South African Maritime Safety Authority v McKenzie (017/09) [2010] ZASCA 2; 2010 (3) SA 601 (SCA) ; [2010] 3 All SA 1 (SCA) ; (2010) 31 ILJ 529 (SCA) ; [2010] 5 BLLR 488 (SCA) (15 February 2010)

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South African Maritime Safety Authority v McKenzie (017/09) [2010] ZASCA 2; 2010 (3) SA 601 (SCA) ; [2010] 3 All SA 1 (SCA) ; (2010) 31 ILJ 529 (SCA) ; [2010] 5 BLLR 488 (SCA) (15 February 2010)

Links to summary

THE SUPREME COURT OF
APPEAL
OF SOUTH
AFRICA
JUDGMENT
Case no: 017/09
In the matter between:
SOUTH
AFRICAN MARITIME
SAFETY AUTHORITY
A
ppellant
and
FAFIE FORTUNE MCKENZIE
Respondent
Neutral citation:
SAMSA
v McKenzie
(017/09)
[
2010] ZASCA 2
(15
February 2010)
Coram:
MPATI P,
NUGENT and MHLANTLA JJA and LEACH and WALLIS AJJA
Heard
:
18
November 2009
Delivered
:
15
February 2010
Summary: Contract of employment – unfair
dismissal in terms of
section 185
of the
Labour Relations Act 66 of
1995
– whether section creates contractual right not to be unfairly
dismissed.
ORDER
On appeal from:
North
Gauteng High Court (Vilakazi AJ, sitting as court of first instance):
It is ordered that:
1. The late lodging
of the application for leave to appeal is condoned.
2. Leave to appeal
is granted.
3. The appeal is upheld and the order of
the court below is altered to read:
‘
The plaintiff’s claim is dismissed and both parties
are to pay their own costs.’
4. Both parties will pay their own costs in
this appeal including the costs of the applications for condonation.
JUDGMENT
WALLIS AJA (MPATI P, NUGENT and MHLANTLA JJA and LEACH
AJA concurring)
[1] Mr McKenzie was formerly employed by
the South African Maritime Safety Association (SAMSA) as its chief
internal auditor, but
was dismissed on 1 March 2005 in a manner that
he alleges was both procedurally and substantively unfair. After
pursuing his remedies
under the Labour Relations Act 66 of 1995 (‘the
LRA’) and reaching a settlement with SAMSA in terms of which he was
paid an amount
equivalent to one year’s salary, he instituted the
present action claiming that his contract of employment was subject
to ‘an
explicit, alternatively implied, further alternatively tacit
term … that the employment contract would not be terminated by the
Defendant or the Plaintiff without just cause’. He then alleged
that this term had been breached in consequence of his having been
dismissed ‘in a procedural and substantive unfair manner’. This
he contended entitled him to claim damages calculated on the
basis
that he would otherwise have continued working for SAMSA until his
retirement. The amount he claims is R5.2 million.
[2] SAMSA filed a plea containing four
special pleas and these were set down for trial as separate issues
before Acting Justice Vilakazi.
1
The parties proceeded on the basis that no evidence was necessary
beyond certain documents that were attached to the pleadings or
contained in a trial bundle and referred to without objection in the
course of argument. The special pleas were dismissed and leave
to
appeal was refused. On petition to this Court an order was made in
terms of section 21(3)(c)(ii) of the Supreme Court Act
2
directing that the application for leave to appeal be set down for
hearing before this Court and, as is usual in such orders, directing
the parties to be prepared to argue the merits of the appeal. It is
on that basis that the matter came before us.
[3] At the outset two applications for
condonation fell to be considered, the first relating to the late
lodging of the application
for leave to appeal and the second
relating to the late filing of a replying affidavit in the
application for leave to appeal. The
first was not opposed on the
ground that it was unnecessary. This is not correct as the
application was lodged out of time.
3
Be that as it may this is clearly a case where condonation should be
granted. As regards the second application it was delivered
after
this Court had made its order directing that the application be set
down for argument. The replying affidavit added nothing
to the
consideration of the application and Mr Khoza SC, who appeared for
SAMSA, did not persist with it. The costs attendant upon
these
applications will be dealt with together with all other questions of
costs.
[4] Turning to the
merits of the application for leave to appeal, as is frequently the
case with such applications, the outcome depends
upon the merits of
the case. As I am satisfied for the reasons that follow that the
appeal should succeed it follows that leave to
appeal should be
granted.
[5] Among the special pleas filed by SAMSA
was one nominally expressed as a challenge to the jurisdiction of the
high court to consider
the claim. Another raised as a defence to the
claim the settlement agreement that was reached when Mr McKenzie
pursued his remedies
under the LRA. On the view that I take in this
matter it is not necessary to consider that defence.
[6] When
a jurisdictional challenge is raised the court must necessarily
dispose of it before entering upon any further questions
that arise
in the case.
4
The nominal challenge in this case was raised in terms that have
