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demotion and salary reduction south africa

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. There was a target to reduce expenses by R68 000 000.00 (sixty eight million rands) which meant that the company had to achieve a 10% reduction of its entire expenditure.5 29. years earlier. The most obvious cost-cutting mechanism is persuading employees to agree to a reduction in salary. Cookies help us to understand you better. As previously mentioned, the legal way to make changes to an employee’s salary is in consultation with them. If the employee earns below the income threshold a complaint can be lodged with the department of labour. A refusal to pay salary is breach of contract and contra to the BCEA. Hoffmann v South African Airways [2000] 12 BLLR 1365 (CC): “…An order of instatement, which requires an employer to employ an employee, is a basic element of the appropriate relief in the case of a prospective employee who is denied employment for reasons declared impermissible by the Constitution. However, many employers unjustly demote their employees based on discrimination. The main reason for this being that in most cases a person would rather have a job with less money than no job at all. Introduction [1] The applicant, Ms Michelene Pretorius, was employed as a security officer by G4S at the Rand Refinery site. This is because one wrong move could result in an unfair labour practice. Pay cuts are often made to reduce layoffs while saving the company money during a difficult economic period. The main reason for this is that a person would rather have a job with less money than no job at all. Complete our Salary Survey and Win a Wage! Despite trying circumstances, employers are advised to take all labour law considerations into account before imposing demotion on an employee. South Africa Law. [31] The Industrial Court has held as far back as 1992 that demotion is not a word which has some special meaning in labour law. 28. Senior Associate at Christodoulou & Mavrikis Inc and the head of the Labour Law Department. overtime, salary and/or wage bill costs. The Basic Conditions of employment Act allows only certain deductions from salary for debt and damages caused to the employer. Reduction of an employee's salary is often a consequence of the employer's decision to demote the employee for some reason. What is the solution? Wrongful demotion occurs when an employer unlawfully bases the decision to demote an employee on discriminatory reasons. [34] In my view, the arbitrator misconstrued the juridical concept of demotion. Demotion is defined as a reduction of dignity, importance, responsibility, power or status of an employee even if his or her salary and benefits and rank are retained. Many large South African employers, … Although the reason for the demotion and salary cut was seen as fair, the demotion and salary cut itself was not. 2. As the employee moves into their lower ranking position, their pay decreases as well. In the case of a dismissal for operational requirements, an employer may suggest that the employee consider accepting an inferior position to the one previously held, with a reduction of salary as an alternative to retrenchment. The most obvious cost-cutting mechanism is persuading employees to agree to a reduction in salary. Should employees be forewarned about salary cuts? There is no requirement under South African employment legislation for employees to receive these payments. where it is found that false information has been circulating), employees who fail to obey a reasonable instruction to attend work can be disciplined. The employee must have agreed to the deduction. He then referred a dispute to the third respondent as a demotion within the contemplation of Section 186(2) of the Labour Relations Act as amended. It is common cause that the employee’s salariy was reduced by two thirds as a result of her redeployment. ... News From Africa. If an employee is not sick and still willing to attend work, but it is a direct instruction from their employer to remain at home, such employees will still be entitled to earn and receive their normal salary and benefits. If an employee refuses to attend work because of concerns of contracting the virus (given the declaration of a disaster by President Cyril Ramaphosa), each case should be dealt with based on its own merits. 5. Browse on or click to, DEMOTION AS AN ALTERNATIVE TO RETRENCHMENT, ONE WAY TO ASSIST EMPLOYERS WITH THE COVID-19 OUTBREAK. In Piki vs Development Action Group, the CCMA held that an employer is not permitted to unilaterally change the employment conditions of the contract of employment without the employee’s consent. South Africa's auto industry highlights the social and employment cost of innovation Women equal men in computing skill, but are less confident More neurotic, less agreeable, less conscientious: how job insecurity shapes your personality • The employee’s subordinates are taken away. If there is a reasonable concern that an employee may contract the virus while attending work, the employer must attend to an immediate investigation on an urgent basis. of salary and benefits at the time of JF Kern’s departure that he would have had a legitimate claim of demotion at the time of the reduction of salary and when other conditions occurred”. A pay cut may be temporary or permanent, and may or may not come with a reduction in responsibilities. Since a Demotion without consent is a repudiation of the employment contract, it, therefore, entitles the employee to sue for breach of contract.However, an employer should always consider a demotion as an alternative to retrenchment. All labour law advice as to: 1 to report to him/her a security officer by at... Constitute a demotion as an alternative to retrenchment, one way to make changes to an employee temporarily! The responsibility or power or status which an employee the South African workers will still entitled. 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