 (LC), the employee informed the employer that she was pregnant and
wished to take time off for her confinement, her manager agreed that she could take leave. However, the manager later changed his mind
and informed her that she need not return after maternity leave. The applicant did not return to work and claimed to have been
automatically unfairly dismissed. The Court held that the applicant had been unfairly dismissed in terms of section 187 (1) e of the LRA. She
was awarded compensation equivalent to 80 weeks remuneration.
An employee who has a miscarriage during the third trimester of pregnancy or bears a stillborn child is entitled to maternity leave for six
weeks after the miscarriage or stillbirth, whether or not the employee had commenced maternity leave at the time of the miscarriage or
stillbirth. Notification to take maternity leave should be given to the employer four weeks before the employee intends to commence with the
leave.
An employer is not obliged to pay an employee who is on maternity leave, employees on such leave may claim for benefits from the
Unemployment Insurance Fund.
Family Responsibility Leave
According to section 27 of the BCEA, employees may take up to 3 days of paid leave a year to attend to certain family responsibilities.
Family responsibility leave expires at the end of the annual cycle. Only employees who have been in employment for longer than four
months and who work four days or more for the employer are entitled to family responsibility leave.
The reasons for taking such leave should be in the circumstances:
 When the employee’s child is born
 When the employee’s child is sick and
 In the event of the death of the employee’s:
- Spouse or life partner
- Parent or adoptive parent
- Grandparent
- Child or adopted child
- Grandchild
- Sibling
On a discretionary basis, some companies in their company policies make additions to the categories as stipulated above. For example, inlaws are mostly added in other company policies. An employer may require a reasonable proof of birth, illness or death for which a worker
requests family responsibility leave.
Conclusion
Generally an employer is compelled to grant leave to an employee in all the abovementioned circumstances. It is also imperative and
necessary for employers to allow their employees time off. A holiday at least once a year is generally regarded as good for productivity, is
probably necessary to the employee’s health, and is a basic right that helps to prevent employees from being compelled to surrender
themselves entirely to the demands of their employers (Todd, 2001).
Case References
Jardine v Tongaat – Hulett Sugar Ltd (2003) 7 BLLR 717 (LC)
Jooste v Kohler Packaging Ltd (2003) 12 BLLR 1251 (LC)
Lukie v Rural Alliance CC t/a Development Specialist (2004) 8 BLLR 769 (LC)
References
Department of Labour. Basic Guide to Leave, www.labour.gov.za. Accessed December 2004
Todd,C. (2001). Contracts of Employment. Siber Ink CC
Grogan,J.(February 2004) Employment Law Journal,“Holiday Blues”. Lexis Nexis Butterwoths, Volume 20
Parbhoo,S Why worry about absenteeism at the workplace? CCMA publication, CCMail July 2003 Page 18
Tony Healy & Associates. How to manage sick leave The Star Workplace, Wednesday 21 January 2004: Page 4
Republic of South Africa. The Labour Relations Act, 66 of 1995. Pretoria: Government Printers
Republic of South Africa. The Employment Equity Act,55 of 1998. Pretoria: Government Printers
Republic of South Africa. The Basic Conditions of Employment Act, 75 of 1997. Pretoria: Government Printers
December 2004 – Page 19
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LABOUR RELATIONS IN AFRICA: CHILD LABOUR IN AFRICA
By Sunita Parbhoo
The aim of this article is to present an overview of child labour in Africa. It briefly discusses the extent and nature of child labour and
its possible causes.
