CCMA Process

The Commission for Conciliation, Mediation and Arbitration (CCMA) promotes fair practices in the work environment, and ensures that labour disputes that fall within its jurisdiction are resolved efficiently, cost effectively, and with the least amount of formalities.

An employee is able to refer a dispute to the CCMA by submitting a Labour Relations Act (LRA) 7.11 referral form to the CCMA and delivering a copy of it to the employer. The employee can deliver the referral form to the employer physically or by email or by fax or by registered mail. When submitting the referral form at the CCMA, the employee must also attach proof of delivery on the employer. The employee can submit the referral to the CCMA physically or by email or by fax. The employee or trade union referring a dispute must identify the parties to the dispute (including their contact details) and the nature of the dispute but is not required to submit a detailed statement of the facts of the dispute.

Employees who refer disputes more than 30 days after a dismissal, or 90 days after an unfair labour practice dispute, or 6 months after a discrimination dispute must request the CCMA, on application, to condone their late referral if there is good cause for the delay. Failure to successfully apply for condonation for the late referral of a dispute will result in the CCMA not being able to adjudicate the dispute.

The CCMA will firstly try to resolve the dispute through conciliation. Conciliation is essentially an informal ‘off the record’ meeting between the parties and the CCMA commissioner, whereby the commissioner attempts to facilitate a settlement of the dispute.  The CCMA usually has a high success rate in facilitating settlements during conciliation.

Generally, if the parties are unable to settle the dispute at conciliation, the commissioner issues a LRA 7.12 form (i.e., certificate of outcome) certifying that the dispute remains unresolved. Thereafter, the employee will be entitled to refer the dispute to arbitration by delivering a LRA 7. 13 form within 90 days from the date of the certificate of outcome.

The LRA does not prescribe a basic format or procedure for an arbitration hearing and commissioners have a wide discretion on how to conduct proceedings. The law requires a commissioner to determine a dispute ‘fairly and quickly’ and ‘to deal with the substantial merits of the dispute with a minimum of legal formalities’. However, a party is entitled to produce documentary evidence, call witnesses, question the witnesses of any other party, and address opening and closing remarks to the commissioner.

Be the above as it may, the CCMA sets all disputes down for a con-arb hearing, which is a process where conciliation first sits, and if unsuccessful, arbitration follows immediately thereafter (on the same date of conciliation). A party that intends to object to a dispute being dealt by means of a con-arb, must deliver a written notice to the CCMA and the other party, at least 7 days prior to the scheduled date, and the conciliation and arbitration hearing will automatically be separated, and the ordinary process applies and the employee must refer the dispute to arbitration within 90 days of conciliation failing to settle the matter.

A party may, however, not object to the con-arb process if the dispute relates to: (a) the dismissal of an employee for any reason related to probation or an unfair labour practice relating to probation; (b) a dispute relating to a compliance order referred in terms of section 69(5) of the Basic Conditions of Employment Act (BCEA); or (c) claims for failure to pay any amount owing referred in terms of section 73A of the BCEA.

The CCMA dispute resolution process is rather simple, and all necessary forms can be found on the CCMA website.

How Do You Handle a CCMA Case?

It’s important to understand in which instances the CCMA can assist. They are:

  • unfair dismissal,
  • unfair labour practice,
  • disputes relating to compliance orders,
  • retrenchment,
  • certain discrimination disputes,
  • national minimum wage disputes,
  • freedom of association,
  • organisational rights,
  • collective agreements,
  • mutual interest issues.

CCMA Legal Representation

In conciliation proceedings a party to the dispute may appear in person or be represented only by: (a) if the party is an employer, a director/member or employee of that party and (b) any member of that party’s registered trade union or registered employers’ organisation or an office bearer or official of the registered trade union or employer’s organisations as defined in the LRA. Accordingly, no legal representation will be allowed at conciliation proceedings, unless to raise and/or deal with preliminary points.

In arbitration proceedings, in addition to an individual entitled to represent a party at conciliation proceedings, a party to the dispute can be represented by a legal practitioner or a candidate attorney.

However, a legal practitioner or candidate attorney  is not automatically permitted to represent a party at arbitration if the disputer pertains to an unfair dismissal (where a party has alleged that the reason for the dismissal relates to the employee’s conduct or capacity) or the dispute being arbitrated is referred in terms of section 69(5), 73 or 73A of the BCEA, unless the parties consent to it, or the arbitrator permits it (on application by a party) due to ‘the nature of the questions of law raised by the dispute, its complexity, the public interest and the comparative ability of the opposing parties to deal with the arbitration.

A party that is not satisfied with the arbitration award, can within 6 weeks thereof, apply to the Labour Court to review the arbitration award

Adams & Adams has a team of experienced and highly skilled employment attorneys that can assist with all types of employment and labour disputes, including internal disciplinary enquiries, CCMA disputes, Labour Court and Labour Appeal Court matters. For ease of reference, the CCMA provides a host of tools and documents available for download that can be accessed by anyone that is looking for confirmation before referring a case and submitting the relevant forms.

Mandatory COVID -19 Immunisation in the Workplace: It’s Not That Straight Forward

Many employers have placed their hopes of a return to the pre Covid-19 workplace on the development of a Covid 19 vaccine.  South Africa is in the process of acquiring and rolling out vaccines, however, it seems that although people are encouraged to be immunized, no one will, at this stage, be legally required to take the vaccine. Furthermore, unlike medical testing in the workplace, which is regulated in terms of section 7 of the Employment Equity Act (“EEA”), at present, there is no employment and labour legislation regulating medical treatment in the workplace, which includes immunization in the workplace. It is against this backdrop that many employers will, justifiably so, be looking to rely on its obligations as contained in the Occupational Health and Safety Act (‘OHSA”), to implement a mandatory immunization policy for its employees and job applicants.

