Dismissing employees for reason of incapacity

“… no company is allowed to simply discard employees suffering from occupational diseases. People are not pieces of machinery. The fact that an employee cannot perform the job he is appointed to do does not justify substantive dismissal.”

This phrase was apparently the basis of a CCMA decision ordering Xstrata to reinstate Johann Engelbrecht, a mechanical fitter, who was dismissed by Xstrata in September 2004 by reason of incapacity.  He referred his dismissal to the CCMA which found that his dismissal was procedurally and substantively unfair.  According to a Business Report article published on 31 January 2006:

“When Johann Engelbrecht joined Xstrata, the diversified mining giant, as a mechanical fitter, he was a healthy man. During his work he was exposed to Vanadium fumes and dust, and became ill and was diagnosed with chronic bronchitis and toxic vanadium levels.

On September 30 2004 he was dismissed for incapacity. Engelbrecht took the company to the Commission for Conciliation Mediation and Arbitration (CCMA), which found that his dismissal was substantively and procedurally unfair.

Silas Molebaloa, the commissioner, ordered Engelbrecht’s reinstatement retrospective for the preceding 10 months and that he be paid R58 660.

The full amount was R119 960, but Molebaloa ordered that R12 300 be deducted for Unemployment Insurance Fund payments Engelbrecht received for three months and the R7 000 a month he had earned as a temporary employee for seven months.

Molebaloa said, with approval argument raised on Engelbrecht’s behalf, that “no company is allowed to simply discard employees suffering from occupational diseases. People are not pieces of machinery. The fact that an employee cannot perform the job he is appointed to do does not justify substantive dismissal.”

Evidence at the CCMA was that the diagnosis of chronic bronchitis and that Engelbrecht had toxic vanadium levels was made on March 4 2004. He was declared permanently unfit to work in a particular area and could not be exposed to vanadium dust.”

The Code of Good Practice on Dismissals says the following about incapacity related dismissals (arising out of illness or injury):

“10 Incapacity: Ill health or injury

(1) Incapacity on the grounds of ill health or injury may be temporary or permanent. If an employee is temporarily unable to work in these circumstances, the employer should investigate the extent of the incapacity or the injury. If the employee is likely to be absent for a time that is unreasonably long in the circumstances, the employer should investigate all the possible alternatives short of dismissal. When alternatives are considered, relevant factors might include the nature of the job, the period of absence, the seriousness of the illness or injury and the possibility of securing a temporary replacement for the ill or injured employee. In cases of permanent incapacity, the employer should ascertain the possibility of securing alternative employment, or adapting the duties or work circumstances of the employee to accommodate the employee’s disability.

(2) In the process of the investigation referred to in subsection (1) the employee should be allowed the opportunity to state a case in response and to be assisted by a trade union representative or fellow employee.

(3) The degree of incapacity is relevant to the fairness of any dismissal. The cause of the incapacity may also be relevant. In the case of certain kinds of incapacity, for example alcoholism or drug abuse, counselling and rehabilitation may be appropriate steps for an employer to consider.

(4) Particular consideration should be given to employees who are injured at work or who are incapacitated by work-related illness. The courts have indicated that the duty on the employer to accommodate the incapacity of the employee is more onerous in these circumstances.

11 Guidelines in cases of dismissal arising from ill health or injury

Any person determining whether a dismissal arising from ill health or injury is unfair should consider-

(a) whether or not the employee is capable of performing the work; and

(b) if the employee is not capable-

(i) the extent to which the employee is able to perform the work;

(ii) the extent to which the employee’s work circumstances might be adapted to accommodate disability, or, where this is not possible, the extent to which the employee’s duties might be adapted; and

(iii) the availability of any suitable alternative work.”

What has caused some concern is Commissioner Molebaloa’s assertion that “[t]he fact that an employee cannot perform the job he is appointed to do does not justify substantive dismissal”.  This assertion contradicts the Code of Good Practice quoted above and the Labour Relations Act (Act 66 of 1995) which clearly provide for dismissals arising out of incapacity by reason of illness or injury.  According to John Grogan, one of South Africa’s leading labour lawyers, in his book Dismissal, Discrimination & Unfair Labour Practices –

“The following principles have emerged from South African case law involving dismissals for incapacity arising out of illness or injury:

• the employer must ascertain whether the employee is capable of performing the work for which he or she was employed;
• if employees are unable to fully perform their normal duties, the extent of their incapacity, and its likely duration, must be established;
• the employer is then obliged to investigate whether the employee’s duties can be adapted to accommodate the disability;
• if employees cannot be placed in their former position, their employees must ascertain whether alternative work can be found for them, even if at reduced remuneration.

Only once these steps are taken, will dismissal of an injured or sick employee be deemed substantively fair.  Although in cases of dismissal for reasons related to the illness or injury of the employee it makes little sense to speak of procedural fairness as an independent requirement, the code indicates the steps an employer should take before dismissing an employee for this reason.”

I believe that Commissioner Molebaloa’s assertion is not an accurate or complete reflection of the legal position on occupational illnesses.  What does seem to be the case is that in instances where an incapacity due to illness or injury arises due to the employee’s working conditions as appears to be the case with Mr Engelbrecht, employers are required to take adequate steps to protect their employees from occupational hazards and can hardly complain when their employees become ill to the extent they can no longer fulfill their duties as a result of such hazards where those employers fail to take adequate steps.  As Grogan puts it –

“Special consideration must be given to work-related illness or injury”

Ultimately it is permissible to dismiss an employee by reason of incapacity arising out of illness or injury.  It is important that employers follow the appropriate procedure and have regard to considerations such as those referred to by Grogan above.  If an employer does not follow the guidelines set out in the Code of Good Practice and which emerge from our case law, there is a strong likelihood that employees will successfully challenge their dismissals.

In any event, the fat lady has not yet sung.  Xstrata has given notice of its intention to appeal the CCMA’s decision.

Update:

There are two Codes of Good Practice which are relevant to the questions of disability and HIV/AIDS and which I recommend all employers read and familiarise themselves with.  These two Codes were prepared in light of the Employment Equity Act which prohibits discrimination on certain grounds.  These Codes are the Code of Good Practice on Key Aspects on the Employment of People with Disabilities and the Code of Good Practice on Key Aspects of HIV/AIDS and Employment.  These documents and many others may be found on the Department of Labour’s website.

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