Incidence
The incidence of child labour is higher in sub-Saharan Africa than in any other region in the world. It is estimated that 41% of children
between the ages of 5-14 years in this region are employed - this amounts to approximately 80 million children. Participation rates
are highest in East Africa, followed by West Africa and then middle Africa. The incidence of child labour in the same age-range and
for the same definition of work is estimated to be 21% in Asia and 17% in Latin America. The number of working children is,
however, greater in Asia on account of its greater population density. Of the 250 million children that are estimated to be working
around the world, 61% are in Asia, 32% in Africa and 7% in Latin America. 120 million of these 250 million children are employed on
a full-time basis. In many developing countries, more than half of the population is made up of individuals that are under the age of
20. High children participation rates therefore involve a substantial fraction of individuals.
While the incidence of child labour in Asia and Latin America has witnessed a secular decline in the post-war era, this is not the case
in sub-Saharan Africa. Slow or negative economic growth, famine and disease, war and conflict, poor governance and the spread of
HIV/AIDS in Africa are all likely to have contributed to maintaining the incidence of child labour. The International Labour
Organisation (ILO) estimates that the number of child labourers in Africa could exceed the 100 million mark as a result of a
demographic explosion of impoverished people, the deterioration in living standards, the incapacity of education systems in catering
for all children as well as the poor levels of economic growth across the African continent.
Child fostering and orphanhood in Africa
More than 15% of adults in sub-Saharan Africa are HIV-positive and prevalence rates in some of the southern African countries are
as high as 25%. The death of prime-age adults has resulted in a growing number of orphans in Uganda, Malawi, Mozambique,
Zambia and Zimbabwe, where close to 15% of children under the age of 15 have lost either one or both parents. The latter statistics
clearly reveal that Africa has the greatest proportion of children who are orphans. In 2001, 34 million children in sub-Saharan Africa
were orphans, one-third due to the AIDS epidemic. It is estimated that by 2010, the number of orphans will reach 42 million. Twenty
million of these children – or almost 6% of all the children in Africa – will be orphaned due to AIDS.
Orphaned children are typically brought up by their grandparents, other relatives or, possibly unrelated households in the community.
It is recognised that this sort of informal support is unlikely to be able to sustain the increasing numbers of orphans, especially in the
context of the weakening of adult health as well as the continuing sluggishness of the continent’s overall economic growth. A further
cause for concern is the possibility that the altruism of adult carer givers towards children grows weaker as the biological relation
between adult and child is weakened. This concern applies more widely given the practice of child fostering which has a long history
in Africa. Consistent with this, recent research finds some evidence that orphan and foster children are less likely to be enrolled in
school than the biological children of the adults with whom they live. This underlines the importance of finding appropriate policy
initiatives to address this growing problem.
However, with economic stagnation, falling government revenues and continuing expansion of the school-age population, some
African governments are hard-pressed to widen the access to schooling while also raising the quality of education. Currently, there is
an ongoing debate regarding the efficiency and equity implications of introducing school fees and encouraging the private provision
of public services. Since education is not the exact inverse of child labour, one also has to consider recent evidence on the extent to
which school attendance and school performance creates a trade-off against child labour. Most data sets describe an inverse
correlation between child labour and education at the micro-level which is unsurprising as these are competing uses of time. It is
therefore possible that a policy intervention that results in an increase in school enrolment draws children out of “inactivity” with, no
reduction in child labour.
December 2004 – Page 20
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Why do children work?
Incentives, constraints and agency
The commonly held view that poverty compels child labour reflects the importance of subsistence constraints. However, micro-data
reveals that children work in households that cannot be classified as “subsistence-poor”2. There must, therefore, be other reasons
why children work. A useful framework of causes that is suggested is to categorise them in terms of incentives, constraints and
agency.
The incentive to work is determined by the return to work relative to alternative uses of time such as school attendance. Thus
children may work because the net returns to education are low and the returns to work experience are relatively large. Policy can
modify incentives, for example, by improving school quality or by lowering school fees. However, even where incentives favour
education over work, a household may be compelled by poverty constraints to send a child to work. When these are binding, the
opportunity cost of schooling is too high. In this case, policy interventions are best targeted at alleviating poverty in households
supplying child labour.
