DRAFT CODE OF GOOD PRACTICE ON DISMISSAL

On 22 January 2025, the Department of Employment and Labour published the

Draft Code of Good Practice on Dismissal (draft Code), for public comment.

The purpose of the code is to provide guidance to employers, employees, trade

unions and persons applying the code on the legal obligations under the Labour
Relations Act, 1995.

The intended changes affect small employers, dismissals linked to poor

performance, misconduct, participation in unprotected strikes and operational
requirements.

The most significant changes are highlighted below.

SMALL BUSINESSES

Small businesses are excluded from complying with the Code where it is not
reasonably practicable or feasible. The draft Code proposes that the
circumstances of a small business must be taken into account when determining
the fairness of a dismissal. Small businesses are not expected to engage in time
consuming investigations or pre-dismissal processes.

FAIR DISMISSAL

On the fairness of a dismissal, the draft Code proposes that where a dismissal is
not automatically unfair, the employer need only show that the dismissal was for
a fair reason and in compliance with a fair procedure. This is in contrast to the
current Code, that states that the employer must show that the reason is related
to conduct, or capacity or an operational requirement.

MISCONDUCT

The draft Code proposes that medium and larger employers should adopt written
disciplinary rules and procedures to establish the standard of conduct required of
their employees. This is a change to the current Code which encourages all
employers, irrespective of size, to adopt a standard of conduct.

According to the current Code, serious infringements or repeated offences

warrant sanctions short of dismissal. The draft Code suggests rather final written
warnings or dismissal. The draft further proposes that an employer may depart
from rules and procedures if there is justification for doing so.

Steel and Engineering Industries Federation of Southern Africa (SEIFSA)

Directors: E Monage (President), L Trentini (CEO)*, T Chibanguza (COO)*, N Ngwenya, P J du Plessis, T Tsehlo, E Volschenk, H Mamabolo, R Haynes, M Naidoo, M McCulloch, P du
Plessis,

* Executive Director

Head office: 011 298 9400 / [email protected]

42 Anderson Street Metal Industries House 6th Floor, Marshalltown, Johannesburg, 2001
www.seifsa.co.za
In terms of the current Code, it is generally not appropriate to dismiss an
employee for a first offence, except where the misconduct is serious and makes
the continued employment relationship intolerable. The Draft supports this
contention, subject to the seriousness of the misconduct, or repeated
misconduct.

When deciding on a fair sanction, the draft Code does not limit the guidelines to
dismissal, but rather to all sanctions. It adds to the guidelines, by including:

• The importance of the rule or standard in the workplace; and

• The actual or potential harm or damage caused by the employee’s
contravention of the rule or standard.

Whilst that is commendable, it does seem contrary to the purpose of the draft
Code, which aims to make its application intentionally general. The two additional
factors are not limited to dismissal as a sanction, but all sanctions.

To determine whether the sanction of dismissal is the appropriate sanction where

the continued employment relationship is intolerable, an employer must in
addition include:

• The nature and requirements of the job;

• The nature and seriousness of the misconduct and its effect on the
business;
• Whether progressive discipline might prevent a recurrence of the
misconduct;
• Any acknowledgement of wrongdoing by the employee and willingness to
comply with the employer’s rules and standards; and
• The employee’s circumstances.

The above forces an employer to firstly, admit that the continued employment
relationship would be intolerable, and then still justify why it would be intolerable.
For a draft Code that means to simplify disciplinary processes, this does not seem
to be the case.

In exceptional circumstances, the draft Code suggests that an employer may

deviate from some or all pre-dismissal procedures. However, the employer may
still need to justify its non-compliance if the employee refers a dispute about the
procedural unfairness of the dismissal. The draft Code emphasises that non-
compliance will also depend on the type of allegation and the nature and size of
the employer. On the other hand, the current Code, is silent on factors that may
justify deviation from pre-dismissal procedures.

INDUSTRIAL ACTION DISMISSAL

Under dismissals and industrial action, the draft Code has added more
circumstance when determining the fairness of a dismissal, not only that the
strike was in response to unjustified conduct by the employer, it also in response
to conduct that is unlawful and unfair.
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When determining the seriousness of the misconduct, factors to be taken into

account include:

• Conduct of the parties to the dispute related to the strike and the conduct
by any other person that has a bearing on the seriousness of the
contravention;
• The legitimacy of the strike demands;
• The duration and timing of the strike; and
• The harm caused by the strike.

Processes to be followed when an unprotected strike takes place have been

clearly set out to include, instances where the employees are represented by a
trade union, and where there is no trade union.

Employees who respond to an ultimatum by returning to the workplace in the

stipulated timeframe are pardoned from further disciplinary action, whilst those
who ignore it, face possible dismissal.

Collective representation is recognised to satisfy procedural requirements in

cases of collective misconduct.

PROBATION

The draft Code recognises that probation is necessary for an employer to assess
the employee’s performance and suitability for employment.

Suitability of employment is an important addition, as the draft Code realises that

an employee should also fit into the company culture.

An employer still has the duty to give the employee reasonable guidance, that is
appropriate to the nature and size of the employer and the job. Unlike the current
Code, the Draft is silent on processes the employer should follow when they are
dissatisfied with an employee’s performance.

INCAPACITY

• Poor work performance

When considering the fairness of a work performance dismissal, the draft

Code has added that the required work standard must have been
reasonably achievable. The stringent requirements for poor work
performance don’t have to be observed for managers, senior employees
and highly skilled employees. According to the draft Code, these
employees should have the knowledge and skill that enables them to
judge their own performance and recognise that their performance is not
meeting the required level.

Head office: 011 298 9400 / [email protected].

42 Anderson Street Metal Industries House 6th Floor, Marshalltown, Johannesburg, 2001
www.seifsa.co.za
 • Ill health, injury and other forms of incapacity

The current Code provides guidelines in cases of dismissals arising from ill
health or injury, whilst the draft Code has not included such guidelines. In
the draft Code, imprisonment is recognised as a form of incapacity, with
the employer encouraged to assess the extent of the incapacity and find
alternatives short of dismissal. Incompatibility is seen as an employee’s
inability to work in harmony with an employer’s business culture or co-
workers and can constitute a form of incapacity justifying dismissal.

OPERATIONAL REQUIREMENTS

The Code of Good Practice on Dismissal Based on Operational Requirements is

now incorporated into the draft Code. Most of what is contained in the Code is
included in the draft Code, setting out what would be considered fair reasons and
fair procedure. On re-employment of retrenched employees, the draft Code does
not include a time limit on preferential hiring or oblige an employer to inform
representative trade unions of their offers of re-employment.

CONCLUSION

SEIFSA is in the process of carefully perusing the Draft Code and working
collaboratively with BUSA will be making submissions on areas that are not clear,
require further explanation and/or we are not in agreement with.

The window to make written submissions closes on 24 March 2025

In the interim, SEIFSA urges all affiliated member companies to continue to

strictly follow their in-house rules, disciplinary policies and procedures and
maintain a strict adherence to the prescripts of procedural and substantive
fairness.

Ends.