Paper 3: Labour Relations

Question 1

s197 of the LRA deals with the transfer of business as a going concern and amends certain common law principles. What, briefly, are the effects of s197 on the parties including the employees?

Answer 1

(1) the purchaser is automatically substituted in the place of the old employer
(2) this can only be avoided by written agreement
(3) all rights and obligations that existed at the time of transfer continue in force
(4) anything done by the old employer is considered to have been done by the new employer
(5) any new terms and conditions ie pensions must be no less favourable than before
(6) dismissal by reason of transfer is automatically unfair
The old employer will remain jointly liable for any claims arising from dismissal within 12 months for operational reasons.

Question 2

Your client negotiates a sale of the trading business to a new company which has been established for the purpose by a wealthy local businessman. Explain to your client how the LRA might affect the transaction and which should therefore be dealt with in the deed of sale

Answer 2

The LRA which provides in s197 that the purchaser in all respects steps into the shoes of the seller qua employer and is bound by all the obligations of the seller to the employees.

Question 3

in which tribunal or forum would you or your client seek relief in respect of: a claim for reinstatement after unfair dismissal

Answer 3

The CCMA

Question 4

An employer may dismiss an employee due to operational requirements - on what must these requirements be based in terms of the LRA?

Answer 4

• economic
• technological
• structural
• similar needs of employer

Question 5

Name four alternatives to retrenchment an employer should consider

Answer 5

The employer should seek to minimize termination of employment by:

• not hiring new employees
• eliminating overtime
• voluntary retrenchment
• early retirement
• reduction in working hours

Question 6

operational requirements are recognised grounds for dismissal of an employee , on what needs of the employer must the requirements be based?

Answer 6

• economic
• technological
• structural
• similar needs of employer

Question 7

What are the three requirements for fairness in s189 of the LRA (retrenchment)?

Answer 7

The employer must avoid or minimise terminations e.g stop hiring, stop overtime, offer voluntary retrenchment or early retirement, reduce working hours

Question 8

what are the minimum requirements in terms of the Labour Relations Act for a fair dismissal?

Answer 8

The dismissal must be procedurally and substantively fair.

Question 9

Name 3 valid and legal grounds for a fair dismissal of an employee in terms of the Labour Relations Act

Answer 9

• conduct/ misconduct
• capacity / incapacity
• operational requirements

Question 10

Your client is sued by a shop assistant that he had dismissed from employment in the Magistrates Court. The shop assistant claims compensation for wrongful dismissal as an unfair labour practice. Does your client have a valid defence?

Answer 10

He has a valid defence as the Magistrate’s court has no jurisdiction to adjudicate an unfair labour practice ito s157 of the Labour Relations Act