The OHSA places a duty on employers to amongst others, provide and maintain, as far as is reasonably possible, a working environment that is safe and without risk to the health of its employees.  Employers therefore need to take appropriate steps in their workplaces to comply with these obligations and it is arguable that by implementing a mandatory workplace immunization policy, employers will ensure that the risk of contracting and spreading covid -19 in the workplace is minimised and possibly illuminated. However, prior to implementing a mandatory immunization policy in the workplace or compelling employees to be vaccinated, employers should consider the following:

  • Section 12(b) of the Constitution states that everyone has the right to bodily and physiological integrity, which includes the right to security in and control over one’s body. This section provides that a person has a right to make decisions about their own body in an autonomous and independent manner without any undue external interference and prevents any unwanted disturbances of bodily integrity, as would arise if an employee/job applicant is compelled to be immunised.
  • The Constitution protects a person’s right to religion and belief, including the right to practice one’s religion. Certain religions may prohibit immunisation. Furthermore, certain vaccines may contain ingredients that are prohibited in certain religions.
  • Vaccinated employees may raise that their constitutional right to life is being compromised by working with employees who object / refuse to being vaccinated (especially since contracting COVID-19 can cause death).
  • Employees / job applicants are protected from being unfairly discriminated against in terms of the EEA and in particular on the grounds listed in Section 6 of the EEA. Therefore, if an employer does not employ a job applicant or refuses an employee entry into the workplace, for instance, based on their objection to be vaccinated on religious or cultural believes, the employee / job applicant may challenge that decision as an unfair discrimination.
  • Should an employee be dismissed for refusing to be vaccinated on any unfair discriminatory ground listed in the EEA, an employee may challenge the fairness of his or her dismissal as an automatically unfair dismissal.
  • Unilaterally implementing a mandatory immunisation policy in the workplace (without consulting , ideally negotiating, the employees and/or their trade unions to obtain consent/agreement) could result in employees alleging that their terms and conditions of employment were unilaterally amended. This could result in endless unfair labour practice disputes at the CCMA and if upheld could result in the policy being unenforceable.
  • Certain employees may raise valid and justifiable health concerns associated with the vaccine. These could range from both short and long-term side effects to the potential complications due to existing medical conditions.
  • Employers who compel employee’s to be vaccinated may run the risk of potential damages claims in circumstances where employees/job applicants adversely react to the vaccine.

An employer is encouraged to consider all objections seriously, however, the justifiability of each objection will be determined on a case to case basis after having regard to the nature and reasons of the objection, the nature of the employers industry, workplace, workforce and the degree of risk associated with the failure to be vaccinated, including the employees specific job function and the possibility and feasibility of implementing other reasonable protective measures, short of the vaccine.  Furthermore, none of the above-mentioned rights are absolute in nature, with each of them possibly being limited, if the requirements of lawful limitation is met, together with the other considerations require such a limitation. What is clear, is that a one size fits all approach may not be implementable and our courts will be called upon to make decisions on a case specific basis, because what may be lawful in an industry where risk exposure is very high may not be lawful in other industries.

In light of the above, prior to implementing a mandatory immunisation policy, it is advisable for employers to identify the risk of exposure to covid – 19 at the workplace and also to identify the possibility and feasibility of implementing other reasonable protective and preventative measures, short of the vaccine to limit and eliminate the risks, if any.  Thereafter, it is advisable for an employer to also embark on an employee vaccination awareness and education programme. The purpose of the awareness and education programme is to encourage employees to get vaccinated and at the same time to address any employee concerns, objections, and myths. Depending on the nature of the concerns, it may be beneficial to also utilise the services of a health care professional and/or religious leaders from different faiths. By adopting this approach, the employer will mitigate the risks discussed above and be best placed to receive consent and indemnity from its employees and if not, it will assist in determining the feasibility, risk exposure and the form of a workplace immunisation policy, if necessary.

What Is the Difference Between Permanent, Fixed Term and Part Time, Contracts of Employment?

Governed by both the Labour Relations Act, as well as the Basic Conditions of Employment Act, permanent, fixed termand part time contracts of employment regulate the employment relationship (including rights, duties and obligations) between the employer and the employee.

Permanent Employment Contract

A Permanent employment contract endures indefinitely or at least until the date of retirement, subject to being terminated by resignation, mutual agreement or for reasons relating to misconduct, incapacity, or operational requirements of the employer.

Irrespective of the type of contract of employment, the Basic Conditions of Employment Act stipulates that at least the following particulars must be provided in writing to an employee at the commencement of employment:

  • the full name and address of the employer;
  • the name and occupation of the employee, or a brief description of the work for which the employee is employed;
  • the place of work, and whether the employee is required or permitted to work at various places;
  • the date on which the employment began;
  • the employee’s ordinary hours and days of work;
  • the employee’s wage or the rate and method of calculating wages;
  • the rate of pay for overtime work;
  • any other cash payments to which the employee is entitled;
  • any payment in kind that the employee is entitled to and the value of the payment in kind;
  • how frequently remuneration will be paid;
  • any deductions to be made from the employee’s remuneration;
  • the leave to which the employee is entitled;
  • the period of notice required to terminate employment, or if employment is for a specified period, the date when employment is to terminate;
  • a description of any council or sectoral determination which covers the employer’s business;
  • any period of employment with a previous employer that counts towards the employee’s period of employment.
  • a list of any other documents that form part of the contract of employment, indicating a place that is reasonably accessible to the employee where a copy of each may be obtained

In addition to the above and irrespective of the type of contract of employment, the Basic Conditions of Employment Act also provides certain mandatory minimum standards of employment including, including inter alia, leave, hours of work, maternity leave, notice periods etc

The National Minimum Wage Act oversees minimum wages/remuneration, and an employer may not remunerate employees less than the minimum wage as determined from time to time.

In addition to the minimum standards of employment contained in the Basic Conditions of Employment Act and the Minimum Wage Act, the Labour Relations Act also provides certain additional protections to employees employed on a Fixed term and Part time contracts of employment.

Although, the employer and employee can at their discretion enter into a contract of employment on terms and conditions that are best suitable to both parties, the parties however cannot enter into a contract of employment that provides for terms and conditions of employment that are less favourable then the prescribed minimum standards of employment contained in the Basic Conditions of Employment Act and the National Minimum Wage Act or that is in contravention  of the protections afforded  in the Labour Relations Act.

