When is a Dismissal Unfair?

A dismissal in South Africa is unfair under section 188 of the Labour Relations Act 66 of 1995 (LRA) if the employer fails a two-part test: there must be a fair reason related to the employee’s conduct, capacity, or the employer’s operational requirements, and the employer must follow a fair procedure. A separate, stricter category — automatically unfair dismissals under section 187 of the LRA — applies when the dismissal is linked to a protected ground such as trade union membership, exercising a right under the Act, or pregnancy, with a higher compensation cap and no qualifying service requirement. Disputes about unfair dismissal are referred first to the CCMA for conciliation and, if unresolved, arbitration, with the Labour Court in Johannesburg hearing reviews and certain claims that the CCMA cannot grant. This guide sets out what each limb of the test means in practice, the remedies available, and the strict time limits that apply.

The Legal Test: Section 188 of the LRA

Section 188(1) of the LRA defines an unfair dismissal as one that is not for a fair reason related to the employee’s conduct or capacity, or based on the employer’s operational requirements, or is effected without following a fair procedure. The two limbs — substantive fairness (a fair reason) and procedural fairness (a fair process) — are assessed independently. Failing either limb makes the dismissal unfair, even if the other was sound.

The employer carries the burden of proof on both limbs. Section 192 of the LRA inverts the normal civil onus once the employee shows that a dismissal occurred: the employer must then prove that the dismissal was fair. This shift matters in practice — many employees win at the CCMA simply because the employer cannot reconstruct the disciplinary process or justify the sanction chosen.

The Three Categories of Valid Reason

Section 188 recognises three categories of dismissal that can be substantively fair. Each has its own procedural rules, which are covered in the next section.

Category	What it covers	Typical examples
Misconduct (conduct)	The employee’s wrongdoing or breach of workplace rules — the most common dismissal ground.	Theft, dishonesty, insubordination, absenteeism, breach of a workplace policy, gross misconduct such as assault.
Incapacity (capacity)	The employee is unable to perform the job — through ill health, lack of skill, or sustained poor performance.	Ill-health retirement, failure to meet required competencies, prolonged poor performance after counselling.
Operational requirements	The employer’s economic, technological, structural, or similar needs (retrenchment).	Business closure, restructuring, automation removing a role, downturn requiring headcount reduction.

Each of these categories has its own established procedural requirements, and conflating them — for example, dismissing for poor performance without following an incapacity process — is one of the most common ways employers fall foul of the test.

Procedural Fairness: What Counts as a Fair Process

The procedural requirements differ depending on which category of valid reason the employer relies on.

• Misconduct: a disciplinary hearing with prior written notice of the allegations, an opportunity to respond (with a trade union representative or colleague present), consideration of the employee’s version, and a proportionate outcome. The procedural defects that most often surface in CCMA arbitrations are no independent chairperson, no minute-taker, no representative allowed, a sanction disproportionate to the charge, and an outcome that was predetermined before the hearing.
• Incapacity: an assessment, an opportunity for the employee to address it, and consideration of alternatives to dismissal (training, counselling, extended probation, ill-health retirement) before termination.
• Operational requirements: a section 189 consultation process involving written reasons for the proposed dismissals, disclosure of alternatives to dismissal, severance pay, and the timing — followed by selection criteria that are fair and objectively applied. Section 189A sets stricter requirements for large-scale retrenchments.

Burger Huyser Attorneys runs disciplinary-hearing chairing, incapacity-process drafting, and retrenchment-consultation support from its Labour Law practice, with intake available across the firm’s Gauteng branch network — work that matters because procedural defects, not the underlying reason, are what most often tip an otherwise defensible dismissal into the unfair column.

Automatically Unfair Dismissals (Section 187 of the LRA)

A dismissal is automatically unfair if it is linked to one of the protected grounds listed in section 187(1)(a) to (f) of the LRA, regardless of whether the employer followed a fair procedure or had a fair reason on the face of it. The grounds include:

• Trade union membership, participation in lawful union activities, or refusal to join a union.
• Exercising a right conferred by the LRA (for example, raising a grievance or claiming a protective right under the BCEA).
• Taking part in protected industrial action (a lawful strike).
• The employee’s pregnancy, intended pregnancy, or any reason related to pregnancy.
• Refusing to do work normally performed by an employee on strike (a prohibition on using replacement labour).
• The employee’s family responsibility — for example, caring for a sick child under section 18 of the Basic Conditions of Employment Act.

The compensation cap is higher under section 187(7): up to 24 months’ remuneration, compared with the standard 12 months under section 194 for ordinary unfair dismissal. There is also no qualifying service requirement, so a pregnant employee dismissed in her first week can still claim.

The CCMA vs the Labour Court: Where the Case Goes

Section 191 of the LRA sets the route a dismissed employee must follow. The dispute is first referred to a bargaining council (if one covers the workplace) or to the CCMA for conciliation. Under section 191(1), this referral must happen within 30 days of the date of dismissal — or within 30 days of the date on which the employee was given notice of dismissal, if the employer gave notice rather than dismissing summarily.

If conciliation fails, the employee then has 90 days from the date of the certificate of outcome to refer the dispute further — to the CCMA for arbitration, or in limited categories (such as automatically unfair dismissals where the employee elects court) to the Labour Court. The Labour Court sits in Johannesburg (for Gauteng and most northern matters) and Cape Town (for Western Cape matters), with the Labour Appeal Court in Bloemfontein hearing appeals from the Labour Court. The CCMA and the Department of Employment and Labour’s Inspectorate are not interchangeable: the Inspectorate enforces compliance with the Basic Conditions of Employment Act and minimum-wages regulations but does not adjudicate unfair-dismissal disputes.

