MRL3702 SEP/NOV PORTFOLIO EXAM 2021 55612792
ASHLEIGH HALA 15-16 SEPTEMBER 2021
UNISA COLLEGE OF LAW
MRL3702
LABOUR LAW
EXAMINATION PORTFOLIO
OF
ASHLEIGH HALA
STUDENT NUMBER 55612792
15 – 16 SEPTEMBER 2021
, MRL3702 SEP/NOV PORTFOLIO EXAM 2021 55612792
ASHLEIGH HALA 15-16 SEPTEMBER 2021
QUESTION 1
1.1 (a) The employer at Cool Dairy Products (Pty) Ltd (CPD) relied upon the ground
of dismissal for operational requirements in order to dismiss his employees.
Section 188(1)(a)(ii) of the Labour Relations Act 66 of 1995 (LRA) provides that
in certain circumstances, the employer’s operational requirements can
constitute a fair reason for dismissal. ‘Operational requirements’ are defined in
section 213 of the LRA, as the economic, technological, structural or similar
needs of an employer. Similar needs are hard to narrow down, however
examples of what would justify retrenchment are:
• the employee’s actions or presence have a negative effect on the business
• the employee’s conduct has led to a breakdown of the trust relationship
• the enterprises’ business requirements are such that changes must be made
to the employee’s terms and conditions of employment.
Along with other amendments to the LRA in 2002, section 189A was added and
provided requirements that need to be met in order for a dismissal to be
substantively fair for operational reasons.
Application to the facts
In the scenario regarding the CPD retrenchments, the employer could argue that
he dismissed his employees for operational reasons, based on the economic
needs of his business and the impact that the unstable demand for dairy
products had on CPD. The decision made in the case of Fry’s Metals1 can assist
this reasoning, as it was held that a business is entitled to retrench employees
in order to increase profits regardless of whether they are fighting to survive or
are profitable. This decision was confirmed recently in the National Union of
Metalworkers of South Africa & Another v Aveng Trident Steel 2. Here dismissals
are made to increase profits, however dismissing employees in order to do so
is allowed. If the employer of CPD can prove that his reasons for the dismissals
are in line with section 189A, then he will have a case where his dismissals are
substantively fair for operational reasons.
(b)(i) A large-scale dismissal is determined based on the relations between the
number of employees dismissed and the size of the business. According to the
LRA, a large-scale dismissal occurs if an employer employs more than 400, but
not more than 500 employees, and 40 employees are dismissed. Between 2016-
2018 CPD dismissed 35 employees and it employs exactly 500 people, which is
not a large-scale dismissal. Neither Grietjie or Mosebethwane are correct.
(ii) Between 2016-2020 CPD retrenched 50 people. According to the reasoning
above, CPD would have undergone large-scale dismissal. However, CPD is a
big employer, as it has over 50 employees. In 2002, the LRA was amended and
section 189A was added, which applies to big employers undergoing large-scale
retrenchments. Section 189A provides that the number of employees retrenched
1Fry’s Metals (Pty) Ltd v National Union of Metalworkers of SA & Others (2003) 24 ILJ133 (LAC).
2National Union of Metalworkers of South Africa & Another v Aveng Trident Steel (A division of Aveng Africa
Proprietary Limited) & Others (unreported Labour Appeal Court JA25/18 13 June 2019).
ASHLEIGH HALA 15-16 SEPTEMBER 2021
UNISA COLLEGE OF LAW
MRL3702
LABOUR LAW
EXAMINATION PORTFOLIO
OF
ASHLEIGH HALA
STUDENT NUMBER 55612792
15 – 16 SEPTEMBER 2021
, MRL3702 SEP/NOV PORTFOLIO EXAM 2021 55612792
ASHLEIGH HALA 15-16 SEPTEMBER 2021
QUESTION 1
1.1 (a) The employer at Cool Dairy Products (Pty) Ltd (CPD) relied upon the ground
of dismissal for operational requirements in order to dismiss his employees.
Section 188(1)(a)(ii) of the Labour Relations Act 66 of 1995 (LRA) provides that
in certain circumstances, the employer’s operational requirements can
constitute a fair reason for dismissal. ‘Operational requirements’ are defined in
section 213 of the LRA, as the economic, technological, structural or similar
needs of an employer. Similar needs are hard to narrow down, however
examples of what would justify retrenchment are:
• the employee’s actions or presence have a negative effect on the business
• the employee’s conduct has led to a breakdown of the trust relationship
• the enterprises’ business requirements are such that changes must be made
to the employee’s terms and conditions of employment.
Along with other amendments to the LRA in 2002, section 189A was added and
provided requirements that need to be met in order for a dismissal to be
substantively fair for operational reasons.
Application to the facts
In the scenario regarding the CPD retrenchments, the employer could argue that
he dismissed his employees for operational reasons, based on the economic
needs of his business and the impact that the unstable demand for dairy
products had on CPD. The decision made in the case of Fry’s Metals1 can assist
this reasoning, as it was held that a business is entitled to retrench employees
in order to increase profits regardless of whether they are fighting to survive or
are profitable. This decision was confirmed recently in the National Union of
Metalworkers of South Africa & Another v Aveng Trident Steel 2. Here dismissals
are made to increase profits, however dismissing employees in order to do so
is allowed. If the employer of CPD can prove that his reasons for the dismissals
are in line with section 189A, then he will have a case where his dismissals are
substantively fair for operational reasons.
(b)(i) A large-scale dismissal is determined based on the relations between the
number of employees dismissed and the size of the business. According to the
LRA, a large-scale dismissal occurs if an employer employs more than 400, but
not more than 500 employees, and 40 employees are dismissed. Between 2016-
2018 CPD dismissed 35 employees and it employs exactly 500 people, which is
not a large-scale dismissal. Neither Grietjie or Mosebethwane are correct.
(ii) Between 2016-2020 CPD retrenched 50 people. According to the reasoning
above, CPD would have undergone large-scale dismissal. However, CPD is a
big employer, as it has over 50 employees. In 2002, the LRA was amended and
section 189A was added, which applies to big employers undergoing large-scale
retrenchments. Section 189A provides that the number of employees retrenched
1Fry’s Metals (Pty) Ltd v National Union of Metalworkers of SA & Others (2003) 24 ILJ133 (LAC).
2National Union of Metalworkers of South Africa & Another v Aveng Trident Steel (A division of Aveng Africa
Proprietary Limited) & Others (unreported Labour Appeal Court JA25/18 13 June 2019).
