Can an employee be dismissed for refusing to obey an instruction to work overtime?

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Can an employee be dismissed for refusing to obey an instruction to work overtime?

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Kgodisho Phashe: Welcome to the CDH Conversations podcast, in which we'll be discussing the recently handed down case of AMCU on behalf of Mkhonto & Others v Andru Mine. And in doing so, we'll consider the question of whether an employee can be dismissed for refusing to obey an instruction to work over time. I'm Kgodisho Phashe an Employment Law Associate CDH. Joining me today is Fiona Leppan, Senior Director in our employment law department.

Recently the Labour court handed down a judgment in which it had to consider whether dismissing, or the dismissal of an employee for insubordination was an appropriate sanction for employees who refused to obey an instruction to work overtime. The case raised important questions relating to overtime and highlighted an important aspect of section 10 of the BCEA. Fiona, thank you so much for your time to discuss not only the outcome of this case, but the direction that our law seems to be taking. Particularly in relation to the scope of overtime, taking into consideration challenges which employees and employers are facing, challenges such as load shedding.

Before we dive into the conversation of the legal principles, please could you enlighten us a bit more about the facts and backgrounds of the case?

Fiona Leppan: Thank you very much, Kgodisho. The case certainly centers upon the important principles that are enshrined in the basic conditions of employment at the BCEA, particularly in relation to the regulation of overtime. And the facts in this matter just need to be outlined so that we can follow the debate. Four employees were charged and dismissed for gross insubordination, in that they had refused to obey an instruction from their site manager to work overtime to meet production targets. And this conduct allegedly resulted in a loss of production for the employer.

The employees' normal working hours were from six o'clock in the morning to four o'clock in the afternoon. But on the day in question, the site manager had instructed the entire team to work overtime, and the employees didn't agree to this, and they were dismissed on account of having been insubordinate in failing to honor that instruction.

Now these employees, when they were dismissed following disciplinary hearings, they referred their unfair dismissal dispute to the CCMA, and there the CCMA commissioner found the dismissal of the employees was substantively fair. But AMCU, who was representing the dismissed employees, instituted review proceedings on their behalf and that went through to the labour court and hence the decision we are looking to discuss this morning.

Kgodisho Phashe: Thank you, Fiona. And for the sake of providing our listeners with some more context, I understand that one of the issues in dispute was that not all workers were present when the site manager gave instruction, but it was conceded by the applicants that they were all aware that instruction was given. So now this brings us to the crisp issue that was before the labor court, and this issue was whether the employer proved at the charge of insubordination. The applicants contended that since the instruction was unlawful in the first place, the employees should have never been found guilty of insubordination. The employer, on the other hand, argued that the employees were bound by their contract, which made provision for overtime.

Fiona Leppan:  Right. So a charge of gross insubordination doesn't center upon a refusal to obey an instruction. It has to be accompanied by a defiance of authority. And in that regard, there was some concern that that was never an element that was charged or rather proven by the employer. Hence AMCU's challenge to these dismissals as a kickoff. But what is central to this particular case is the issue of whether or not the contracts of employment actually governed consent to work overtime. And here we must go back to sections 10(1)(a) and 10(5) of the BCEA, because this really was something that captured the labor court's attention.

And just to summarize, section 10(1)(a) requires that, an employer may not require or permit an employee to work overtime except in accordance with an agreement. And then subsection 5 says that any agreement that is concluded with the employee when the employee starts employment with the employer, or within three months of that starting date, lapses after one year.

Now the term, agreement, in the BCEA includes a collective agreement. Absent a collective agreement, which would be between the employer, for example, and a trade union, the agreement that was relied upon here was the contract of employment that was concluded on entry into service. So that was a problem, where this period had lapsed, but there was one employee that stood out in that regard, and I know you've wanted to just tell us what happened to that particular person, Kgodisho, so I'm handing back to you.

Kgodisho Phashe: Thank you, Fiona. And that was the caveat to this matter. One of the employees had not agreed in his contract of employment to work overtime. Therefore, there was no binding contractual obligation to work overtime for that employee. However, there were two other employees who had agreed through their contract of employment to work overtime. However, AMCU argued that their overtime agreement had lapsed, in line with Section 10(5) of the BCEA, and you've just explained that. Now the labour court held that the instruction by the employer was unlawful as it contravenes section 10(1)(a) and 10(5) of the BCEA and that as section 10(1), agreement could only be inferred when an employee had worked over time without prior consent.

There was one further employee who had worked for the company for less than a year. And in that regard, the labor court found that he had agreed to work overtime in his employment contract, and the instruction to him was therefore lawful as he had not been employed for more than a year. However, the labor court still contended that the sentence of dismissal was still inappropriate.

Fiona Leppan: Yes, you're absolutely correct because if we move on from that angle on the lawfulness side, the lawfulness of the instruction, the labor court still had to examine a.) the charge, which was gross insubordination, and the degree of insubordination that had been committed versus the appropriateness of the sanction that was imposed.

And that takes us to the most important case of Palluci Home Depot versus Herskowitz and Others, which is a decision of the Labor Appeal Court, which said, in that particular matter that;

Unless the insubordination is of a particularly gross nature, then the employer should be looking at corrective action steps and should issue a prior warning for having recourse to the final act of dismissal because we must understand that the penalty of dismissal is really the last resort.

Why? Because it puts an employee into potential economic indigency because it's difficult to find alternative work in these economic circumstances in which South Africa finds itself. But of course, what the employer was looking at was, well, this is gross insubordination because you just didn't follow our instruction. But the court has made it plain that the willfulness of the refusal is what counts. And these employees had said, we can't work this overtime despite your request for the simple reason that we've got other issues in our private life that we need to attend to, and those are something we must do. They've been prearranged and we can't assist you by working overtime.

And that's where the labor court concluded the sanction of dismissal was completely disproportionate, when the facts are truly examined and therefore the dismissals were unfair. And then challenged, of course, the ruling of the commissioner and his finding that indeed there was a basis upon which to dismiss these persons fairly. It was not viewed to have been a correct application of the law, and also it was a decision that was unreasonable in the circumstances handed down by the CCMA commissioner. What this does tell you, this case, is;

Employers need to continuously reexamine their overtime clauses in the instrument upon which they seek to rely, which is the ground or foundation rather, for the consent.

It could be that they need to seek an exemption if they've got an agreement in an individual contract of employment where there's a need to work overtime beyond the year, but that would have to be with ministerial approval. Alternatively, they conclude same as a collective agreement with the union, again where they go beyond one year by consent and equally seek an exemption on that score.

Kgodisho Phashe: Thank you. Fiona. That bring us to the end of our conversation today. Thank you for the discussion.

Fiona Leppan: Thank you very much, Kgodisho.