Labour Appeal Court Clarifies the Difference Between Procedural and Substantive Unfairness
The Labour Appeal Court has confirmed that even serious procedural flaws in a disciplinary process do not automatically render a dismissal substantively unfair.
In Universal Product Network (Pty) Ltd v Commissioner Patrick Mbatsana N.O. and Others (Case No. JA31/25, Labour Appeal Court, delivered 31 March 2026), the Court overturned a Labour Court judgment that had reinstated more than 250 dismissed employees after finding that gross procedural unfairness had effectively transformed their dismissals into substantively unfair dismissals.
The dispute arose during a protected wage strike at Universal Product Network (UPN), the logistics division of Woolworths, in October 2015. While the strike was protected, the parties had agreed to picketing rules and the Labour Court granted an interdict prohibiting certain unlawful conduct during the strike.
UPN alleged that approximately 256 employees breached the picketing rules and the Court order by blocking vehicles from entering and leaving its premises and engaging in other misconduct. Following disciplinary enquiries, almost all of the employees were dismissed.
The dispute was referred to the CCMA, where the Commissioner found that the dismissals were substantively fair because the employees had committed the misconduct. However, shortcomings in the disciplinary process meant the dismissals were procedurally unfair, and each employee was awarded one month's salary as compensation.
The union successfully reviewed the award in the Labour Court, which held that the procedural defects were so serious that they undermined the validity of the dismissals themselves. It substituted the CCMA award with an order declaring the dismissals substantively unfair and directed UPN to reinstate the employees.
The Labour Appeal Court disagreed.
The Labour Appeal Court held that the Labour Court had decided an issue that had never been pleaded by the union. The review application challenged the finding that the employees were guilty of misconduct and argued that dismissal was too harsh. It did not contend that procedural unfairness had become substantive unfairness.
More importantly, the Court held that the Labour Relations Act clearly distinguishes between substantive and procedural fairness. An employer must prove both that there was a fair reason for dismissal and that a fair procedure was followed. A failure in one does not automatically invalidate the other.
The Court warned that accepting the Labour Court's approach would produce illogical results, allowing even an employee guilty of serious misconduct, such as theft, to claim substantive unfairness simply because the disciplinary process was flawed.
Finding that the CCMA's award was reasonable and that the employees had been fairly dismissed for misconduct, the Labour Appeal Court upheld UPN's appeal and reinstated the Commissioner's original award.
This article is for informational purposes only and does not constitute legal advice. For specific legal guidance on protected disclosures, employment practices, or compliance obligations, consult a qualified labour law practitioner.
© 2026 Global Business Solutions (GBS). All rights reserved.
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