Labour Legislation in South Africa

Problem Statement

What protection are employees, who are suffering from Depression, afforded in terms of labour legislation in South Africa? Do the various bodies of labour legislation, the Constitution of the Republic of South Africa and common law provide adequate protection from dismissals in the workplace? International and foreign guidelines and trends are also considered as well as their applicability to the South African labour context.

1. Significance Of This Research

Depression is a psychological disorder that is affecting, not only the South African workplace, but workplaces abroad as well. This body of work will be investigating what depression is and why is it a problem in the South African workplace. This question will be addressed by reference to research conducted on depression in the workplace, both locally and abroad, nationally and internationally? as well as the use of statistical results concluded from various studies. The next step is then to evaluate if adequate protection against dismissal is afforded to the employees with depression during the period that they are temporarily unable to perform to the required standard.

Thus, the main question addressed is whether South African labour law, namely the Labour Relations Act (LRA), Employment Equity Act and Basic Conditions of Employment Act, the Constitution and common law principles provide a solution to this problem. More specifically, the forms of dismissal permitted in the LRA will be discussed, which include: Incapacity, Misconduct and Operational Requirements. Automatically unfair dismissals will also be discussed in light of an employee who is dismissed due to his/her depression.

International law and foreign law are also taken into account when interpreting the various bodies of employment law, as this is required by the Constitution. A conclusion will then be drawn as to whether adequate protection is afforded to the affected employees. If adequate protection is afforded, it will be evaluated against international and foreign trends. If no adequate solution is provided, then the problems within the law will be investigated. International and foreign trends will then also be considered to determine their applicability in the South African context.

To accomplish this task, bodies of legislation, textbooks, case reports, journal articles as well as internet research will be used to gather the necessary current information.

What Is Depression And What Is It’s Relevance In The South African Workplace?

Depression is increasing at an alarming rate as universally, people are being exposed to stressors both at work and at home. South Africa is no exception. One simply has to note the high rate of incidents such as road rage, family killings and suicides to understand that all people, no matter their background, are struggling to cope with stress. Research has revealed that stress directly contributes to the onset of depression.

Major Depressive Disorder, or what is commonly referred to as Depression, is a psychological disorder. Psychological disorders are defined as psychological dysfunctions associated with distress or impairment in functioning that is not a typical or culturally expected response. A psychological dysfunction refers to a breakdown in cognitive, emotional, or behavioural functioning. People suffering from this disorder simply cannot perform their daily functions as they use to. They emotionally stop functioning and ‘shut down’, they behave in a manner which is out of character, such as not wanting to get out of bed in the mornings nor wanting to work or eat, when they enjoyed those activities in the past. Their rationalisations begin to change, becoming at times, irrational and they are no longer able to stabilise their emotions. They seem to lose the will to live.

A depressive episode may occur at any point in ones life-span. The average duration is anything between two weeks to five months (if left untreated), and can occur up to four times in an average lifespan.

A survey conducted by the International Labour Organisation (ILO) has found that after heart disease, depression in the workplace is the second most-disabling illness for workers. Symptoms of depression appear to be related to job dissatisfaction, work overload and inadequate remuneration. The United Nations Labour Agency found that unclear instructions, unrealistic deadlines, lack of decision making, isolated working conditions, workplace surveillance and inadequate childcare arrangements also contribute to triggering depression.

Companies or Organisations simply cannot exist without their employees, and ultimately the strength of the workforce thus determines the strength of the organisation or company. No matter how sophisticated the organisation’s infrastructure is, if the employees are not producing, the organisation suffers.

The ILO released the statistic that one in five workers suffer from psychological disorders and only six percent seek treatment. Most psychological disorders are treatable through either medication or therapy. The majority of people suffering from psychological disorders live ‘normal’ lives, and are able to work and keep relationships. But, accommodation does need to be made, as often living with a psychological disorder requires a lifestyle change.

