A while ago, I had the opportunity in representing a respondent at the CCMA with a very uncommon dispute. The dispute was essentially about a policy relating to a possible benefit and the fair application thereof. The Applicant was represented by a representative of YKWUSA. The true issue in dispute was formulated as to whether: –
→ the annual increase payable to the applicant and other employees of the respondent in terms of the Remuneration and Adjustment Policy of the respondent are “benefits” in terms of section 186(2)(a) of the Labour Relations Act; and
→ the decision of the employer taken in terms of its policy to grant a 3% increase, in casu to the applicant was fair and reasonable or, if not, whether it was an “unfair labour practice” in terms of section 186(2)(a) of the Labour Relations Act.
A respondent, when considering some form of increase or bonus practice or policy (where none statutorily, ie. sectoral determination, bargaining council compliances, apply) , should not embark on it lightly. It is necessary for companies to adopt a comprehensive, Remuneration Adjustment Policy with fair key principles, in line with an employee’s career path and / fair or employment equity principles, where applicable.
In this case the respondent submitted the following: “Alignment with the Career Path is also of strategic importance and we aim to conform to the principle of equal pay for work of equal value”. Only this may ensure the granting of increases on a fair and equitable basis, limiting one’s labour risks and ensure future dispute prevention at labour forums.
The primary issue in dispute herein was whether the employer in exercising its discretion to grant increases in terms of its own policy acted fairly towards the applicant. The answer lies in terms of the Labour Court case in Trans-Caledon Tunnel Authority v Commission for Conciliation, Mediation and Arbitration & Others (2013) 34 ILJ2643 (LC) where it was decided that benefits to employees who lay claim to it in terms of the employees past practice or policy is also regarded as “benefits” as contemplated in section 186(2)(a) of the Labour Relations Act.
However, when looking at the evidence, the Commissioner found that, the applicant was already earning over the Career Path of her peers even before increases were implemented. Despite a 0% increase that would have been justifiable, the respondent still implemented a 3% increase towards the applicant. In terms of the Remuneration Adjustment Policy of the respondent, the commissioner found to be a fair and equitable exercise of the employer’s discretion in terms of the policy of the employer and is in line with the requirement to phase in the practical application of the principle of equal pay for work of equal value required in terms of the amended section 6(4) of the Employment Equity Act and is found not to be an unfair labour practice relating to benefits, as contemplated in section 186(2)(a) of the Labour Relations Act.
One may derive from this case, that the same principles entrenched in the fair application of policies relating to increases as a benefit, is the yardstick for the fair application of most other monetary benefits.
I trust that the reader hereof found this article of value. For the particulars on the background facts and evidence herein, the reader may obtain and peruse the CCMA ruling under case number GATW5649/15.
Article by: Johann Preiss
CEO Dispute Resolution Official – Pretoria