HEINEKEN Beverages mulls over next steps after losing court case against striking workers

HEINEKEN Beverages said on Wednesday that it was carefully considering the Labour Court judgment and assessing its next steps.

This comes after the Labour Court in Cape Town on Monday ruled that HEINEKEN acted unlawfully when it withheld short-term incentive (STI) bonuses from 39 Solidarity members because they took part in a two-day protected strike in February 2023.

In a detailed 60-page judgment, Judge R Lagrange found that HEINEKEN breached sections 5(1) and 5(2)(c)(vi) of the Labour Relations Act (LRA), which prohibit employers from discriminating against or prejudicing employees for exercising rights conferred by the Act, including the constitutional right to strike.

HEINEKEN on Wednesday acknowledged the court judgment. 

It said the company’s decision at the time was informed by the collective bargaining dynamics at play as well as the long standing STI policy that expressly addressed industrial action alongside other disqualifying criteria.

HEINEKEN said this approach was communicated in advance (before the strike) to ensure transparency and fairness.

"While HEINEKEN notes the Labour Court’s reasoning with respect, the company is carefully considering the judgment and assessing its next steps," HEINEKEN said.

"Throughout this process, HEINEKEN’s management remains committed to constructive engagement with all stakeholders, compliance with its legal obligations, and the continued wellbeing and dignity of its employees." 

Judge R Lagrange's ruling ordered the multinational beverage company to disclose how the 2023 STI bonuses were calculated and to pay the affected employees the bonuses they were denied.

The case centred on HEINEKEN's refusal to pay the incentive bonus to Solidarity members after they engaged in a protected strike to demand organisational rights. Non-striking employees, meanwhile, received the full STI bonus after the company’s board approved the payout in June 2023.

Solidarity argued that the employees met all the qualifying criteria for the bonus except one: they had exercised their right to strike. In the union’s view, withholding the STI solely for this reason amounted to unlawful discrimination and an impermissible act of victimisation under section 5 of the LRA.

HEINEKEN, however, insisted it acted lawfully. The company argued that its STI policy, which pre-dated the strike and explicitly disqualifies employees who participate in industrial action, allowed it to withhold payment, alongside other disqualifying factors such as misconduct and underperformance. 

It argued that the decision to withhold STI was aimed at preserving operational stability and was neither arbitrary nor actuated by improper motives.

The company further contended that using the STI scheme in this manner was not punitive but a legitimate exercise of managerial prerogative within the context of collective bargaining. It cited case law permitting employers, in certain circumstances, to reward non-strikers as part of economic pressure tactics.

But Judge Lagrange rejected this justification, finding the company failed to meet its burden of proving that the differential treatment was rational, proportionate and connected to a legitimate purpose.

Under Labour Appeal Court precedent, most notably Safcor Freight and Cullinan Diamond Mine, an employer may, in limited circumstances, reward non-strikers or impose economic measures during a strike, but only where the measure is a suitable and proportionate response to the strike and aimed at protecting business operations.

In such cases, the employer bears the onus of showing its actions were justifiable and not motivated by improper or punitive intentions.

In HEINEKEN's case, the judge held, the company failed to demonstrate this.

“The defendant provided no details of the impact its denial of the bonus would have on strikers or on incentivising workers not to strike,” Lagrange said.

He highlighted that the strike lasted only two days and was limited to Solidarity members seeking organisational rights — a dispute unlikely to draw widespread participation from the broader workforce.

HEINEKEN also provided no evidence that withholding the STI was necessary to preserve operations, nor that its actions were proportional to the effects of the brief strike.

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