The Labour Relations Act (LRA) contains provisions that aim to protect employees from being unfairly discriminated against as a result of exercising one or more of the rights in the LRA. Prejudicing an employee based on the fact that the employee took part in the activities of a trade union, which were lawful, is one of the prohibitions in the LRA.
In National Union of Metal Workers of South Africa obo Members v Element Six Production (Pty) Ltd, the Labour Court had to determine whether the payment of a token of appreciation to non-striking employees who had performed additional work during a national protected strike was discriminatory within the meaning of s5 of the LRA.
The specific provisions relied on were:
" 5. Protection of employees and persons seeking employment
(c) prejudice an employee or a person seeking employment because of past, present or anticipated –
(iii) participation in the lawful activities of a trade union, federation of trade unions or workplace forum;
(vi) exercise of any right conferred by this Act;"
Element Six employed approximately 980 employees. On 1 July 2014, certain of its employees who were members of NUMSA, UASA and SAEWA commenced a protected strike at its Spring's plant in support of national demands tabled at the MEIBC. It was anticipated that the strike would last for three weeks. Prior to the strike, Element Six's employees had worked overtime to ensure that there were sufficient stock piles to meet client demands during the strike.
The strike lasted longer than expected. Certain employees who did not participate in the strike performed additional tasks during the strike in order to meet client demands. The strike ended on 28 July 2014. On 6 August 2014, Element Six decided to pay a token of appreciation to employees who:
NUMSA sought an order declaring that Element Six's conduct in paying the token of appreciation constituted discrimination in terms of s5(1), s5(2)(c)(iii) and s5(2)(c)(vi) of the LRA and that those members who had participated in the strike also be paid the amount of the token of appreciation.
In coming to is decision, the court accepted the argument advanced by NUMSA that in order to demonstrate a contravention of s5, a party was required to demonstrate "discriminatory conduct that was actuated by an illicit reason" and that in order to determine whether the payment was unfairly discriminatory, there needed to be an enquiry into whether "rational and objective criteria were used in assessing who the beneficiaries of the payment were and whether [Element Six] intended to unfairly discriminate against striking workers."
Following from this, the court found that on the facts NUMSA had demonstrated that there was in fact differentiation which amounted to discrimination, and that Element Six had failed to show that this discrimination was fair because, amongst other things, Element Six was unable to show that the criteria applied in making the payments were fair and objective in that:
While the court issued a declaratory order that Element Six's conduct in paying the token of appreciation contravened the relevant provisions of s5 of the LRA, and that it was prohibited from engaging in any such conduct in future, the court held that it was not competent for it to grant the striking employees monetary relief, namely payment of the amount of the token of appreciation. In this regard, the court relied on the Labour Court decision in FAWU & others v Pets Products where the court, confronted with similar facts, namely ordering that compensation be paid to striking employees in an amount equivalent to a voucher paid to non-striking employees, held that "... were [it] to grant the applicants' request, then [it] would, in effect, compound or condone the illegitimate conduct of the respondent. Quite simply, two wrongs do not make a right."
Coupled with no order as to costs, Element Six for all intents and purposes managed to get off very lightly. That said, employers need to be extremely cautious when considering how to compensate non-striking employees for additional tasks performed during a protected strike as it may fall foul of s5 of the LRA and a court adjudicating any potential claims against an employer may not be as lenient as in the Element Six case.
Jean-Pierre is a Senior Associate and Paki a Candidate Attorney with Fasken Martineau, South Africa.