South Africa: Employment case law update July 2026 – key takeaways

On Thursday, 16 July 2026, we hosted a webinar on the latest cases impacting the employment law landscape in South Africa. Please click here to access the recording. Citations and mini-summaries of the cases discussed, together with key takeaways, are set out below.

Section 188A(11)

• Industrial Development Corporation of South Africa v Modika and Others (A2026-037072) [2026] ZALAC (17 March 2026)

Urgent appeal – protected disclosures – section 188A(11) of the Labour Relations Act, 1995 (LRA) – pre-dismissal arbitration – urgent interdict to restrain internal disciplinary hearing – whether Labour Court entitled to grant interdictory relief not sought in notice of motion – usurpation of powers of the Commission for Conciliation, Mediation and Arbitration (CCMA) – whether Labour Court can determine jurisdictional requirements for section 188A(11) referral – misapplication of section 188A(11) – impermissible intervention in medias res – requirements for protected disclosure under the Protected Disclosures Act, 2000 (PDA) – complaint/grievance against superior not constituting protected disclosure – disciplinary action as occupational detriment – causal connection required between protected disclosure and alleged occupational detriment – jurisdictional facts as pre-condition to exercise of administrative power – discretionary nature of interdictory relief – irreparable harm not demonstrated – substantial redress available through automatically unfair dismissal remedy under section 187(1)(h) – appeal upheld, Labour Court order set aside.

Key takeaways: (1) Section 188A of the LRA allows allegations of misconduct or incapacity to be decided by an independent arbitrator instead of through an employer‑run hearing. The enhanced mechanism under section 188A(11) is available only where an employee, acting in good faith, claims that participating in an enquiry would amount to an occupational detriment arising from a protected disclosure under the PDA. In such circumstances, either party may insist that the matter proceed as a pre‑dismissal arbitration before the CCMA or another accredited body, effectively displacing the employer’s internal process. Crucially, though, simply alleging a protected disclosure is not enough. A referral under section 188A(11) is only competent where certain jurisdictional facts are present, ie (i) the employee must have made a disclosure falling within the ambit of the PDA; (ii) the disclosure must have been made honestly and in good faith; (iii) the employee must have suffered an occupational detriment; and (iv) there must be a causal link between the disclosure and the alleged detriment. The LAC in this case held that it is the role of the CCMA, as an administrative body, to determine whether these jurisdictional facts exist. Only once the CCMA accepts the referral, does an arbitrator assume responsibility for conducting the inquiry into the allegations of misconduct or incapacity and the internal inquiry terminates automatically. (2) The LAC also reaffirmed the well-established principle that courts should be slow to interfere in disciplinary matters before they have run their course, and that such intervention is permissible only in exceptional circumstances. Such circumstances arise where an aggrieved person cannot be afforded substantial relief once a process is completed.

The judgment is available here.

Retrenchments

• National Union of Metalworkers of South Africa and Others v Industrial Oleo Chemical Products (CCT 367/24) [2026] ZACC 22 (29 May 2026)

Interpretation of section 189A(7)(b)(ii) of the LRA, read with section 191(11) – appeal concerning Labour Court’s jurisdiction to adjudicate unfair dismissal dispute after failed facilitation without prior conciliation – statutory interpretation and jurisdictional challenge implicating sections 23(1) and 34 of the Constitution – distinction between facilitation and conciliation – majority holding conciliation not required and direct referral to Labour Court permitted – dissent holding prior conciliation mandatory – order granting leave to appeal, setting aside Labour Appeal Court (LAC) decision, and remitting matter to Labour Court for determination of the merits – no order as to costs.

Key takeaway: The Constitutional Court’s decision has finally settled the controversy that persisted for some time and clarifies that, following a facilitated consultation process in a ‘large-scale retrenchment’, a referral to conciliation is not required before referring a dispute about the substantive fairness of retrenchments to the Labour Court in terms of section 189A(7)(b)(ii) of the LRA.

The judgment is available here.

• Solidarity and Others v Tsebo Facilities Solutions (Pty) Ltd and Others (C472/23) [2026] ZALCCT 49 (23 March 2026)

Severance pay – section 41(4) of the Basic Conditions of Employment Act, 1997 (BCEA) – forfeiture – causation – employees retrenched after employer lost contract with client – secured employment with incoming service provider (CBRE) before the employer’s section 189 process and before conclusion of an Alternative Employment Agreement (AEA) – commissioner misconceived the section 41(4) inquiry by treating acceptance of alternative employment as dispositive and failing to determine whether employment was obtained as a result of the employer’s efforts – findings inconsistent with evidence and with commissioner’s own factual conclusions – award unreasonable and reviewable – substituted with orders requiring employer to pay severance pay, with interest calculated from the date the payments became due and payable.

