This article was written by Lee Crisp , an Associate Designate at Norton Rose Fulbright South Africa
Under the common law, employers are not entitled to unilaterally vary the terms of an employee’s employment contract. If terms and conditions are unilaterally varied, the employee has an election to resile from the contract or to sue for damages in terms of the contract or to accept the variation. The Labour Appeal Court has held that where a unilateral change to employment terms also constitutes an unfair labour practice, the affected employee may choose between strike action and referring the matter to arbitration.
The Labour Relations Act, 1995 (LRA) generally treats unilateral changes of employment terms as matters for bargaining and agreement between the parties. Section 64(4) of the LRA permits employees or trade unions referring a unilateral change dispute to a bargaining council or the Commission for Conciliation, Mediation and Arbitration (CCMA) to require an employer not implement or, if already implemented, reverse the unilateral change for a mandatory period. This mandatory period must elapse before a strike can be called in respect of the dispute. The unilateral change will, therefore, be determined through the usual conciliation procedures before a bargaining council or the CCMA.
The procedure provided for in section 64 therefore does not mean that an employee is deprived of alternative remedies if an employer unilaterally varies their contract of employment, which can in most instances be challenged as a breach of contract in terms of the common law.
A unilateral change in the terms of employment by an employer is also unlawful if it constitutes an unfair labour practice for purposes of section 186(2)(a) of the LRA. This will be the case if the change in terms of employment relates to a demotion or the loss of benefits to an employee. In these cases, employees have additional recourse to have the dispute arbitrated by the CCMA. Changes in the way in which employee is required to work, for example changes in shift times, have been held to constitute changes in work practice rather than changes in the terms of employment.
Employment Equity Act
In addition to the provisions of the LRA, recent amendments to the Employment Equity Act, 1998 (EEA) introduced the concept of “equal pay for equal work”. Section 6(1) of the EEA prohibits unfair discrimination in employment policies and practices based on any listed ground which includes race, gender and disability. Section 6(4) provides that where a difference exists in the terms of employment of employees performing the same or substantially similar work of equal value, such difference amounts to unfair discrimination if based on a listed ground.
But, it is important to point out that section 6(4) of the EEA does not create additional rights for employees but rather concretises the position insofar as differences in terms of employment are concerned. Employees may therefore use this provision to challenge that differentiation as a form of unfair discrimination in appropriate circumstances. These disputes may be referred directly to the CCMA (as opposed to the Labour Court prior to the amendments), facilitating easier access to recourse on these matters for employees earning below the threshold determined by the Minister of Labour.