Made redundant while pregnant? These are your rights

When you are pregnant and your employer decides to make you redundant, you have rights in terms of labour legislation, as an employer recently found out when he had to pay an employee R800 000 in compensation for starting redundancy proceedings while she was expecting.

The employee was a financial manager and earned a gross salary of R50 000 per month at the time of her dismissal on 30 November 2020. She received IVF treatment as a single person in January 2019 and became pregnant with a due date of 11 June 2020.

She informed the CEO on 3 January 2020 and told him that she would work until 31 May 2020, says Jonathan Goldberg, labour law expert at Global Business Solutions..

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Unfortunately, there were complications with the pregnancy and the woman was admitted to hospital to be monitored and the baby was born on 2 May 2020. She scheduled to do a handover of her work to her assistant on 14 May 2020 but was unable to do so.

She was discharged on 12 June 2020 with her baby and had a first handover meeting with her assistant three days later. She informed the CEO that she and the baby had to be admitted to the hospital again for a few days.

Her maternity leave was going to be from 1 June 2020 to 30 September 2020, but she told the CEO she would revise her situation at the end of August and might consider to start working half day from September.

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When you return to an awkward vibe in the office

On 2 July the CEO finally returned her unanswered calls and screamed and yelled at her during the call.  He said he could not go on like this and needs a financial manager. He also said he did not understand why the employee could not be available for work calls but could do two photoshoots with her baby.

The employee testified that she returned to the office on 1 October 2020 and found an awkward vibe in her office. After she sent the CEO a message to ask for her laptop, he asked her to come to the boardroom. 

There he said he thinks he cannot afford her, but mentioned he still had not talked to HR. He also said he did not want her at the office because she would confuse staff with her presence and there was no work for her. She testified that she asked him to tell her that in writing to ensure she was not absent without approval.

On a Sunday she received a message about a meeting the next day and was told that a decision had been made whether there should be a mutual separation agreement or a section 189 process (retrenchment). On the Monday she received a Notice of Retrenchment.

The employee testified that in the meeting she said that the letter provided was not a mutual settlement agreement and the notice also did not refer to the statutory minimum for retrenchment pay.

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CEO’s attitude changed when she became pregnant

Under cross-examination, she agreed that another employee took on additional functions when she was on maternity leave. She also insisted that the CEO’s attitude to her changed when she said she was pregnant and taking maternity leave.

She wanted to know why the company did not start the consultation process sooner if the department was restructured in August. The employee agreed that there was a consultation process, but no alternatives were listed for her and she also did not get any information on the company’s financials as she requested.

The court found that the employee was a credible witness and that the CEO’s credibility was somewhat damaged by the mistake made in the statement of defence about being taken by surprise when the employee arrived on 14 September.

The CEO also was unable to clearly recall what he said to the employee when she arrived and while he downplayed his anger on the telephone call, he largely confirmed the content of the call and tenor of his anger.

He acknowledged that he was thankful that the employee had worked from the hospital while she was admitted, but his testimony reflected his lack of understanding the right to maternity leave enshrined in our law, Goldberg says.

His anger at the fact the employee had not been at the end of the phone whenever needed after the discharge of her premature baby from hospital was a prime example, he points out. The employee’s primary claim was that her employment was terminated due to her being pregnant.

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Automatic unfair dismissal

According to section 187 of the Labour Relations Act, a dismissal is automatically unfair if the employer, in dismissing the employee, acts contrary to section 5 or if the reason for the dismissal is the employee’s pregnancy, intended pregnancy or any reason related to her pregnancy.

The CEO said the employee’s letter setting out how she would like to take her maternity leave made him angry and emotional. After this letter he removed her access to her computer and the system, spoke to the IT person about the system upgrade in August and decided to get an accountant in to assist in the department in mid-October.

He produced no substantive evidence to show that her retrenchment was necessary for operational requirements except saying that not paying her salary anymore will cut costs. No evidence was tendered about how there would be a cost saving once a consultant attended to the employee’s functions and two extra people were seconded to do accounting administration.

Goldberg says the employee did her best in the most difficult of circumstances, while suffering from high blood pressure in hospital before the birth and attending to her child who was in ICU after the birth to perform the essential functions of her job.

She did not have time to do a full hand over of her functions because her pregnancy did not go to full term. The fact that she was not available during all working hours between 12 June when her baby was discharged from hospital and writing her letter on 25 June, when she set out how she would like to organise her maternity leave, had no basis in law for her employment to be under threat.

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Evidence she became redundant because she was pregnant

The employee provided all the evidence necessary, while her employer could not show that genuine operational requirements were the real reason for the termination of her employment. The CEO’s own evidence signified the relation between her dismissal and her pregnancy.

The fact that the employee, on advice, participated in the consultations and tried to save her livelihood by so doing, is neither here nor there, Goldberg says. “This was a case of automatic unfair dismissal for reasons related to pregnancy.”

The employee wanted compensation for her automatic unfair dismissal and the court had to decide what is fair and equitable in the circumstances. She testified that she was unemployed for a period of four months after her dismissal.

The judge said he considers that she was a senior employee and did have a responsibility to the employer to have duly interacted with the employer about how her maternity leave will be handled between January and May of 2020 in deciding on compensation.

As the dismissal was automatically unfair, the employer had to pay the employee compensation in an amount equivalent to 16 months of her salary at the time of her dismissal being 16 x R50 000 = R800 000. The employer also had to pay the costs of the referral.