Fixed Term Employment Contract

A fixed term contract of employment expires/terminates automatically on the arrival of a specific date or the occurrence of a specific event agreed to between the parties in the contract of employment.

Accordingly, fixed term contracts are generally utilised where the nature of the work is for a fixed duration only or linked to the conclusion of a specific project.

In addition to the prescribed minimum standards of employment mentioned above, the Labour Relations Act also provides additional protection to fixed terms employees who earn below the earnings threshold (as determined from time to time by the Minister of Employment and Labour in terms of the Basic Conditions of Employment Act). The current earnings threshold is R205, 433.30 per annum.

The purpose of the amendments is to provide protection against lengthy fixed-term contracts that are not justified and to avoid the continuous rollovers of fixed-term contracts.

The Labour Relations Act provides that an employee who earns below the earnings threshold can only  be employed on fixed term contract for a maximum period of 3 months or a period greater than 3 months under the following circumstances:

  • is engaged on account of a temporary increase in the volume of work which is not expected to endure beyond 12 (twelve) months;
  • is a student or recent graduate who is employed for the purpose of being trained or gaining work experience in order to enter a job or profession;
  • is engaged to work exclusively on a genuine and specific project that has a limited or defined duration;
  • is a non-citizen who has been granted a work permit for a defined period;
  • is engaged to perform seasonal work;
  • is engaged on an official public works scheme or similar public job creation scheme;
  • is engaged in a position which is funded by an external source for a limited period;
  • has reached the normal or agreed retirement age applicable in the employer’s business.

Failure to comply with the above will result in the fixed term contract of employment automatically being deemed as permanent in nature.

The above mentioned additional protections will not be applicable to  fixed term employee’s who earn  in excess of the earnings threshold or to an employer that employs less than 10 employees, or employs less than 50 (fifty) employees and the business has been in operation for less than 2  years, subject to certain conditions contained in the Labour Relations Act.:

In so far as fixed term contracts relating to employees who earn more than the earnings threshold, the principle relating to the reasonable expectation that the fixed contract will be renewed or be made permanent will be applicable.

Part Time Employment Contract

Part time employees differ from full time fixed term and permanent employees. Part time employees generally work less hours per week then full time fixed term and permanent employees. For example, part time employees generally only work half days, twice or thrice a week or only on weekends, etc.

In addition to the prescribed minimum standards of employment mentioned above , the Labour Relations Act also requires an employer to treat its part time employees on the whole not less favourably than a comparable full-time employee doing the same or similar work, unless there is a justifiable reason for different treatment.

A justifiable reason for different treatment is, inter alia, seniority, experience, length of service, merit, the quality or quantity of work performed or any other criteria of a similar nature.

For advice on employment contracts, contact the Employment and Labour Law Attorneys at Adams and Adams.

Remote Working Challenges to Traditional Employment Contracts

Before the COVID-19 pandemic accelerated the transition to remote working capabilities, an employment contract would often refer to an employee’s ‘place of work’. At such ‘place of work’, the employer and employee both had obligations to fulfil, which were regulated by legislation and practice reflected in the employment contract.

However, the move to a more agile or remote working environment provides challenges to the traditional social contract legally, particularly in terms of the current Basic Conditions of Employment Act (BCEA) 1997, as well as the responsibilities of both employer and employee. Many employers may have to amend and/or introduce new policies to regulate employees who are now working remotely.

Possible challenges to existing social contracts

Remote working can present issues when following the law in terms of particulars of employment in terms of the BCEA. Specifically, the ‘place of work’, and, where the employee is required or permitted to work, which needs to be identified and indicated in the contract.

The flexibility of working from home can create an ‘always-on’ culture, where employees find it difficult to unplug from technology and may work longer hours than at the traditional office. Consideration needs to be applied to the concept of ‘ordinary hours of work’ and the regulation of overtime for employees earning below the threshold and employees who are contractually entitled to overtime.

New policies for the usage of remote working tools, such as laptops or access to a VPN, and how employees must deal with confidential and privileged company information when working remotely may need to be introduced. The wellbeing of employees (including alcohol and substance abuse), dress code, the disciplinary code and procedure, such as misconduct in light of the new policies and protocols, and the restructuring of benefits may all need to be amended under the new working regime.

Other challenges to existing employment contracts include how companies manage, maintain, and measure employees’ work standards while working from home or remotely. Employers may need to upskill employees and provide tools and equipment, so that performance standards are met during remote operations. There should also be a proper understanding of the process that an employer must follow when the employee’s performance is below the required performance standard, including the code of good practice on incapacity in a remote working situation.

Making changes to employment contracts

Before an employer contemplates any changes to an employee’s contract of work, they should engage with registered trade unions, employee representatives and/or the employees to reach an agreement.  Even in circumstances where an employer may have a contractual right to change certain terms and conditions of employment, it is still always good management to consult on such matters.

If an employee’s position becomes redundant, for example if the job at the traditional place of work no longer exists, it could result in retrenchment in terms of operational restructuring and/or the employer’s operational requirements and the payment of severance pay if applicable. This line of action is not always in the best interest of both parties, in that the employee will potentially be unemployed and the employer will potentially lose employees with key expertise and knowledge. Therefore, the parties ought to try and reach a compromise where possible.

As remote working looks like it is here to stay for the long term, companies are advised to review their employee contracts as well as those with collaborators, consultants, and other remote workers to ensure that they can enhance business value and reduce significant risks. Seeking legal advice on modifying policies and benefits for remote working can make this transition much easier.

What Legal Effect Does Remote Working Have on Intellectual Property Rights in the Workplace?

In a recent Savile Row Workplace survey, in partnership with Adams & Adams, and published in October 2020, 88% of the respondents said they prefer to either work from home or a combination of both home and office. Despite this, 67% of those surveyed have not altered their work policies or agreements for remote working, and of those that did, only 7% made any change to their intellectual property management regime.

