Elmarie Styen v Business Connexion Group Limited

The plaintiff was employed by UCS Solutions (Pty) Ltd as a Programme Manager – SAP with a contractual retirement age of 60 years. On 1 April 2018, UCS was transferred to the defendant (BCX) as a going concern under section 197 of the LRA. BCX subsequently sought to harmonise employment contracts of employees from various transferred subsidiaries (which had varying retirement ages between 60 and 65 years) and BCX's own employees. The plaintiff was informed of BCX's intention to transition employees to a retirement age of 65 years, but no specific timeline was set and no formal variation of her contract occurred. The plaintiff reached 60 years on 6 June 2020. On 9 July 2020, she enquired about the 65-year retirement age but was informed this only applied to employees on new terms and conditions. BCX offered her a fixed-term contract which she rejected. Her employment was terminated on 4 September 2020, three months after turning 60. She claimed automatic unfair dismissal based on age discrimination under section 187(1)(f) of the LRA.

• Whether there was an agreed retirement age between the plaintiff and BCX
• Whether the agreed retirement age of 60 years with the old employer (UCS) transferred to the new employer (BCX) under section 197 of the LRA
• Whether BCX's failure to transition the plaintiff to a 65-year retirement age amounted to discrimination
• Whether the dismissal was automatically unfair under section 187(1)(f) of the LRA or fair under the exception in section 187(2)(b)
• Whether BCX was obliged to provide procedural fairness before retiring the plaintiff at the agreed retirement age

The plaintiff's claim was dismissed with costs. The Court ordered the plaintiff to pay the costs of BCX.

When a business is transferred as a going concern under section 197 of the LRA, all terms and conditions of employment, including any agreed retirement age, are automatically transferred to the new employer. The phrase "agreed retirement age" in section 187(2)(b) of the LRA includes retirement ages agreed with a previous employer where the employment relationship has been transferred under section 197. A new employer's promise or intention to harmonise employment conditions does not constitute a variation of the contract of employment in the absence of a formal written agreement, particularly where the contract contains a non-variation clause. Where an employee has reached an agreed retirement age (whether agreed with the current or a previous employer in the context of a section 197 transfer), the dismissal is fair under section 187(2)(b) and the employer has no obligation to afford procedural fairness before dismissing the employee.

The Court made strong observations about unfounded discrimination claims, stating that "those who make unfounded and baseless accusations of discrimination must face the same treatment as those who practise it." The Court emphasised that discrimination cases must be viewed from the perspectives of both employers and employees, and that the same energy used to condemn discriminatory practices should be used to condemn employees who make wild allegations of discrimination. The Court noted that employees who make such allegations "do so at their own peril". The Court also observed that to the extent the plaintiff complained about being treated differently from other employees, her proper remedy would have been to lodge a grievance or refer an unfair labour practice dispute under section 186(2) of the LRA relating to the provision of benefits, rather than claiming automatic unfair dismissal based on discrimination.

This case provides important clarification on the operation of section 197 of the LRA in relation to retirement ages when businesses are transferred as going concerns. It confirms that agreed retirement ages are among the terms and conditions that automatically transfer to the new employer, and that mere promises or intentions by the new employer to harmonise conditions do not vary contractual terms in the absence of formal written variation. The judgment reinforces that section 187(2)(b) operates as a complete defence to age discrimination claims where an agreed retirement age has been reached, even where that agreement was with a previous employer whose business was transferred under section 197. The case also demonstrates the Court's willingness to award costs against employees who bring unfounded discrimination claims, reflecting judicial concern about baseless allegations of discrimination.