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Three facts you must know about salary increases to avoid an unfair labour practice case

by , 26 November 2014
If you don't handle salary increases correctly at your company, your employees could take you to the CCMA for unfair labour practices. This costs a lot of money and takes time, two things you can't afford to lose.

The good news is it's easy avoid legal battles over salary increases if you have the know-how.

Here are three points you must familiarise yourself with when it comes to salary increases so you can avoid unfair labour practice cases.

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If you don't and your employee disputes this deduction, you'll land up at the CCMA. And you WILL lose!

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Three important points you need to know about salary increases

#1: You can't unilaterally take away the right to a salary increase if it's guaranteed.
If your employee's annual salary increase is guaranteed, you can't unilaterally remove this right and replace it with a discretionary annual salary increase.
Doing this would make you guilty of a breach of contract. And your employee will definitely beat you at the CCMA for unfair labour practice.
If you want to make such a change, make sure you get your employee to agree, in writing.
#2: Even if an annual salary increase isn't guaranteed, you can't refuse your employee an increase if you don't have valid reasons and he meets all the requirements.
According to the Labour Law for Managers Loose Leaf Service, even if you haven't guaranteed your employee an annual salary increase, you may be guilty of an unfair labour practice if you don't give an increase. That's if, for example, he meets all the requirements for a discretionary increase, but you refuse to increase his salary for no valid reason.
If, for example, your employee takes you to the CCMA for this, he'll have to prove:
  • He has some entitlement to receive an increase (for example, it's become company practice to provide annual increases, or all your other employees got one); and
  • You acted unfairly by not increasing his salary (for example, by deciding arbitrarily not to give the increase).
The moral of the story?
Be consistent when it comes to salary increases.

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#3: You must you still pay your employee a performance-related increase even if she's taken maternity leave
South African labour laws make it clear that you can't unfairly discriminate against an employee, on the basis of her pregnancy or any matter that relates to her pregnancy, for example, taking maternity leave.
So when it comes to salary increases, the rule is, if your employee met the performance standard you require for the period she worked, you must give her the same benefits as others who have met the standard.
If her performance has been satisfactory and the only reason she didn't fully achieve her targets was because she took maternity leave, you must at least give her a pro-rata increase.
Bottom line: Something as straightforward as salary increases can lead to a full blown legal dispute. So now that you know these points, make sure you handle increases correctly so you can avoid unfair labour practice cases.
PS: For more information on how to handle salary increases correctly, check out the Labour Law for Managers Loose Leaf Service.

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