Hold­ing out for cash may back­fire

An un­fairly dis­missed em­ployee has no au­to­matic right to com­pen­sa­tion while an em­ployer has a right to rem­edy a wrong

Business Day - Business Law and Tax Review - - BUSINESS LAW & TAX REVIEW - MO­HAMMED CHAVOOS & JOCELYN EVANS

COM­PEN­SA­TION-hun­gry and re­in­state­ment-re­sis­tant em­ploy­ees may be in for a shock af­ter the Supreme Court of Ap­peal de­nied an award of com­pen­sa­tion to an em­ployee who had un­rea­son­ably re­fused a gen­uine of­fer of re­in­state­ment by her em­ployer af­ter she had been un­fairly dis­missed.

This case high­lights some im­por­tant as­pects re­lat­ing to un­fair dis­missals and the reme­dies pro­vided for in our labour leg­is­la­tion.

These can be sum­marised fol­lows:

An un­fairly dis­missed em­ployee only has a right to be con­sid­ered for re­me­dial mea­sures and has no au­to­matic right to com­pen­sa­tion or any other rem­edy;

An em­ployer has a right to rem­edy a wrong; there­fore once an em­ployer has

as seen the er­ror of its ways it is within that em­ployer’s right to make a gen­uine of­fer of re­in­state­ment to an em­ployee to rem­edy the sit­u­a­tion;

Should an em­ployee un­rea­son­ably refuse the of­fer or fail to show that the work­ing re­la­tion­ship had bro­ken down and as a con­se­quence the em­ployee can­not ac­cept re­in­state­ment, the em­ployee runs the risk of not be­ing awarded any com­pen­sa­tion.

In the case in ques­tion, a Dr Rawl­ins was dis­missed in Fe­bru­ary 1998 from her em­ploy­ment as a doc­tor with­out due process be­ing fol­lowed. Her em­ployer, a Dr Kemp, con­ceded that her dis­missal was both pro­ce­du­rally and sub­stan­tively un­fair. She was also not dis­missed as a con­se­quence of her preg­nancy but rather as a re­sult of her em­ploye’s op­er­a­tional re­quire­ments.

Rawl­ins had, sub­se­quent to her dis­missal, ob­tained em­ploy­ment at a higher salary than what she earned prior to her dis­missal. It was not in dis­pute that Kemp had on three dif­fer­ent oc­ca­sions dur­ing the con­cil­i­a­tion and lit­i­ga­tion process of­fered to re­in­state Rawl­ins as from the date on which she was due to re­turn to work fol­low­ing her ma­ter­nity leave and Rawl­ins had ei­ther ig­nored or cat­e­gor­i­cally re­fused to ac­cept the of­fer made. Not­with­stand­ing the of­fer of re­in­state­ment and her im­proved earn­ings, the labour court awarded Rawl­ins 12 months com­pen­sa­tion.

The labour court, in ar­riv­ing at its de­ci­sion mis­di­rected it­self by plac­ing un­due em­pha­sis on how Rawl­ins was treated by Kemp and the award was clearly puni­tive in na­ture. The only is­sue to con­sider was whether any com­pen­sa­tion should have been awarded and if so, whether the or­der of 12 months com­pen­sa­tion was just.

The Labour Ap­peal Court found by ma­jor­ity that no com­pen­sa­tion should have been awarded at all and there­fore set aside the labour court’s de­ci­sion. The Labour Ap­peal Court ad­vanced the fol­low­ing rea­sons for its de­ci­sion: an em­ployee has no vested right to a rem­edy in terms of labour leg­is­la­tion. All that the em­ployee has is a right to be con­sid­ered for a rem­edy. An em­ployer has a “right to right a wrong”. An em­ployer who had treated an em­ployee un­fairly is en­ti­tled to rem­edy that con­duct by of­fer­ing to re­in­state the ag­grieved em­ployee. Should an em­ployee un­rea­son­ably refuse to be re­in­stated, the em­ployer has a good case in sup­port of no or­der of com­pen­sa­tion be­ing made in favour of the em­ployee.

The Labour Ap­peal Court did not ac­cept that the re­la­tion­ship was ir-

The Supreme Court of Ap­peal held that a court’s re­me­dial pow­ers are com­pen­satory and not puni­tive in na­ture

repara­ble be­tween the doc­tors and re­jected Rawl­ins’s con­tention that she was un­able to work with Kemp in the light of what had tran­spired be­tween them. This was largely be­cause Rawl­ins worked at a satel­lite prac­tice and would not come into reg­u­lar con­tact with Kemp and fur­ther­more no ob­jec­tive grounds were ad­vanced as to why the re­la­tion­ship was bro­ken.

The court re­fused to ac­cept only Rawl­ins’s sub­jec­tive per­cep­tion of the work­ing re­la­tion­ship. On a fur­ther ap­peal, the Supreme Court of Ap­peal held that a court’s re­me­dial pow­ers are com­pen­satory and not puni­tive in na­ture and there­fore the court was clearly mis­di­rected when mak­ing such an or­der.

The Supreme Court of Ap­peal, in up­hold­ing the Labour Ap­peal Court’s de­ci­sion, con­curred with its find­ings and re­it­er­ated that the re­fusal of the re­peated of­fers of re­in­state­ment was un­rea­son­able and as a con­se­quence thereof, the em­ployee only had her­self to blame for her fi­nan­cial loss.

Pic­ture: STOCK.XCHNG

An un­fairly dis­missed em­ployee only has a right to be con­sid­ered for re­me­dial mea­sures and has no au­to­matic right to com­pen­sa­tion or any other rem­edy An em­ployer has a right to rem­edy a wrong Should an em­ployee un­rea­son­ably not ac­cept re­in­state­ment,...

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