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Employers and POPIA

Employment Law , ,

The Protection of Personal Information Act (POPIA) has been in partial effect since November 2013. As of 01 July 2020, most of the remaining sections has commenced, and these sections bear relevance to employers.

The POPI Act is formulated based on the provision of the Constitution of the Republic of South Africa (Section 14, 1996) which provides that everyone has the right to privacy, including protection against any unlawful collection, retention, dissemination or use of personal information.

The Act itself promotes the protection of personal information processed by both public and private institutions. It establishes minimum requirements for the processing of personal information and provides for the establishment of an Information Regulator to exercise certain powers and to perform certain duties and functions in terms of the Act as well as the Promotion of Access to Information Act (2000), the issuing of codes of conduct, the rights of persons regarding unsolicited electronic communications and automated decision making and to regulate the flow of personal information across the borders of the Republic and all connected matters. It applies to the processing of personal information of all personal data that is entered into a record by or for a responsible party through either manual or automated means.

These provisions also impact the means and methods employers, as the responsible party, use to gather, record, store, and use employee records. Anything that the employer collect that contains an employee’s personal information is governed by this Act. Personal information includes an employee’s application file, personal file, payroll information, leave/medical file, and any other information the employer has about the employee. In other words, anything that employer collects that contains an employee’s personal information.

The POPI Act defines “personal information” in very broad terms to include any information relating to the identity of a person as well as any information that can be used to identify a person, such as race, gender, sex, marital status, nationality, ethnicity, sexual orientation, physical or mental health, disability, religion, culture, language, education, medical, financial, biometric, criminal or employment information, identifying number, symbol, e-mail address, location, opinions, confidential correspondence, etc.

It is a fundamental principle of POPIA that an employee must consent to the processing of his/her personal information. This means that he/she must be fully informed of the scope and nature of the processing. Consent must also be given voluntarily for a specific process. Consent gained by an employer using an unequal negotiating position, will not meet the definition of consent according to the POPIA.

POPIA in practise

Employers must ensure that staff responsible for processing personal employee information, as described by the Act, are aware of the conditions and requirements imposed on employers by the Act.

Employers should review all data records to determine what personal and/or sensitive information it has for employees and where the information is stored. Where information is being processed without consent, employers should determine what the legitimate basis is for doing so, and if the processing is based on the “legitimate interest” of the employers, this should be documented. Employees should be notified of the scope and nature of personal information processing and their consent to do so must be gained for processing any information that has not been obtained or kept legitimately.

Notify employees of the nature and scope of processing and gain consent to the extent that any employee data is not being processed for any reason other than a legitimately sound one.

Data privacy policies should be drafted, and all employees must be trained with regards to the content of the policy. This policy should include steps by which employees can lodge complaints against the processing of personal information.

Employment contracts should be reviewed and updated where necessary to include wording in compliance with the principle of consent by the employee to process specific personal information, as required to enter into a contractual relationship – including full information of the scope and nature of the processing. An employment contract cannot include a general consent clause with the intent to cover ongoing information processing during the period of employment. POPIA defines ‘consent’ as “any voluntary, specific and informed expression of will in terms of which permission is given for the processing of personal information.” A general consent would not satisfy the requirement of specificity to every instance of information processing.

This article is offered only as an introduction to the implications of POPIA and its impact on employment. Employers have a 12-month grace period from the commencement of the act to reach compliance and are strongly encouraged to consult with a labour and personal information specialist. Contact our Cape Town office for assistance 021 919 6418.

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Reimbursement of training costs

Employment Law , , , ,

Can an employer deduct money for training should the employee resign within a specific period after completing the training?

Many employers provide training to new employees when they join the company. The reason for training may vary from on-the-job training to train the new employee on proprietary systems of software, to being sent on formal skill development courses. Current employee may also require new training should the business’s operational requirements request it and or a new system is being implemented.

When an employee resigns, especially soon after completing training, employers are quite justified in feeling wronged. The question becomes, may they hold the employee liable for the costs and expenses incurred for the specific training?

Firstly, it is important to keep in mind that Section 34(2) of the BCEA specifies that:

“2) A deduction in terms of subsection (1)(a) may be made to reimburse an employer for loss or damage only if–

a) the loss or damage occurred in the course of employment and was due to the fault of the employee

b) the employer has followed a fair procedure and has given the employee a reasonable opportunity to show why the deductions should not be made

c) the total amount of the debt does not exceed the actual amount of the loss or damage; and

d) the total deductions from the employee’s remuneration in terms of this subsection do not exceed one-quarter of the employee’s remuneration in money.”

If a (advisably written) agreement was established between the employer and the employee that the employee would be liable to repay the costs of the training should s/he resign within a specified period after completion of training, the employer will be able to enforce the signed written agreement. The employer will then be allowed to recover from the employee a proportionate / pro rata amount of the training costs incurred by the employer for the employees training received.

