BUSINESS NEWS - The new Labour Laws (Employment Laws) Amendment Bill proposes a doubling of severance pay, as well as increased powers for the Commission for Conciliation, Mediation and Arbitration (CCMA) to simplify procedures and reduce backlogs.

The bill, which the Department of Employment and Labour (DEL) published on 26 February, is open to public comment by no later than 28 March.  

One of the main proposals, that severance pay for retrenched employees be doubled from one week's pay per year worked to two weeks per year worked, can have an impact on employment in the long run, according to George-based labour law attorney Dawie Bezuidenhout. 

He said it could cause employers to become more cautious when considering the cost of retrenchment versus keeping the employee, albeit in a different employment position. Employers could also be more cautious when appointing a new employee.

"Employees' job security would be more certain, however, getting employed will become much more difficult, because the employer will know they are stuck with this employee for the long run."

The bill specifies that the increased sever-ance rate will only apply to years worked after the law takes effect.

The CCMA's powers expanded

Furthermore, the bill proposes that the CCMA be allowed to arbitrate disputes about severance pay in retrenchment cases where the fairness of the dismissal is not contested. This could be all kinds of disputes, including large-scale retrenchments (more than 50 employees) and retrenchments with procedural complexities usually dealt with by the Labour Court.

Bezuidenhout cautions that the presiding officers in the CCMA should have the same training and expertise in labour laws as the officers in the Labour Court. Should the DEL not have the capacity or funds to empower them to deal with more complicated cases effectively, it could result in more harm than good, causing more reviews and referrals to the Labour Court, which is the exact contrast to what the bill aims to achieve.

"On the other hand, a complex labour issue that came about in George would be able to be dealt with in the George CCMA rather than the parties being compelled to approach the Cape Town Labour Court for relief, thereby being much more available and cost-effective to the parties involved."

Another proposal by the bill would allow the CCMA to hear objections to compliance orders issued by labour inspectors, and convert orders into arbitration awards. This would enable the parties to enforce awards directly through the sheriff, such as attaching assets, without first obtaining a Labour Court order.

Bezuidenhout cautions that while this could speed up dispute resolution and provide quicker relief, it also removes the Labour Court's oversight in confirming that enforcement is fair and equitable.

The bill also proposes that the CCMA be allowed to award interest on unpaid employer contributions to benefit funds such as pension or medical schemes, which could provide a more speedy recourse for aggrieved employees.

Bezuidenhout says only time would tell if these proposed changes would be able to maintain the quality of services envisioned by the CCMA.

The proposed changes would impact employees in the retail sector. Photo: Pexels

Other proposals in the Labour Laws (Employment Laws) Amendment Bill:

• On-call employees (usually working shifts in retail, hospitality and security):
• Minimum pay guarantees proposed even if scheduled shifts are not used.
• Employers must give adequate notice if a shift is cancelled.
• Workers must be compensated if shifts are cancelled without notice.
• Parental leave changes:
• Proposal for gender-neutral parental leave.
• Parents could share a combined leave period of four months and 10 days, taken consecutively, partially or concurrently.
• A father may not take more than one parental leave cycle within 12 months.
• Fathers could receive six weeks' leave after a miscarriage, although proof of parental involvement may be required.
• Workplace harassment:
• Employees could refer all workplace harassment complaints directly to the CCMA, not only sexual harassment cases.
• Small business and probation changes:
• New employees may not have unfair dismissal protection during the first three months (probation). The probation period could be extended if reasonable.
• Businesses with fewer than 50 employees may be exempt from bargaining council wage agreements during their first two years.

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