REGULATION OF STATUTORY LEAVE DURING THE COVID-19 LOCK DOWN PERIOD

Posted on March 31, 2020

INTRODUCTION

  1. The purpose of this article is to provide a legal opinion on the application of the provisions of the Basic Conditions of Employment Act no. 75 of 1997 (“BCEA) pertaining to leave entitlement of employees employed by a Company during the national lock down period from midnight Thursday, 26 March 2020 until midnight 16 April 2020.
  2. The Occupational Health and Safety Act 85 of 1993 (“OHSA”) places an obligation on an employer (despite its form of entity) to bring about and maintain, as far as reasonably practicable, a working environment that is safe and without risk to the health of its employees.
  3. In the event that a Company is impacted, in any manner whatsoever, as a result of the Coronavirus (Covid-19) and/or the mandatory lock down imposed by the South African Government through the Disaster Management Act, the Company can implement inter alia Reduced Work Time or Temporary Lay-Offs without pay. The different options and legal and/or financial implications on the Company will be explored more fully infra.
  4. The statutory provisions governing the working hours and leave entitlement of an employee whose terms and conditions of employment have been impacted by the lock down, are enshrined in the BCEA. The pertinent provisions relevant to this memorandum are repeated herein for ease of reference:
    “[7](a) – Every employer must regulate the working time of each employee in accordance with the provisions of any Act governing occupational health and safety;
    b) with due regard to the health and safety of employees…”
    “[20](5) – An employer may not require or permit an employee to take annual leave during –
    (a) any other period of leave to which the employee is entitled in terms of this Chapter; or
    (b) any period of notice of termination of employment.”
    “[20](10) – Annual leave must be taken –
    (a) in accordance with an agreement between the employer and the employee; or
    (b) if there is no agreement in terms of paragraph (a), at a time determined by the employer
    in accordance with this section.”
  5. Based on the aforementioned provisions, it is evident that, given the unique circumstances of the lock down period, an employer is entitled to determine that the employees’ annual leave be utilised during this period.

Conclusion and recommendation

  1. The following recommendation is designed as a broad guideline, based on generic scenarios and should be investigated for appropriateness for individual Company circumstances, prior to implementation. We recommend that you consult with our offices via email or conference call prior to taking implementing any of the generic recommendations.
  2. A general recommendation might be to implement practical changes to enable the Company to utilise its resources to its full potential, to relieve the stress on the Unemployment Insurance Fund, to assist the government and to prevent future needs to invoke the provisions of section 189 of the Labour Relations Act pertaining to retrenchments, within the ambits of the legislation mentioned supra:
    1. The employees that are unable to work from home will be temporarily laid off for the lock down period. The Company can utilise the employees’ annual leave until exhausted or regard the period as unpaid leave. The Company should claim unemployment benefits on behalf of the employees from the Unemployment Insurance Fund for the period of unpaid leave. An employer must pay an employee leave pay at least equivalent to the remuneration that the employee would have received for working on the two public holidays on the 10 th of April 2020 (Good Friday) and 13 th of April 2020 (Family Day).
    2. Those employees that are able to continue to render their services to the Company from home should continue doing so, but enter into an agreement with the Company in respect of the working hours and remuneration for the period. We recommend that the remuneration be  calculated as a percentage of the total hours that the employee would normally have worked during the same period. Ensure that the selection criteria of the employees that are required to continue working from home, is applied in a fair and reasonable manner directly linked to the Company’s operational requirements during the lock down period.
  3. If the Company might require financial assistance from the Unemployment Insurance Fund, it should access information regarding available funding through a dedicated mailbox: covid19ters@labour.gov.za.
  4. The aforementioned recommendation should not be applied without prior consultation with our offices.

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