# New Code of Good Practice: Who is an employee?:

On 1 December 2006 the Department of Labour published its latest Code of Good Practice in terms of the Labour Relations Act. The Code attempts to grapple with definition of an employee, using various tests and interpretative methods to allow parties to arrive at a clearer definition of an employee. The Code also notes that the definition of an employee varies according to different statutes. For example, a person may be deemed to be an employee in terms of Income Tax legislation, but not necessarily in terms of the Labour Relations Act.

Download the Code of Good Practice at Workinfo.com

# HR Executive Discussion Forum:

Join over 250 Human Resource practitioners in a free online discussion forum. Members may post questions or viewpoints to colleagues and enter into debate on key human resource issues. Visit ht tp://www.workinfo.com/free/forums.html to join this forum today.

# Employment Equity and Equality: Three new cases on the right to equality by Andre van Niekerk who may be contacted at www.elaw.co.za

The Constitution establishes a substantive right to equality, and the Employment Equity Act mirrors this right in the employment context. But the legislative prohibition against unfair discrimination is broadly stated, and it has been left to the Courts to fill in the gaps. Three recent judgments deal with different aspects of the right to equality, and provide answers to difficult questions.

# The first is Thekiso v IBM South Africa (Freund AJ, JS 415/05), in which a retrenched employee, a black woman, challenged her employer's decision to appoint a white man to a new job established during a restructuring. She claimed a right to the job on the basis of her status as a historically disadvantaged South African, and her capacity, within a reasonable time, to do the job.

# The second case, COWA and others v Petroleum Oil and Gas Co-Operative of South Africa (Pillay J C437/2003), concerned a challenge to a remuneration structure that advantage employees with family responsibilities. A claim was brought on behalf of those employees without dependent spouses and children who claimed that they were doing the same work for less pay purely on the basis that they had no family responsibilities.

# The third case, a recent judgment by the High Court, Du Preez v Minister of Justice and Constitutional Development [2006] 8 BLLR 767 (SE), confirms a trend in terms of which the courts are inclined to monitor the implementation of affirmative action programmes, and to adopt a relatively critical perspective when doing so.

Each of the judgments is discussed in more detail below, and all can be accessed on the Caselaw website – www.caselaw.co.z a

# Thekiso v IBM South Africa (Freund AJ, JS 415/05)

IBM lost a contract to provide services to a mining house, and had to restructure as a consequence. In the course of the restructuring, many posts became redundant, but a new post, that of asset management, was created. Ms Thekiso claimed that she had been unfairly selected for retrenchment since the company had failed to consider section 15 of the Employment Equity Act when appointing a white male to the new post. This argument was raised during the course of the Labour Court proceedings in which the fairness of the retrenchment was challenged more generally, and it was common cause that the issue of affirmative action has not been raised during the consultations that precede the retrenchment.

The argument raised was that the EEA required every designated employer to implement affirmative action measures for people from designated groups. Affirmative action measurements are designed to ensure that suitably qualified people from designated groups have equal employment opportunities, and are equitably represented in the workplace. They include measures to retain and develop people from designated groups. On this basis, the company was obliged to retain the applicant in preference to any white male, provided she was suitably qualified for the position. (She argued that she was. The relevant definition refers to the ability to acquire, within a reasonable time, the ability to do the job).

The Court rejected the argument, and in effect, held that the EEA, insofar as it obliges designated employers to implement affirmative action measures, could be used as a shield, but not a sword. In other words, there is no right to rely directly on the EEA to claim unfair selection in the context of a retrenchment. The Court went further and said –

"Not only does the EEA not provide any mechanism for pursuing such a complaint [that a retrenchment constitutes a breach of the employer's affirmative action obligations], but, in my view, on a proper construction thereof, there is no legal obligation on an employer when taking any particular appointment or dismissal decision to give preference to suitably qualified employees from a designated group. In my view, section 15(2)(d)(ii) does not impose an obligation on an employer contemplating retrenchments to retain black employees in preference to white employees it believes better meets its needs."

