It is well-known that section 60 of the Employment Equity Act 55 of 1998 (“the Act”) provides that an employer may be held vicariously liable for the acts of discrimination, including sexual or racial harassment, or workplace bullying, committed by its employees. This is in addition to any claim that the victim of the discrimination could have against the employer under the common law.

Liability under section 60 of the Act arises if an employer becomes aware of an incident of discrimination committed by an employee, but fails to comply with its statutory duties to consult all relevant parties and to take the “necessary steps to eliminate the alleged conduct and comply with the provisions of the Act”.  Where an employer can prove that it complied with its statutory obligations and that it did all that was reasonably practicable to ensure that the offending employee would not engage in conduct in contravention of the Act, then the employer will not be held vicariously liable for the conduct of the offending employee.

In the recent case of Amathole District Municipality v CCMA & Others[1], the Labour Appeal Court commented as follows:

“Section 60 does not create automatic liability on the part of the employer for the acts of discrimination including sexual harassment by their employees. Certain requirements must be met.”[2]

In Potgieter v National Commissioner of the South African Police Service & Another[3], the Labour Court succinctly set out the requirements that must be proven before an employer can be held vicariously liable to an employee who was subjected to sexual harassment by another employee. These requirements are as follows:

1. The sexual harassment or conduct complained of must be committed by another employee;
2. The conduct complained of must meet the requirements of harassment constituting unfair discrimination;
3. The sexual harassment took place at the workplace;
4. The sexual harassment was immediately brought to the attention of the employer;
5. The employer was aware of the incident of sexual harassment;
6. The employer failed to consult all relevant parties, or take the necessary steps to eliminate the conduct or otherwise comply with the Act; and
7. The employer failed to take all reasonable and practical measures to ensure that employees did not action in contravention of the Act.

The above requirements, which were further endorsed by the Labour Appeal Court in SAMKA v Shoprite Checkers (Pty) Ltd[4], have since been codified in the Code of Good Practice on the Prevention and Elimination of Harassment[5] (“the Code”), which came into effect on 18 March 2022.

We discuss below how these requirements have been interpreted by our Courts in various cases.

Requirement 1: The harassment must be committed by an employee.

Sexual harassment constitutes serious misconduct, which could warrant dismissal, even if the victim of such harassment is not a fellow employee but, for example, a member of the public (as was the case in Ekurhuleni Metropolitan Municipality v SA Local Government Bargaining Council & others[6]). However, since one of the objectives of section 60 of the Act is to encourage an employer to take steps to eliminate harassment in the workplace and protect its employees from such conduct, in order for an employer to be exposed to a potential liability in terms of section 60 of the Act, both the perpetrator and the victim must be employees of the employer.

In SAMKA v Shoprite Checkers[7] the Labour Appeal Court considered a claim for damages against an employer where an employee complained that her employer had failed to protect her from a racist utterance by a customer. The Labour Appeal Court found that the application of section 60 of the Act is expressly confined to an employee (as defined in the Act) since an employer exercises authority over an employee but not over a customer, and as such, the appeal was dismissed.

Requirement 2:  The conduct complained of must meet the requirements of harassment constituting ‘unfair discrimination’.

Section 6(3) of the Act states that, “harassment of any employee is a form of unfair discrimination and is prohibited on any one or combination of grounds in section 6(1) of the Act.”

It is critical that the conduct complained about must meet the requirements of “harassment” before an employer is exposed to any risk of vicarious liability.  If it does not, it cannot be regarded as unfair discrimination deserving of protection under the Act.

Although harassment is not defined in the Act, clause 4 of the Code defines harassment as follows:

‘4.1.1 unwanted conduct, which impairs dignity;

4.1.2 which creates a hostile or intimidating work environment for one or more employees or is calculated to, or has the effect of, inducing submission by actual or threatened adverse consequences; and

4.1.3 is related to one or more grounds in respect of which discrimination is prohibited in terms of section 6(1) of the Act.’

This requirement was specifically considered by the Labour Appeal Court in the Amathole District Municipality case[8], where the Court considered a further appeal by an employer who had been unsuccessful in the Labour Court, in appealing a CCMA award which found it to be vicariously liable for the sexual harassment of one of its employees.

In this case, the alleged that she had been subjected to sexual harassment by her manager over a period of six months and was dissatisfied with the manner in which her employer had handled the matter.

