Employment Law

Recovery of Costs for Employer After Successful CCMA Matter featured image

Recovery of Costs for Employer After Successful CCMA Matter

The mandate of the COMMISSION FOR CONCILIATION, MEDIATION ARBITRATION (CCMA) is to provide simple procedures for the resolution of labour disputes through statutory conciliation, mediation, and arbitration.

It has become apparent that many employees abuse this system. During the period of 2019/2020, it was recorded that employees lose approximately 40% of cases referred to the CCMA for arbitration.

Obviously, not all the 40% of cases lost by the employees can be translated to abuse. Various other factors have also played a role. But keeping in mind that the CCMA was primarily established to protect employees and that it can already be argued that the CCMA is biased in favour of the employee, these numbers paint a very alarming picture.

The system of referring a matter to the CCMA is so simple and has no cost implications for the employee. Many employees have come to the realization that they might as well embark on the journey and although their matter has no merit, they have nothing to lose. This makes it tempting for dishonest employees to abuse the system in order to make some money at the expense of employers.

Many Employers have raised the concern that even if they win the referred matter at the CCMA, the money and time lost during the process can never be recovered.

Employers need to be reminded that all is not lost. The law makes provision for Employers to recover their actual costs. Even though the institution does not automatically award the costs to the successful party, they may bring an application for the recovery of costs.

The costs that may be recovered are actual costs. On the downside, however, the Employer will only be allowed to recover legal fees if the employee was also represented by a legal practitioner.

The CCMA and the Labour Court know some employees take chances, and this is highly frowned upon.

For example, in Simane v Coca-Cola (2006, 10 BALR 1044), the CCMA agreed that the employee had been guilty of dishonesty. As he had lodged a case for unfair dismissal knowing that it was not genuine, the CCMA awarded costs against him.

Another example is Ndwalane v The Magic Company (Pty) Ltd (2006, 5 BALR 497) where the employee was employed on a fixed-term contract. When the fixed term contract expired and he was told to go, he lodged an unfair labour practice case against the employer. However, he brought no proof of unfairness and the arbitrator found his case to have been frivolous and vexatious. He was ordered to pay part of the employer's legal costs.

Employers are reminded that even though the exercise of defending yourself at the CCMA and possibly the Labour Court can be a tedious and expensive exercise, we urge you not to settle and accept liability, especially in instances where the employee is acting vexatious and mala fide. The chances are very good that the CCMA and the Court would hold the male fide employee liable for your costs and order the employee to reimburse your costs.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.