Key takeaways: (1) In terms of section 41(4) of the BCEA, an employee who unreasonably refuses to accept the employer’s offer of alternative employment with that employer or any other employer, is not entitled to severance pay upon retrenchment. Where the offer of alternative employment is with another employer, the question of causation becomes key. The forfeiture of severance pay only applies where it can be shown that the employer has arranged the alternative employment for the employee. This requires more than simply engaging with the incoming employer, eg about potentially concluding a section 197 agreement, or submitting names of its employees to a competitive and discretionary recruitment process over which it has no control – the current employer must have taken purposive steps to cause that alternative employment to come about. In this case, where the evidence was that the applicants had received offers of employment from the incoming service provider, and responded to an independent recruitment drive, of which the employer was unaware, and before an AEA was concluded and the retrenchment process commenced, it could not be said that their alternative employment had been arranged by their employer. (2) There is no motive-based exception to the entitlement to severance pay.  The fact that an employee, through their own efforts, may receive an offer of employment from another employer and allows the termination of their current employment to come about through retrenchment, instead of resigning, does not disentitle them to statutory severance pay.

The judgment is available here.

Unfair discrimination

• Masimla v Pioneer Fishing (Pty) Ltd and Others (C435/2023) [2026] ZALCCT 65 (13 April 2026)

Automatically unfair dismissal relating to alleged quid pro quo sexual harassment – in limine points relating to court’s jurisdiction to hear unfair discrimination claim arising from alleged conduct of a contractor, and whether employer could be held liable for automatically unfair dismissal on the basis that it allegedly gave effect to the vindictive intentions of the contractor to dismiss her following the termination of a consensual romantic relationship – Court not having jurisdiction over unfair discrimination claim, but having jurisdiction over automatically unfair dismissal claim – plaintiff failing to adduce evidence of sexual harassment or to make out a case that it was the cause of her dismissal – automatically unfair dismissal claim dismissed – Court declining to entertain unfair dismissal for misconduct claim.

Key takeaway: Section 60 of the EEA creates a mechanism of vicarious liability for employers in respect of acts of unfair discrimination committed by employees in the workplace. This provision does not extend to the conduct of independent contractors or other non-employees, notwithstanding the broader scope of the Code of Good Practice on the Prevention and Elimination of Harassment in the Workplace, which refers to a wider range of workplace participants including contractors, suppliers, and clients. Employers should, however, be aware that employees may choose to bring a delictual claim in circumstances where the alleged perpetrator of harassment is an independent contractor or any other third party who is not employed by the employer. It is therefore important for employers to take all reasonable steps to ensure that employees are protected against all forms of harassment in the workplace, including harassment that may be perpetrated by third parties.

The judgment is available here.

• Moses Kotane Institute v Mzimele and Another (DA18/2023) [2026] ZALAC 24 (26 May 2026)

Appeal – unfair discrimination – sections 6 and 11 of Employment Equity Act, 1998 (EEA) – gender – male chartered accountant ranked first for CFO post but excluded solely on basis of gender – Institute, under pressure from shareholder, appointed female candidate lacking advertised qualifications to address representivity on board without employment equity plan – Court held reliance on affirmative action unlawful, ad hoc and not pleaded – appointment created absolute barrier against male candidates, constituting unfair discrimination – damages claim failed for lack of proof of patrimonial loss – appeal against finding of unfair discrimination dismissed – damages award set aside.

Key takeaways: (1) Affirmative action measures must be consciously designed to achieve equitable representation of suitably qualified persons from designated groups, rational and implemented lawfully and not for an ulterior or capricious purpose to constitute a valid defence to a claim of unfair discrimination under the EEA. (2) A written employment equity plan is expected to show that any affirmative action measure was ‘designed’ in accordance with section 15 of the EEA. In exceptional circumstances, an employer may establish de facto design through contemporaneous documentation demonstrating the necessary safeguards. These would include a board resolution predating the appointment that sets representivity goals for the relevant occupational level, a workforce analysis using national and regional data on the economically active population that identifies under-representation, a recorded section 20(4) assessment of each candidate’s suitability and documentation showing flexibility rather than the creation of absolute barriers. Without these safeguards, general reliance on values or shareholder pressure is insufficient. (3) Affirmative action measures under the EEA may include preferential treatment and numerical goals, but expressly exclude quotas (section 15(3)) and must not create absolute barriers to the employment or advancement of non-designated candidates (section 15(4)). Where an employer introduces a post-interview, gender-determinative rule that makes the outcome dependent on category membership alone, this will likely be treated as a functional quota or absolute barrier and be found to be impermissible. (4) Patrimonial damages require proof of actual financial loss, causation, and quantification. Tax returns issued by SARS may be admissible as evidence of historical income, but are not sufficient on their own to prove the quantum of loss. Similarly, the salary of the successful candidate may serve as a reference point, but is not determinative in the absence of evidence establishing what the claimant would in fact have earned.