Agency issues arise with child labour because the decision to work is typically taken by adults (parents). This distinguishes it from an
adult labour supply decision. However remote it may seem at first glance, there is, in principle, the possibility that some children are
set to work because their parents value their own consumption more than the long-term welfare of their children. Child welfare may
then be raised by policies that make schooling compulsory or that ban child labour, thereby eliminating the agency of a parent or
carer. These factors may, of course, interact. For example, parents’ labour supply decisions will determine the tightness of the
household budget constraint. So parents with limited altruism may elect to consume some leisure while sending their children to
work, which highlights the agency problem.
Markets and institutions
The strength of markets and institutions will mediate the force of incentives, constraints and agency. In this section, the roles of
imperfections are considered in the markets for credit, land and labour and the part played by tastes and norms. For example,
underdeveloped credit markets will tend to increase the force of constraints in determining the extent of child labour. Limited access
to capital markets not only perpetuates chronic poverty but also traps non-poor households in states of poverty following income
shocks. Poor households are likely to be particularly risk-averse and they may employ children ex ante to diversify their sources of
income or ex post to make up income losses in bad times.
Similarly, imperfect labour markets may strengthen the incentive to employ children. For example, it may be difficult to substitute
hired labour for family labour. This creates an incentive to employ family labour. The fact that the marginal product of family labour is
increasing in the value of productive assets such as land or livestock means that one may expect to find that the children of the landrich are more likely to be in work than are the children of small landowners or landless agricultural workers. Remarkably, this has
proven to be the case in rural Ghana and Pakistan and, likely, in other countries too.
Research has also shown that children may work because they enjoy work or the independence that it brings more then they enjoy
going to school. Thus incentives can be non-material and local policy interventions should be sensitive to encouraging creativity and
joy in education as much as to improving infrastructure and increasing monetary returns.
Supply and demand
Another aspect to consider is how does the demand side of the market influence the decision of parents to supply child labour.
Together with total supply, this determines relative wages and hence, the incentive to supply labour. If child labour is in fact
substitutable (be it imperfectly) for unskilled adult labour in production, then cost-minimising employers will only prefer children if they
are effectively cheaper in terms of their wages. In principle, a well-functioning labour market should equalise effective wages, that is,
wages should be adjusted to the level of productivity. Under these conditions, employers are indifferent between adults and children
and with skill acquisition and the consequent increase in the relative productivity of adults; households will face a falling nominal
return to child labour. In practice, however, just as women continue to be paid less than men for equal work, children may be paid
disproportionately less than adults.
A historical analyses and case studies have, moreover, identified non-monetary reasons why employers may prefer to hire children.
A possible argument that is consistent with the casting of employers of child labour as exploitative is that children are relatively easy
This part of the population cannot even afford (or can barely attend to) the basics of survival, despite significant amounts of humanitarian assistance. On average,
the subsistence poor have larger households than the non-poor. Families living in subsistence poverty are generally large; they have many non-working dependents
and low levels of education.
2
December 2004 – Page 21
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to control. Other arguments relate to the technology of particular sectors. For instance, children worked in coalmines in England
because they were small enough to go down the shafts. There was a visible decline in child labour with advances in the technology
of mining. Technological change may thus change the demand for child labour in comparison to adult labour by altering their relative
marginal productivities. For example, research has found that mechanisation in Egyptian agriculture has reduced the incidence of
child labour. Technological change will also tend to increase the return to schooling for given levels of school access and school
quality.
Policies
Issues and overview
Child labour is an emotive issue that has led activists and policy-makers to advocate absolute controls such as trade sanctions, bans
on child labour or compulsory education. Since the 1980’s various countries, including African countries, have adopted
comprehensive national policies and programmes on child labour. Conventional policies pertaining to child labour have, in the past,
concentrated on the demand side with companies being persuaded to reduce the demand for child labour by legislation. This
approach has not been very successful, especially in countries where a large fraction of work is situated in the informal sector. As a
result, policy options have been expanded to assess the supply side of factors. These include laws that make schooling compulsory
and initiatives that make schooling more attractive by improving access and quality.
