There is a common misconception that when an employee is dismissed due to misconduct, the employee has no entitlement to any statutory monies. This misconception, however, needs to be corrected.
Section 73A(1) of the Labour Relations Act (LRA) determines that:
“Despite Section 77, any employee or worker, as defined in Section 1 of the National Minimum Wage Act (NMWA) of 2018, may refer a dispute to the Commission for Conciliation, Mediation, and Arbitration (CCMA) concerning the failure to pay any amount owing to that employee or worker in terms of this Act, the NMWA, a contract of employment, a sectoral determination or a collective agreement”.
It is clear from the above Section that the payment of statutory monies upon the dismissal of an employee is required by law. Statutory monies include the dismissed employee’s salary up until the date of dismissal, any overtime worked, the employee’s pro rata leave pay, and even the employee’s pro rata bonus, depending on the employment contract or any other collective agreement which regulates payment of bonuses upon dismissal.
In the above situation, we must establish the correct date of dismissal to ensure accurate payment. Section 190 of the LRA determines the following:
“(1) The date of dismissal is the earlier of-
- The date on which the contract of employment terminated; or
- The date on which the employee left the service of the employer.”
Section 190(2)(d) goes further. It states: “Despite Section (1), if an employer terminates an employee’s employment on notice, the date of dismissal is the date on which the notice expires or if it is an earlier date, the date on which the employee is paid all outstanding salary.”
Instances exist where there needs to be more compliance by the employer to pay any statutory monies due, as Section 73A referrals frequently cause the employer to attend matters at the CCMA. Section 73A provides a remedy to an employee to claim, from the employer, any statutory monies owed to the employee upon dismissal. Section 73A also places a duty on an employer to pay out all the monies due to the employee. Suppose a dispute is referred against an employer who failed to pay the dismissed employee’s statutory monies. In that case, the employer will have to be present at the CCMA, where they will have to explain why the employee was or was not paid their rightful monies, which the employee would be entitled to upon dismissal.
Unlike other types of disputes referred to the CCMA, to which any party can raise an objection to the arbitration process proceeding immediately after the conciliation, Section 73A(5) determines that the arbitration must commence immediately after certifying the dispute remains unresolved. This process will therefore be time-consuming for an employer because the employer and their witnesses will have to be present at the CCMA. Should there be no resolution of the dispute during conciliation, the matter will proceed to arbitration whereby the employee will bear the onus to prove that there are monies due, and should the employee prove their case, it will lead to an award in which the Commissioner will order the employer to make the necessary payment to the employee within a specific timeframe.
To avoid any claims that may arise due to non-payment, it is therefore advisable for all employers to pay their employees all statutory monies due upon dismissal and to ensure that proof of such payments is kept on record.
Article By: Marteleen Lindemann
Dispute Resolution Official – CEO Klerksdorp