Remedies: Reinstatement, Re-employment, or Compensation

If a CCMA arbitrator or Labour Court judge finds a dismissal unfair, three remedies are available. Reinstatement is the primary remedy in law — the employee is put back in the same job on the same terms, with back pay from the date of dismissal — and is ordered unless the employer shows it is impracticable. Where reinstatement is not practical, re-employment in a different role may be ordered. Compensation is the monetary alternative.

Remedy	When it applies	Cap
Reinstatement	Primary remedy; ordered unless the employer shows impracticability.	Back pay from date of dismissal.
Re-employment	Alternative where reinstatement is impracticable.	Back pay from date of dismissal.
Compensation — ordinary unfair dismissal (s 194(1))	Monetary award in lieu of reinstatement.	12 months’ remuneration.
Compensation — automatically unfair dismissal (s 194(3)) and protected disclosures	For section 187 dismissals and whistleblowing dismissals under the Protected Disclosures Act.	24 months’ remuneration.

Severance pay is separate from compensation. Under section 35 of the LRA, an employee dismissed for operational requirements is entitled to at least one week’s remuneration for each completed year of continuous service with that employer. Severance is a free-standing entitlement and is not deducted from any compensation awarded at the CCMA.

Common Scenarios Searchers Ask About

Scenario	Usually unfair if…	Usually fair if…
Dismissal for a first offence	The misconduct is minor (for example a single late arrival) and no warnings were issued.	The misconduct is serious (theft, assault, gross dishonesty) and a fair hearing was held.
Dismissal during probation	No formal assessment, no opportunity to improve, and no warnings given.	A documented probation review, support to improve, and a hearing preceded the dismissal.
Dismissal for poor performance	The employer never told the employee the standards were not being met, or refused training.	Clear KPIs, regular feedback, an opportunity to improve, and a documented incapacity process preceded the dismissal.
Retrenchment	No section 189 consultation, no selection criteria disclosed, or the selection was discriminatory.	A genuine section 189 process with consultation, severance, and fair selection criteria.
Dismissal after raising a complaint	The timing or evidence links the dismissal to a protected disclosure or trade union activity.	An unrelated, substantiated misconduct charge was investigated and proven through a fair hearing.

Frequently Asked Questions

What qualifies as an unfair dismissal in South Africa?

Under section 188 of the Labour Relations Act 66 of 1995, a dismissal is unfair if the employer cannot show a fair reason related to the employee’s conduct, capacity, or the employer’s operational requirements, or if the employer did not follow a fair procedure. Both limbs are tested — failing either one makes the dismissal unfair. The employer carries the burden of proof at a CCMA arbitration once the employee shows the dismissal occurred.

How much compensation can I get for unfair dismissal in South Africa?

Compensation for ordinary unfair dismissal is capped at 12 months’ remuneration under section 194(1) of the LRA. For automatically unfair dismissals under section 187 (for example for trade union activity, pregnancy, or a protected disclosure) the cap rises to 24 months’ remuneration under section 194(3). Compensation is determined by the CCMA arbitrator or Labour Court judge based on the employee’s actual loss, the seriousness of the employer’s conduct, and whether the dismissal was only procedurally defective, only substantively unfair, or both.

What is the difference between unfair dismissal and unfair labour practice?

Unfair dismissal applies when the employer terminates the employment relationship. Unfair labour practice (sections 185 to 186 of the LRA) covers conduct short of dismissal that unfairly affects an employee — typically demotion, suspension without pay, unfair changes to terms of employment, or workplace victimisation. The two are different causes of action with different forums and different remedies.

How long do I have to challenge an unfair dismissal?

Under section 191(1) of the LRA, a dismissed employee must refer the dispute to a bargaining council or the CCMA for conciliation within 30 days of the date of dismissal, or within 30 days of the date the employee was given notice if notice was given instead of immediate dismissal. If conciliation fails, the employee then has 90 days from the date of the certificate of outcome to refer the dispute to the CCMA for arbitration. Late referrals require a formal application for condonation, which is granted only if the employee shows good cause and reasonable prospects of success.

Do I automatically get my job back if the dismissal was unfair?

Not automatically. A CCMA arbitrator or Labour Court judge may order reinstatement (back in the same job), re-employment (in a different role), or compensation instead. Reinstatement is the primary remedy in law and is ordered unless the employer shows it is impracticable — but in practice, working relationships are often too damaged, and arbitrators may award compensation instead, particularly where the employee has already found new work.

If you are facing a dismissal — as an employee who believes the process was unfair or an employer defending a CCMA referral — Burger Huyser Attorneys’ Labour Law practice can take the matter from the first conciliation session through to arbitration or Labour Court review. The firm’s CCMA-side work is run from the Linden (Randburg) head office (011 888 0246) with intake also available through the Centurion, Pretoria, Sandton, Roodepoort, Bedfordview, Alberton, and Midrand branches. The 30-day deadline for referring a dispute to the CCMA is strict, so contact the firm as early as possible after the dismissal. Burger Huyser carries a 4.8/5 average across 250+ Google reviews (Trustindex verified “Top Rated Law Firm in South Africa”) and handles the full range of labour-law work, including disciplinary-hearing chairing, drafting of employment contracts, and representation at CCMA arbitration.