Intellectual property remains a valuable asset to a business, which needs careful consideration in remote working scenarios, where a company’s rights may be at risk out of a controlled traditional workplace environment. Many businesses may need to rethink their agreements and policies in this new space to mitigate a potential loss of intellectual property rights.

Clauses dealing with intellectual property when working from home

Before making any changes to intellectual property policies and agreements, businesses should have a clear understanding of how intellectual property rights are created, who owns these rights, and what effect remote working may have on these rights. At the outset, it is worth noting the following challenge with the general rule that intellectual property created within the course and scope of an employment contract is owned by the employer. In a remote working environment, one should appreciate that accurately  determining which aspects of creativity or innovation are within the course and scope of an employment contract and which are not,  become considerably more challenging and open to abuse.

The most common of these rights are:

  • Copyrights

These rights evolve automatically through the creation of works such as literary, artistic, musical, or computer programs. Identifying the author of these works is critical in determining ownership, as only in a limited number of circumstances is the first owner of the work not the author. Exceptions to this include works created in the course of employment of another, or provisions of a contract that regulates ownership.

Where remote working does not entail any change to employment, copyrights will likely continue to be owned by the employer. However, if an employees’ obligations are to change due to working out of the office, it may be necessary for any contracts and policies to contain specific clauses on copyright ownership.

  • Patents

A patentee is the person whose name is entered in the register as the grantee or proprietor of a patent. An application for a patent in respect of an invention may be made by the inventor or by any other person acquiring the right to apply, or by both such inventor and such other person.

Any contract is null and void if an employer:

  • attempts to secure ownership of intellectual property made outside of the employee’s course and scope of employment; or
  • tries to limit the employee’s rights in inventions or designs developed by him/her for more than one year following termination of employment.

If an organisation funding the invention is publicly funded (which may include a financial contribution to the place of work) then special legislation governs the commercialisation and ownership of such intellectual property, especially patent rights. Remote working could affect both the relationship between inventor and organisation and the funding of the place of work.

  • Designs

A proprietor is the author of the design; or where the author of the design executes the work for another person, the other person for whom the work is so executed; or where a person, or their employee acting in the course of their employment, makes a design for another person in terms of an agreement, such other person; where the ownership in the design has passed to any other person, such other person.

Any design for another person is owned by that person. However, the meaning of “work for another person” is open to interpretation and, consequently, should be regulated by a written contract and/or enforceable policies. As with patents, the unlawfulness of certain contractual terms mean that additional care should be taken when drafting these terms.

  • Trade marks

Rights in trade marks occur both through registration and through reputation or goodwill of a company symbolised by the trade mark under which that trade mark or goodwill is created. There are both registered and unregistered trade marks.

The applicant for a registered trade mark right needs to be the proprietor, who adopted the trade mark or has the intention of using that trade mark, if the trade mark is not in use by them. Ownership of unregistered trade mark rights is a question of fact related to the public understanding of who is in control of that trade mark.

Remote working, linked with possible changes in employment terms, could raise questions on proprietorship. This may result in user and registered trade marks rights vesting in different persons, reducing the value of the trade mark. Contractual terms and enforceable policies can regulate these outcomes.

  • Knowhow, confidential information and trade secrets

These rights relate to information that is both secret (not being known outside of the organisation) and that which gives that organisation a competitive advantage. To enforce these rights, they need to be capable of being identified, accessed and restricted in agreements between an organisation and employees and contractors.

In a remote working environment, this secret information may be at risk of being exposed to the public domain through practical considerations, such as a stolen laptop or a casual conversation with a spouse. Because of this, along with other common law principles, care needs to be taken when drafting, managing and enforcing contractual terms and policies dealing with this type of protection.

Considerations for a global workforce

As remote working practices accelerate, businesses can look beyond national borders in which to operate and in which to hire employees. Approaches to the contract of employment, policies and laws relating to intellectual property differ from one country to the next and cannot be ignored.

Government also has a role to play because of its protectionist policy on IP transfers in and out of South Africa. From an IP perspective, for example, innovation from a local consultant will likely require government approval to be exported to an overseas client, potentially disincentivising the use of the South African workforce as consultants.

Businesses should obtain specific legal advice to instil intellectual property guidelines and policies for employees to follow when remote working. Furthermore, the validity of the contract or enforceability of related policies and the way in which they are agreed, adopted, or executed is very important under such working circumstances.

Protecting Innovation in a Remote Working Environment

Almost overnight, most office-based workers had to adapt to remote working conditions when social distancing regulations were put in place in March this year to slow the spread of the COVID-19 virus. This shift has presented challenges as well as pay-offs, and as restrictions have eased and a new hybrid model of working is looking like the way of the future, organisations have to ask what this means for work culture, such as innovation and productivity, as well as employee policies and agreements.

Intellectual property rights and working from home

Innovation is crucial to business sustainability especially in the disruption era in which we live, where challenges and stress often bring about creativity. In remote working conditions, businesses need a clear mandate on how to cultivate and protect innovation so that today’s new idea is not tomorrow’s court case.

Relationship between innovation and intellectual property

Conceptually, innovation and intellectual property are comfortable bedfellows. Intellectual property rights are designed to encourage innovation and protect and promote creativity. They do this by creating areas and periods of exclusivity or a monopoly right as an incentive to innovate and to share the innovation.

For example, the principle of sharing the innovation as publicly available drawings in a design and embodiments or claims in a patent both wards off others from infringement and stimulates further innovation. The automatic protection provided by copyright protects the creators (music, artistic works and the like). The trade mark’s ability to protect sustainable brands can be linked to incentivising innovation by that brand.

Furthermore, the state of innovation of companies and countries is regularly measured by their level of intellectual property registrations relative to others.

Move towards intangible business assets

Tangible value of an organisation is attributed to buildings, factories, stock and the like whereas intangible value encompasses everything that cannot be physically seen, such as goodwill, and includes the value of human capital, expertise, innovation, culture, and brand reputation. Over the past five decades, company valuation experts have consistently reflected that intangible assets on a company balance sheet significantly and increasingly outweigh the tangible value of that company – and this has even more of an impact not only in the digital era, but as the workplace no longer needs to be in a traditional office environment.