Countries such as Benin, Egypt, Kenya, Senegal and Tanzania were amongst the early participants in the International Programme
for the Elimination of Child Labour (IPEC), a major cooperation programme that was implemented by the ILO in 1992. For example,
in 2000, the ILO-IPEC launched a three-year regional project (including Kenya, Malawi, Tanzania, Uganda and Zambia) to build
institutional capacity and prevent children from entering child labour into the commercial agriculture sector. This programme seeks to
rehabilitate 7500 children that are engaged in exploitative work in this sector and to prevent a further 15000 at risk children from
entering such work.
The labour law in Africa generally concentrates on the manufacturing sector, disregarding the rural economy. Seasonal and casual
workers such as under-age children and self-employed farmers are rarely covered under national laws. Trade unions have attempted
to redress this problem. In Kenya, for example, affiliates of the Central Trade Organisation include child labour on their agendas
when negotiating collective bargaining agreements, while the Tanzanian and Agricultural Workers’ Union has succeeded in
incorporating a clause in its agreement that prohibits child labour in agriculture.
Overall, there is an impressive list of initiatives but their efficiency relies upon the following conditions:
a)
b)
Identifying the causes of child labour and understanding the incentives and constraints driving the decision to work, and
The commitment and enforcement capacity of governments.
The relative success of interventions aimed at eliminating child labour in Latin America reflects, to some degree, better governance.
These interventions have also been monitored by randomly collecting data before and after the introduction of a policy. While there
probably are regions that have been transformed, there is currently little evidence as yet of real success in Africa.
This article has been summarised from a research report produced by the Organisation for Economic Co-operation and
Development (Directorate for Employment, Labour and Social Affairs).
Reference
Bhalotra, S. 2003. Child Labour in Africa. Organisation for Economic Co-operation and Development. Directorate for Employment,
Labour and Social Affairs. OECD Social, Employment and Migration working Papers. Paris, France.
December 2004 – Page 22
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FAMILY-RELATED LEAVE AND INDUSTRIAL RELATIONS IN EUROPE
By Sunita Parbhoo
Introduction
The various forms of family-related leave are a central issue in the widespread attempts across Europe to create a better work-life balance.
Such leave has received increasing attention over recent years from both legislators (often prompted by EU Directives) and the social
partners. A study conducted by the European Foundation for the Improvement of Living and Working Conditions looked at the current
position in 19 EU Member States and Norway in terms of legislation and collective bargaining on the key forms of family-related leave –
maternity leave, paternity leave, parental leave and leave for urgent family reasons – and the views of trade unions and employers on the
matter. It also assesses the impact of family-related leave and its equality. The key findings of the above-mentioned study are reflected
below.
Parental leave is a fundamental component of a “work-life balance” or a
“reconciliation of work and family life” measure. Leave schemes may be a
manner in which parents - especially mothers - may avoid the time
devoted to the care and education of their children being an obstacle to
their careers. Originally developed as a form of support for parents to
make it easier for them to continue working or to return to employment
after a break, parental leave can also be a means of fostering gender
equality. However, leave may also aggravate the difficulties faced by
some parents, mainly mothers, in trying to keep a job or in returning to
employment. Leave schemes may also accentuate “career discontinuity”
which is most prevalent among women. In such cases, parental leave
might, ultimately, undermine rather than promote gender equality at work,
at home and in the family by reinforcing women taking a greater share of
parenting duties. This study also aims to look at how men and women use
family-related leave opportunities and the extent to which rules governing
leave potentially promote differing use by men and women.
Role played by EU initiatives
An EU Council Recommendation on childcare at the end of March 1992 encouraged Member States to “adopt and/or encourage measures
to take realistic account of women’s increased participation in the labour force, such as special leave to enable all employed parents who so
wish to discharge effectively their working, educational and family responsibilities with, inter alia flexibility in how leave may be taken”.
