COVID-19 Employers are called on to do the Right Thing

March 20, 2020
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April 22, 2020

COVID-19 Employers are called on to do the Right Thing

In a recent statement, President Cyril Ramaphosa called on all business leaders and business owners to act with care and asked that leaders do the right thing during these unprecedented times. On the back of his recent public addresses, numerous opinions, articles, legal interpretations and government legislated guidelines have come to the fore. Some true, some fake. The 21-day lockdown that commenced on midnight 26 March 2020 has since overridden the 3-month state of disaster guidelines and should be interpreted accordingly.

Notwithstanding, there are still many questions relating to how employers should respond and take action. Set out below, is a quick guide which we hope will assist clients to make the right decisions and do the right thing.

Can employees work from home?

Yes, especially when mandated under lockdown scenarios. Unless deemed essential services and critical skills, employers should (where practical) instruct staff to work from home, providing them with clear guidelines and rules that specify expectations and obligations. At the same time, employers must make all efforts, within reason, to enable employees to work from home, through the provision of necessary tools, hardware, software and other essential items.

Granting annual leave – Yes/No?

Employers are within their rights to ask employees to use their annual leave during this lockdown time BUT can only enforce the use of annual statutory leave, e.g. 15 days per/annum. Employers, however, cannot use this period to force staff to take accumulated annual leave as a means of reducing that leave liability.

If an employer takes the decision to send staff home on statutory leave in order to mitigate the risks of the pandemic, then the employer can determine the time and dates that leave is to be taken.

NOTE Staff must be paid when instructed to avail themselves of statutory leave.

Can an employer force staff to take annual leave?

The answer is YES, but not when the employee needs to go into enforced self – isolation/quarantine as a result of testing positive for COVID-19.

However, take note that such a measure is subject to normal contracts of employment, company leave policy and applicable collective bargaining agreements.

What about taking UIF special leave?

Such a requirement comes into play during the pandemic only when staff are subjected to and required to self – isolate for a minimum of 14 days. Then such leave must be granted as special leave.

Employees are then permitted to apply for UIF benefits to be paid on condition that the reason for quarantine meets the stated UIF criteria.

What about sick leave?

Sick leave is governed as per the Basic Conditions of Employment Act (BCEA) section22 that regulates sick leave entitlements.

If an employee proceeds on sick leave during this period and the reason is unrelated to COVID-19 and supported by a doctor’s certificate, then the employee must be paid by the employer at the agreed normal rate of pay.

However, section23 of the BCEA states that an employer is not required to pay an employee who is absent for more than 2 consecutive days in an 8-week cycle without a medical certificate. Here it is recommended during this current period to apply discretion and conduct the necessary due “investigation” to determine the validity of sick leave, bearing in mind that if abuse of sick leave is established the employer is within their right to proceed with disciplinary measures.

IF an employee has exhausted their sick leave entitlement in the allocated 3-year period then the employer is not legally required to pay the employee for sick leave exceeding the statutory 30 / 36 days unless a fair reason exists that could tilt the scale in favour of paying the employee. Here again, rational and clear decision making must be applied to do the right thing during this period.

What about reducing salaries?

Like many European football teams and players are doing the employer and employee can negotiate and agree on a reduced
salary as a measure to avoid unpaid leave, temporary layoff or retrenchment.

However, note that remuneration/salary is an agreed term and condition of employment committed to contract and often underpinned by collective bargaining agreements, hence the need to consult on terms with all stakeholders.

The employer cannot make a unilateral decision without entering into consultation as this would constitute an unfair labour practice.

Forced to consider short time/temporary layoffs?

Unfortunately, despite the best intentions of the government to curb the spread of this pandemic one cannot ignore the consequential impact on business owners, in particular SMME’s.

As a measure to avoid retrenchment employers can consider alternatives as a means to balance one’s obligations to employees with the need to maintain business continuity and in view thereof can institute short time / temporary layoff processes.

Short time is the reduction of working hours and comes with a corresponding decrease in the employee’s wage/salary.

The temporary layoff is the suspension of an employee’s contract due to the fact that the employer is compelled to stop working due to the suspension of projects or the like and is therefore unable to afford its workforce due to the lack of cash flow coming into the business.

These alternatives are well documented and procedural guidelines are available to employers that provides for an application to be made in accordance with the UIF COVID-19 Temporary Employee / Employer Relief scheme, TERS.

Can retrenchment be considered?

Regrettably, the answer is yes, IF operational requirements deem it necessary in order to sustain business continuity.

Retrenchment is a no-fault termination on the part of an employee and the usual separation process of consultation and calculation methodology must be followed as prescribed by section189 of the LRA.

NOTE that pursuing retrenchment must not be used as an opportunity for the employer to terminate the employment of ill employees.

We would urge leaders to think very carefully and explore all other alternatives to avoid the negative impact that comes with retrenching staff at this time.

Can staff be dismissed for ill-health incapacity?

YES, again the employer is within their rights to pursue such a procedural process when an employee is chronically ill and unable to fulfil
their contractual obligations and requirements for prolonged periods.

As per schedule 8 of the code of good practice iro dismissals employers are required to conduct an investigation into the nature of illness and suitability to continue working. However, employers are urged to seek alternatives to dismissal if at all possible.

Such a process cannot be applied to new COVID-19 cases and cannot be used as a solution to dismiss staff who become infected. Again, leaders are urged to do the right thing!

Consider pregnant staff.

The BCEA expressly provides for the protection of employees before and after childbirth. No employer may permit a pregnant employee to perform work that is hazardous to the health of the child or parent.

Employers are encouraged to do all they can when considering the health and safety of pregnant employees, viz-a-vee allow the employee to work from home; afford additional leave benefits on a prid pro quo basis and if fulfilling a critical role be given a safe and isolated working space.

Director fiduciary obligations and duties.

Leaders and in particular designated directors per CIPC schedules must uphold their duty to act with care and in the best interests of the company and do what is right to protect the company.

All considerations must be given to the risk of jeopardizing the continued operations of the company and rendering it insolvent if staff are/are not subjected to any one of the above possible decisions.

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Crowe DNA (Pty)Ltd
+27 87 057 2613

Note that this easy aid guide must be read and considered taking into account the specific and unique facts of each case. This guide serves to assist our clients to make the right decision BUT we strongly recommend that you contact our HR Advisory team of experts for advice applicable to your situation and environment.

DISCLAIMER – This document serves as an informative guide to be used for information purposes by Crowe clients and is not intended to be viewed as a legal guideline document. Situations and scenarios differ from employer.

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