The principle of “no work, no pay” during the time of COVID-19

Two courts recently handed down judgments regarding the applicability of the principle of “no work, no pay” during the COVID-19 lockdown. Unfortunately, and rather surprisingly, these judgments are at odds with one another. 

One decision, handed down by the South Gauteng High Court, and cited as Mhlonipheni v Mezepoli Melrose Arch (Pty) Ltd and Others [2020] ZAGPJHC 136 (3 June 2020), found that the principle of “no work, no pay” could not be applied by employers for the period of COVID-19 Lockdown. In finding that the employer had an obligation to pay its employees during the lockdown period, the court explained that this obligation was not excluded by the principle of supervening impossibility. It remained possible for the employer to remunerate its employees despite the lockdown. In support of its view that employers were obligated to remunerate employees during this time, it was noted that the Level 5 Lockdown Regulations specifically identified the implementation of payroll systems as essential servicesFurthermore, it stated that the employer’s duty to Remunerate arises upon the tendering of services by employees – and is not dependent on the actual performance of work by employees.

In an ill twist of fate, the second decision relating to the applicability of the principle of “no work, no pay” during the COVID-19 Lockdown period was handed down by the Johannesburg Labour Court on the exact same day, 03 June 2020, as the Melrose Arch Decision summarized above. However, in this matter, cited as Macsteel Service Centres SA (Pty) Ltd v National Union of Metal Workers of South Africa and others [2020] JOL 47372 (LC), the Labour Court held as follows:

The reality in law is that the employees who rendered no service, albeit to no fault of their own or due to circumstances outside their employer’s control, like the global Covid-19 pandemic and national state of disaster, are not entitled to remuneration and the Applicant could have implemented the principle of ‘no work no pay’.”

While the clarity the Macsteel Decision ought to have provided to employees and employers alike regarding the principle of “no work, no pay” during the time of COVID-19, it’s effect have undoubtedly been muddied by the contrary finding of the High Court in the Melrose Arch Decision. It is important to note that a Labour Court Decision has an equal status to any Decision handed down by the High Court. However, it is arguable that the Macsteel Decision trumps the High Court finding by virtue of the fact that it was handed down by the Labour Court which has more specialized understanding and grasp of Labour Issues and Principles. As such, the Macsteel Decision ought to be favored until such time as a superior court finds in the alternative.”