The judgment is available here. 

 Restraints of trade

• Didi Waterproofing Services (Pty) Ltd v Els and Another (2025/235294) [2026] ZALCCT 73 (20 April 2026)

Restraint of trade – enforceability – employer sought urgent interdict enforcing restraint and confidentiality undertakings against former site manager who established new company – objection to late answering affidavit failed, urgency undermined by applicant’s own delays – restraint clause vague and overbroad, prohibiting establishment of any new business without protecting proprietary interests – Court refused to rewrite contract – enforcement contrary to public policy and Constitution – confidentiality claim speculative, no specific confidential information or misuse proved – requirements for final interdict not met – application dismissed with costs.

Key takeaways: (1) A restraint of trade clause must be drafted with precision and clarity. In this case, the clause prohibited the employee from ‘establishing a new business’ but did not expressly prohibit him from establishing a competing business. The Court refused to read the word ‘competing’ into the provision, holding that to do so would amount to creating a new contract for the parties. Employers must therefore ensure that restraint provisions are drafted to capture the specific conduct they seek to prevent. Vague or overbroad language may render the provision unenforceable. (2) A restraint provision that prevents a former employee from establishing any business (including one that does not compete with the employer) but permits the employee to join an existing competitor, is unlikely to be enforceable. Such a provision is contrary to public policy as it does not protect any recognisable proprietary interest and, in effect, seeks to prevent the employee from becoming an entrepreneur, confining them to the role of an employee. (3) Even where an employee expressly agreed at the time of signing that a restraint provision is ‘fair, reasonable and necessary’, this does not render an otherwise unreasonable restraint enforceable. Whether a restraint is reasonable is determined at the time enforcement is sought, not at the time the agreement was entered into. Provisions contrary to public policy will not be enforced regardless of the employee’s prior consent. (4) An employer seeking to enforce a confidentiality undertaking must put forward credible, specific evidence that the employee had access to protectable confidential information and, preferably, that the employee has actually breached the confidentiality obligation. Broad and unsubstantiated allegations, such as claiming an employee had access to ‘inner workings’, general business operations, or unspecified ‘processes and techniques’, are insufficient.

The judgment is available here.

Fixed-term contracts

• Maphosa v New Model Private College and Others (A2025/132542) [2026] ZALAC 22 (28 May 2026)

Appeal – unfair suspension – appellants employed as educators under successive one-year fixed-term contracts, in some instances renewed for nine to ten years – for the 2020 calendar year, appellants engaged on a 12-month fixed-term contract, with an invitation to reapply for 2021 – appellants not reappointed – commissioner found that long history of contract renewal created reasonable expectation of renewal, that the appellants remained employees of the respondent, and that their suspension without cogent reason or fair procedure was unfair – each appellant awarded compensation equivalent to 12 months’ remuneration – on review, Labour Court held that the commissioner had committed a material error of law by conflating the test for a ‘dismissal’ with the separate question of the actual existence of an employment contract capable of being suspended – award set aside – on appeal, appellants (for the first time) relied on section 198B(5), read with section 198B(3), of the LRA – earned below earnings threshold – engaged on successive fixed-term contracts exceeding three months without any justifiable reason – employment deemed by law to be of indefinite duration – capable of being suspended – although commissioner’s own reasoning flawed, ultimate conclusion correct – appeal upheld – order of the Labour Court set aside and substituted with an order dismissing the review application.

Key takeaway: Employers who engage employees on fixed-term contracts who earn below the BCEA earnings threshold, for periods exceeding three months, must be able to point to a genuine, evidenced justifiable reason under sections 198B(3) and (4) of the LRA. Where no such reason exists or can be proven, their employment will be deemed, automatically and by operation of law, to be of indefinite duration under section 198B(5) after the initial three-month period, irrespective of what the contract itself is labelled or how many times it has been renewed. Employers using successive fixed-term contracts for lower-earning staff should maintain contemporaneous, written records of the justifiable reason for each fixed term. This deeming effect is not a mere technicality: it can establish the existence of an employment relationship for purposes unrelated to dismissal, such as a claim of unfair suspension. Employers should therefore not assume that the expiry of a fixed-term contract automatically ends the employment relationship or shields them from suspension-related or other unfair labour practice claims, where the employee falls within the scope of section 198B of the LRA.

The judgment is available here.