Depression in the South African workplace has been found to be increasing at an alarming rate in every sector. As noted above, depression is a leading cause of absenteeism and low productivity in the workforce.

Research conducted by AIC Insurance on absenteeism in South Africa confirms that the country’s economy is losing as much as R12 billion a year due to absenteeism. The average company experiences 4.5% absenteeism on any given day. In certain companies, the figure is as high as 18%. The wellness of employees is thus vital if a company is to improve their bottom line.

Statistics between January and November 2007, released by Sanlam show that of the approximate R 142 million that was paid out for disability claims, 19.85% were for mental disorders and approximately 80% of that was solely for depression. Depression is thus clearly becoming a large and costly problem for companies in South Africa as it not only affects the company’s bottom line, but also ultimately the country’s economy.

Thus, it is important to be able to identify when an employee is suffering from a psychological disorder such as depression and, when to intervene to provide a remedy. This early detection approach is advisable as research conducted by the ILO has found that bad management inevitably costs companies, not only in the form of a loss of productivity attributed to the poor mental health and the associated despondent attitude of the workforce resulting in absenteeism, but also through a higher staff turnover and the associated costs of recruitment and training of the new staff. It is thus economically advisable for a company to take interest in the mental health of its employees so as to reduce the losses they suffer due to absenteeism as a result of depression and adapt the working environment accordingly.

However, beyond the obvious economic benefits of mentally healthy employees, the law requires an employer to consider their employees and not discriminate against them due to their ill health or disability in any manner or form .

Section 9 of the Constitution ensures each persons right to equality before the law and the right to equal protection and benefit of the law. Included is the right not to be discriminated against on various grounds including disabilities. Section 23 provides for the right to fair labour practices. This encompasses the rights to equality contained in Section 9 as well as the right to a fair relationship between the employee and their employer, including accommodation of both interests to arrive at an agreement.

Thus, an employee with depression has the right to be treated equally with the other employees and to approach the employer to come to a common understanding with regard to the disorder. These rights prevent dismissal by discriminating against him by the mere fact that the employee is ‘ill’, even though the disorder is treatable.

Section 22 of the Constitution provides for the freedom of trade, occupation and industry. This fundamental right contained in the bill of rights guarantees each citizen the right to choose their trade, occupation or profession. This right protects the freedom of commercial activity. An occupation is said to be defined as an activity through which individuals seek to provide for not only their material needs, but also in the idealistic sense of their occupation being their vocation, their calling. An individual has the right to choose or change their occupations or workplace. This right also encompasses an implied right that protects the right to practice as it would be unfair to allow an individual to choose their trade, do the necessary training, preparations and legal requirements, then not allow them to practice.

Since depression is a disorder that is manageable, it would be constitutionally unfair to dismiss an employee who has chosen a trade, fulfilled all the necessary requirements (such as training etc) and simply due to their treatable psychological disorder, are not allowed to practice. This is clearly unconstitutional in terms of Section 22 and clearly a violation of Sections 9 and 23 as the employee is being discriminated against on the ground of their disorder / disability, as discussed above.

It is thus vital to have an awareness of mental health issues, especially in order for a manager to be an effective leader. Dealing with depression in the workplace is important, particularly in regard to growth and development of the employees, upholding their basic human rights and thus ultimately improving the bottom line of the company and the economy as a whole.

Protection Afforded To Employees With Depression Within S.A. Law

The LRA and Section 23 (1) of the Bill of Rights provides that everyone has the right to fair labour practices, as mentioned above. On this fundamental right, persons suffering from depression are entitled to both a procedurally and substantially fair dismissal. This fundamental right was also upheld in Section 188 of the LRA.

