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UNILATERAL CHANGES TO TERMS AND CONDITIONS OF EMPLOYMENT

From time-to-time employers have to make changes to employees’ employment conditions as a result of ever-changing circumstances in terms of the economy, legislation, and even technology. Employment conditions typically include:


1. Working hours such as starting and finishing time, working days, etc.

2. Overtime pay.

3. Annual leave, sick leave, and family responsibility leave.

4. Paid maternity and paternity leave.

5. Retirement age.

6. Medical aid, funeral plans, and retirement funds.

7. A company vehicle that includes private usage.

8. Bonus payments.

9. Commission.


Employers are not allowed to make unilateral changes to the employment conditions of their employees, including instances where additional terms and conditions of employment are introduced without agreement from the employee.


The Disciplinary Code, Operational and Human Resources policies generally do not constitute employment conditions and may be changed by the employer without agreement from the employee. The only exceptions would be where such a policy constitutes a condition of employment, i.e., the retirement age policy, or where the employer agreed with a trade union to first negotiate any changes to the disciplinary code and other company policies.


The dismissal of more than one employee as a result of their refusal to accept a demand in respect of a matter of mutual interest will render such a dismissal automatically unfair in terms of section 187(1)(C) of the Labour Relations Act (LRA). Employers are forced to negotiate any changes to employment conditions with employees. Should an agreement not be reached, the employer will have one of two options available, both equally potentially detrimental to the operations of the business.


The first option is to make a unilateral change to the employment conditions of the employees that are not willing to accept the changes, depending on whether the majority of employees agreed to the changes. The employees that did not agree to the changes will be able to approach the Labour Court for an order or the CCMA or Bargaining Council in terms of section 64(4) of the LRA.


Section 64(4) of the LRA suggests that the employee can refer the dispute to the CCMA or a Bargaining Council, and the referring party may require the employer not to unilaterally implement the change to the terms and conditions of employment, or, if the employer has already implemented the change unilaterally, the referring party may require the employer to restore the terms and conditions of employment that applied before the change. After obtaining a certificate of non-resolution from the CCMA or Bargaining Council, the affected employees may embark on protected industrial action.


The second option available to the employer would be to declare a deadlock and to refer the dispute to the CCMA or Bargaining Council as a matter of mutual interest. After obtaining the certificate of non-compliance the employer may opt to lockout the employees that are not willing to accept the changes in employment conditions.


The effect of the latter (second option) will be the same as that of a protected strike with an additional restriction in terms of the use of replacement labour during the lockout. This will be as a result of the employer locking employees out without receiving notice of a strike; the lock will therefore be considered to be offensive and not defensive.


If the dismissal of employees, even though based on the operational requirements of the employer, can be drawn back to the mere refusal to accept a demand in respect of a mutual interest, the dismissal of those employees will be automatically unfair. As in all cases, specific procedures are to be followed and employers are advised to proceed with extreme caution.


In order to succeed in proving that a dismissal was fair under the circumstances described above, the employer will have to be able to prove that justifiable changes in terms of the operations of the business resulted in subsequent changes in employment conditions. Changes to terms and conditions of employment are not a matter to be approached without careful forethought and planning.



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