Member States were also encouraged to take and/or encourage initiatives related to the sharing of occupational, family and upbringing
responsibilities between both parents.
In order to comply with the requirements of the 1992 Directive, some Member States had to amend their maternity leave legislation in the
first half of the 1990s. Since this initial implementation phase, there have been no significant changes in the “old” EU driven by a need to
bring national legislation into line with this Directive. However, specific countries may still have to make further amendments to their
legislation in order to ensure compliance to the Directive.
Statutory family-related leave provisions
There are a large variety of leave options open to parents, short and long, paid and unpaid. As far as paid leave is concerned,
compensation may be calculated as all or part of the individual’s normal pay or be paid at a flat rate. Compensation may be limited to a
period shorter than the actual duration of the leave. The various forms of leave may be broken down into four categories:



Maternity leave with compensation generally covering all or part of the mother’s regular salary, often for a period of approximately
15 weeks, some of which is taken prior to the birth of the baby,
Paternity leave which generally consists of a few days off for fathers immediately following the birth of a child,
Parental leave consisting of a block of several months to care for a young child, following on from maternity leave. Traditionally,
this type of leave has either been unpaid or compensation has been a flat-rate benefit. In certain northern European countries,
December 2004 – Page 23
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
the compensation is a contribution-based social insurance benefits which is calculated as all or part of the individual’s normal
pay, and
Leave to care for older children in special circumstances which is applicable in instances of illness, disability, an emergency
situation etc.
Under this traditional four-category model, the various forms of leave
follow each other in chronological order based on the age of the child.
This model is, however, not very conducive to analysis and comparison
since actual provisions may tend to deviate from it. The boundaries
between these different types of leave have tended to blur and various
categories of leave may overlap or be, at least partially, interchangeable.
An extended period of maternity leave, as in the UK (up to 52 weeks)
functions de facto like parental leave in other countries. Alternatively,
parental leave may, as in the case in Finland, constitute an extension of
maternity and paternity leave, with both being paid in the same way as
wage compensation, or be quite separate when it is unpaid, as in Ireland.
The distinction between maternity and paternity leave also tends to be
blurred in some countries, especially in the case of postal-natal leave.
Parental leave also tends to be no longer restricted to infants. It may often
be taken in an increasingly flexible and staggered fashion and long after
maternity or paternity leave. It may also function as leave to care for a sick
child.
Below, the four traditional categories of leave are briefly outlined and compared to each other. However, it needs to be highlighted that to
fully understand the complete picture of parental leave, it is important to keep in mind that the whole range of provisions in a particular
country may be combined, shared between parents or chronologically follow on from one another.
Statutory maternity leave
The 1992 EU maternity Directive enhances the employment protection of pregnant women and women who have recently given birth or are
breastfeeding and guarantee a minimum of 14 weeks maternity leave. For several countries, this Directive required changes to national
legislation which was undertaken in the first half of the 1990s. In addition, since the mid-1990s, maternity entitlement in many countries has
been enhanced, however, not as a result of the above-mentioned Directive.
EU maternity Directive
The Council Directive of 19 October 1992 on the introduction of measures to encourage improvements in the safety and health at work of pregnant
workers and workers who have recently given birth or are breastfeeding sets out the following requirements on maternity leave:



Workers are entitled to a continuous period of at least 14 weeks maternity leave allocated or after confinement, in accordance with
national practice. This period must include at least two weeks of compulsory maternity leave allocated before or after confinement, in
accordance with national practice;
Pregnant workers have the right to paid time off, in accordance with national legislation and/or practice, for ante-natal examinations, if
such examinations cannot take place outside of working hours; and
Women must be protected from dismissal from the beginning of their pregnancy to the end of their maternity leave. The only exception is
if the dismissal is for reasons unrelated to the pregnancy which can then be permitted under the national law and where the appropriate
authority has provided its consent. If a worker protected by the Directive is dismissed during this period, she has the right to be given the
reason in writing.