One must note that currently, specific statutes exist that protect labour practices and thus must be applied before the Bill of Rights may be invoked. Section 188 of the LRA, as mentioned above, provides that a dismissal will only be fair if it is motivated by a ‘fair reason’ and ‘was effected in accordance with a fair procedure’. This section makes it clear that fair procedure and fair reason are two separate requirements. Substantive fairness, or fair reason, has two parts, first is to establish why the employee was dismissed, then the second is to establish the adequacy of that reason. If that reason falls with the scope of Section 187 – automatically unfair dismissals, the enquiry ends, unless the employer has a solid defence. If the reasons relate to the capacity or conduct of the employer, or reasons not in Section 187, the adequacy of the reason must be assessed on a case by case basis.

Section 188 (1)(a) of the LRA provides three reasons through which employees may be dismissed. They relate to the conduct (or misconduct) and incapacity of the employee, and the operational requirements of the employer. This classification thus determines the forum in which the dismissal disputes are resolved, and determines the principles that must be applied when deciding if the dismissal was in fact fair. In order for a dismissal to be fair, the concept of fairness requires a correlation between the seriousness of the employees conduct or incapacity (substantive requirement) and the employer’s action (procedural requirement).

The categories of dismissals do overlap in certain circumstances, but their procedures are very different. Incapacity, operational requirements, misconduct and automatically unfair dismissals will be looked at as forms of dismissing an employee with depression. In determining whether a dismissal, through these various routes, is in fact fair, the justification is analysed, which depends on the reason for the dismissal given by the employer. In the case of incapacity, the justification is that the employee did not reach the expected attainable performance standard and no other alternative existed. In operational requirements, the justification will be that the employee became redundant. In the case of a dismissal for misconduct, the justification is that the employee has broken a known reasonable rule in the workplace. For automatically unfair dismissals the justification is the employer’s defence, that the dismissal was due to the inherent requirements of the job that the employee no longer had. These various forms will be discussed below.

Incapacity

When an employee enters into a contract of employment, there is an implied agreement to work according to a reasonable standard set by the employer. If the employee fails to meet the standard, the employer is entitled to terminate the contract. Terminations for this reason are known as dismissal for incapacity, and are said to be a ‘no fault’ dismissal, as the incapacity arises from a lack of skill or from physical or mental ability. This form of dismissal is essentially the employers legitimate loss of confidence in the ability of the employee to perform in accordance with the contract of employment as the employee cannot perform their work to the standard set by the employer . Thus the duty to perform ones work may also be breached if the employee is physically present but mentally ‘absent’.

Incapacity is divided into categories, which are: poor work performance and ill health or injury. The LRA does not distinguish betweens the forms of incapacity; this distinction is drawn in Code of Good Practice: Dismissals (the Code). Although these forms imply that the employee is unable to perform as required, they are two very different concepts. Poor work performance by the employee may be due to inadequate training, ability, skills, knowledge or simply unreliable or outdated machinery. Ill health or injury refers to a temporary or permanent injury or accident (injury), or a physical or mental impairment (ill health). Poor work performance thus differs from ill health or injury as with the latter, the employee would be incapable of performing to the required standard as a result of their illness or injury, not because they merely didn’t measure up to the performance standard. Both these forms require the dismissal to be substantively and procedurally fair.

Poor Work Performance

Item 9 of The Code addresses the issue of an employee who is not performing as required. This Item encompasses a 3 stage enquiry. Firstly it provides that in order for an employer to dismiss an employee for incapacity, namely poor work performance, the employer must prove that a standard exists and that it is in fact reasonable, then proof is required that the employee did not meet that standard . The crucial question to be answered in the enquiry is whether the said standard is objective and whether the employee was aware, or should have reasonably been aware of the standard.

The next part of the enquiry in Item 9 requires that the employee be informed of their deficient performance as well as then being given a reasonable time to improve. The courts in A-B v SA Breweries held that although the employer is entitled to set standards, the courts will intervene when these standards are grossly unreasonable. Thus the performance standard is central to any dismissal for poor work performance.

