Business Day
BU S I N E S S DAY.CO. Z A
Friday 27 June 2025
Business Law & Tax Review Calling a rose by any other name ... Suspension vs special leave: employers must note both trigger the same legal obligations By JOE MOTHIBI & TSHEPANG KGALADI ENS
The recent decision by the Road Accident Fund (RAF) to rescind its initial decision to place its CEO on special leave, replacing it with a precautionary suspension, has raised more than just eyebrows. It has also brought into sharp focus the confusion that sometimes arises when employers are faced with a choice of whether to implement one or the other. Precautionary suspension is usually unilaterally imposed when an employer reasonably believes that an employee might have breached a workplace rule that requires investigation, or which may result in disciplinary action. It is not punitive but precautionary in nature. It is imposed for reasons of good administration, often to safeguard the integrity of an investigation or to protect witnesses. There is no requirement for an employee to be provided with the opportunity to make representations before being placed on precautionary suspension, unless the employer has imposed such a duty on itself through its procedures or by agreement with unions. Special leave, on the other hand, is generally granted with the agreement of the employee and is sometimes at the employee’s behest. It generally serves the same purpose as a precautionary suspension, except that it does not carry with it the stigma associated with being placed on precautionary suspension. It is a case of a rose by any other name smelling as sweet. As the Labour Court stated in Sibanyoni v Speaker of the City of Mbombela and others [2024] JOL 66313 (LC): “Special leave imposed by an employer is essentially a euphemism for a precautionary suspension … It is irrelevant whether special leave is imposed for a prolonged or short period. It remains a suspension regardless …” In Heyneke v Umhlatuze Municipality
(Heyneke) (2010) 31 ILJ 2608 (LC), the court, when dealing with the placement of a municipal manager on “special leave”, had the following to say: “Special leave that is imposed on employees is effectively a suspension in the hope of subverting the residual unfair labour practice provisions of the Labour Relations Act No. 66 of 1995 (LRA) and all the time and other constraints that accompany suspensions. “To discharge its onus of proving the ... lawfulness of the special leave the municipality has to show that the special leave was at all times at the instance of the employee and with his consent, that it was not imposed on him, that exceptional circumstances existed and that the special leave resolution was adopted in good faith,
and that it was rational, reasonable, proportionate and in the public interest.” (own emphasis) Because special leave is treated as a form of precautionary suspension, it is essential employers comply with the requirements that govern suspensions. Even if the term special leave is used, the underlying nature of the action — removing an employee from the workplace pending an investigation — triggers the same legal obligations as a precautionary 123RF — DERIN30 suspension. The terms of a suspension that typically apply to precautionary suspension also apply when an employee is placed on special leave, such as, for example, being barred from the workplace and contacting fellow employees.
Use correct procedures The RAF matter serves as a timely reminder of how crucial it is for employers to use correct legal procedures when removing an employee from the workplace as a precaution pending an investigation or disciplinary action. While special leave might appear to be a neutral or softer option, it cannot be imposed unilaterally without consent; doing so may render the action unlawful. The cost of misunderstanding these concepts can be steep.
State dealings need to comply with EEA By MELISSA COGGER, TALITA LAUBSCHER & CHLOË LOUBSER Bowmans
A significant amendment brought about by the Employment Equity Amendment Act, 2022 is the coming into operation of section 53 of the Employment Equity Act, 1998 (EEA). In terms of this section, every employer who makes an offer to conclude an agreement with any organ of state for the furnishing of supplies or services or for the letting or hiring of anything, must comply with the relevant provisions of the EEA and attach to that offer either a certificate or a declaration of compliance. This applies to both designated and nondesignated employers. Accordingly, every employer that makes an offer to do business with an organ of state must, if it is a designated employer, comply with Chapters II and III of the
EEA; and if it not a designated employer, comply with Chapter II of the EEA. A failure to comply with the relevant provisions of the EEA is sufficient ground for rejection of any offer to conclude an agreement with the state, or for the cancellation of the agreement. The legislation contemplates two options for an employer: either it can request a compliance certificate from the employment and labour minister and attach that certificate to its offer; or it can attach a declaration that it complies with the relevant chapters of the EEA. A certificate is conclusive evidence of an employer’s compliance. A declaration, on the other hand, is only conclusive evidence of compliance once verified by the Director-General. While section 53(1) provides for these two options, the newly enacted Employment Equity
Regulations, 2025 (General Administrative EE Regulations) only deal with the first: the certificate of compliance. It does not provide any details on the verification process. If an employer chooses to attach a declaration of compliance, it is unclear at this stage how verification would be sought, and by whom. Accordingly, while attaching a declaration of compliance is an option for proving compliance, whether organs of state will accept such declarations remains to be seen. Arguably, a decision by an organ of state to reject an offer by an employer to do business solely on the basis that the employer has attached a declaration as opposed to a certificate, may be open to legal challenge. However, in the circumstances and for the sake of certainty, it is likely that employers will opt to provide certificates.
IN YOUR COURT
PETER BLANCKENBERG COLUMNIST
The ins and outs of conditional clauses
I
t is common in offers to purchase (OTPs) in respect of immovable property that such OTPs contain conditional clauses. These conditional clauses frequently deal with the raising of the capital necessary to pay the purchase price. Our law requires that any acquisition of immovable property must be in writing and signed by both the seller and the purchaser or duly authorised representatives of such persons. Further, the terms and conditions of the OTP must express the intention of the parties in sufficient detail to ensure that the OTP is enforceable. These important terms deal with issues such as the description of the property, the purchase price, the payment of the purchase price and so on. Where there is a conditional clause, effectively the requirement of certainty as to the meaning of the conditional clause also applies. So, for instance, the conditional clause would need to state its purpose in a manner which is able to be interpreted and understood by the parties. Where a conditional clause deals with the raising of finance, this would generally mean that its contents would carefully define the nature of the finance to be raised and the date by which such finance should be raised. Our case law is clear that when a conditional clause fails to be met in accordance with its own terms, then the OTP itself lapses and ceases to exist. In addition, the OTP cannot be revived by way of an addendum or by way of some other form of ancillary letter or partial agreement. In short, an OTP which has ceased to exist (because a conditional clause of such OTP has not been complied with in accordance with its own terms) has to be replaced by a new OTP. It is essential therefore that sellers and purchasers alike, and property practitioners, are aware that when a conditional clause is inserted into an OTP noncompliance with such conditional clause automatically renders the OTP invalid and of no further legal consequence: there is nothing in law to be revived. A new OTP must be entered into by all the parties and signed by all the parties. This principle was established once again in the Supreme Court of Appeal case Maria Luisa Palma Codevilla v Paula Jane Kennedy-Smith NO and Others (494/2023) [2024] ZASCA 136 (October 10 2024). Notwithstanding that all the parties involved intended to revive the OTP (which had lapsed through failure of a conditional clause) by way of an addendum which was signed by all the parties concerned, Schippers JA held in a majority judgment that the addendum was incapable of reviving an OTP which itself no longer existed in law.
-Peter Blanckenberg is a Director at Blanckenberg & Associates Inc.