UNILATERAL CHANGES TO TERMS AND CONDITIONS OF EMPLOYMENT

UNILATERAL CHANGES TO TERMS AND CONDITIONS OF EMPLOYMENT 

The Covid-19 pandemic has had a detrimental impact on business all over South Africa. The financial hardships experienced by some businesses have caused them to make significant decisions without the agreement of their employees. 

Such an employer, Maxsteel, recently decided to reduce its employees’ salaries during May, June and July 2020 by 20%. There was no agreement in place with the representative union, the National Union of Metalworkers of South Africa (“NUMSA”), or any of its members. As the dispute related to a unilateral change to terms and conditions of employment, NUMSA were only required to provide 48 hours’ notice of industrial action. 

The employer approached the Labour Court and sought an order declaring the strike unprotected. The Labour Court found the strike to be protected. 

Employers are reminded that any changes to the terms and conditions of employment cannot be implemented unilaterally. Any changes need to be agreed to by the affected employees. 

In order to reduce costs, in particular the costs of wages and salaries, employers should consider the following: - 

1. Short time; 

2. Temporary Layoffs; 

3. An agreement to change terms and conditions of employment; and 

4. Terminations of contracts of employment for operational reasons (retrenchments). 

Simply unilaterally changing terms and conditions of employment will not likely be accepted by the Courts. 

For more information, please contact our offices. 

(With acknowledgment to Farrel Inc.)