The final stage of the enquiry in Item 9 emphasises that a dismissal should only be a remedy of last resort. No employee may be dismissed without first being made aware of their poor work performance through consultation and given a reasonable period to improve. First, the appropriate instruction, training, guidance and alternative work must be offered. Then, if this is unsuccessful, reasonable accommodation must be made. Once the employer has done all that is expected and to no avail, then dismissal may be the only appropriate sanction.

When applying the 3 stage enquiry discussed above to a situation where an employee has depression, one will find that the employee fails at each stage. In the first stage, the employee is aware of the performance standard when he begins his employment as there is an implied agreement to work to a reasonable standard. The second stage requires that the employee be made aware of his drop in performance. Upon the employer bringing to the attention of the employee his drop in performance level, as much as the employee expresses desire to improve, he cannot as his depression, if left untreated, will worsen. This will result in the performance level dropping further as he loses all interest in activities which he once enjoyed (as mentioned earlier). The third stage requires the employer to provide training to the employee, alternative work or reasonable accommodation. If the drop in performance is due to the lack of training, or boredom in the same job or an accommodation due to a lifestyle change, then the performance level should increase. But, unfortunately, when dealing with an employee with depression, more than likely, none of the suggestions will work as he is no longer motivated to work nor has interest in it thus all attempts will be in vain.

Thus, one will find that the employee fails the enquiry and thus is dismissed as there is no other option left to the employer. The ultimate conclusion is that depression falls through the cracks as it isn’t identified and dealt with effectively as not only is there a negative stigma attached to depression, thus only few employees will disclose it to their employers fearing prejudice, but the employers are not equipped to identify it. Thus the same outcome will occur to the next employee with depression in the workplace as they are unable to perform up to the required reasonable standard.

Therefore, depression cannot be dealt with under incapacity for poor work performance as it will pass unnoticed and thus result in an injustice in the dismissing of an ill employee and not deal with the growing problem of depression in any manner or form.

Health Or Injury

Ill health or injury is the second category of dismissal under the incapacity heading. Item 10 of The Code deals with substantive and procedural fairness where the employee’s incapacity is due to illness or injury. Item 11 sets out the guidelines that must be followed in order to dismiss the employee. The guidelines provided in the Code will be looked at in the context of an employee who is suffering from depression, to determine if depression is better dealt with as incapacity due to ill health or injury.

Item 11 of the Code entails various factors which must be determined when considering a dismissal for ill health or injury. The factors include: ascertaining whether the employee is capable of performing the work for which he was employed; if the employee is unable to work, then the extent of his inability to perform his duties must be determined; whether the employee’s duties can be adapted and the employee accommodated, when reasonable, to continue his duties; and finally if the employee cannot be placed in his former position, the employer must ascertain alternative work, even at a reduced salary, if available.

Only once the above factors are considered, may the employer conclude that there is no other option but to dismiss the employee. The onus rests on the employer to prove that the employee is in fact incapacitated and cannot work and thus that their dismissal would constitute a substantively fair dismissal.

When applying these guidelines to an employee who is suffering from depression, the employee is afforded a little more protection then if he is dealt with under incapacity for poor work performance. Only the ill health component is applicable as depression is not an injury, it is a temporary psychological disease affecting ones mental health thus falling under the category of ill health.

Upon applying the first requirements of Item 11, one can conclude that the employee is in fact not, at that point in time, capable of performing his work. This is as a result of the effects of depression on the individual. He loses the will to do those activities he once enjoyed or did at a reasonable standard, and no longer has any motivation or interest in performing his duties. Thus at that point, he is temporarily incapable of doing his work. This requirement merely assesses the extent of the capability of his work performance at that point in time and not the cause of the lessening performance.