The legal basis for protecting and enhancing intangible value is, most directly, through intellectual property rights created by statute and common law. Thus, from a business value perspective an understanding of the ownership and control of intellectual property rights is crucial.

Why governance of intellectual property is important

If stakeholder value in a company is protected by intellectual property then proper intellectual property governance becomes important. For example, the negligent lapsing of a crucial intellectual property right can significantly devalue a company, as would the badly researched selection of a trade mark to act as legal title to reputation and goodwill, or the sharing of trade secrets and abuse of confidential information obligations. Corruption scandals such as Theranos in the United States and Steinhoff locally are also linked to the lack of legitimate intellectual property governance and transparency. As stakeholders and investors are crucial to business growth, proper intellectual property governance should therefore follow as a business imperative.

A business seeking to encourage work output and protect innovation will be astute in ensuring that clauses within their employment contacts, policies and even ad hoc agreements with staff create a basis for that to occur. Examples include clauses governing confidential information, incentive clauses or policies for innovation, patent development or performance generally, restraints of trade, intellectual property ownership and cession clauses, as well as penalty clauses.

These legal obligations become even more imperative in a remote working and/or hybrid model space, where collaboration between full-time employees and contractors, along with the removal from the formal ‘place of work’, can lead to questions of who has actual ownership among the layers of intellectual property that produced the final innovation. Addressing these issues in contracts and agreements, and identifying and mapping out intellectual property, upfront will help to avoid disputes and protect innovation.

Protecting and Cultivating Innovation in a Remote Working Environment – a Legal Analysis

88% of the respondents in the Savile Row Workplace survey published in October 2020 would prefer to either work from home or a combination of both. A few days ago, Microsoft a permanent work from home option with its staff. Despite this, 67% of the respondents in the survey have not changed work policies or agreements and of those that did only 7% made any change to their intellectual property management regime. 41% of respondents in the survey do not see remote working as a major concern or no different to a traditional working environment.

If one accepts that innovation is crucial to business sustainability especially in the disruption era in which we live, there appears to be a need to better explain the purpose of intellectual property and how these rights together with workplace policies on performance can assist businesses adapt and compete. Companies are advised to review their employee contracts as well as those with collaborators, consultants, and remote workers to ensure that they can enhance business value and reduce significant risks.

Relationship between innovation and intellectual property

Conceptually, innovation and intellectual property are comfortable bedfellows. Intellectual property rights are designed to encourage innovation and protect and promote creativity. They do this by creating areas and periods of exclusivity or a monopoly right as an incentive to innovate and to share the innovation. For example, the principle of sharing the innovation as publicly available drawings in a design and embodiments or claims in a patent both wards off others from infringement as well as stimulate further innovation. The automatic protection provided by copyright protects the creators (music, artistic works and the like) and the trade mark’s ability to protect sustainable brands can be linked to incentivising innovation by that brand. Furthermore, the state of innovation of companies and countries is regularly measured by their level of intellectual property registrations relative to others.

Relationship between business value, intangibles, and intellectual property

Over the past five decades company valuation experts have consistently reflected that the value intangibles on a company balance sheet significantly and increasingly outweigh the tangible value of that company. Tangible value is attributed to buildings, factories, stock and the like whereas intangible value encompasses everything that cannot be physically seen, such as goodwill and includes the value of human capital, expertise, culture, and brand reputation. The legal basis for protecting and enhancing intangible value is, most directly, through intellectual property rights created by statute and common law. Thus, from a business value perspective the ownership and control of intellectual property rights is crucial.”””44372″”45425″”44366″”46213″

Relationship between governance and intellectual property

If one accepts that stakeholder value in company is protected by intellectual property it stands to reason that proper intellectual property governance becomes important. For example, the negligent lapsing of a crucial intellectual property right can significantly devalue a company as would the badly researched selection of a trade mark to act as legal title to reputation and goodwill, or the sharing of trade secrets and abuse of confidential information obligations.  Corruption scandals such as Theranos in the United States and Steinhoff locally are also linked to the lack of legitimate intellectual property governance and transparency. Stakeholders and investors are crucial to business growth. Proper intellectual property governance should therefore follow as business imperative.

 Employment contracts, intellectual property, performance, and the function of a place of work

An employee’s place of work is often a material term of an employment contract and it should be provided to an employee at the commencement of employment. This is normally the traditional office. The employer has obligations toward that place of work and the employee, obligations to be at that place of work and performance obligations toward it. The employment contract regulated by legislation and practice reflects the social contract between employer and employee.

A business seeking to encourage work output and protect innovation will be astute in ensuring that clauses within their employment contacts, policies and even ad hoc agreements with staff create a basis for that to occur. Examples include, clauses governing confidential information, incentive clauses or policies for innovation, patent development or performance generally, restraints of trade, intellectual property ownership and cession clauses as well as penalty clauses.

The move to a more agile or remote working environment challenges the traditional social contract, in a legal sense, existing between employee and employer in several ways:

