Legal updates and opinions
News / News
How binding is a CCMA settlement agreement?
Written settlement agreement at the CCMA
If an employee enters into a written settlement agreement at the Commission for Conciliation, Mediation and Arbitration (“CCMA”) on the advice of her representative, can she subsequently escape the agreement on the basis that she was duped into doing so by her representative? Can she do so if she entered the agreement under duress or as a result of the undue influence of her representative?
Ordinary laws of contract
In Ulster v the Standard Bank of South Africa Ltd (C 647/2012) [2013] ZALCCT 3 (15 February 2013), the Labour Court was faced with this question. It held that the ordinary laws of contract will apply. Therefore a settlement agreement can only be set aside if it is successfully shown that the employee was placed under the type of duress required in common law. In this case, the employee was a bank manager with 30 years’ experience, she was educated and well-informed.
It was clear she understood the nature of contracts. She understood the nature of the proceedings and agreed to sign the settlement agreement. In the circumstances, she entered into the agreement with open eyes, fully aware of its consequences, and should be bound by the terms thereof.
Common law position on the effect of concluding an agreement
Whilst this decision confirms the common law position on the effect of concluding an agreement, it does highlight that a settlement agreement might not stand up to scrutiny if the employee can show that he or she did not understand the legal significance of signing such an agreement, was not well informed, educated or experienced in such matters. A way to avoid this result would be to ensure that the terms of a settlement agreement are explained to the employee by the Commissioner before he or she signs the agreement.
It may even be advisable to have the agreement translated for the employee if his or her first language is different to that in which the agreement is drafted.
Read more on the CCMA pronounces on mandatory vaccination policy.
Latest News
South Africa’s Greylisting: Regulatory authorities make progress on the Financial Action Task Force recommendations
Introduction It has been over a year since the Financial Action Task Force ("FATF") announced that South Africa had [...]
Is your business struggling? Liquidation or Business Rescue are not the only options: The Section 155 Compromise
and researched by Thabani Dlamini - Candidate Attorney Introduction When your business is struggling and creditors are knocking down the [...]
Be careful what you wish for: Lessons from the LAC
On 13 October 2021 the Labour Court ("LC") found the dismissal of the employee to be automatically unfair. This was [...]
An extension of the Parate Executie principle in the liquidation context
Emontic Investments (Pty) Ltd v Bothomley and Others[1] Introduction A Parate Executie clause is generally regarded as an impermissible contractual [...]
Pro Bono Matters
In the past year, our pro bono team and other lawyers from Werksmans worked on a variety of matters across [...]
Business Rescue Trends in 2024 and Beyond
Brandon Starr - Candidate Attorney and Caitlin Steytler - Candidate Attorney With looming elections now scheduled for 29 May 2024, [...]
