26 November 2025 -ELRC602-25/26WC

Commissioner: Gerald Jacobs
Case Number: ELRC602-25/26WC
Date of Award: 26 November 2025

In the matter between:

SADTU obo Phumezo Sidwell Gelem
(Applicant/Employee)

And

Western Cape Education Department
(Respondent/Employer)

Details of Hearing and Representation

The matter was referred for arbitration in terms of the ELRC constitution Part C (Dispute Resolution Procedures) Clause 69 and was heard virtually on 10 October 2025 and finalised on 5 November 2025.
The applicant, Mr Gelem, was represented by his full-time shop steward, Mr Juwa Dimande. The respondent, the Western Cape Department of Cape Town, was represented by its Labour Relations Officer, Ms Nelsonia Hlathuka.
Most of the facts were common cause, and both parties agreed to provide written submissions instead of presenting oral evidence by 13 November 2025.

The issue/s to be decided

The dispute relates to the deduction of the overpayment of the applicant’s salary arising from the respondent’s non-approval of his temporary incapacity leave.

Background facts

Both party’s submitted documentation and produced further documentary evidence during the hearing as they referred to additional evidence. Further documentation was produced for and during the resumed hearing. Based on the evidence heard and documents before me, I found the following facts.
The applicant developed symptoms of depression in November 2024 and was under the care of his medical practitioner from 8 January to 15 July 2025. As part of his treatment, he was referred to social development for counselling and sessions with social workers. He was booked off for major depression from 9 April to 30 June 2025. The applicant was booked off for major depression from April through June 2025 and did not attend work during this period.
Before the start of the second school term, on 24 March 2025, he sent a WhatsApp message to the principal, stating that he was feeling better and intended to return to duty at the start of the term on 9 April 2025. The principal replied that he should not return because a substitute teacher had already been appointed and approved until the end of June, and because his medical certificate booked him off for that period.
At that stage, he had already exhausted his full allocation of his normal sick leave for the 2025 to 2027 cycle. This necessitated the application for incapacity leave as opposed to routine paid sick leave (like a few days off for the flu) that only requires a standard medical note from a General Practitioner. However, when requesting extended incapacity leave (like the three months sought in this case) for a severe, specialised condition such as major depression, the Policy and Procedure on Incapacity Leave and Ill-Health Retirement (PILIR) and its guidelines require specialist involvement. This requirement comes from the Guidelines for Incapacity Assessment (Annexure G), which form part of the PILIR. The guidelines make it clear that incapacity applications on psychiatric grounds must be assessed and treated by a psychiatrist. Although the role of general practitioners and clinical psychologists is acknowledged, a psychiatric condition serious enough to justify temporary or permanent incapacity must be optimally treated by a registered psychiatrist. Major Depressive Disorder is specifically listed among the conditions that often lead to incapacity applications, so the rules for psychiatric conditions apply directly. For long periods of temporary incapacity leave submitted on Annexure B, the policy also requires current medical reports not older than six months, and reports for psychiatric conditions not older than two months.
The applicant submitted the correct Annexure B application for Temporary Incapacity Leave on 25 March 2025, supported by his doctor’s report diagnosing major depression. He continued to receive his salary while the application was being processed. On 3 June 2025, the Directorate: Service Benefits issued a letter stating that his application had not been submitted on time, even though he said he had filed it on three separate occasions. The letter informed him that his absence from 9 April 2025 to 30 June 2025 would be treated as leave without pay and that, because his salary had been paid for that period, an overpayment had been made. It also advised that the Directorate of Financial Accounting would contact him regarding the overpayment.
The applicant returned to work on 22 July 2025, the first day of the third term. In August 2025, the WCED Directorate Financial Accounting issued another letter setting out the repayment process for his leave without pay. It referred back to the earlier notice of 3 June 2025 and confirmed that the repayment related to the period 9 April 2025 to 30 June 2025 and that the total amount owed was R91 550.12. The Department stated that it was entitled to recover the full amount under Section 38 of the Public Service Act, 1994, read with Provincial Treasury Instruction 11.3.1. It also advised him that a salary deduction of R8 800.00 would be implemented to prevent delays and that a PERSAL deduction for this amount had already been activated. This deduction was made in line with the Basic Conditions of Employment Act, which allows an employer to deduct up to 25 per cent of an employee’s gross salary. The letter added that if he left the WCED before the balance was settled, the outstanding amount would be sent to the debtors section for recovery. However, the letter was sent to the wrong email address.
Later, on 6 October 2025, by the WCED Directorate: Service Benefits issued a letter setting out the outcome of his temporary incapacity leave application for the period 9 April 2025 to 30 June 2025. The Department noted that he had been absent for 119 days due to major depression, but declined the application because cases based on psychiatric conditions must be assessed and treated by a psychiatrist. For an absence of this length, the Department expected evidence of more intensive psychiatric management. The file showed that he had been managed by his General Practitioner, who referred him for social work intervention, but no psychiatric reports were submitted. The Department stated that while reports from other medical practitioners are not disregarded, optimal treatment by a psychiatrist is required before temporary incapacity leave can be considered. Without the necessary medical evidence, the application could not be approved.
This communication confirmed the refusal of incapacity leave and supported the Department’s decision to recover the salary paid during his absence, as previously indicated in the letter of 3 June 2025.
Aggrieved by the deduction, the applicant lodged a formal grievance, which was not resolved. Thereafter, he referred the matter to the ELRC for conciliation. The matter remained unresolved at the conciliation meeting, and a certificate of non-resolution was issued. The matter was then set down for arbitration.

