In a recent Labour Court case, City of Cape Town v Irwin Oostendorp and Others, C530/2022, 05 August 2025, Acting Labour Court Judge Coen de Kock, in summary, made the following ruling that impacts on employers’ internal advancement and promotion opportunities and policies.
Introduction
The amended guidance arising from the judgment establishes important principles for fairness, accountability, and process in discretionary advancement or promotion decisions under South African labour law. It confirms that even when advancement opportunities are not guaranteed by contract or policy, employees are still entitled to fair consideration, and employers must exercise their discretion transparently and rationally.
Discretionary Advancement as a Protected “Benefit”
The judgment confirms that discretionary advancement opportunities qualify as “benefits” under section 186(2)(a) of the Labour Relations Act. This means employees cannot be excluded arbitrarily from being considered for progression, promotion, or deviation processes (a formal system for managing any departure from an approved standard procedure or instruction), even if advancement is not contractually promised. The fairness obligation extends to how employees are treated during consideration for such benefits. The key implication is that exclusion from advancement can itself constitute an unfair labour practice.
Two-Stage Accountability Process
The judgment creates a two-step review mechanism. First, arbitrators assess procedural fairness – whether the employee was fairly considered. If exclusion was arbitrary, the remedy is to refer the matter to the appropriate decision-maker for reconsideration. Second, the decision-maker’s substantive decision – whether to grant the advancement – must itself be rational and fair. The employee retains the right to challenge this second decision if it is unreasonable or ignores relevant considerations. This structure gives employees dual protection while maintaining managerial discretion.
Limits on Arbitrator Powers
The ruling restricts arbitrators from substituting their own decisions for those of designated authorities. They may correct procedural unfairness but cannot make substantive employment decisions such as promotions or advancements. Their power lies in ensuring the employee is fairly reconsidered by the proper decision-maker, not in granting the benefit directly. This distinction preserves institutional boundaries and statutory authority.
Review of Gatekeeping Decisions
Line managers’ preliminary decisions to include or exclude employees from advancement reports are now subject to fairness review. Such “gatekeeping” cannot be arbitrary, discriminatory, or based on irrelevant distinctions. Managers must provide rational, documented reasons for exclusion. This enhances accountability within internal HR processes.
Context, Legacy, and Consistency
Acting Judge De Kock stressed that fairness requires considering factors such as the employee’s length of service, performance at a higher level, and historical precedents where similarly situated employees were advanced. Legacy employees who have evolved with their roles deserve contextual consideration. Arbitrary distinctions – such as between a matric and diploma holder when neither meets formal requirements – are unfair if inconsistently applied. Employers must apply deviation criteria evenly and rationally.
Preserved Right to Further Challenge
The judgment explicitly allows employees to challenge the final decision of a Manager if it is unreasonable or fails to follow the court’s guidance. This ensures that designated authorities exercise discretion meaningfully and in line with fairness principles.
Broader Application and Balance
While the case arose from a municipal setting, the principles apply across all employment contexts involving discretionary benefits – promotions, shortlisting, or policy deviations. The judgment balances employee protection and employer discretion by embedding fairness at every stage without guaranteeing outcomes. It ensures structured accountability: fair consideration, reasoned decisions, and reviewability of arbitrary conduct.
Conclusion
The judgment reinforces that discretion must be exercised fairly, transparently, and consistently, making advancement processes subject to procedural and substantive fairness while preserving legitimate managerial authority.