The written agreement would have to meet the following criteria:

  • That is was signed/agreed to prior to the commencement of the training.
  • That it disclosed all the terms and costs to the employee prior to the signing of the agreement.
  • That it clearly stipulates the terms under which the employee would be liable to repay such
  • That it stipulates the period for which the employee will be held liable for those costs.
  • That is stipulates how the proportionate / pro rata amount will be worked out should the employee leave/ resign before the specified period has lapsed.

If training is offered on the condition that the employee may be held liable to reimburse the costs should s/he resign for any reason or is dismissed, before training could commence, through no fault of the employer within a certain time, the employee must be given a fair opportunity to refuse the offer of training should s/he feel that the conditions are unacceptable for whatever reason.

If no agreement was signed prior to the training, it is implied that the employer is offering the training at company cost without requiring the employee to reimburse the employer. An employer has no legal entitlement after the fact to demand the repayment of training costs if the only basis is that the employee has resigned.

To succeed in a claim for reimbursement of training costs against an employee, the employer would have to show that a valid agreement was in place prior to incurring the cost of the training. The reimbursement claimed cannot exceed the actual cost of the training, that is, the total provable cost of providing the training less the portion claimed by the employer in terms of the Skills Development Act.

Employers are cautioned to carefully consider when imposing a liability for training costs on an employee should s/he resign, as this may result in the provision falling under the scope of the Conventional Penalties Act 15 of 1962, if the cost claimed is deemed to be a penalty and the penalty amount is disproportionate to the actual loss/damage suffered by the employer.

This article is being provided for informational purposes. Contact Joblaw for any enquiries and legal advice.

 

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Importance of having disciplinary warnings on file

Employment Law , , , ,

It is an unfortunate reality that even the most diligent and fair employer or business-owner will at some point be required to apply disciplinary action or issue warnings in situations in the best interest of the company and the employee.

Disciplinary procedures and warnings, when appropriately used and managed, is not intended to punish a wrong but to correct wrong actions.

Warnings can range from a verbal warning to a final written warning depending on the circumstances under which it occurred or the severity of the misconduct or offence in need of correction. The severity of a warning can progressively be increased if the employee keeps repeating the offences or continues to commit offences against the established disciplinary code despite previous attempts to rectify the situation. Warnings issued should always follow the company’s established Disciplinary Code and it must be on record that the employee being sanctioned has seen, read and understood the disciplinary code. Employers are encouraged to discuss the company’s Disciplinary Code with Employees on a yearly basis.

Item 7 (b) of Schedule 8 to the Labour Relations Act provides:

If a rule or standard was contravened, whether or not:

(i)           The rule was a valid or reasonable rule or standard

(ii)           The employee was aware, or could reasonably be expected to have been aware, of the rule or standard;

(iii)         The rule or standard has been consistently applied by the employer

The drafting and dissemination of the company disciplinary code, as well as record that all employees have been informed of the disciplinary code is the first step in a vital record keeping process to fairly and lawfully apply disciplinary actions which may lead to warnings. The lack of such a paper trial may invalidate any defence against an unfair business practise/dismissal claim at the CCMA from the start.

A written warning must, at minimum, contain the following,

  • the identity of the employer and the employee
  • details of the offence: nature of, date of and time of offence
  • the terms of the warning and the period of validity
  • a clear statement of the corrective actions required by the sanctioned employee
  • a clear statement of the consequences for the sanctioned employee should he/she fail to fulfil the requirements as stated above or repeated offenses within the warning period
  • verifiable proof (in the form of the employee’s signature or witnesses) that the warning was delivered and received by the employee.

A warning should only be issued after a fair disciplinary process, and this process must be started immediately after the employer finds out about the transgression, conducted and completed as soon as possible to enable the employer to issue a warning (if warranted) with the most specific, concise information possible. This will help to avoid any future problems that may lead to a challenge at work or at the CCMA.

It is vital to any business and employer to keep accurate, detailed record of every disciplinary action and warning, including verbal warnings, documenting the charges and actions taken. To not do so imposes a huge risk to the employer should any disciplinary action be challenged at the CCMA, which could lead to monetary awards or reinstatement of a sanctioned employee.

In case law, refer to Gcwensha v CCMA & others, where the employee had been dismissed for gross negligence. Diligent recordkeeping by the employer evidenced that the employee had several previous warnings for incompetence, negligence and inefficiency. Gcwensha was on a current warning when he was dismissed. The court found that the employee had a ” deplorable record” of transgressions and misconduct, which the employer was entitled to take into consideration when deciding on the appropriate sanction to be taken for the current transgression. The employer was able to defend this action and avoid reinstatement of the employee because of the verifiable history of warnings he had on file.