Statutory paternity leave
The March 1992 EU Council Recommendation on childcare stated that “as regards responsibilities arising from the care and upbringing of
children, it is recommended that Member States should promote and encourage, with due respect for freedom of the individual, increased
participation by men, in order to achieve a more equal sharing of parental responsibilities between men and women and to enable women
to have a more effective role in the labour market”. The entitlement to family-related leave for fathers has been significantly enhanced in
many countries since the time of the Recommendation. Post-natal leave which was traditionally available only to women, now tends to be
available to men as well, or to be open to sharing between the two parents. This change has been reflected in the creation or enhancement
of specific leave, called paternity leave, available to fathers only on the birth of a child. Legislation, on paternity leave available to fathers
after the birth of a child or during the first few months of a child’s life has been introduced in some countries or alternatively upgraded, in
particular, since the late 1990’s in countries such as Belgium, Finland, France, the Netherlands, Norway, Portugal, Spain and the UK.
December 2004 – Page 24
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The duration of statutory paternity leave varies from one country to another. It should be emphasised that, in the same manner that
assessing the duration of paternity leave in isolation can be problematic since paternity leave may be extended through parental leave. In
countries with very short paternity leave, this may be offset by the existence of parental leave, thus ultimately providing fathers with
significant leave in terms of both duration and compensation.
Statutory parental leave
The parental leave legislation of many EU Member States has been significantly amended since the early 1990’s. The 1996 Directive on the
issue often directed these amendments since it compelled some Member States, such as Ireland and the UK, to introduce this type of leave
in addition to maternity leave. In short, under the Directive, parental leave is required to be an individual entitlement lasting at least three
months’ following the birth or adoption of a child (in addition to the minimum of 14 weeks’ maternity leave that is guaranteed by the pregnant
workers’ Directive). Eligibility criteria relating to the length of employment or length of service in a company may not exceed one year.
Workers must be able to return to their jobs. The Directive also recommends that leave should be flexible, available until the child turns
eight, non-transferable from one parent to the other and cover cases where adoption takes place.
EU parental leave Directive
The Council Directive of 3 June 1996 gave legal effect to the framework agreement on parental leave that was concluded in December 1995 by the
Union of Industrial and Employers’ Confederations of Europe (UNICE), the European Centre of Enterprises with Public Participation and of
Enterprises of General Economic Interest (CEEP) and the European Trade Union Confederation (ETUC). The 1996 Directive was subsequently
extended to the UK by another Directive. The parental leave Directive lays down the following requirements:
Male and female employees must have an individual, non-transferable right to at least three months’ parental leave for childcare
purposes (distinctly separate from maternity leave) after the birth or adoption of a child until a given age of up to eight years to be
defined by Member States and/or management and labour. To promote equal opportunities and equal treatment between males and
females, the right to parental leave should, in principle, be granted on a non-transferable basis.
The conditions of access and detailed rules governing parental leave are to be defined by national law and/or collective agreement. Such national
provisions may:






Determine whether parental leave is granted on a full-time basis, in a piecemeal manner or in the form of a time-credit system;
Make the entitlement to parental leave subject to a period of work qualification and/or length of service qualification which may not
exceed one year;
Adjust conditions of access and detailed rules for applying parental leave to the special circumstances of adoption;
Establish notice periods to be provided by the employee to the employer when exercising the right to parental leave, specifying the
beginning and the end of the period of leave;
Define the circumstances in which an employer, following consultation in accordance with national legislation, collective agreements and
practice, is allowed to postpone the granting of parental leave for justifiable reasons related to the operation of the undertaking, for
example, where work is of a seasonal nature, where a replacement cannot be found within the notice period, where a significant
proportion of the workforce applies for parental leave simultaneously, or where a specific function is of strategic importance; and
Authorise special arrangements to meet the operational and organisational requirements of small undertakings.
