The case of Seokwane v Bidvest Prestige Cleaning Services (“Bidvest”) is an important reminder for employers to guard against acts that may constitute discrimination on the basis of age.

This is no easy task – whilst the Employment Equity Act 1998 prohibits unfair discrimination on employees based on age, the Labour Relations Act 1995 provides that the dismissal based on age is fair if an employee has reached the normal or agreed retirement age for persons employed in that capacity.  

Ms Seokwane was hired by Bidvest as a 62-year-old on a three-year fixed-term employment contract.   At the time of hiring, she was already over Bidvest’s retirement age of 60 years.

Bidvest elected to retire Ms Seokwane before the end of the fixed-term contract and she claimed this amounted to age discrimination. The Labour Court agreed – it found that the true reason for Ms Seokwane’s termination of employment was due to its operational requirements (redundancy), that arose when its client requested a reduction in staff.

It was ultimately concluded that Bidvest’s decision to employ the employee, knowing her age, and then retire her due to operational requirements was deemed discriminatory and that the employee was subjected to an automatically unfair dismissal (based on age discrimination). Despite relying on clauses in the employment contract and retirement policy, the court found that Bidvest’s conduct violated fair retirement practices.  The court emphasised that retirement should not be used as a pretext for dismissing employees based on other reasons. The employee was compensated in an amount equivalent to 12 months’ remuneration.

The lessons for employers from this judgement include:

• Adhere to the legal provisions relating to retirement.
• Do not use age as a basis for dismissal when this is not the true reason for the dismissal.
• Employees should be afforded adequate notice and consideration when approaching retirement