Appointing a Third-Party Arbitrator Before Resorting to Dismissal

Class ActionEmployers and Employees seeking to resolve disputes are aware of the option of referring such disputes to the Commission for Conciliation, Mediation and Arbitration (CCMA). Referral often happens where a decision has already been made relating to either an alleged unfair dismissal or issues of capacity. However, not many Employers are aware of the option whereby a dispute is referred to the CCMA, or an otherwise accredited third-party Arbitrator before a decision leading to the above is made.

 

S188A of the Labour Relations Act (the ‘Act’) sets out the provisions relating to an Agreement for Pre-Dismissal Arbitration but what exactly is this and when will it become useful?

 

The Process

 

As stated above, disputes arise between Employers and Employees and where this occurs, there is always scope for parties to allege that the appointed ‘decision-maker’ in these proceedings is biased, either by their employment to the business or relationship to the Employee. In such an instance, a third-party Arbitrator can be appointed to chair an inquiry where both parties agree to such in writing if the dispute is related to conduct or capacity and the various provisions of S188A of the Act are adhered to. A contract of employment can also include a clause whereby the Employee grants consent to the inquiry.

 

This inquiry will take place where the decision to be made by the Employer could, in all likelihood, culminate in the Employee being dismissed. A suitably qualified and impartial Arbitrator would ensure a transparent and unbiased decision, with such decision being regarded as the Employer’s final one in the matter.

 

To properly make use of this process, the Employee can only provide the consent necessary to validate the proceedings if they have been informed of the allegations levelled against them.

 

The matter is then arbitrated according to the standard rules whereby the Arbitrator may conduct the inquiry in the way they feel would be best. This would take into account the nature of the dispute, information to be presented and resources available, all while ensuring fairness and an efficient yet competent decision.

 

Legal representation for the duration of the inquiry would be allowed upon application to the Arbitrator by either party. Alternatively, Employers may be represented by a manager or office bearer while Employees can be represented by a co-employee, member of a registered trade union or a shop steward.

 

Decision

 

The appointed Arbitrator delivers their decision within 14 days after the inquiry with the matter subsequently not eligible for referral to the CCMA or Bargaining Council for arbitration or conciliation. This period may be extended by the Director of the CCMA but only where there is good cause shown. It provides a way for Employers to ensure potential future costs of resolving the dispute is avoided by making use of a reliable process in taking a decision to either dismiss, retain or suspend the Employee.

 

Conclusion

 

Employees have the benefit of not being held liable for the costs of appointing such an Arbitrator. As per S188A(3)(a) an Arbitrator is only appointed to a matter once the CCMA has received payment of the prescribed fee for which the Employer is liable.

For Employers, making use of a third-party Arbitrator by Agreement would mean a mutually beneficial way of ending a dispute that could potentially develop into a much bigger issue. Credibility is a very strong influencing factor on how the overall business is perceived, and if the proper guidance is not obtained in such pivotal processes, the results could affect a lot more than the Employer/Employee relationship.

 

For this reason, it is always advised to seek professional advice from qualified experts when engaging in sensitive employment matters.

 

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