Article 35/2023

What is the rationale for awarding compensation?

What are the types of factors to be taken into account to determine whether compensation should be awarded?

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In McGregor v Public Health and Social Development Sectoral Bargaining Council and Others (2021) 32 SALLR 33 (CC), the constitutional court, with reference to, inter alia, Rawlins v Kemp t/a Centralmed (2010) 31 ILJ 2325 (SCA), identified the rationale for compensation as follows:

  • it gives meaning to the right not to be unfairly dismissed and discourages a shotgun approach
  • it recognises the right to be heard before any action is taken by the employer
  • it recognises the employee’s worth as a person

In respect of the factors to be taken into account to determine whether compensation should be awarded, the constitutional court, in McGregor, provided the following non-exhaustive list:

  • the courts are more in favour of awarding compensation than not where the dismissal is both substantively and procedurally unfair than where the dismissal is only substantively or procedurally unfair
  • the nature and extent of deviation from procedural fairness requirements also plays a role – the lesser the deviation, the greater chance of no compensation, whereas the more serious the deviation the stronger the chance of compensation
  • the reason for dismissal also plays a role as well as the employee’s guilt or innocence and the appropriateness of the sanction
  • if the dismissal is only procedurally unfair, there is a discretion not to award compensation at all or to award the appropriate compensation

(Johnson & Johnson v CWIU (1999) 20 ILJ 89 (LAC))

July 3, 2025

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June 26, 2025

The first leg of the test to determine whether or not urgency exists, when an urgent application is brought, requires a court to assess whether an urgent hearing is necessary because the applicant will not be able to obtain substantial redress in the normal course.

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Previous articles this year dealt with a zero-tolerance policy when tested positively for alcohol or drugs, as well as a zero-tolerance policy in respect of having tested positive for cannabis. In short, the courts hold the viewpoint that, by means of such policies, an employer is not permitted to create an absolute ‘no go zone’ and, furthermore, held that, at all given times, one of the fundamental questions to be asked, irrespective of the content of such zero-tolerance policy, is the effect of the drugs/alcohol/cannabis on the ability of the employee to do his/her job.