Executive Insights

Are you entitled to pay during lockdown if you couldn’t work? Here’s what the courts say

Business Insider SA
  • Two court rulings came to different conclusions on whether companies could enforce "no work, no pay" when employees weren't allowed to work during lockdown.
  • The high court in Johannesburg found that a restaurant had to pay salaries during Level 4 and Level 5.
  • But recently, the Labour Court ruled that a company was under no obligation.
  • For more articles, go to www.BusinessInsider.co.za.

During the initial stages of South Africa’s lockdown, millions of South Africans were legally not allowed to do their jobs. Government enforced strict rules about who was allowed out, and most people were not deemed essential services.

They couldn’t do their jobs through no fault of their own – but can companies fall back on “no work, no pay”?

Rulings in two recent court cases came to different conclusions.

READ | South Africans are not taking leave in lockdown - and companies are getting worried

In the first case, the high court in Johannesburg found that a Melrose Arch restaurant had to pay salaries during Level 5 and Level 4 of the national lockdown – when restaurants weren't allowed to open for sit-down meals.

According to Bradley Workman-Davies, director at Werksmans Attorneys, the judgement found that non-essential employees were legally entitled to tender their services during the Level 5 and Level 4 stages of the lockdown – even if they couldn’t actually deliver these services during lockdown.

He says the judgment has been criticised, and in his view, a new ruling by the Labour Court has the “correct legal approach”: where it was legally impermissible for employees to perform services, the tendering of services by these employees is irrelevant, and the employer is entitled to implement the no-work-no-pay principle. The court ruled in a case of Macsteel versus Numsa, when Macsteel filed an ultimately unsuccessful application to prevent a strike.

In its ruling about the matter, the court also dealt with Macsteel's payment of workers. 

Macsteel had undertook to pay 100% of salaries in March and April, and then up to 80% of employees’ salaries for May, June and July 2020, with the Unemployment Insurance Fund's Temporary Employee Relief Scheme being relied upon to make payment of the balance.

But the judge found that it had no legal obligation to do so in respect of employees who were not legally able to work, says Workman-Davies.

The court held that those employees who “rendered no service, albeit to no fault of their own or due to circumstances outside their employer’s control, like the global Covid-19 pandemic or the national state of disaster, are not entitled to remuneration and Macsteel could have implemented the principle of 'no work no pay’.”

“This Macsteel judgement from the specialist labour court, rather than that of the High Court... should be relied upon as setting out the correct approach," according to Workman-Davies.

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