Labour Court rules retrenchments at Right to Care were unfair, awarding compensation to six employees.
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The Labour Court in Johannesburg has ruled that the retrenchment of six employees by healthcare non-profit Right to Care NPC was substantively unfair, finding that the organisation failed to justify the dismissals, ignored viable alternatives, and applied an unfair selection process.
Judge Robert Makhura ordered the employer to pay each of the affected workers compensation equivalent to six months’ salary.
The dispute arose after Right to Care retrenched six employees, most of them pharmacist assistants, following a reduction in donor funding for its APACE programme, which focuses on HIV/AIDS and tuberculosis interventions.
The organisation argued that a funding cut from the United States Agency for International Development necessitated the retrenchments. However, the court rejected this justification.
Judge Makhura found that the NGO had failed to demonstrate that the funding reduction placed the organisation under broader financial strain. Evidence presented in court showed that, at the time of the retrenchments, there were hundreds of vacant positions across various programmes within the organisation.
The court held that a reduction in funding within a single programme could not, on its own, justify retrenchments where the organisation as a whole remained financially stable.
A central issue in the case was the employer’s use of a controversial “re-competition” process. Instead of placing affected employees into available roles, the organisation required them to reapply and compete for positions, including jobs they had previously held.
The court was highly critical of this approach, ruling that it did not constitute a fair selection criterion but was effectively a standard recruitment process imposed on employees already facing dismissal.
The judgment made it clear that requiring employees to apply for their own jobs does not amount to a genuine alternative to retrenchment. It also found that the process lacked transparency, with the employer failing to provide evidence explaining how candidates were assessed or selected.
The Labour Court further held that the consultation process required under labour law had not been meaningfully conducted. Although employees proposed several alternatives, including cost-cutting measures, voluntary retrenchments and the application of “last in, first out” principles, the employer failed to properly engage with these suggestions.
The court concluded that the decision to retrench had effectively been made before consultations began, rendering the process little more than a formality.
Despite the availability of numerous vacancies within the organisation, the court found that Right to Care failed to take reasonable steps to avoid dismissals. Affected employees were simply told to apply for available positions, with no structured attempt to redeploy them or provide training where necessary. This, the court held, amounted to a breach of the employer’s obligations.
The court also scrutinised specific hiring decisions made during the retrenchment process, which further undermined the fairness of the employer’s approach.
In one instance, a former employee who had already left the organisation was rehired into a vacant position ahead of retrenched staff. In another, a fixed-term employee was appointed over a permanent employee facing retrenchment. These decisions were found to demonstrate inconsistency and unfairness in the application of the selection process.
While the employees initially sought maximum compensation, the court awarded each of the six workers six months’ remuneration, describing the amount as just and equitable in the circumstances.
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