  • Difficulties adhering to the requirements of particulars of employment in terms of the Basic Conditions of Employment Act 1997, requires consideration specifically relating to:
  • The “place of work”, and, where the employee is required or permitted to work at various places, an indication of this in the contract.
  • The concept of “ordinary hours of work” and the regulation of overtime for employee earning below the threshold and employees who are contractually entitled to overtime.
  • Benefits that allow the employee to perform work from the workplace, for example canteen allowance or parking.
  • Agreement to any changes in terms and conditions of employment and possible options available if either party is not willing to accept these changes. This could bring into play retrenchments or redundancy based on the employer’s operational requirements:
    • if no agreement is reached, in the absence of a contractual right to change these terms and conditions of employment and in particular the traditional place of work, this may result in the employee’s position possibly becoming redundant i.e. because the job at the traditional place of work no longer exists.  This could result in retrenchment in terms of an operational restructuring and or the employer’s operational requirements and the payment of severance pay if applicable;
    • this may not always be in the best interest of both parties in that the employee will potentially be unemployed and the employer will potentially lose key employees. Therefore, the parties ought to reach a compromise; and
    • In all circumstances where an employer contemplates changing terms and conditions of employment, it should engage with the registered trade unions, employee representatives and/or the employees to reach an agreement. Even in circumstances where an employer may have a contractual right to change certain terms and conditions of employment it is still always good management to consult on such matters.
  • Challenges in how companies manage, maintain, and measure employees work standard while working from home or remotely.  This includes upskilling of employees and the employer’s obligation to provide its employees with the tools and equipment to perform their functions from home.
  • The possible need to amend and/or introduce new policies to regulate employees who are working remotely. This includes how employees must deal with confidential and privileged company information when working remotely and the wellbeing of employees (including alcohol and substance abuse), dress code and potential amendments to the disciplinary code and procedure and the restructuring of benefits policies.
  • The interplay and potential significance of the employer’s corporate social responsibility initiatives in the context of the creating employment equity which could lead to greater corporate involvement in community development, especially if it could directly increase performance of staff.
  • A proper understanding of the process that an employer must follow when the employee is performance below the required performance standard, including the code of good practice on incapacity in a remote working situation.
  • The retrenchment processes the company can follow where the employees do not agree to the changes in the terms and conditions of employment to allow for remote work. A retrenchment must be based on the operational requirements of the employer.

The clauses dealing with intellectual property

To understand changes that need to be made one needs to have some idea of how intellectual property rights are created and who owns those rights, and what effect remote working may have on those rights. The most common of these rights are.

Copyrights

 These rights evolve automatically through the creation of works such as literary, artistic, musical, sound recordings, broadcasts, or computer programs. Identifying the author of these works is critical to determining ownership for it is only in a limited number of circumstances that the first owner of the work will not be the author. Two of these exceptions are works created in the course of employment of another or where a contract regulates ownership, the provisions of that contract.

Consequently, where remote working does not entail any change to employment, copyrights will likely continue to be owned by the employer. However, if as predicted, employees will increasingly become liberated from their organisations, it becomes necessary for any contracts of work and policies to contain specific clauses on copyright ownership.

Remote working is also expected to accelerate the adoption of technology solutions. These solutions are underpinned by software innovation through generation of computer programs protected by copyrights. Software developers tend to be very mobile and since ownership will vest in the person who has “control over the making of the computer program” – a vague concept – their contract becomes critical not only to control the intellectual property creation but to access it as well. These computer programs also often reflect trade secrets in the way that they operate, so protection on confidentiality related to them is critical to avoid loss of both rights.

It is recommended that specific legal advice is obtained. Copyright arises through statute and strict compliance with the legislation is required for it be effective. For example, the exceptions referred to above are themselves subject to limited further exceptions relating to photographs, works for magazines and moral rights. Further, the validity of the contract or enforceability of related policies and the way in which they are agreed, adopted, or executed is very important.

Patents

 A patentee is the person whose name is entered in the register as the name of the grantee or proprietor of a patent. An application for a patent in respect of an invention may be made by the inventor or by any other person acquiring from him the right to apply or by both such inventor and such other person.

Any condition in a contract of employment which requires an employee to assign to his employer an invention made by him otherwise than within the course and scope of his employment, or restricts the right of an employee in an invention made by him more than one year after the termination of the contract of employment is null and void.

It will be evident, that clauses in employment contracts and related policies require close attention to ensure that the right to apply for a patent between inventor and employer organisation or between the inventor and the organisation that funded the invention requires careful construction. If the organisation funding the invention is publicly funded (which may include a financial contribution to the place of work) then special legislation governs the commercialisation and ownership of such intellectual property, especially patent rights. Remote working could affect both the relationship between inventor and organisation and the funding of the place of work.

Designs

 Under South African design law a proprietor is the author of the design; or where the author of the design executes the work for another person, the other person for whom the work is so executed; or where a person, or his employee acting in the course of his employment, makes a design for another person in terms of an agreement, such other person; where the ownership in the design has passed to any other person, such other person.

Any condition in a contract of employment which requires an employee to assign to his employer a design made by him otherwise than within the course and scope of his employment, or restricts the right of an employee in a design made by him more than one year after the termination of the contract of employment is null and void.

There is a difference in the initial ownership provisions relation to designs compared with patents, copyright and trade marks because any design for another person (e.g. in a remote working environment whether governed by an employment agreement or not) is owned by that person. This would appear to place less emphasis on design ownership than the other intellectual property rights. However, the meaning of “work for another person” is open to interpretation and consequently should be regulated by written contract and/or enforceable policies. As with patents, the unlawfulness of certain contractual terms mean that additional care should be taken when drafting these terms.

Trade Marks

Rights in trade marks occur both through registration and through reputation or goodwill of a company symbolised by the trade mark under which that trade mark or goodwill is created. In simple terms, there are both registered and unregistered trade marks. Ownership of these independent rights may be by separate persons, although that is not advisable because it will dilute the value of the trade mark. The applicant for a registered trade mark right needs to be the proprietor. This is regarded as the person who adopted the trade mark or has the intention of using that trade mark, if the trade mark is not in use by them. Ownership of unregistered trade mark rights is a question of fact related to the public understanding of who is in control of that trade mark.

The regulation of ownership of a trade mark is relatively complex. Remote working linked with changes from employment to independent contracting could give rises to questions on proprietorship and may results in user and registered trade marks rights vesting in different persons, if uncontrolled, reducing the strength of the trade mark and devaluing it. As a result there is a need to regulate this very carefully through contractual terms and enforceable policies.

Knowhow, confidential information, and trade secrets

These rights arise and relation to information that is both secret (in the sense of not being known outside of the organisation) and that which gives that organisation a competitive advantage. To be capable of being enforced, the rights needs to be capable of being identified, accessed, and retained. The only way to do this is to have proper agreements in place with employees and contractors that deal with identification, access, and restrictions.

