1300 Edcon dismissals probed by highest court

The Constitutional Court has been called upon to determine once and for all a contentious dispute between employers and employees regarding the validity of large-scale dismissals where an employer did not comply with the law.

A total of 1300 of 3000 employees who were dismissed by retailer Edcon in 2013 and 2014 on Tuesday asked the court to set aside a Labour Appeal Court (LAC) judgment passed in March this year. They are also seeking reinstatement with full back-pay.

In its judgment in the case‚ the LAC overturned decisions it had made in the past — notably the De Beers decision‚ in which it had accepted that if proper notice of termination was not given in large-scale retrenchments by employers‚ subsequent dismissals were invalid and of no force and effect.

The LAC held that it was never the intention of the legislature that an employer’s failure to comply with some sections of the Labour Relations Act (LRA) would result in dismissals being invalid.

Edcon‚ which owns store chains including Edgars and CNA‚ admits that it retrenched 3000 workers without following the procedures set out in the LRA. Edcon failed to refer a dispute to the Commission for Conciliation‚ Mediation and Arbitration and to wait out the relevant time period before issuing a notice of termination.

Bradley Conradie‚ a partner at law firm Bradley Conradie Halton Cheadle‚ said the effect of the LAC judgment‚ as it stood‚ was that an employer would not face the absurd prospect of having to reinstate an employee who was not required in its business and potentially be liable for years of back pay because proper termination procedures were not followed.

“Rather‚ the appropriate sanction in most cases will be payment of compensation to the affected employees‚” Conradie said.

In argument before the Constitutional Court on Tuesday‚ advocate Andrew Redding SC‚ for the retrenched employees‚ said the amendments to the LRA in 2002 introduced new rights to employees including a compulsory period of consultation.

He said one of the obligations imposed upon an employer by the amendments was not to dismiss prematurely‚ without allowing the time period referred to in the LRA.

Edcon said the effect of the De Beers decision was that despite employees having been effectively dismissed based on the employer’s operational requirements‚ the employer was prohibited from doing so and compelled to reinstate the employees with back pay.

The court reserved judgment.

X