a case for private dispute resolution in the workplace

The Commission for Conciliation, Mediation and Arbitration (“the CCMA”) continues to do admirable work within the employment landscape. However, COVID, significant budget cuts and increasing demands on a dispute resolution body that is required to service thousands of employers and employees annually have taken a toll on its ability to operate as effectively and efficiently as we have come to expect from years past. As employment law practitioners we have also experienced the frustration felt by employers and employees as CCMA users.        

Recent amendments to the CCMA rules, such as the ones directing Commissioners to re-schedule an arbitration or remove it from the roll, if the referring party fails to attend the arbitration instead of dismissing the claim as was previously the case, may serve to prolong matters and are open to potential manipulation by unscrupulous parties. While the dispute resolution mechanisms designed to deal with employment-related disputes were intended to be simple and speedy, this is no longer necessarily the case.    

The Labour Relations Act recognizes that employers and employees may conclude private agreements regulating the resolution of disputes via private dispute resolution procedures such as private arbitration. This position has further been confirmed by various Labour Court decisions, the underpinning principle emerging from these cases in the use of private resolution procedures being that the employee must not be placed in a position that is worse than what he or she would have been in had they have been permitted to pursue a claim through the CCMA or Labour Courts.   In essence, the person or body appointed to resolve the dispute must be independent of the employer;   and the costs associated with the private dispute resolution procedure must not be prohibitive to the employee’s ability to participate therein.  Employee’s earnings below the Basic Conditions of Employment Act (“the BCEA”) earnings threshold (approximately R20 092.55 per month currently) may not be required to contribute to the costs of the private resolution procedure, and for those earning in excess of the BCEA earning threshold, a contribution to costs is permitted, but this too must be within reason. 

While the employer may be expected to carry some, if not all, of the costs associated with the private dispute resolution process, there are still a number of benefits in choosing this approach, which include, inter, alia:    

  • Parties are at the mercy of the commissioner or judge’s calendar and there may be limited availability to complete an arbitration, trial or other proceeding once they have started hearing the matter.  This can lead to lengthy delays in the matter’s conclusion, causing legal costs or lost working hours (hours out of office)  to escalate.  As a paid-for service, private mediators and arbitrators are often more readily available than their public counterparts.
  • The parties can have input into the election of their private mediator and/or private arbitrator, while one does not have input into the identity of the commissioner or judge;
  • The parties are in control of the private resolution process, being able to agree on the manner in which the dispute will be resolved.  For example, it is possible to agree to a two-tier private dispute resolution procedure comprising of mediation, followed by arbitration.  While conciliation within the context of the CCMA is intended to be a truncated mediation process, it is often nothing more than a “meet and greet” with the appointed commissioner in order to obtain the certificate of non-resolution to take the matter further.   The opportunity to mediate the dispute both properly and effectively between the parties via a private resolution procedure, and potentially resolve the dispute without the need for further costly and time-consuming litigation, is therefore lost; and
  • The parties can have input into the terms of reference/brief to the private mediator / or private arbitrator and can agree on how formal/informal the dispute resolution process should be.

Employers considering the use of private dispute resolution procedures for employment disputes have the discretion to reserve it for senior, managerial employees or to implement it across the workforce. 

Furthermore, alternative dispute resolution processes and procedures are not only reserved for disputes which have reached litigation stage.  Mediation and facilitation can be effective tools for dealing with internal grievances and disputes before they become litigious, thus preserving existing and future employment relationships.      A workplace where there are open and effective dispute-preventative measures is likely to be happier and more productive.   

Please contact our offices should you wish to discuss the benefits of private dispute resolution in greater detail, and how to implement it in the workplace.