Misconduct

• Erarite (Pty) Ltd t/a Khayelitsha Superspar v Commission for Conciliation Mediation and Arbitration and Others (C424/2022) [2026] ZALCCT 53 (23 March 2026)

Misconduct dismissal – social media message – bakery manager dismissed after posting biblical verse on WhatsApp status during xenophobic tensions – Commissioner found dismissal substantively unfair, noting message provocative but not incitement to violence – context considered, employee’s frustration acknowledged, misconduct viewed as grave error of judgment – final written warning deemed appropriate – three months’ compensation awarded – Commissioner’s value judgment reasonable under Sidumo – application dismissed, each party to pay own costs.

Key takeaways: (1) Social media misconduct must be assessed contextually. In this case, the commissioner (and the court on review) drew a distinction between conduct that is provocative or ill-judged and conduct amounting to hate speech or incitement to violence. When taking disciplinary action, employers should ensure that the framing of the allegations and internal findings accurately reflect the gravity of the conduct actually committed, and that the sanction that is imposed is proportionate. (2) Arbitrators are not required to defer to the employer’s chosen sanction. While the decision to dismiss belongs to the employer, the determination of its fairness does not – the commissioner’s own sense of fairness prevails.  Employers should accordingly be prepared to justify dismissal as a proportionate response on the facts, rather than relying on the fact that dismissal was their preferred outcome.

The judgment is available here.

• Universal Product Network (Pty) Ltd v Mbatsana NO (JA31/25) [2026] ZALAC 14 (31 March 2026)

Appeal – review of arbitration award – approximately 256 employees dismissed following protected strike action after disciplinary enquiries found them guilty of misconduct (breach of picketing rules, an interim court interdict, and obstruction of vehicles) – commissioner found the dismissals substantively fair but procedurally unfair, and awarded each employee one month’s remuneration as compensation – on review, Labour Court mero motu reviewed and set aside the commissioner’s finding on procedural unfairness and substituted a finding that ‘gross’ procedural defects in the internal disciplinary process had vitiated the outcome, rendering the dismissals substantively unfair, and ordered reinstatement – whether gross procedural unfairness can mutate into substantive unfairness – commissioner afforded parties opportunity to address principal issue and reached reasonable decision – Labour Court erred in reviewing and setting aside award and in deciding un-pleaded case – arbitration award unimpeachable, Labour Court’s substitution void – appeal upheld – Labour Court order set aside – Review application dismissed – no costs order.

Key takeaway: Procedural unfairness, however serious, cannot convert a substantively fair dismissal for misconduct into an unfair one. The LAC confirmed that the current LRA maintains a strict bifurcation between substantive fairness (ie a fair reason for dismissal) in section 188(1)(a)(i) and procedural fairness (ie a fair process) in section 188(1)(b).  Employers can take some comfort that even significant procedural shortcomings in a disciplinary process will not, by themselves, expose an otherwise justified dismissal to a finding of substantive unfairness, with the risk of potential reinstatement and back pay. Employers should, nevertheless, undertake to follow a fair process leading up to dismissal, to mitigate against compensation orders. 

The judgment is available here.

Defamation

• Donald v LF and Another (2769/2023) [2026] ZALMPPHC 49 (9 April 2026)

Defamation – workplace grievance – plaintiff sued co-worker and employer over grievance letter alleging sexual harassment – employer investigated, disciplinary hearing presided over by independent chairperson resulted in dismissal, later upheld by CCMA – plaintiff claimed damages and apology, alleging false accusations and racially demeaning language – Court held grievance written on qualified privileged occasion, allegations substantially true and in public interest – use of word ‘boy’ peripheral and not defamatory in context – no publication beyond disciplinary process – claim dismissed with costs on attorney and client scale.

Key takeaways: (1) Employers and complainant employees are not automatically exposed to defamation liability simply because an accused employee is later aggrieved by the outcome. Internal grievance and disciplinary communications will generally attract qualified privilege, meaning such communications are protected from a defamation claim provided they are made without malice and within the scope of that workplace process. Employers should ensure grievance and disciplinary correspondence is shared strictly on a need-to-know basis to preserve the protection of privilege.  (2) Isolated intemperate language within a grievance will not, by itself, defeat qualified privilege or found a defamation claim. In this case, even though the complainant conceded she used the word ‘boy’ to refer to the accused employee in her grievance ‘out of spite,’ this did not vitiate privilege. This is because the doctrine of qualified privilege attaches to the occasion as a whole, not to individual words or expressions contained in the privileged document. When assessing privilege, one considers the dominant purpose and overall character of the communication. (3) The reporting of workplace sexual harassment by a complainant to her employer serves the public interest in promoting dignified and safe working environments. A complainant who is faced with a defamation claim by the harasser will therefore generally also be able to establish the defence of truth and public benefit. 

The judgment is available here.