The employee admitted that she had engaged in sexual relations with her manager but indicated that she did not resist his advances because she feared dismissal. The employee testified that she had reported the conduct of her manager to her boyfriend once the harassment had stopped and had lodged a grievance with her employer four months later. After receiving the employee’s grievance, the employer’s HR Department made several attempts to arrange a grievance hearing, but the aggrieved employee was first on sick leave after which she took extensive annual leave.  Further attempts were made by the HR Department to set up the grievance hearing but the employee did not respond to emails from the HR Department and she then took further periods of leave before being admitted into a clinic by her psychiatrist.

When the grievance hearing was finally held, the chairperson ultimately found that there was no basis for the complaint of sexual harassment but made certain recommendations to the employer relating to the employee’s stress management, training to improve her work performance and that she be relocated to a work in a different department to that of the accused manager due to the impact of the allegations on their working relationship.

Dissatisfied with the outcome of the grievance hearing, the employee referred an unfair discrimination dispute to the CCMA.

The CCMA inter alia found that there was no reason why the employee would fabricate the story and that the emails and SMS messages which the employer attempted to rely upon to prove that there had been a consensual relationship between the employee and her manager, “could have been tampered with”.  The CCMA therefore found in the employee’s favour and ordered the employer to pay R150,000 in compensation to the employee, on the basis that the employer was vicariously liable for the sexual harassment of the employee by her manager.  The employer lodged an appeal to the Labour Court which found that it could not interfere with the credibility findings of the CCMA and, as such, the Labour Court upheld the CCMA award.

In the further appeal, the Labour Appeal Court revisited the SMS and email communications which the employee had sent to her manager to determine whether the conduct complained of constituted “unwanted conduct”. These communications, which the CCMA and the Labour Court had declined to consider, revealed that the employee had used affectionate terms such as “sweety”, “my love” and “honey” and that she had also sent her manager a SMS message, which the Court regarded as a seductive expression, that read: “U knw what Im hungry for u nw serious sweety, what’s ur plans for today”. The Court further found that the employee had given inconsistent testimony and that she was not a reliable or credible witness as she had deliberately misread the SMS message into the record at the arbitration to exclude the suggestive words that had been used. She had also attempted to explain that her message related to a particular incident which the employer later revealed had only occurred three months after the message was sent to her manager.

The Labour Appeal Court considered the definition of “harassment” as contained in clause 4 of the Code and, more particularly, the requirement that the conduct be “unwanted”.  The Court confirmed that the test as to whether or not the conduct is “unwelcome or unwanted” is an objective test.  On a balance of probabilities, the Court found that the sexual conduct between the employee and her manager was consensual and thus not unwelcome.  As a result, the Labour Appeal Court found that the manager’s conduct did not meet the requirements of ‘harassment’ and could not therefore constitute unfair discrimination. It therefore followed that the employer could accordingly not be held vicariously liable for any unfair discrimination and the employer’s appeal to overturn the compensation award succeeded.

Requirement 3: The harassment must take place while at work.

This particular requirement has been expanded to include circumstances where the harassment may not have taken place at the workplace specifically but that it took place while the employee was acting in his/her capacity as an employee, or the harassment otherwise impacted upon the employment relationship.

This occurred in the case of Biggar v City of Johannesburg[9]  in the context of racial harassment which had occurred at the residential accommodation provided to employees by the employer.  The Labour Court found although the harassment had not occurred at the workplace specifically or whilst the employees were on duty, the employer-provided accommodation was sufficiently connected to the employment relationship to find vicarious liability on the part of the employer, when it failed to adequately address the complaints of racial harassment that had been reported by the affected employee, and to take disciplinary action against the perpetrators. The employee therefore succeeded in obtaining inter alia an order of compensation against his employer.

Requirement 4: The sexual harassment was “immediately” brought to the attention of the employer.

The Labour Appeal Court confirmed in Liberty Group Limited v M[10] that this requirement seeks to afford the employer an opportunity to respond to the discrimination.  The term “immediately” must be given a sensible meaning and will require an assessment of the facts unique to each matter.  In this case, there was a delay of some weeks between the occurrence of the sexual harassment and the reporting thereof.  The Court however found that the matter was reported within sufficient time and that an unduly technical approach to the timing of the report was not warranted.

However, in the Amathole District Municipality case[11], the Court found that the employee had patently failed to satisfy the requirement of immediately bringing the alleged harassment to the attention of the employer as she had waited four months before lodging a grievance, even though she had admitted that her boyfriend had urged her to do so earlier.