The enquiry then moves on to the second part, which places an onus on the employer to attempt to aid the employee. The employer is required to determine the extent to which the employee can perform as well as adapt either his work environment or his duties, or to provide alternative work. This could well provide the depressed employee with a certain amount of protection, as the employer is required to determine the extent of the performance ability, provided one of two situations occur. Firstly, that the employee knows he is depressed and discloses it to his employer, but negative stigma attached to depression plays a role as to whether or not the employee wishes to disclose his illness to his employer. Secondly, the employer recognises that either the employee is depressed or that the employee is not well and directs him towards professional help, which would identify the problem of depression.

If the depression is caused by the work itself, then the solution proposed in Item 11 of alternative work offered or accommodation would possibly solve the problem. However, if the cause of depression is something other than work, when the employee returns to full health, he finds himself in other circumstances regarding his work which he may or may not enjoy, which in turn may lead to another depressive episode. This, however, requires the depression being identified so that an appropriate solution may be found.

In theory, Item 11 would offer some protection to the employee, however, due to the two variables mentioned earlier – the negative stigma and employers not being equipped to identify depression, there is a very real possibility that once again it would be unnoticed as the dismissal system would not identify it and the employee may be dismissed for his ill health. All that is required is to assess the extent of the incapability of performing his work for that particular time period. If the performance level doesn’t rise, the employee is dismissed and thus the true reason remains unidentified and thus unnoticed.

Item 10 of the Code addresses the nature, degree and extent of the incapacity, as well as providing for reasonable accommodation, it elaborates on the second part of the enquiry found in item 11. Item 10 provides that when incapacity on the grounds of ill health or injury is temporary, the employer is obliged to ascertain the extent of the incapacity, and if the employee is likely to be absent. If the time period of absence is unreasonably long, the employer must investigate all other alternatives short of dismissal. When the alternatives are considered, the following are relevant factors: the nature of the job, the period of absence, seriousness of the illness and the possibility of securing a temporary replacement for the ill employee. The cause of the incapacity is also relevant as well as if counselling is appropriate.

As discussed earlier, research has shown that the leading cause of absenteeism in the workforce is depression. Dismissal is inappropriate if the absence is for a relatively short period, although habitual absenteeism may warrant a dismissal even for medical reasons. Various factors are to be taken into account when evaluating the reasonableness of an employees absence, such as strategic importance of the employee’s job, their length of service, how easily they may be temporarily replaced, the financial capacity of the employer to make arrangements to replace the ill employee, the prospect of the employee recovering as well as the effect of the employees absence on the other employees.

The provisions of the Basic Conditions of Employment Act (BCEA) must be taken into account when deciding whether or not to dismiss an employee due to ill health or injury due to excessive absenteeism. An employer is entitled to dismiss an employee where it can be assumed that the employee’s illness clearly exceeds their sick leave entitlement, even though at that point in time, the leave need not be exhausted. The BCEA gives every employee a particular amount of sick leave implying that when an employee is genuinely incapacitated, they should be protected against dismissals during that period only.

Dismissing an employee with depression as incapacity for ill health requires an employer to satisfy various requirements (discussed above). However, an employer cannot be expected to continue employing an employee who is no longer productive. The nature and size of the employer’s business must be considered as small businesses may not have the resources to cope with and support a non productive employee nor be able to provide alternative work. As a result, an employee suffering from depression in a larger company has greater job security than at a smaller company as the larger company can afford to spend more on accommodating the employee.

Although incapacity for Ill Health proves to afford a depressed employee with more protection than poor work performance, it is still not sufficient. As discussed above, only the symptoms are treated, i.e. adapting the work environment or finding alternative work for the employee, ignoring the cause. A depressed employee may respond to these changes at first, but they will not last as depression causes the employee to lose motivation and interest, as already discussed. Thus resulting in the outcome of a dismissal as the employer has in fact done all he is required to do and the depression will continue to pass unnoticed.

As discussed above, treating depression as an incapacity for poor work performance affords the employee no protection as the depression goes unnoticed thus allowing it to worsen. As a result, ultimately causing the dismissal of the depressed employee as regardless of the employer’s accommodations and attempts at increasing the work performance, a depressed employee will only worsen as that is the nature of the psychological disease until it either passes or is treated.

