Many companies and employers have been subjected to difficult economic conditions over the past few months. They are still reeling after the effects of the COVID pandemic and its devastating effect on our economy. Desperate times call for desperate measures, but can an employer reduce the working hours of his employees to decrease his payroll expenses?
Should an employer consider reducing hours of work or shift changes, or pay cuts, he should understand that these steps will change working conditions.
Working conditions can only be changed by an agreement.
What are working conditions?
Working conditions refer to a wide range of elements relating to the work that has to be agreed on whenever an employment relationship is initiated, such as working hours, wages/payment, overtime, benefits, deductions from the salary and leave. Minimum conditions of employment are regulated by the Basic Conditions of Employment Act (BCEA) Act 75 of 1997 as amended.
Chapter two of the BCEA regulates working hours and overtime.
Every employer in South Africa must regulate the working time of each employee:
- Under any Act governing occupational health and safety;
- With due regard to the health and safety of employees;
- With due regard to the Code of Good Practice on regulating Working Time issued under section 87(1)(a) of the Act; and
- With due regard to the family responsibilities of employees.
Whenever an employer considers changing any of the conditions of employment to ensure the company’s survival, such as working hours, there should be a thorough and meaningful consultation process with the employees and/or their union, if applicable. One should also keep in mind that certain bargaining council requirements may exist and must be adhered to depending on the sector the employees work in.
If the business falls under the scope of application of the Metal and Engineering Industries Bargaining Council (MEIBC), for example, then the requirements to reduce working hours (short time) according to the Main Agreement include that an employer shall give the Regional Council, affected employees and affected party trade unions five calendar days’ notice of the intention to implement short-time hours. During the five calendar day notification period, the employer shall consult with the representatives of the trade union officials and/or elected shop stewards on how the short time working will operate. Another requirement is that an employer shall give the Regional Council, affected by the employees and affected party trade unions, five calendar days’ notice if short time is to continue for over six weeks from the original implementation date.
It is important to know whether a company has to comply with certain requirements not regulated by the BCEA but by a bargaining council, as non-compliance could lead to an unwelcome award, should a case be referred.
Any consultation will aim to agree between the employer and employees/their representative union before a change in working conditions is implemented. Only then will it be smooth sailing; otherwise, the employer must choose another option to curb expenses.
What if no agreement is reached between the parties?
If no agreement is reached after the thorough process of interaction and consultation, the employer has the choice to retrench employees based on operational requirements. This should be a matter of last resort. The reduced hours will still be offered to employees as an alternative to job losses.
Should you have any questions, or require assistance regarding such an agreement or the consultation process in the workplace, contact your nearest SEESA Labour legal advisor for expert advice. Alternatively, leave your contact details on our website, and a SEESA representative will contact you.
About The Author:
Charle Koegelenberg started his career at SEESA in January 2009. He is currently a Labour Legal Advisor and acts as a Training Facilitator at SEESA’s Kimberley branch.
Resources:
- The Basic Conditions of Employment Act (BCEA) Act 75 of 1997 as amended;
- The Metal and Engineering Industries Bargaining Council (MEIBC) Main Agreement;
- https://www.higgsattorneys.co.za/articles/how-to-change-employees-working-hours-reduce-salaries-and-or-restructure-without-committing-an-unfair-labour-practice/
https://serr.co.za/considering-short-time-work-and-lay-off-as-an-alternative-to-retrenchment-in-2021 Anil Singh.
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