Workers must be protected against dismissal on the grounds of applying for or taking parental leave, and have the right to return to the same or
similar job and maintain the rights previously acquired or in the process of being acquired.
Leave for urgent family reasons
The EU parental leave Directive provides workers with an entitlement to “time off from work on the grounds of force majeure for urgent
family reasons in cases of sickness or accident making their immediate presence indispensable”, though Member States (and/or
management and labour) may “specify conditions of access and detailed rules and may limit this entitlement to a certain amount of time per
year and/or per case”. This provision appears to have stimulated the development of specific leave for family reasons, particularly on the
grounds of unforeseeable circumstances or of a sick or disabled child. The leave to care for a child may be limited – a matter of just a few
days – for emergencies or short illnesses. Alternatively, it may be relatively extended – from several weeks to several years – for more
serious illnesses or cases of disability.
A distinction between long-and-short-term leave is relatively arbitrary because the various national leave schemes actually represent a
continuum in terms of the duration of leave for family reasons. In addition, long-term leave may sometimes be broken into short periods, in
Sweden, for example, a paid leave scheme providing for a maximum of 60 days per child, per year, per parent for children under the age of
12 (and 16 in certain instances) is often in practice utilised in very small blocks.
December 2004 – Page 25
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Collective bargaining and family-related leave
In the countries examined, legislative provisions in general, define parental and family-related leave, with collective agreements playing a
subsidiary role in most cases. The 1996 EU parental leave Directive has further reinforced this predominance of legislation by requiring
Member States to apply its provisions to all private and public sector employees. In the new Member States studies – Hungary, Poland,
Slovakia and Slovenia – legislative provisions, inherited from older policies, also play the predominant role. However, collective agreements
can have a “leverage effect” with regard to changes to the legislation. For example, bargaining plays this role in the UK and Denmark,
where collective agreements are important in regulating family-related leave. Bargaining has prompted legislation in a different way in the
Netherlands, in that its poor results have led to amendments being made to the legislation.
Level and content of bargaining
The level at which collective bargaining on family-related leave takes place varies from one country to the next, usually following the normal
contours of the national bargaining structures. National-level intersectoral bargaining plays a part in regulation in countries where this
bargaining is significant, such as Belgium, Finland, Greece and Ireland. Sectoral agreements deal, to varying extents, with family-related
leave in Austria, Denmark, Finland, France, Germany, Italy, Netherlands, Spain and Sweden. Relevant company or works agreements are
reported from many countries, such as Austria, Denmark, Ireland, Italy, Netherlands, Norway, Spain, Sweden and the UK. However, it is
perhaps only in the UK, with its “voluntarist” and decentralised bargaining system that the level of bargaining predominates.
The collective bargaining process may deal with various aspects of leave, notably:
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Extending the duration of statutory leave schemes or increasing the age of the children in respect of whom they apply;
Providing full partial pay during periods of unpaid statutory leave, or topping up the compensation provided by law, or extending
the period of leave that attracts compensation;
Reducing or reorganising the working time of parents, or allowing them to take family-related leave in a flexible way, such as in
separate blocks; and
Reorganising the jobs or working arrangements of parents with young children.
Social partners’ positions
The extent to which representatives of employers and employees give priority to issues related to the family, gender equality and the
reconciliation of work and family life varies according to national realities. The importance attached by the social partners to placing issues
such as family-related leave on their agendas varies with the significance of collective bargaining in this area, in the country in question.
In most countries, issues related to parental and family-related leave are not at the heart of industrial relations. Such leave is often, it
appears, perceived as more of a family policy issue than a work-related one. The social partners appear more concerned with problems
relating to the organisation of work and tend to focus negotiations more on changes to employment conditions and the reduction of working
time.
