Blog

Incapacity cases sit at the intersection of operational reality and employee vulnerability.

Unlike with the case of misconduct, incapacity is usually not blameworthy, which is why South African labour law expects employers to exhaust reasonable options that may preserve employment before turning to dismissal. The legal risk is also two‑fold: An ill‑health incapacity dismissal can be unfair under the Labour Relations Act (LRA) if the process is thin, and it can escalate into a discrimination dispute where the incapacity implicates disability and reasonable accommodation under the Employment Equity Act (EEA).

The Evolving Legal Framework

Historically, the Code of Good Practice: Dismissal in Schedule 8 of the LRA framed the core enquiry in medical incapacity matters. It required investigating the extent of the incapacity with all alternatives short of dismissal being considered where absence is unreasonably long, while in permanent incapacity, considering alternative work or adapting duties or work circumstances to accommodate disability. It further directed decision‑makers to consider the employee’s ability to perform work, how work circumstances or duties could be adapted, and whether suitable alternative work exists.

From September 2025, a consolidated Code of Good Practice on Dismissal became effective and (on its face) repealed the older Schedule 8 Code, while retaining the same policy thrust. It still holds that dismissal for incapacity should follow a fair, context‑sensitive process and that employers must consider alternatives and, where relevant, the heightened duty in work‑related ill‑health or injury situations. In practice, the earlier Schedule 8 jurisprudence remains highly instructive because it developed the meaning of “investigation”, “alternatives” and “accommodation” in real workplaces, and the 2025 Code signals continuity rather than a lower standard.

Where incapacity overlaps with disability, the EEA’s disability guidance becomes central. The Code of Good Practice: Key Aspects on the Employment of People with Disabilities (the Disability Code) states plainly that employers should reasonably accommodate people with disabilities to reduce the impact of impairment on the ability to perform essential job functions, consult the employee (and where appropriate technical experts), and implement the most cost‑effective means of removing barriers. The Disability Code also expressly links reasonable accommodation to recruitment, the working environment, work methods, assessment and benefits.

Court Expectations according to Case Law

Two themes emerge consistently from South African decisions: Employers must ground decisions in objective evidence, and they must demonstrate meaningful attempts to avoid dismissal.

In Parexel International (Pty) Ltd v Chakane NO, the Labour Court emphasised that an employer faced with ill‑health incapacity is “enjoined to establish the extent of incapacity based on objective facts” and to “explore means to reasonably accommodate” the employee; an approach driven mainly by the length of absence, without exploring alternatives short of dismissal, was criticised. This is a practical warning to HR teams in that a lengthy absence may trigger the enquiry, but it cannot substitute for the enquiry.

In Standard Bank / Ferreira, the duty to assist was treated as more onerous where the employee was injured on duty, and the failure to follow internal incapacity procedures (including obtaining appropriate expert assessments where the policy required it) contributed to a finding of unfairness. This illustrates an under‑appreciated risk that even where an employer has tried ‘something’ (temporary light duties or ad hoc adjustments), the absence of a structured accommodation enquiry supported by medical or occupational evidence can still render dismissal vulnerable.

The Labour Appeal Court’s approach to frequent or persistent illness‑related absence also underscores balancing, not reflex. In the line of authority discussed in later judgments, the fairness test asks whether the employer can fairly be expected to continue the employment relationship, considering factors such as the nature and cause of incapacity, likelihood of recovery or recurrence, the period and operational impact of absence, the effect on co‑workers, as well as the employee’s record and length of service. Those factors align naturally with the ‘alternatives’ duty: If the operational impact can be mitigated through adjustments or redeployment, dismissal becomes harder to justify.

Finally, disability cases reinforce that accommodation is not merely good practice but also part of legal justification. In Smith v Kit Kat Group (Pty) Ltd, the Labour Court dealt with disability discrimination and considered accommodation and hardship principles in assessing fairness. The lesson for incapacity managers is that where the employee’s limitations plausibly fall within disability, an incapacity route without a disability‑aware accommodation analysis can expose the employer to EEA claims, not only unfair dismissal consequences.

Reasonable Accommodation in Practice

Accommodation is fact‑specific. The Disability Code contemplates adjustments ranging from adapting facilities and equipment, re-organising workstations, changing training and assessment systems, restructuring jobs by reallocating non‑essential functions, adjusting working time and leave, and providing specialised supervision or support.

In the incapacity context, common accommodation pathways include temporary adjustments (light duty, reduced hours, phased return), ergonomic or assistive interventions, revised performance measurement where the job remains essentially the same, and redeployment into a suitable alternative vacancy where the employee is suitably qualified.

A useful discipline for HR is to separate essential functions from peripheral tasks since the aim is not to eliminate the job but to reduce the impact of impairment on performing what is essential. This dovetails with the Schedule 8 approach that speaks to adapting work circumstances and duties and considering suitable alternative work before dismissal.

Unjustifiable Hardship as a Real Limit

Accommodation is not unlimited. The Disability Code states that an employer need not accommodate a qualified applicant or employee if it would impose an unjustifiable hardship on the business. Importantly, the Code defines unjustifiable hardship as action requiring significant or considerable difficulty or expense, taking into account (among other things) the effectiveness of the accommodation and the extent to which it would seriously disrupt operations. It also recognises that what is unjustifiable for one employer at a particular time may not be unjustifiable for another – or even for the same employer at a different time.

For employers, the practical implication is that ‘undue hardship’ is not a label to be asserted but rather a conclusion to be demonstrated. Decision‑makers should be able to show that they tested options that are effective and cost‑sensible, considered operational disruption with evidence (not assumption), and explored less burdensome variants before concluding that accommodation is not viable.

The more resourced and structured the business, the harder it may be to justify a bare too expensive or too difficult stance. This is particularly so where the incapacity arose from work‑related injury or illness, which case law and the Codes treat as warranting heightened consideration.

A Defensible, Employer‑Friendly Approach

A fair incapacity process relies on showing that the employer made an informed, humane and operationally realistic decision. At a minimum, records should reflect a sequence that mirrors the Codes and case law i.e. obtain appropriate medical information and prognosis; consult the employee meaningfully; assess essential functions and operational impact; test accommodations and alternatives (including temporary measures and redeployment where available); and only then decide whether continued employment is untenable.

The Commission for Conciliation, Mediation and Arbitration’s (CCMA’s) own published arbitration commentary provides a good illustration of what ‘enough’ can look like: Where an employer accommodated an employee over an extended period with temporary roles and light duty, sought medical guidance, and still faced clear evidence that the employee could not perform the essential requirements even with adjustments, the commissioner was satisfied that there were no reasonable alternatives.

Accommodation as the Fairness Hinge

Incapacity dismissals are won or lost on the accommodation narrative.

Employers treating accommodation as an afterthought tend to struggle to justify dismissal, as seen in decisions criticising reliance on absence duration instead of objective investigation and alternatives.

On the other hand, employers who view accommodation as a structured problem‑solving process – tempered by the legitimate limit of unjustifiable hardship – are better placed to reach defensible outcomes, whether that outcome is continued employment with adjustments, redeployment, or where genuinely necessary, dismissal.