PROCEDURAL VERSUS SUBSTANTIVE FAIRNESS IN DISCIPLINARY ACTION

Written by Mamotuku Khaole

In South African labour law, fairness is the cornerstone of any disciplinary action, particularly where dismissal is contemplated. The Labour Relations Act 66 of 1995 (LRA), read together with the Code of Good Practice: Dismissal (Schedule 8), establishes that a dismissal will only be considered fair if it satisfies two essential requirements: substantive fairness and procedural fairness.

For small and medium enterprises (SMEs) in the hairdressing, cosmetology, beauty, and skincare industry, navigating these requirements can be challenging, especially where operational pressures and limited HR resources exist. Owners and managers often juggle multiple roles: creative director, financial manager, and HR officer, while maintaining client satisfaction. In this environment, disciplinary action can feel daunting. However, failure to comply may expose employers to disputes at the CCMA or Bargaining Council, often resulting in reinstatement orders or compensation awards.

The Legal Framework: Code of Good Practice: Dismissal

The code serves as a guideline for fair dismissal. It does not impose rigid rules but provides principles that employers must follow when disciplining employees.

At its core, the Code requires that:

• There must be a fair reason for dismissal (substantive fairness), and

• A fair procedure must be followed (procedural fairness).

A failure in either element renders the dismissal unfair. Importantly, even where misconduct is proven, dismissal may still be unfair if the procedure followed was defective.

What is Substantive Fairness? (The “Why”)

Substantive fairness concerns the reason for the disciplinary action or dismissal. It asks a fundamental question: Was there a valid and fair reason to discipline or dismiss the employee?

In terms of the Code of Good Practice, particularly Item 7, employers must establish several key elements:

1. Existence of a Rule

   There must be a workplace rule or standard regulating conduct.

2. Validity and Reasonableness of the Rule

   The rule must be lawful, reasonable, and relevant to the workplace.

3. Employee Awareness

   The employee must have known, or reasonably be expected to have known, the rule.

4. Breach of the Rule

   The employer must prove, on a balance of probabilities, that the employee contravened the rule.

5. Consistency in Application

   The rule must be applied consistently to all employees.

6. Appropriateness of the Sanction

   Dismissal must be an appropriate sanction, often described as whether the “penalty fits the crime.”

Practical Example (Substantive Fairness)

An employee is dismissed for being late. However:

• There is no clear rule regulating timekeeping, or

• Other employees are not disciplined for similar conduct

In such a case, the dismissal may be substantively unfair due to inconsistency or lack of a valid rule.

Examples in SMEs

• Misconduct: Theft of establishment products, repeated lateness, or insubordination.

• Incapacity: An employee who is unable to perform treatments safely despite training.

• Operational requirements: Retrenchments due to declining revenue or restructuring.

What is Procedural Fairness? (The “How”)

Procedural fairness relates to the process followed before imposing discipline or dismissal. It ensures that the employee is treated fairly and given an opportunity to respond.

Key Requirements of Procedural Fairness

According to the Code and established practice, employers should:

• Inform the employee of the allegations in a clear manner

• Allow a reasonable time to prepare

• Provide an opportunity to state their case

• Allow representation (e.g., fellow employee or Union Representative)

• Conduct a fair and unbiased hearing

• Communicate the outcome with reasons

Practical Example (Procedural Fairness)

An employee is dismissed immediately after an incident of misconduct without:

• Being informed of the charges

• Being given an opportunity to respond

Even if the employee was guilty, the dismissal would likely be procedurally unfair.

Practical Application in SMEs

SMEs often lack dedicated HR departments. However, procedural fairness does not require elaborate hearings. A simple, well-documented process suffices:

• Issue a written notice of charges

• Hold a meeting where the employee can respond

• Record the proceedings and outcome

This protects both employer and employee, ensuring transparency and compliance.

Comparing Substantive and Procedural Fairness

Aspect	Substantive Fairness	Procedural Fairness
Focus	Validity of reason	Correct process
Key Question	Was dismissal justified?	Was the process fair?
Evidence Required	Proof of misconduct, incapacity, or operational need	Proof of notice, hearing, representation
Risk if Absent	Unfair dismissal ruling	Unfair dismissal ruling
Employer Obligation	Investigate thoroughly	Follow fair hearing steps

The Interplay Between Substantive and Procedural Fairness

South African labour law treats these two elements as independent but equally important.

A dismissal may be:

• Substantively fair but procedurally unfair (valid reason, flawed process), or

• Procedurally fair but substantively unfair (correct process, no valid reason)

In either case, the dismissal may still be deemed unfair. Courts and arbitrators typically assess both elements separately before reaching a conclusion.

Consequences of Unfair Dismissal

If a dismissal is found to be unfair, remedies may include:

• Reinstatement (primary remedy)

• Re-employment

• Compensation (up to 12 months’ remuneration in ordinary cases)

These outcomes can have significant financial and operational implications.

Common Mistakes Employers Make

Many employers, particularly in SMEs, fall into the following traps:

• Assuming guilt equals fairness

→ Even clear misconduct does not justify skipping the procedure

• Overlooking consistency

→ Treating employees differently for the same offence

• Rushing the process

→ Failing to allow adequate preparation time

• Ignoring mitigating factors

→ Length of service, disciplinary record, personal circumstances

Implications for SMEs in the Hairdressing and Beauty Industry

• Resource constraints: SMEs often lack HR specialists. Owners must therefore familiarise themselves with the Code of Good Practice.

• Close-knit teams: In small establishments, disciplinary action affects morale and client trust. Fairness fosters respect and reduces conflict.

• Consistency: Applying rules consistently prevents claims of discrimination. For example, if one stylist is dismissed for lateness while another is merely warned, the employer risks a finding of unfairness.

• Documentation: Written records of warnings, hearings, and outcomes are critical. They provide evidence of fairness if disputes arise.

Best Practice Approach for Employers

To ensure both substantive and procedural fairness, employers should adopt the following approach:

1. Investigate thoroughly before taking action

2. Formulate clear charges

3. Notify the employee properly

4. Hold a fair hearing

5. Consider all evidence and mitigating factors

6. Apply an appropriate sanction

7. Provide reasons for the decision

This structured approach aligns with the principles set out in Schedule 8.

Conclusion

For establishments in the hairdressing, cosmetology, beauty, and skincare industry, disciplinary action must balance authority with fairness. Substantive fairness ensures that dismissals are justified, while procedural fairness ensures that employees are treated with dignity and transparency. Together, they form the foundation of lawful and ethical workplace discipline.

By adhering to the Labour Relations Act and the Code of Good Practice on Dismissal, SMEs can protect their establishments from costly disputes, foster trust among employees, and maintain a professional reputation in the industry.