Could Employees be Entitled to Promotions to Avoid Retrenchments?

Many employers are being forced to restructure during the COVID-19 pandemic. The cost of doing so in an uncompliant manner is high and employers cannot afford to make such mistakes. In this article, we discuss a new dispute regarding alleged unfair labour practices that arose during a recent restructuring process.

Could an employer’s failure to appoint an employee to a more senior position in their new structure result in an unfair labour practice? This is one of the questions which the Labour-Court was asked to answer in the Telkom SA Ltd v Commission for Conciliation, Mediation and Arbitration Others (2019) matter.

In the abovementioned matter, an employer opted to restructure in 2016. The affected
employee wanted to avoid dismissal and applied for a newly created role.
This position was more senior and the employee’s application was subsequently unsuccessful.

Not to be deterred, the employee appealed the unsuccessful application and then
referred the non-placement to the Commission for Conciliation, Mediation and Arbitration
(“CCMA”). The employee referred to an unfair labour practice dispute on the basis of promotion.
Following the employer’s conclusion of the restructuring, the employee’s role became redundant.

At the CCMA, the employer disputed the CCMA’s jurisdiction. The Commissioner held that
although the process had characteristics of section 189 of the Labour Relationships
Act (“LRA”) process (retrenchments) it also had elements of section 186 of the LRA. The
Commissioner explained that the dispute also related to “promotional opportunities” that
were contemplated by the company and fell within an unfair labour practice relating to
the promotion. When this matter was taken on review, the Labour Court (“the court”) agreed
that the CCMA had the right to hear this matter.

On review, however, the court fundamentally disagreed with the Commissioner’s Arbitration Award which found that the employer committed an unfair labour practice by failing to promote the employee in an effort to avoid the employee’s retrenchment.
The Commissioner had ordered the reinstatement of the employee to the promoted position, but the court stated it would be “inconceivable” that employees could entertain an expectation of a promotion to avoid dismissal during restructuring.
The court clarified that, in order to claim that an unfair labour practice based on promotion occurred, the evidence must be led to support that there was unfairness in the process. In this matter, the reinstatement of the employee was impossible because the employee’s position had become redundant. The employee had no right to demand appointment to a more senior role and there was no evidence of unfairness in the employee’s non-appointment to the more senior position.

Employees, therefore do not have a right to refer unfair labour practice disputes
relating to the promotion where there is no unfairness in the non-placement of the
employee to a more senior position, even if the promotion could be an alternative to retrenchment.