15 March 2010 by

Retrenchment of a single employee, procedural fairness and the CCMA

In Rand Water v Bracks NO & Others (2007) 28 ILJ 2310 (LC), the Labour Court (the Court) held that the Commission for Conciliation Mediation and Arbitration (CCMA) does not have jurisdiction to hear disputes about the procedural fairness of dismissal for operational requirements involving single employees. The Court held that it had to adjudicate such disputes and not the CCMA.

The decision was severely criticised by a number of academics for being a very literal interpretation of Section 191(12) of the Labour Relations Act 66 of 1995 (the LRA) and not giving effect to the purpose of the section. The CCMA was also not in favour of the judgment and appealed the decision, despite the parties settling the dispute. The effect of the Court judgment was that Commissioners could not entertain retrenchment disputes where only a single employee was retrenched and procedural fairness was placed in dispute.

The Labour Appeal Court (the LAC) handed down its judgment on Tuesday 10 March 2010. The LAC held that the CCMA does indeed have jurisdiction to hear disputes about the procedural fairness of a dismissal for operational requirements involving a single employee.

The LAC favoured the interpretation of the section 191(12) as adopted by Acting Judge Ngalwana in a subsequent matter of Scheme Data Services (Pty) Ltd v Myhill NO & Others (2009) 30 ILJ 399 (LC).

The purpose of section 191(12), as now clarified by the LAC, is to provide a single retrenched employee, who may not be able to afford the legal costs of labour court litigation, the opportunity to have the dismissal dispute speedily resolved through arbitration. Disputes referred to the CCMA are generally resolved more speedily than those subject to litigation at the Court.

The decision of the LAC is certainly a victory for employees and the effective and efficient resolution of disputes.

Aadil Patel, Director, Employment Law

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