In a remote working environment, there will also be practical considerations that may risk the publication or exposure of that information to the public domain. A stolen laptop or a casual conversation with a spouse all potentially risk protection of trade secrets. This, in addition to common law principles of fairness when it comes to restraint of trade provisions, penalty clauses, jurisdiction and urgency, all mean that care in drafting, managing  and enforcing contractual terms and policies dealing with this type of protection are important.

Other remarks

As remote working practices accelerate opportunities to employ and be employed across national boundaries increase. Approaches to the contract of employment, policies and laws relating to intellectual property differ from one country to the next and cannot be ignored. Furthermore, South Africa’s strong protectionist regime and exchange control policies relating to intellectual property rights and assets are likely to require further assessment should the country wish its fiscus to take advantages of global opportunities from local taxpayers working in outsourcing environments.

Forced Leave, Retrenchments and Dismissals – Lockdown Labour Questions Answered

What are the rules and regulations regarding dismissals during the lockdown?

Employers are not precluded from dismissing employees during the national lockdown, provided that such dismissals are implemented in terms of the LRA. In this regard, the LRA provides that a dismissal must be for a fair reason (misconduct, incapacity or operational requirements and effected in accordance with a fair procedure). A guideline on what is a fair procedure is set out in the relevant code of good practice issued in the LRA and is often incorporated in the employer’s disciplinary code and procedure.

How does retrenchment work during this period? Is anyone allowed to get retrenched?          

Employers are not precluded from retrenching employees during the national lockdown, provided the employer has a valid operational reason to implement retrenchments and follows the procedures set out in section 189 of the LRA.

The LRA defines operational requirements on the economic, technological, structural, or similar needs of the employer. An employer must be able to justify a business rational based on the employer’s operation requirements prior to implementing a retrenchment.

In summary, the LRA sates that as soon as an employer contemplates retrenchments, the employer must consult with the affected employees or their trade unions. Importantly, the employer must issue the potentially affected employees or their trade unions with a written statutory notice informing the employees of their potential retrenchment, the reason thereof, the alternatives that the employer considered and why these alternatives were rejected, selection criteria, severance pay, timing of the retrenchments etc. This notice also forms the basis of the mandatory joint consensus-seeking consultation process. If at the end of the consultation process retrenchments cannot be avoided, the employer must issue the employee with a notice of termination of employment and pay the retrenched employees their salary until the date of dismissal, their accrued leave pay, notice period and severance pay (i.e. a minimum of 1 weeks’ pay for every completed year of service).

What if you are told you must work from the workplace, but the workplace is not compliant with the health protocols?

On 4 June 2020, the Minister of Employment and Labour issued a consolidated directive in terms of health and safety in the workplace, replacing the directive issued on 29 April 2020. In terms of the new directive, an employee may refuse to perform any work if circumstances with reasonable justification arise or appears to that employee or to a health and safety representative to pose an imminent and serious risk of exposure to COVID 19.

Prior to withholding any labour, the employee must notify the employer of the risk and of their refusal to work.  If the employer is of the view that the risk and the refusal to work is reasonably justifiable, the employer must remedy the allegedly unsafe working environment.

The directive also provides certain protections to employees who utilise the right to report the unsafe working environment to the employer and thereafter refuse to work. These protections include the following:

  • No employer may make any deduction from an employee’s remuneration, require or permit an employee to make any payment to the employer or any other person, in respect of anything which the employer is obliged to provide or to do in terms of this Direction;
  • No person may threaten to take any action against a person because that person has exercised, or intends to exercise, the right to refuse to work;
  • No employee may be dismissed, disciplined, prejudiced, or harassed for refusing to perform any work.

If there is a dispute as to whether this provision has been contravened or not the employee may refer a dispute to the CCMA or an accredited bargaining council.

These provisions of the directive may be open to abuse by unscrupulous employees and/or trade unions, and unless employers can prove that employees are acting in bad faith, the employer cannot take any action against the employee.

Can an employee be dismissed for not being at the workplace when required to do so?

Yes. However, this depends on the employee’s reason for not attending the workplace and on the employer’s disciplinary code and procedure.

If the employee has a valid reason for being absent from work (i.e. he is sick, contracted Covid 19, has a reasonable justification that the workplace is unsafe, or any other valid reason recognised in law) they must notify the employer of the reason and, if requested, provide the relevant proof to confirm the reason for being absent from work.

However, if the employee has no valid reason for being absent from work, and subject to specific facts around the employee’s absenteeism, the employer may institute disciplinary action against the employee for insubordination, failure to obey a reasonable and lawful instruction, breaching the employers policies and/or for staying absent without a valid reason. However, the employer must follow a fair procedure when instituting disciplinary action against the employee (i.e. the employee must be informed of the misconduct and the employee must be given an opportunity to be heard).

In what situation does an employer have to force employees to take leave and how does this work?

Generally, the employer may determine the timing of annual leave. Employment contracts often entitle employers to determine the timing of annual leave and therefore employers can compel employees to take annual leave during the lockdown or during the employer’s annual shutdown period.

 How does this affect your annual leave?

If the employee has not accumulated enough paid annual leave, the employer and employee may enter into an agreement to allow employees to take negative leave. The agreement should also make provision for instances where an employee leaves the employer’s employ prior to accumulating enough annual leave to cover the negative accumulated leave.

According to the TERS directive issued by the Minister of Employment and Labour on 8 April 2020, employers who have compelled their employees to take annual leave during the lockdown period may claim the leave payment from the TERS benefit and then credit the employee concerned with the proportionate entitlement to the paid annual leave.vc_row_inner css”.vc_custom_1600160218060{margin-bottom: 10px !important;padding-top: 15px !important;padding-right: 15px !important;padding-bottom: 15px !important;padding-left: 15px !important;background-color: #ededed !important;border-radius: 5px !important;}”vc_column_inner width”2/3″vc_column_textNeed assistance with labour related matters? Speak to an attorney by submitting an enquiry online./vc_column_innervc_column_inner width””vc_btn title”View Labour Services & Enquire” style”flat” color”theme_style_1″ size”sm” align”center” button_block”true” link”url:https%3A%2F%2Fwww.adams.africa%2Fservices%2Flabour-law%2F|title:Employment%20and%20Labour%20Law||”/vc_column_inner/vc_row_innervc_column_text

If an employee is diagnosed with COVID-19, how does leave and pay work during this period? Is the employer obliged to pay for any health bills?

