Member Article

Disputes arising from an employer’s failure to promote an employee have become an established feature in South African workplaces, especially in the public sector. They have also been the subject of a large number of arbitrations by virtue of the provisions of section 186 (2)(a) of the Labour Relations Act, 1995 (“LRA”). This section provides that the definition of an unfair labour practice includes unfair conduct by an employer relating to the promotion of an employee.

In assessing the fairness of dismissals on the basis of misconduct and incapacity, arbitrators and the labour courts have not been willing to defer to employer views as to whether a dismissal is fair or not. They have found that they will form their own views on the fairness of a dismissal after considering the reason for dismissal advanced by the employer.

In contrast, arbitrators and the labour courts have typically been unwilling to interfere with decisions taken by employers as to who the most suitable candidate for promotion is. They have formulated their test for interfering in various ways.

This was considered in the recent Labour Appeal Court decision in Department of Rural Development and Agrarian Reform v General Public Service Sectoral Bargaining Council and Other. The employee in this matter, Mr Musisi commenced employment with the Department of Rural Development and Agrarian Reform on a permanent basis in 2000. In 2006, he occupied the post of Deputy Director: Economics, Marketing and Statistics. In 2007, after the incumbent of the post of Senior Manager: Economics, Marketing and Statistics Services (“SMEMSS”), Mr Coetzee, was seconded to the Eastern Cape Rural Finance Corporation, Mr Musisi was appointed to act in his position. When Mr Coetzee’s secondment came to an end in 2009, he did not return to his post, but was promoted to the post of General Manager.

The result was that the post of SMESSS became vacant. Mr Musisi continued to act in this position. In 2009 and early 2011, the employer initiated processes to fill the vacant post but these were not completed. Later in 2011, a third process was initiated and completed, but, despite two persons (including Mr Musisi) being recommended for appointment to the post, the post was left unfilled. From 2007 until March 2011, Mr Musisi acted in the post and the failure to appoint him aggrieved him. He referred an unfair labour practice dispute to the General Public Service Sectoral Bargaining Council and argued that the failure to promote him constituted an unfair labour practice.

The arbitrator analysed the evidence and agreed with Mr Musisi; he found that the failure to promote Mr Musisi was unfair. In his award, the arbitrator considered the argument raised by the employer that it had a discretion or prerogative to decide whether or not to promote an employee and that an arbitrator should not readily interfere in this type of decision. The commissioner accepted that an employer has a discretion on whether or not to promote an employee, but that this must then be exercised fairly and reasonably.

On review, the Labour Court held that the arbitrator had had proper regard to all relevant considerations when he found that Mr Musisi should have been promoted. The decision of the arbitrator was not unreasonable. The Labour Court further noted that “the decision not to promote had to be made fairly and reasonably” and the Department had failed to meet this test.

On appeal, the Labour Appeal Court also accepted that the arbitrator’s decision had not been unreasonable and that the Labour Court did not err by refusing to interfere with the arbitrator’s findings.

The court also provided the following test for assessing the fairness of a decision to promote, or not to promote, an employee:

“the Department’s contention that restraint and deference are called for is not entirely misplaced, though somewhat overstated in the context of this case. Courts and arbitrators should be reluctant to interfere with an employer’s decision to refuse promotion. They will do so only when the decision or reasoning is assailable because there is evidence that the employer acted on the basis of some unreasonable, irrelevant or invidious consideration; or the decision was arbitrary, capricious or unfair; or the employer failed to apply its mind to the promotion or acted in bad faith. But equally, where there is no rational relationship between the decision not to promote, the purpose of the promotion and the information upon which the impugned decision is based, interference with the decision will be justified. Because there is ordinarily no right to promotion, arbitrators and courts should hesitate before appointing the aggrieved employee to the post. Such deference, however, will be less compelling where the employer has unfairly discriminated against an employee or acted otherwise egregiously. Likewise, the remedy of instatement might be appropriate where it will cause no prejudice to another successful candidate because the post is vacant; or the employee proves that but for the unfair conduct he, or she, would have been appointed.”

This judgment serves as a caution to employers who unreasonably withhold promoting deserving candidates, subject to operational needs.

Reviewed by Peter le Roux, an Executive Consultant in ENSafrica’s Employment department.

Kara Barnard Associate Employment [email protected] +27 82 564 0964

Muzi Mgabhi Candidate Attorney Employment [email protected] +27 67 416 8983