Trade unions frequently stress the importance of a balanced family policy, fostering gender equality both in the home and at work. In many
countries trade unions tend to focus on problems faced by women trying to return to work after a long period of parental leave and the
gender equality implications for the labour market. They advocate parental leave schemes that could be shared to a greater extent by the
two parents and that do not cut them off totally from their jobs. Unions tend to focus their demands on the followings options and benefits:
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Entitlements to return to work;
The option of part-time work for parents;
Compensation for maternity;
Paternity and parental leave; and
Childcare infrastructure.
For their part, while many employers’ organisations express support for an improved work-life balance, some consider that family and
parental leave-related issues are not really their responsibility and that legislation hampers their ability to conduct business. Consequently,
they are often opposed to improvements made to paid leave which they perceive as creating additional costs to companies.
Despite these varying positions and perspectives, employers’ organisations and trade unions have been able to reach consensus on
various aspects of family-related leave in many countries. At a national intersectoral level, notable agreements have been reached on
issues such as parental leave, implementing a central funding mechanism to finance additional parental leave pay and benefits, women’s
position during and after maternity leave, improved maternity and paternity leave rights and promoting lower level bargaining on various
aspects of family-related leave.
Apart from the sphere of direct collective bargaining, various forms of consensus between national social partner organisations are reported
from various countries. This often takes place in government consultations over new or amended legislation. For example, the social
December 2004 – Page 26
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partners play a significant role in the discussions that take place related to legislative changes that are made to leave schemes. In Finland,
there was relative consensus among the social partners in prior tripartite consultations over the three most recent reforms in this area – to
enable parents to share parental leave by allowing both of them to work part time, to extend paternity leave, and to create part time leave
for childcare.
Impact of leave and gender equality
The decision to take parental or other family-related leave is never without consequences to an individual’s career. When utilised as a
means of balancing family and work commitment, leave may turn out to hamper parents’ careers, especially mothers, or may even be
perceived as a sign (real or imagined) that those taking leave are less willing to “invest” in work – a perception that may lead to all sorts of
consequences, such as lower pay and slower promotions.
Leave may also have a positive effect on gender equality both at home and in the workplace. The sharing of leave by both parents is an
important factor and the extent to which men and women use the various types of leave available reveals the gender-based perception and
division of labour in European societies. The respective take-up of leave by men and women, however, varies from one country to the next
and this seems to result from a variety of factors such as duration, compensation, flexibility, provisions for sharing by the two parents as
well as the environment. Furthermore, several interlinked factors which often build up into a system explain low leave take-up rates among
parents. These include the following factors:
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Problems with regard to information about the leave;
Leave compensation and pay disparities;
Hard-to-find or inflexible childcare facilities, leading parents to care fully for their own children;
Prevailing family organisation models; and
Fear among employees that taking leave will isolate them from the labour market.
Conclusion
Leave is but one tool, amongst others, used to foster the work-life balance and to promote gender equality. The impact of leave depends on
other contextual factors which enable parents to reduce the constraints - which are essentially time-related - of family responsibilities or
prevent them from doing so. These factors concern matters such as wage disparities on the labour market; the prevailing values of society
as to the role and place of men and women in the family and at work; the availability and accessibility of childcare facilities; working
conditions and the possibility of tailoring job and work schedules.
The analysis of the family-related leave schemes that are available in the 20 EU countries that were studied underscores the variety of
provisions and configurations that exist. All in all, in the majority of countries, legislation is predominant and structures the leave that is
available to parents. However, where collective agreements exist, they play a significant role in and are, even sometimes, a platform to
improving parental leave. The varying degrees of importance of collective bargaining related to leave reflect the national specifications in
the labour market organisation of the individual countries.
This article has been summarised from a research report produced by the European Foundation for the Improvement of Living and Working
Conditions.
Reference
Math, A & Meilland, C. 2004. Family-related leave and industrial relations. European Foundation for the Improvement of Living and
Working Conditions. European Industrial Relations Observatory on-line. Surrey.
December 2004 – Page 27
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