The Court was careful to note that affirmative action considerations had played no role in the consultation process. The Court made no decision on whether the company would have been entitled to take race and gender into account when selecting employees to be dismissed, nor what the position would have been had Ms Thekiso raised the issue of preference on the basis of race and gender during the selection process. There is also the possibility, of course, that these issues may be regulated in the employer's policies and procedures, giving rise to a contractual claim rather than a claim under the EEA. Had this claim not been raised so late in the day, the case might have taken on a very different complexion.

# COWA and others v Petroleum Oil and Gas Co- Operative of South Africa (Pillay J C437/2003)

As noted above, this case concerned a challenge to conditions of employment, established by a collective agreement that provided more favourable terms for employee with family responsibilities. This was an unintended consequence of a conversion to a total guaranteed remuneration package when existing benefits, some of which were calculated to take into account the number of each employee’s dependants, were incorporated into the package.

In considering the claim for discrimination on the grounds of family responsibility, the Court reviewed the essential content of the right. The Court noted that the family is an institution that in international terms is highly valued, and made reference to the UN Declaration of Human Rights and the European Social Charter and the South African Constitution, noting the status accorded to the family in those instruments.

The Court referred particularly to ILO Convention 156 on Workers with Family Responsibilities from which the definition of “family responsibilities” in the Employment Equity Act is drawn. This definition reads –

“The responsibility of employees in relation to their spouse or partner, their dependent children or other members of their immediate family who need their care or support or approach.”

The substantive right to equality established by the Constitution and the Employment Equity Act had the result that special measures are applied to workers with family responsibilities to adjust for the hardships of having those responsibilities. Without affirmation of the special status, there is no right to equality amongst the workforce.

In the present case, the Company was sharing the responsibility for addressing the special needs of workers with family responsibly by providing additional remuneration for employees with dependents. The Court concluded, “the Second Respondent pays more to employees with dependents, not as a reward for performance. Nor is it an accolade for special achievement. It is a legal and moral response to the social needs of a vulnerable group of employees.”

The Court dismissed the application and ordered that the Applicant pay 30% of the Company’s costs.

# Du Preez v Minister of Justice and Constitutional Development [2006] 8 BLLR 767 (SE)

This case, brought under the promotion of Equality and Prevention of Unfair Discrimination Act, 2000, concerned the appointment of Magistrates. The claim was brought under the Equality Act since Magistrates, being judicial officers independent of the public service, are subject only to the Constitution. They are not employees as defined by the Employment Equity Act, but the Courts’ observations apply equally to workplaces in respect of which the EEA applies.

The claim concerned the criteria for the shortlisting for posts of Regional Magistrates in the Port Elizabeth area. The criteria included experience, qualifications, race and gender to which each was afforded a specific weighting. Candidates with the highest scores were placed on a short list and interviewed by the Magistrate’s Commission. The Applicant, a white male applied for a position and did not make the shortlist. He initiated proceedings under the Equality Act complaining that he had been discriminated against.

After a comprehensive review of the evidence, the Court found that the shortlisting formula raised an insurmountable obstacle for the Applicant, and established an absolute barrier to his appointment to the post of Regional Court Magistrate. The formula effectively gave “automatic and absolute preference” to black female applicants who met the minimum job requirements irrespective of how they compared with other applicants. No regard was had to how the formula affected other applicants nor did it address the specific needs of the post, beyond the minimum qualifications for the job.

In setting aside the criteria and ordering the Department to re-advertise the positions, the Court concluded the following –

“The Respondents, not being subject to the Employment Equity Act, are not obliged to prepare and implement an employment equity plan as contemplated in that Act. Nevertheless, one would expect it of them to set an example and have some formal and comprehensive affirmative action plan, which – in an open democratic society – would be available to all interested parties. Only then would candidates for the posts of judicial officers know where they stand. Instead, various officials have here outlined the respondents’ policy in regard to the appointment of Regional Court Magistrates. They have done so in broad and vague terms. The specifics of the shortlisting criteria for the various posts had to be gleaned from documentation supplied by the respondents’ legal representatives, from which the court had to piece together the implications of the departmental policy. That policy is rudimentary and unsatisfactory, to say the least.”

The judgments confirm a trend in terms of which the Courts will readily supervise the application of affirmative action plans, and set aside appointments that are made in the name of affirmative action but where plans are either non-existence or inconsistent with the purpose underlying the EEA.