Incapacity for Ill health affords little more protection. It requires the employer to only dismiss in the last instance and only recognises the said employee as having an incapacity for ill health. Although the employer is required to determine the extent of the capability of the performance, it does not require an inquiry as to the cause of the lessening performance. Following the required steps in Item 11 may not improve the performance with any accommodation or alternative work. Thus, once again, resulting in the employees dismissal and the cause being ignored.

Operational Requirements

A variety of scenarios exist that may result in an employer needing to dismiss one or more employees. Section 188 of the LRA, in line with international labour standards, recognises the employers needs and operational requirements, in certain circumstances, are valid reasons for dismissal. Thus, operational requirements are accepted as another form of dismissal recognised in the LRA.

S213 of the LRA provides that dismissing an employee for operational requirements means that the dismissal was due to economic, technological, structural or similar needs of the employer. Thus, this is a ‘no-fault’ dismissal on the part of the employee and is purely dependent on the employers’ needs and requirements.

Section 189

Section 189 deals with small scale dismissals, i.e. dismissals in companies that have fewer than 50 employees. Before the S189A Amendment in 2002 (discussed below), there was no statutory definition provided for substantive fairness. The courts therefore determined the question of substantive fairness as one of fact. Thus, the employer was expected to prove various facts.

Firstly, the employer must prove, on a balance of probability, that the reason given is one based on the operational requirements of the business, i.e. that the reason falls within the given definition of operational requirements. Secondly, the employer must prove that the operational reason exists and it is the real reason and not merely an easier way of dismissing employees by avoiding more stringent formalities.

These requirements seem to provide some protection to the employees as the employer must prove that the principle reason for the dismissal does in fact fall within S189 and no other section. However, in various cases, the courts have held that the LRA doesn’t distinguish between operational requirements when the company is fighting for survival and when a profitable business just wanted to increase their profit margin. The employers need not prove that actual costs were reduced. Thus by merely showing that by dismissing the employee their profits will increase, is a sufficient reason to dismiss as the courts will not interfere with legitimate business decisions.

However, it fails at the second stage, where the employer must prove that the operational requirement is the real reason. As discussed above, the justification of the employers’ entitlement to make a profit affords the employer a rather easy method of getting around the real reason of the dismissal as the courts will not make business decisions. He must merely show that a profit is to be made in this redundancy.

Employers are not expected to keep redundant workers, S189 of the LRA does, however, require the employer to try and avoid retrenchments. The Labour Appeal Court held that the employer must show that the dismissal could not have been avoided. The courts require the employer to show that it was in fact necessary to dismiss the employee to effect saving as well as it must be rational and justifiable.

An employees position becoming redundant due to a technological, structural or similar need or actual economic needs is truly a no-fault dismissal. However, the problem arises when the employer wishes to dismiss an employee for another reason, such as incapacity or misconduct, and opts to restructure the company, claiming economic reasons and dismisses the said employee. The factual proof required does protect the said employee to a point. The employer must show that the reason falls within operational requirements.

This is not a problem as a company always needs to make a profit.

There thus exists an overlap of reasons for dismissals on the basis of operational requirements as the employer always needs to effect saving and the situation where the employee is no longer able to fulfil their contractual obligations due to their illness. It is far less onerous on the employer to show that due to economic circumstances, the employee must be dismissed (as the company’s bottom line is being affected), rather than having to prove that the employee is incapacitated and thus the dismissal was for fair reason as proof is required that the employee did not meet the standard required by incapacities. The Gouws case recognised the ambiguous dividing line between dismissals for operational requirements and the other grounds for dismissals.

Thus the problem of depression continues unnoticed and ignored as it is either not identified or if identified, not knowing how to deal with it. This allows the problem to continue resulting in