Retirement: Simultaneous claims under the Labour Relations Act and the Employment Equity Act

Normally, only one claim is allowed in terms of a specific cause of claim and/or action, but in this article, we will discuss the exceptional case where an employee can lodge a simultaneous claim in the event of a specific dismissal dispute.

In terms of section 187(1)(f) of the Labour Relations Act (LRA), dismissal is automatically unfair if the employer’s reason for dismissal discriminates against an employee, either directly or indirectly on the basis of one of the listed grounds, including age.

In the Labour Law case, Evans v Japanese School of Johannesburg [2006] 12 BLLR 1146 (LC), the employer terminated the employment of an employee at the age of 61 on the alleged ground that she had already reached retirement age at the age of 60. Initially, the employee was appointed without a written contract being in place and without a specific retirement age being agreed upon. Meanwhile the employer, however, began to appoint the employee on a fixed-term contract annually. There was no retirement policy in place, and other employees who were also over the age of 60 were allowed to continue working for the employer. There was absolutely no problem with the performance of the employee in question.

The employer has not met its burden of proof that the dismissal was based on age. The employee brought a claim of automatic unfair dismissal in terms of the LRA (as mentioned here above) against the employer, but also brought a claim in terms of the Employment Equity Act (No 55 of 1998) (EEA) on the grounds of direct unfair discrimination based on age.

Among other things, the court had to decide whether the simultaneous claims would amount to duplication, and whether the employee could file both claims against the employer at the same time given that unfair discrimination based on age is a material part of the cause for both claims. The provisions of section 187(1)(f) of the LRA are similar to section 6 of the EEA insofar as it refers to the same grounds as contemplated in section 6 of the EEA.

The court ruled that although it could amount to duplication, the LRA puts a limit of 24 months on the compensation that may be granted, whereas the EEA does not put a limit on compensation. The court proceeded to grant the employee compensation of 24 months in terms of the LRA for automatic unfair dismissal on the grounds of age, and a further amount of R200 000 as compensation for unfair discrimination in terms of section 6, read together with section 50 of the EEA. A total award of R406 668 was granted to the employee, being R177 144 [section 187(1)(f) LRA], R200 000 (section 6 EEA) and R29 524 (Notice and allowance).

Employers should therefore think twice before unilaterally fixing retirement age afterwards, treating employees differently as far as retirement age is concerned as the courts are by rights more than willing to accommodate employees whose dismissal was automatically unfair in this manner, and to offer them protection in terms of both Acts.

The employer was also ordered to pay the employee’s legal costs.

Author: Ettienne Pio