South Africa: A Fine Line Of Reasoning – The Distinction Between Dismissals For Incapacity And Operational Requirements

In terms of the South African Labour Relations Act, 1995 ("LRA") an employer may only dismiss an employee for a fair reason and in accordance with a fair procedure. Section 188 of the LRA recognises only three fair reasons for dismissal, namely the employee's conduct or capacity or the employer's operational requirements. The lines between the acceptable reasons for dismissal can become blurry, particularly where an employee is prevented from rendering services by external legal factors. Should such an employee be dismissed due to their incapacity to perform their functions? Or is it more appropriate that they be dismissed due to the employer's operational requirements? This issue has been a controversial one for some time. 

Judicial Pinball

For example, in Trident Steel (Pty) Ltd v CCMA & Others (2005) 26 ILJ 1519 (LC), the Labour Court held that the dismissal of an employee due to their incarceration should have been based on the employer's operational requirements. But, in Samancor Tubatse Ferrochrome v MEIBC & others [2010] 8 BLLR 824 (LAC), the employer dismissed an incarcerated employee for 'operational incapacity'.  In that case, the Labour Appeal Court found that incapacity is broader than just ill health and poor performance and would include external legal circumstances, such as incarceration, which are beyond the employee's control and prevent the employee from carrying out his duties. More recently, in Armaments Corporation of South Africa (SOC) Ltd v CCMA & others (2016) 37 ILJ 1127 (LC), the Labour Court held that the employer had correctly categorized a dismissal due to a legal prohibition on employment as a dismissal for incapacity.  

Unfortunately, this judicial pinball has left employers unsure of the reason to cite, let alone the procedure to follow, in dismissing employees who are unable to perform their functions due to the intervention of external legal factors outside of their control.

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