1. If the Labour Court or an arbitrator appointed in terms of this Act finds that a dismissal is unfair, the Court or the arbitrator may

a) order the employer to reinstate the employee from any date, not earlier than the date of dismissal;
b) order the employer to re-employ the employee, either in the work in which the employee was employed before the dismissal or in any other reasonably suitable work on any terms and from any date not earlier than the date of dismissal; or
c) order the employer to pay compensation to the employee.

2. The Labour Court or the arbitrator must require the employer to re-instate or re-employ the employee unless

a) the employee does not wish to be re-instated or re-employed;
b) the circumstances surrounding the dismissal are such that a continued employment relationship would be intolerable;
c) it is not reasonably practicable for the employer to re-instate or re-employ the employee; or
d) the dismissal was unfair only because the employer failed to follow a fair procedure.


If employees are reinstated, they resume employment on the terms and conditions that prevailed at the time of dismissal; the period during which the employee has been out of work as a result of the unfair dismissal is regarded as nothing more than a suspension of the employment contract. However, reinstatement need not be fully retrospective to the date of dismissal. Full retrospective reinstatement is usually denied if the employee was partly to blame for the circumstances that led to his or her dismissal, or if the employee unduly delayed pursuing the action. While ‘back pay’ is obviously a form of compensation for the loss of earnings during the period of unemployment after the dismissal, it is generally regarded as distinct from compensation.


The employees begin work afresh with the employer, and any benefits arising from their past employment are not extended to the new employment relationship.


For more information on labour law advice or services. Please feel free to contact us at Cape Labour Consultants and we will gladly assist you. Cape Labour & Industrial Consultants is a Cape Town-based providing Labour Law (Industrial Relations) and advice to employers and employees across all market segments and industries since 1987.

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