ARTICLE · 15 NOVEMBER 2023

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In terms of Section 41(4) of the Basic Conditions of Employment Act (BCEA), an employee who is dismissed for operational requirements is not entitled to severance...

South AfricaEmployment and HR

In terms of Section 41(4) of the Basic Conditions of Employment Act (BCEA), an employee who is dismissed for operational requirements is not entitled to severance pay if the employee "unreasonably refuses to accept the employer's offer of alternative employment with that employer or any other employer".

The Labour Appeal Court (LAC) previously set out in the case of Irvin & Johnson Ltd v Commission for Conciliation, Mediation & Arbitration & others [2006] 7 BLLR 613 (LAC), the three scenarios which may arise, where:

The employee unreasonably refuses such alternative employment, in which Section 41(4) applies, and the employee forfeits the right to severance pay.
The employee reasonably refuses such alternative employment and is entitled to severance pay.

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