If the employee’s transmission was in the course and scope of carrying out his employment, the employee’s leave will be covered in terms of COIDA.

If an employee’s transmission was outside of the course and scope of his/her employment, the employee is entitled to utilise his/her sick leave entitlement in terms of section 22 of the BCEA. However, if the employee is diagnosed with COVID – 19 and the employee is quarantined they will firstly be entitled to the leave under the UIF illness benefit first.

The employer is not obliged by law to pay the employees medical expenses, unless agreed to between the parties.

Government assistance: who can apply?

The Minister of Employment & Labour encouraged employers to pay their employees during the lockdown period.

Importantly, the Regulations create a special unemployment insurance benefit known as the ‘Temporary Employee / Employer Relief Scheme’ (“TERS”) to compensate qualifying employees who may have lost income due to Covid-19, for example, due to the complete or partial closure of their employers’ businesses because of the lockdown.

The Regulations also permit an employer to claim the payment of annual leave on behalf of its employees, in circumstances where an employer compelled its employees to take annual leave.

 An employer is eligible to apply for this benefit if:

  • the employer is registered with the UIF;
  • the employee(s), on whose behalf they claim the benefit, may have lost their income due to Covid-19;
  • the employer closes its operations as a direct result of the Covid-19 pandemic (for 3 (three) months or a lesser period); and
  • the employer complies with the TERS benefit application procedure.

The Regulation has been extended to 15 August 2020. It is unclear whether the period will be extended past 15 August 2020. We will have to wait to be updated by the Minister of Employment and Labour on this aspect.

 Salary cuts: is there any way an employee can dispute this?

It is critical to emphasize that the employee’s consent is required to change their working hours and/or remuneration. If the employee consents to the change then they will not have any claim, subject to any agreement in this regard. Employers who unilaterally implement short working hours, and/or reduced remuneration, run the risk of breaching an employee’s contract of employment or working conditions. This could possibly encourage strike action (which can be utilised as a form of recourse, provided the relevant procedures are followed) or have them face the risk of defending a fair labour practice dispute at the CCMA arising from the unilateral change to the terms and conditions of employment.

In 2018 there was a new UIF benefit introduced. In terms of this benefit “A contributor employed in any sector who loses his or her income due to reduced working time, despite being employed, is entitled to benefits if the contributor’s total income falls below the benefit level that the contributor would have received if he or she had become wholly unemployed, subject to that contributor having enough credits.

Accordingly, employees who agree to short time and accordingly agree to a reduction in their salary, proportionate to the reduced working hours, can claim the difference in the salary from the UIF. The benefit will be calculated in terms of the income replacement rate sliding scale of 38% (for high earners) up to 60 % (for low earners) as provided in the Unemployment Insurance Act, subject to the maximum threshold as determined from time to time.

Can you claim the loss or agreed reduction in salary at any point in the future? Do companies owe you that lost salary?

If an employee agreed to a reduction in salary, the employee would not have a claim in relation to the reduced amount, subject to the terms of the agreement.

In circumstances where:

  • An employee has tendered their services;
  • The employee is not precluded in terms of the law to tender their services;
  • The employer rejects the services of an employee who is not precluded from tendering their service; and
  • The employer has not paid such an employee his salary;

Only then may the employee enforce their rights by laying a complaint at the Department of Labour or referring a dispute to the CCMA or an Accredited Bargaining Council.

COVID-19 Labour Questions Answered

Ensuring Effective Management of Remote Working

As a starting point, it is important for me to mention that employers should take steps to guard against their employees abusing the office time while working remotely. This will entail the employers monitoring their employee’s emails; however, this must be in accordance with the applicable privacy laws in South Africa. Secondly, the employers must also request their employees to submit timesheets to report on their work activities during their time at home.

Ensuring the Health and Safety of Workers Who Need to Be Onsite

The Occupational Health and Safety Act places a duty on employers to provide and maintain, as far as is reasonably practicable or possible, a working environment that is safe and without risk to the health of their employees.

Legal recourse will depend on the nature of a particular breach. For instance: if in ensuring a safe working environment, the employer requires employees who may have the virus to self-isolate, and the employee refuses, such an employee may be disciplined. If an employer fails to act in accordance with their duties in terms of the Occupational Health and Safety Act, the employer may be held liable in terms of the Act.

Enforcement of Remote Working

Employee’s rights, if any, would depend on the reasons they are working remotely or in social isolation. For instance, and generally speaking: if the employer requires them to work remotely, they will be entitled to their salaries. If an employee, however, is subjected to self-isolation or quarantine at the behest of government (which we understand may now apply in certain instances), it is arguable that the employee would not be entitled to his / her salary from the employer.

Top Tips for Employers and Employees

Employers should stay abreast of developments of the virus spread, government requirements and notices, etc. Employers should take appropriate planning, preventative and precautionary measures to safeguard against the virus. Employers should effectively communicate with their employees of their plans to manage or reduce the spreading of the virus in their workplaces.

This may also be an opportune time for employers to test the viability of their employees working flexi time and / or from home. And lastly, if employers are unsure of their obligations towards their employees, they should seek legal advice.

In relation to employees

Employees should be aware of the steps to be taken if they feel that they may have contracted the virus. Employees must take appropriate precautionary measures to safeguard against the virus; not only at work, but also at home. Employees should not abuse any flexi-time or work-from-home arrangements; it may constitute serious misconduct for which they could be disciplined. Employees should pay careful attention to any instructions provided by the employer in respect of the virus. And lastly, if employees are unsure of their rights, they should seek legal advice.