Reinstatement, Back Pay, and Employer Obligations

Facts

In September 2020, Gotcha Security invited Mavundla to return but imposed conditions requiring a firearm competency certificate and industry registration. Mavundla disputed these conditions and initiated contempt proceedings. On 28 May 2021, the Labour Court ordered unconditional reinstatement with effect from 1 June 2021 (first Labour Court order). Mavundla returned to work but continued to claim arrear remuneration for the period 1 August 2019 to 31 May 2021. Two months later, Mavundla was retrenched and approached the Labour Court for relief in relation to arrear remuneration, which was dismissed by the Labour Court (second Labour Court order).

Law

The case centred on the Labour Relations Act 66 of 1995 and the Constitutional Court's precedent in National Union of Metalworkers of South Africa v Hendor Mining Supplies (a division of Marschalk Beleggings (Pty) Ltd) [2017] ZACC 9; 2017 (7) BCLR 851 (CC); (2017) 38 ILJ 1560 (CC). The Labour Court relied on the this judgment which held that a reinstatement order does not itself revive the contract of employment; rather, the contract is restored when the employer accepts the employee’s offer to return to work. The Constitutional Court stated that this principle is not authority for the proposition that a reinstated employee is only entitled to be paid as from the date of their factual reinstatement.

Application of Law to the Facts

The Labour Court incorrectly found that the contract was restored by the first Labour Court's order, not by the arbitration award. The second Labour Court order overlooked that the proceedings in respect of the first Labour Court order were contempt proceedings, brought to compel Gotcha Security Services to comply with the original reinstatement order from 1 August 2019. These proceedings arose because Gotcha Security Services had imposed unlawful conditions on reinstatement, which the first Labour Court Order set aside, ordering unconditional reinstatement. When Mavundla tendered his services on 1 June 2021, Gotcha Security Services accepted this unconditionally, as required by the first Labour Court's order. Therefore, Mavundla’s contract of employment was restored from 1 August 2019, as per the arbitration award.

Hendor does not support the Labour Court’s view that an order enforcing reinstatement automatically replaces the original reinstatement order. The only change is the date on which the contract is restored by mutual tender and acceptance. Hendor makes clear that, once the contract is restored, the employee is entitled to all benefits, including pay, from the date of restoration, unless the reinstatement order states otherwise. It is not authority for the proposition that an employee is only entitled to pay from the date of actual return to work.

Key takeaways

When an arbitration award or court order reinstates a dismissed employee, the employer is obliged to reinstate the employee on the terms and conditions that existed at the time of dismissal, unless the order expressly provides otherwise.

Imposing additional conditions (such as requiring new certifications or registrations not previously required) before allowing the employee to resume work is impermissible unless such conditions are stipulated in the reinstatement order or the original contract. Before imposing any conditions on reinstatement, employers should seek legal advice to ensure such conditions are lawful and consistent with the original employment contract and the terms of the award or order.

An enforcement or contempt order compelling reinstatement does not, by itself, alter the original date from which the employee’s contract is deemed restored, unless the order expressly states so.

Employers cannot rely on the mere fact that a subsequent court order is silent on arrear remuneration to argue that the employee has abandoned or compromised their claim to back pay.