Employer’s right to implement changes to existing terms and conditions of employment

THE RIGHT TO IMPLEMENT CHANGES TO EXISTING TERMS AND CONDITIONS OF EMPLOYMENT

Media Workers Association and others v Independent Newspapers (Pty) Ltd; Case Number: D426/2002 (Labour Court); Date of Award: 27 March 2002; www.caselaw.co.za

The age old debate surrounding the employer’s right to implement changes to existing terms and conditions of employment came before Pillay D, J in an urgent application brought by Media Workers Association of South Africa, South African Trade Union of Journalists and Chemical Energy Paper Printing Wood and Allied Workers Union.

The application, brought on behalf of journalists and editorial staff, sought to prevent the Independent Newspapers (Pty) Ltd from altering employee’s terms and conditions of employment. The newspaper argued that the need to change terms and conditions of employment was brought about by a need to restructure following a loss of profits. These changes related to grading, hours of work and career advancement.

With restructuring in mind the newspaper initiated a consultation process, commenced on 22 July 2002. During a series of workshops involving affected employees a new editorial structure was developed. The new structure was unveiled at the end of October 2001 at which time the Applicant trade unions became reluctant to continue participating in the consultation process. In retaliation the newspaper began consulting personally with individual employees affected by the restructuring. These consultations took place between November 2001 and February 2002.

The Applicant trade unions contended that by dealing personally with the employees the newspaper had undermined the principles of collective bargaining. Although Judge Pillay agreed that employers should consult with registered trade unions and not directly with their employee members she took the view that where trade unions refused to consult with the employer the employer had no alternative but to consult personally with the individual employees. The Court found that an application of Section 189 would often bring about changes to terms and conditions of employment. These changes are justified provided that they were made in the course of a bona fide retrenchment exercise and as an alternative to retrenchment.

Were changes to terms and conditions of employment (and possible dismissals) were a result of restructuring, a dispute arising out off these changes did not constitute a mutual interest dispute. By implication, aggrieved employees are precluded from embarking on protected strike action to challenge the changes affected by their employer to their terms and conditions of employment.

An additional consequence of the conclusion derived at by Pillay is that while an employer is ordinarily obliged to negotiate before implementing changes to term and conditions of employment or face the risk of strike action an employer implementing similar changes in the context of a section 189 restructuring exercise can effect these changes after only consulting with affected employees. Once this has been done the employees are precluded from striking.

Judge Pillay left open the question whether Sections 188 and 189 of the LRA dealing with unfair dismissals and dismissals based on operational requirements were subservient to the Section 187(1)(c).

Although Judge Pillay’s conclusion that changes to terms of employment can arise within the context of a restructuring exercise is based on sound reasoning the judge omitted to provide guidelines in this regard and has potentially provided employers with a loophole to prevent debilitating strike action by associating unilateral changes to condition of employment with section 189.