Medical Incapacity and Disability in South African Labour Law - Legal Distinctions, Employer Obligations, and Procedural Fairness

The distinction between incapacity due to ill health (medical incapacity) and disability remains one of the most complex and sensitive areas of South African labour law. From both a practical and legal perspective, employers are required to balance operational efficiency against the constitutional and statutory rights of employees who are unable to perform their duties due to illness, injury, or impairment. The difficulty lies not only in determining whether an employee is capable of performing work, but also in navigating the overlapping obligations imposed by the Labour Relations Act 66 of 1995 (LRA), the Employment Equity Act 55 of 1998 (EEA), and the relevant Codes of Good Practice.  This article examines the legal framework governing medical incapacity and disability, the distinction between temporary and permanent incapacity, the duty of reasonable accommodation, and the procedural requirements employers must follow before contemplating dismissal. It further analyses recent Labour Appeal Court jurisprudence illustrating the consequences of non-compliance.   Medical Incapacity: Temporary versus Permanent  The Code of Good Practice: Dismissal (the Dismissal Code) draws a clear distinction between temporary and permanent medical incapacity. This distinction is central to determining whether dismissal is legally permissible.  Where an employee’s illness or injury is temporary and likely to be of short duration, dismissal is not justified. In such circumstances, the employee should be afforded the opportunity to utilise paid sick leave, or unpaid sick leave where paid entitlements have been exhausted, to allow for treatment and recuperation. The mere fact of absence due to illness does not, in itself, constitute a fair reason for dismissal.  Permanent incapacity, by contrast, arises where medical evidence indicates that the employee is unlikely to recover sufficiently to resume their duties within a reasonable period. Even in these circumstances, dismissal is not automatic. The Dismissal Code requires dismissal to be treated as a measure of last resort. Employers must first consider all reasonable alternatives aimed at preserving the employment relationship, including redeployment to alternative positions, adjustment of duties, or modification of the working environment.  This approach reflects the recognition that medical incapacity is not the fault of the employee and that employees suffering from long-term or permanent incapacity often have an increased need for employment security and income continuity.    The Intersection Between Medical Incapacity and Disability  The Dismissal Code must be read together with the Code of Good Practice on Key Aspects on the Employment of People with Disabilities (the Disability Code), issued under the EEA. While the Dismissal Code regulates termination for incapacity, the Disability Code governs the employer’s obligations prior to dismissal, particularly the duty to reasonably accommodate employees with disabilities.  Failure to comply with these obligations may render a dismissal not only substantively or procedurally unfair, but automatically unfair in terms of section 187(1)(f) of the LRA. The distinction is significant: while ordinary unfair dismissals attract a maximum compensation of 12 months’ remuneration, automatically unfair dismissals may result in compensation of up to 24 months’ remuneration.  Defining “Disability” in Labour Law  The Disability Code defines a disability as a long-term (exceeding 12 months), recurring, or permanent physical, mental, intellectual, or sensory impairment that substantially limits a person’s ability to perform work-related functions. The emphasis is not on the existence of an impairment per se, but on its functional impact within the work environment.  Accordingly, an employee who is permanently medically incapacitated and unable to perform their current role will, in most cases, fall within the statutory definition of disability. However, not every impairment constitutes a disability. For example, an employee who is wheelchair-bound will only be regarded as disabled if the impairment substantially affects their ability to perform their job. Where job functions can be performed with reasonable adjustments, the impairment may not amount to a disability for purposes of the EEA.  This functional approach was confirmed in Labour Court jurisprudence where an applicant with diabetes was found not to be disabled, as the condition was effectively managed with medication and did not materially impair his ability to perform work.  Employer Obligations and Reasonable Accommodation  The existence of a disability does not imply that an employee is incapable of performing any work. Employers are required to consider whether the employee’s current role can be adapted to accommodate the disability. Only where this is not feasible should alternative positions be explored.  The employer’s duty is, therefore, not limited to assessing whether the employee can perform existing job requirements, but whether those requirements can reasonably be adjusted. Reasonable accommodation may include modifying duties, restructuring working hours, providing assistive devices, or reallocating non-essential functions.  The obligation is not unlimited. The Disability Code expressly provides that employers are not required to endure “undue hardship”. What constitutes undue hardship depends on the circumstances of each case, including the size and resources of the employer, the nature of the disability, and the financial and operational impact of accommodation measures. The standard remains one of reasonableness.  Where accommodation is not feasible, employers should assist employees in accessing incapacity or disability benefits and attempt to terminate the employment relationship by agreement. Dismissal should only be contemplated where these efforts fail and after compliance with clauses 11 and 12 of the Dismissal Code.  Procedural Requirements in Incapacity Investigations  Employers must follow a structured and documented process when incapacity arises. This includes:  Investigating patterns of absence and maintaining records of dates and reasons; Consulting with the employee to understand the nature and impact of the medical condition; Obtaining medical evidence, preferably informed by a clear description of the employee’s job duties; Allowing for second opinions and further medical testing where requested; Assessing medical reports to determine prognosis and likely duration of incapacity.  Where the employer requests medical reports, it may bear the cost thereof. Employees are entitled to participate meaningfully in the process, and consultations should be properly recorded.  Incapacity Hearings and Dismissal  An incapacity hearing must determine whether the incapacity is temporary or permanent and whether reasonable accommodation is possible. Relevant considerations include:  The expected duration of the incapacity; Whether light duties are prescribed and available; The feasibility of temporary replacements; The impact of continued absence on operational requirements.  Dismissal should only follow once all reasonable alternatives have been exhausted. If dismissal is ultimately justified, the employer must comply with contractual and statutory obligations, including payment of accrued leave, outstanding remuneration, and notice pay.  Case Law Analysis  In Parexel International (Pty) Ltd v Chakane and Others [2019] 11 BLLR 1245 (LAC), the Labour Appeal Court clarified that employers are not required to tolerate prolonged and indefinite absence due to ill health. While employers must consider alternatives short of dismissal, the employee’s willingness and ability to return to work, the reliability of medical evidence, and the length of absence are material factors.  The LAC held that, in circumstances where the employee failed to provide requested medical reports and gave no indication of when she would be fit to resume duties, dismissal for incapacity was fair. This decision confirms that reasonable accommodation does not equate to indefinite job preservation.  Incapacity Due to Poor Work Performance  In Ubuntu Education Fund v Paulsen, NO and Others [2019] 11 BLLR 1252 (LAC), the Court addressed incapacity arising from poor work performance during probation. The LAC reaffirmed that the standard for dismissing probationary employees is lower and that employers are not required to redesign positions to accommodate an employee who proves inherently unsuitable.  The decision highlights the distinction between incapacity due to ill health and incapacity arising from incompetence and underscores the importance of context when assessing fairness.  Conclusion  Medical incapacity and disability present significant legal and operational challenges for employers. South African labour law requires a careful, principled approach grounded in fairness, reasonableness, and procedural integrity. Employers who fail to distinguish properly between temporary and permanent incapacity, or who neglect their duty of reasonable accommodation, expose themselves to substantial legal risk, including findings of automatic unfair dismissal.  Ultimately, proactive engagement, thorough investigation, and compliance with statutory codes not only mitigate legal exposure but also contribute to sustainable workplace relations grounded in dignity, equity, and fairness.  Ross Hendriks | SchoemanLaw Inc   Specialist Employment and Labour Law https://schoemanlaw.co.za/our-services/employment-law/