The opposite was true in NUMSA v John Thompson Africa (Pty) Ltd [1997] 7 BLLR 932 (CCMA). It was the lack of proper record keeping that lead to the employer being ordered to reinstate the employee who was dismissed on charges of ‘wilful damage to and deliberate misuse of company property, using abusive language, and being under the influence of an intoxicating substance.’ The employee appealed the dismissal according to the employer’s established procedures, but at the appeal hearing there were no records of the proceedings or evidence tabled at the disciplinary hearings to make available to the chairperson to consider. It could not be proven that the employment relationship had irretrievably broken down due to the employee’s behaviour and it was ordered that the employee be reinstated.

Schedule 8 (Code of Good Practice – Dismissal) requires that employers must keep records of all disciplinary action taken against employees, the reason for it, and the outcome of that disciplinary action. An employer that does not do this, goes to the CCMA with little ammunition – and his case becomes quite indefensible.

 

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Probation Period & Poor work performance

Employment Law , , ,

Even though appointing new employees on the provision of a probation period or having a probation clause in their contract, has become standard practise in South Africa, much mystery and uncertainty still seems to surround the issue of what a probation period actually means in terms of  the rights of both the employee and employer. The main issue that lands employers at the CCMA is that they mistakenly believe that hiring an employee under a probationary contract or having a probationary clause in the employment contract allows the employer to dismiss an employee at the completion or during the probation period, without any regard to the obligations imposed under the Labour Relations Act, but more specifically the Code of Good Practice: Dismissal (more specifically paragraph 8 and 9).

The reasoning behind a probationary period is to provide the employer with an opportunity to evaluate whether a new appointee is suitable to the position to which s/he has been appointed based on the employee’s performance and ability to carry out the responsibilities as is required by the position. This means that the probation period is only applicable to evaluate the employees’ work performance ability. A probation period may not be used as an easy escape to dismiss a newly appointed employee because the manager does not like him or her or because they do not fit into the business culture.

The misconception regarding probation periods usually touches on this point, with many employers believing that when a probation period is close to its end, they may simply inform an employee that their performance is not satisfactory and end their employment. A termination based on this presumption will be deemed both procedurally and substantively unfair.

It is important to keep in mind that when an employer decides not to permanently employ a new employee after their probation period, such a termination of employment effectively constitutes a dismissal due to poor work performance. For a poor work performance dismissal to be both procedurally and substantively fair, such a decision must be supported by records proving that all requirements of the Code of Good Practice: Dismissal (referred to above)  was met in order to afford the employee a fair opportunity to meet such expectations. These include:

  • Records of all training/coaching provided, including on-the-job training and informal mentoring sessions
  • Minutes of meetings with the employee
  • Solutions to address mistakes and poor work performance
  • Reasonable deadlines given for the improvement of poor work performance
  • The result of the measures taken to resolve the identified poor work performance

The employer will also need to prove that the procedure leading to the termination of the employment contract included an investigation to determine the reasons for the poor work performance and that alternative to remedy the situation, short of dismissal, was considered and implemented to resolve the problem. This means that the performance of the new employee needs to be monitored and recorded from the first day.

It is therefore important to remember when appointing a new employee that a probation period or probationary clause in the contract is not seen as a “trial period” by an employer. It should be deemed as being the induction/training period of the employee, integrating them into the new business. Employers should therefore remember to monitor the employee’s performance from the start. Also, make it clear from the start what is expected of the employee and how they can achieve it. The employer has a duty to assist the employee where reasonably possible to achieve the standard which is expected of them and to ensure that its standards are indeed reasonable and achievable.

While probation can be very beneficial to an employer when recruiting and building his or her team, it must only be used for the intended purpose. It is advised to consult a labour law expert when drawing up policy regarding probation to:

  • Design probationary policy and procedure in line with labour law
  • Establish the measures for monitoring and evaluating work performance
  • Set realistic performance standards to measure progress
  • Train managers on probation law and the implementation of the policy and procedure.

Dismissal for Poor Work Performance (PWP) while Employee is on probation (in a nutshell)

During the probation period the Employer should assess the Employee’s performance. In order to assess it must be clear what is expected of the employee. If it is not clear what is expected of the Employee, he/she should be informed, preferably in writing what is expected of him/her.

The Employee should also be given reasonable evaluation, instruction, training, guidance or counselling in order to allow the employee to render satisfactory service. It is advisable that the Employer keeps proof hereof. The Employee must also be given some time to have an opportunity to improve.

Should the Employer determine that the Employee’s performance is below standard, the Employer should advice the Employee of any aspects in which the Employer consider the Employee to be failing to meet the required standards. If the Employer believes that the Employee is incompetent, the Employer should advise the Employee of the respects in which he/she is not competent.

The Employer should also then allow the Employee to make representations (i.e. to respond, preferably in writing) to the allegations of incompetency that the Employer is making. After receiving the Employee’s representations, the Employer may then decide to either extend his probation period, or to dismiss. It is not necessary (while the Employee is on probation only) to hold a formal enquiry or “hearing”.

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