National Union of Metal Workers of South Africa and Others v Aveng Trident Steel (a division of Aveng Africa (Pty) Ltd) and Another

Aveng Trident Steel experienced severe economic distress due to declining sales and profitability. To address its operational difficulties, Aveng initiated a section 189 consultation process under the Labour Relations Act (LRA) in 2014, proposing a restructuring of its workforce and redesigned job descriptions. NUMSA and its members initially agreed to an interim arrangement to work under the redesigned jobs pending finalisation of a new grading structure. In February 2015, NUMSA withdrew from the interim agreement and refused to continue performing the redesigned jobs, largely due to disputes over wage structures. Aveng then offered employees alternative employment in the redesigned positions at rates prescribed by the applicable bargaining council, warning that rejection would lead to retrenchment. Approximately 733 employees rejected the offer and were dismissed in April 2015. NUMSA contended that these dismissals were automatically unfair under section 187(1)(c) of the LRA, as they were based on employees’ refusal to accept a demand.

Leave to appeal was granted, but the appeal was dismissed. No order as to costs was made.

This case is a leading authority on the interpretation of section 187(1)(c) of the LRA after its amendment. It clarifies the boundary between automatically unfair dismissals and permissible retrenchments for operational requirements, affirming that employers may dismiss employees for genuine operational reasons even where employees refuse proposed changes, provided the true reason is not to compel acceptance of a demand. The judgment preserves the integrity of section 189 retrenchment consultations and balances employees’ rights with employers’ operational needs.