Analysis of submissions received

In terms of the ELRC Constitution Part C (Dispute Resolution Procedures) Clause 7, an employee as defined in the Employment of Educators Act (EEA) may refer a dispute regarding the alleged non-compliance with a provision of the Basic Conditions of Employment Act 75 of 1997 (“the BCEA’) that constitutes a term of that contract of employment, any collective agreement or the EEA. However, Clause 7.6, subject to Clause 7.5, requires that the dispute must not already be before another forum, or, if it was, that the other forum has jurisdiction or the matter was not properly withdrawn.
The dispute raised by the applicant centred on the procedure followed concerning the overpayment deductions. He relied on section 34(1) of the BCEA and claimed the deduction was made without any prior discussion or consultation, even though earlier internal communication suggested that the Directorate: Financial Accounting would formally notify him. He stated that the respondent deducted the money from his salary without his consent, which section 34 prohibits unless the deduction is backed by a written agreement or is authorised by law, a collective agreement, a court order, or an arbitration award. According to the applicant, none of these conditions were met.
The respondent submitted that its authority to deduct the overpayment came from the Public Service Act, 1994, and the Provincial Treasury Instruction issued under Chapter 11 of the Treasury Regulations, which deals with the management of debt owed to the State. Because these laws allow the employer to recover overpayments, the respondent states that the deduction fits within the exception in section 34(1)(b) of the BCEA, which permits salary deductions that are specifically authorised by law.
The Public Service Act sets out a defined process for recovering remuneration that was incorrectly granted to an employee. Chapter VIII of the PSA section 38 requires an executive authority to correct an incorrect salary, salary level, salary scale, or reward from the date the error began. This applies even if the employee did not know an error had been made. When an employee has been overpaid, the amount must be recovered.
The PSA also sets out the method of recovery. If the employee is still in the service of the State, the recovery must be done through deductions from the employee’s salary. The size of the monthly instalments is determined by the relevant accounting officer. If the employee has left the service, recovery must be made from any money still owing to the employee, or by legal action, or a combination of the two. The accounting officer also has the discretion to reduce or waive the debt.
Although section 38(2)(b)(i) of the PSA gives the respondent the power to make unilateral deductions from the applicant’s salary in instalments set by the accounting officer, that provision cannot be read in isolation. It must be applied together with the requirements of the BCEA.
Section 34 of the BCEA reads as follows:
‘34 Deduction and other acts concerning remuneration –
(1) An employer may not make any deductions from an employee’s remuneration unless-
(a) subject to subsection (2), the employee in writing agrees to the deduction in respect of a debt specified in the agreement; or
(b) the deduction is required or permitted in terms of a law, collective agreement, court order or arbitration award.
(2) A deduction in terms of subsection (1) (a) may be made to reimburse an employer for loss or damage only if –
(a) the loss or damage occurred in the course of employment and was due to the fault of the employee;
(b) the employer has followed a fair procedure and has given the employee a reasonable opportunity to show why the deduction should not be made;
(c) the total amount of the debt does not exceed the actual amount of the loss or damage; and
(d) the total deductions from the employee’s remuneration in terms of this subsection do not exceed one-quarter of the employee’s remuneration in money.
(3) A deduction in terms of subsection (1)(a) in respect of any goods purchased by the employee must specify the nature and quantity of the goods.
(4) An employer who deducts an amount from an employee’s remuneration in terms of subsection (1) for payment to another person must pay the amount to the person in accordance with the time period and other requirements specified in the agreement, law, court order or arbitration award.
(5) An employer may not require or permit an employee to-
(a) repay any remuneration except for overpayments previously made by the employer resulting from an error in calculating the employee’s remuneration; or
(b) acknowledge receipt of an amount greater than the remuneration actually received”.
In essence, section 34(1) allows an employer to make a deduction only if the employee has agreed to it in writing for a specific debt, or if the deduction is required or permitted by a law, a collective agreement, a court order, or an arbitration award. Section 34(5)(a) focuses on overpayments and states that an employee may be required to repay money that was overpaid because of an error in calculating remuneration. This means an employee cannot avoid repayment when the money was mistakenly overpaid. However, even when recovering an overpayment, the employer must still comply with the procedural requirements in section 34(1).
Although section 34(1) of the BCEA outlines the procedural requirements for making deductions, section 38(2)(b)(i) of the Public Service Act allows the State, as employer, to recover overpayments directly from an employee’s salary in instalments determined by the accounting officer, without the need for prior consultation or agreement. This forms the basis of the respondent’s argument that they are exempt from the requirements of section 34(1) of the BCEA because the deduction is authorised by the Public Service Act.
