Article contributed by Durban Law Firm - Fawzia Khan & Associates
A demotion usually means a reduction of the responsibility or power or status which an employee previously enjoyed. Together with this diminished power is the loss of the dignity of the employee and of course more often than not a drop in salary.
The Labour Relations Act defines an unfair labour practice as any unfair conduct by an employer relating to the promotion, demotion, probation or training of an employee or any provision of benefits to an employee. Demotions are thus allowed provided it is done fairly, in consultation with the employee and for the right reasons. This means that an employer must follow a fair procedure before it can demote an employee. You cannot demote an employee unilaterally without first consulting with the employee. Should an employer demote an employee without giving the employee an opportunity to be heard, it could amount to an unfair labour practice.
There are a number of cases where employees have successfully challenged their demotions on the basis of it being an unfair labour practice. In one case, an employee who was a cleaner, was asked to perform certain supervisory duties. He failed to carry out these duties properly and went back to being a cleaner. His employer claimed poor work performance and said that the employee always was a cleaner but that he received an allowance for performing the supervisory duties. The arbitrator however found the employer’s conduct to be unfair as the employer failed to prove poor work performance.
In another case, even though here the employer had a valid reason to offer the employee an alternative post at a lower salary, as it lost a major contract, the arbitrator still regarded the demotion as unfair. This was on the basis that the employer did not consult with the employee before making the offer. In the case of Van Niekerk v Medicross Health Care Group (Pty) Ltd an employee who occupied a managerial position was demoted to that of a clerk. The CCMA ordered the employer to reinstate him to his managerial position, as it found that the employer failed to consult and counsel the employee. It said the employer's action amounted to a unilateral change in the terms and conditions of the employee's employment.
Even if your salary and benefits remain unchanged a demotion may nevertheless still be unfair. An employee was regional manager of a company and was informed that due to a restructure in the company, his position of regional manager would be made redundant. The employer appointed him as manager of the Pretoria branch without lowering his salary. The employee argued that due to the changes, his continued employment was made intolerable and he resigned. He referred a constructive dismissal dispute to the CCMA. It was found that his demotion was both intolerable and unbearable and his reason to resign was found to be reasonable and the employer was ordered to pay six month’s salary as compensation.
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