South Africans found to be unfairly dismissed are not always entitled to the reinstatement of their positions. <\/p>\n\n\n\n
According to the Labour Relations Act (LRA), an arbitrator can determine if an employer must reinstate, re-employ or compensate an unfairly dismissed employee. <\/p>\n\n\n\n
However, this is not always the case, as the LRA states that an arbitrator must instruct the employer to reinstate or re-employ the employee unless: <\/p>\n\n\n\n
However, Bradley Workman-Davies and Michiel Heyns from Werksmans Attorneys said that reinstatement is not always possible, even if none of the factors above are present. <\/p>\n\n\n\n
Workman-Davies and Heyns looked at a case where an employee on a fixed contract was fired. <\/p>\n\n\n\n
The case <\/strong><\/p>\n\n\n\n In the case Toyota SA Motors (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration (CCMA) and others<\/em> [2023], an employee worked for Toyota from March 2010 as a crane driver, and his three-month fixed-term contract was repeatedly renewed until he was dismissed in August 2015. <\/p>\n\n\n\n In June 2015, the employee was suspended and noticed to attend a disciplinary inquiry.<\/p>\n\n\n\n However, the employee had just signed a further fixed-term contract three days before the suspension, lasting from August to October. <\/p>\n\n\n\n In August, following a disciplinary inquiry, the employee was fired. He appealed against his dismissal and took the matter to the CCMA. <\/p>\n\n\n\n The arbitrator at the CCMA said that the employee’s dismissal was substantively unfair and ordered that he be paid compensation. <\/p>\n\n\n\n However, the arbitrator said reinstatement was not an option, as the employee’s fixed-term contract had expired. <\/p>\n\n\n\n The employee’s trade union then instituted a review application against the arbitration award, seeking that the compensation be set aside and the employee be reinstated with retrospective effect. <\/p>\n\n\n\n The Labour Court then set aside the compensation award of the arbitrator and ordered Toyota to reinstate the employee from the date of his dismissal with no loss of earnings or benefit as if he wasn’t dismissed. <\/p>\n\n\n\n The matter then went to the Labour Appeal Court (LAC) following an appeal from Toyota. <\/p>\n\n\n\n Although the LAC said that, in terms of the LRA, an arbitrator has the discretion to order an employer to re-employ or compensate an employee whose layoff is found to be unfair, it said that reinstatement does not apply in this case due to the fixed-term contract. <\/p>\n\n\n\n \u201cIntegral to the exercise of [this discretion] in deciding whether to reinstate, re-employ or compensate the employee is the nature of the employment contract and whether it is extant when an employee\u2019s dismissal is found to be unfair. The remedy of reinstatement is confined to the situation where, at the date of the finding that the dismissal is unfair, the original employment contract is still in existence,” the LAC said. <\/p>\n\n\n\n “However, where the employee is employed on a fixed-term contract, the expiry of which precedes the unfair dismissal finding, as in this dispute, then reinstatement or re-employment are not legally permissible remedies.\u201d<\/p>\n\n\n\n The LAC thus upheld the application and said that the Labour Court’s reinstatement sought to create a permanent contract of employment which did not exist. <\/p>\n\n\n\n “Since reinstatement involves the original contract of employment, which in this case was one of limited duration that had terminated by the effluxion of time, it was legally impermissible for the Labour Court to create a new contract through ordering reinstatement,” the LAC added. <\/p>\n\n\n\n Workman-Davies and Heyns said that the case is important as it shows that in the case of a dismissal of an employee on a fixed-term contract that has since expired, an arbitrator or court can not use reinstatement as a remedy as it will essentially create an employment contract between the parties. <\/p>\n\n\n\n
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