In the Public Servants Association obo Ubogu v Head of the Department of Health, Gauteng and Others, Head of the Department of Health, Gauteng and Another v Public Servants Association obo Ubogu (CCT6/17, CCT14/17) [2017] ZACC 45; 2018 (2) BCLR 184 (CC); (2018) 39 ILJ 337 (CC); [2018] 2 BLLR 107 (CC); 2018 (2) SA 365 (CC) (7 December 2017), the Constitutional Court dealt with the issue where the employer made deductions from the employees’ remuneration based on the premise that they had been overpaid or were otherwise indebted. The ConCourt confirmed the Labour Court’s finding that section 38(2)(b)(i) of the Public Service Act was unconstitutional. The Court rejected the argument that this provision fell outside the limits of the BCEA simply because it counted as a “law” under section 34(1)(b). It held that any deduction must still comply with the rule of law and basic procedural safeguards, which the BCEA already has built in through the requirement of written consent or an external authorisation such as a court or arbitration award. Section 38(2)(b)(i) failed this test because it allowed the state to deduct money from employees without first approaching a court, giving it unchecked power to act against employees and to become the judge in its own cause. This amounted to unlawful self-help and breached section 1(c) of the Constitution, which protects the rule of law. It also violated section 34, which guarantees the right to have disputes resolved in a fair public hearing.
In PSA obo Ubogu, the High Court in Gqithekhaya and Others v Amathole District Municipality (EL 601/2021) [2022] ZAECELLC 20; [2022] 4 All SA 106 (ECLD); [2022] 11 BLLR 1066 (ELC); 2023 (2) SA 227 (ECEL); (2023) 44 ILJ 627 (ECL) (5 August 2022), the High Court interpreted section 38(2)(b)(i) of the PSA by relying on and adopting the Constitutional Court’s reasoning in PSA obo Ubogu, where that provision had already been declared unconstitutional. Using the Constitutional Court’s findings as its anchor, the High Court explained that section 38(2)(b)(i) of the Public Service Act created a system of unfettered self-help because it allowed the state to decide for itself whether money had been wrongly paid and then recover it without going to court. By enabling the employer to bypass judicial oversight, the PSA provision undermined the judicial process and denied employees the opportunity to challenge the alleged debt before an independent body. The High Court reaffirmed the principle, set-off cannot be invoked to defeat the employee’s claim in relation to a salary and stated that set-off applies only when the debt is admitted, or a judgment debt exists. It held further that the Public Service Act provision merely recognises that an employee cannot rely on protection against repayment where an overpayment occurred due to a calculation error, but recovery must still follow section 34(1). If the employee does not agree that the amount was overpaid or refuses to consent to repayment, the employer must pursue legal proceedings to recover the amount.
Therefore, the respondent cannot rely on section 38(2)(b)(i) of the Public Service Act to unilaterally deduct overpayments because the section was declared constitutionally invalid due to its authorisation of self-help and its denial of judicial redress.
On the construction of the facts, the respondent effected a salary deduction of R8 800.00 from the applicant’s remuneration in August 2025 without obtaining his written consent and without securing a court order or arbitration award authorising the deduction. The deduction was also implemented without proper notice to the applicant. The August 2025 letter setting out the intended deduction was sent to the wrong email address, meaning the applicant was not informed of the deduction before it was effected. The audi alteram partem principle was therefore not observed, and the applicant had no opportunity to challenge the basis for the deduction or the amount to be recovered.
Furthermore, the deduction was made before the incapacity leave application had been finally determined. The outcome of the application was only communicated on 6 October 2025, yet the deduction had already been processed in August 2025. At that time, the alleged “overpayment” was not a final, enforceable debt. Deducting money in advance of a conclusive determination further reinforces the character of the respondent’s conduct as unlawful self-help.
1. Taken together, these facts demonstrate a clear breach of section 34 of the BCEA. The deduction was imposed unilaterally, without the applicant’s written consent and without a court order. By deducting the applicant’s salary without due process, and before the alleged debt had been finally established, the respondent acted outside the framework of section 34 of the BCEA. The deduction was therefore not permissible, nor was it properly effected in terms of section 34(1). In these circumstances, the respondent’s conduct amounted to unlawful self-help.
In the premises, the following order is made below.

Award

The respondent, the Western Cape Education Department, is ordered to refund the applicant, Mr Phumezo Sidwell Gelem, the amount of R8 800 that was deducted from his salary. Payment must be made into the applicant’s bank account, the details of which are already in the respondent’s possession.
The payment must be effected by no later than 15 December 2025.
The respondent is further ordered to stop making any further deductions for the recovery of the overpayment from the applicant’s salary unless and until it has fully met the requirements of section 34(1) of the BCEA, which includes obtaining the applicant’s written consent, or a valid court order or arbitration award. Only then can the deductions proceed lawfully and without the arbitrary, unilateral effect created by the original Public Service Act provision.