Requirement 5: The employer must be aware of the incident of sexual harassment.  

Where there is no evidence that the employer was informed or aware of alleged incidences of harassment, a vicarious liability claim against an employer will not be successful.

Requirement 6: The employer must have failed to consult all relevant parties, or taken the necessary steps to eliminate the conduct or otherwise comply with the provisions of the Act.

The Act does not specifically set out what steps will be regarded as “necessary” to eliminate discrimination although some guidance is contained in the Code. The Code provides[12] that when an allegation of harassment has been brought to the attention of an employer, the employer must:

1. Offer advice and assistance to the complainant, which could include designating a person outside of line management whom the complainant may approach for confidential advice and/or counselling, including during any disciplinary inquiry that may be instituted following the harassment;
2. Advise the complainant of the informal and formal procedures available to deal with the harassment, as set out in the Code and in the relevant employer policy on harassment, and explain each option to the complainant;
3. Reassure the complainant that he/she will not face job loss or any adverse consequences where harassment is found to have occurred, and that the matter will be dealt with confidentially, as far as possible;
4. Where reasonably practicable, the employer should consider granting a complainant additional sick leave in the case of serious harassment, where sick leave may have been exhausted and the complainant, on medical advice, requires trauma counselling;
5. Follow the procedures, set out in the Code and the relevant employer policy, in a manner that is procedurally and substantively fair; and
6. Raise awareness and provide information on harassment at the workplace in an accessible format, including in orientation and training programmes.

The Code makes it clear that the above steps is regarded as the minimum intervention that should be provided by the employer and as such, what is to be considered “necessary steps” to eliminate harassment will depend on the circumstances of every case.

The employer failed to take all reasonable and practical measures to ensure that employees do not act in contravention of the Act – a seventh requirement?

There has been much debate amongst different judges of our Courts and academic writers as to whether “an employer’s failure to take all reasonably practicable steps to ensure that the employee would not act in contravention of the Act” is a separate requirement which must be met before an employer can escape vicarious liability, or whether it is instead a defence which an employer may raise in response to a vicarious liability claim. This debate arises from the wording of section 60(4) of the Act, which states:

“Despite subsection (3), an employer is not liable for the conduct of an employee if that employer is able to prove that it did all that was reasonably practicable to ensure that the employee would not act in contravention of the Act”.

The Labour Court recently ruled in Shoprite Checkers (Pty) Ltd v JL & Others[13] that the failure by an employer to take all reasonable practicable and proactive steps to ensure employees do not contravene the Act, is not a separate requirement or a basis for holding an employer liable for sexual harassment and other acts of unfair discrimination, but if the employer has done so, it can raise this as a defence.

Conclusion

An employer has a legal duty to take proactive and remedial steps to prevent and eliminate all forms of harassment in the workplace, including but not limited to sexual or racial harassment and workplace bullying, and where such harassment occurs, to take the necessary steps to deal with the harassment, and assist the victim. Any failure on the part of the employer could inter alia result in exposure to a vicarious liability claim for compensation by the employee who has the victim of the harassment, and resultant adverse reputational consequences for the employer.

Employers should therefore take legal advice to ensure that its policies and practices comply with the Act and that it deals with any allegation of harassment in accordance with the Code and any internal policy, to avoid the risk of vicarious liability for the discriminatory conduct of any of its employees.

Legal advice and disclaimer

The above views do not in any way constitute legal advice by Howes Inc as the facts and circumstances of each case must be considered in order to determine what is to be regarded as “necessary steps” to eliminate harassment in the workplace, in each instance. Should you or your company require any advice or assistance in preparing the relevant policies or have any queries in relation to the handling of a harassment case, please contact our office for specific advice.

REGINA MILO

[1] (2023) 44 ILJ 109 (LAC)

[2] At paragraph 60 thereof

[3] (2009) 30 ILJ 1322 (at para 46)

[4] (2020) 41 ILJ 1945 (LAC)

[5] Government Gazette No. 46056 published on 18 March 2022

[6] (2022) 43 ILJ 825 (LAC)

[7] See footnote 4 above

[8] See footnote 1 above

[9] (2011) 32 ILJ 1665 (LC)

[10] (2017) 38 ILJ 1318 (LAC)

[11] See footnote 1 above

[12] At paragraph 10.2 thereof

[13] (2022) 43 ILJ 903 (LC)