become familiar and it is not necessary to set them out in detail.
In substance it was alleged that Mr McKenzie’s remedies for unfair
dismissal are those provided for in the LRA and that the high
courts
have no jurisdiction to grant such remedies.
[7] Once
more, as in other cases that have come before this court, the plea,
so far as it purports to raise a jurisdictional challenge,
is
misdirected. As the Constitutional Court has reiterated in
Gcaba
v Minister of Safety and Security,
5
the question in such cases is whether the
court has jurisdiction over the pleaded claim, and not whether it
has jurisdiction over
some other claim that has not been pleaded but
could possibly arise from the same facts. In this case the
particulars of claim
could not have made it clearer that Mr
McKenzie’s claim is for damages for breach of contract. To the
extent that authority is
required
Fedlife
Assurance Ltd v Wolfaardt
makes it clear
that a claim for damages for breach of contract falls within the
ordinary jurisdiction of the high courts, albeit
that the contract
is one of employment. In
Tsika v Buffalo City
Municipality
6
Grogan AJ concluded, after reviewing
subsequent decisions, that the position remains that
‘
[t]his
court and other civil courts retain their common law jurisdiction to
entertain claims for damages arising from alleged breaches
of
contracts of employment …’
[8] As was the case in
Fedlife,
and in other cases purporting to raise
similar challenges, the plea, properly construed, does not
raise a jurisdictional challenge at all. In substance
what is alleged in the plea is that the
Labour Relations Act is
the
exclusive source of remedies for unfair dismissal, with the result
that Mr McKenzie has no contractual claim. That is not a challenge
to
the jurisdiction of the high court to consider the pleaded claim –
it is a challenge to the validity of the pleaded claim.
I
can only echo, in relation to the facts of this case, what Nugent JA
said in
Makhanya
7
in regard to special pleas purporting to be
pleas to the jurisdiction of the court such as the present one. I
adapt his words to the
facts at present before us:
‘
Once more, so it seems to me,
[this case]
,
like
all the cases that preceded it, [is] not about jurisdiction at all.
It [is] about whether there [is] a good cause of action.
In my view
the least said about jurisdiction in such cases the better because,
once that red-herring is out of the way, courts will
be better placed
to focus on the substantive issue that arises in such cases, which is
whether, and if so in what circumstances,
employees might or might
not have rights that arise outside the LRA.’
[9] When properly
construed, the contention on behalf of the appellant is that the
right in terms of
s185
of the LRA, taken together with the remedies
for a breach of that right contained in
s194
and the procedures
prescribed for adjudicating disputes over unfair dismissals in
s191
,
constitutes a complete statement of the extent of the rights in
respect of unfair dismissal. They are entirely statutory in origin
and content and give rise to no contractual obligation.
8
That puts in issue the correctness of the allegation in the
particulars of claim that Mr McKenzie’s contract of employment was
subject to the condition that it could not be terminated without just
cause. SAMSA pleaded over and in its main plea it admitted
this
allegation contrary to the special plea. However that plea over was
dependent on the failure of the special plea and when seen
in its
context, and in the light of the concession, (referred to in the next
paragraph), that there was no express term to that effect,
it is no
more than a concession of law by counsel who drew the plea.
Accordingly it cannot be said to be binding if it does not truly
reflect the law.
9
[10] Bearing in mind that the breach of
contract is said to lie in the ‘unfair dismissal’ of Mr McKenzie
the allegation in the
particulars of claim that the contract could
not be terminated ‘without just cause’ must be taken to mean that
it could not be
terminated unfairly and this is the basis of the case
advanced by Mr McKenzie. In the first instance he alleges that the
term was
‘explicitly’, that is, expressly agreed. It is not
disputed that the express terms of the contract were embodied in his
letter
of appointment, which contains no such provision. Its outward
appearance is of a conventional contract of employment terminable on
the giving of reasonable notice by either party. Under the heading
‘Terms and conditions of employment’ it is said that these
are
embodied in SAMSA’s Human Resources Policy, which
inter
alia
caters for a notice period. Accordingly
no support for the pleaded term is to be found in the written
contract and the allegation
that it was expressly agreed can be
rejected. This was accepted by the appellant’s attorney.
[11] In the alternative it is alleged that
the term arises either by way of an implied term or as a tacit term.
Corbett AJA explained
the difference between the two in
Alfred
McAlpine & Son (Pty) Ltd v Transvaal Provincial Administration
.
10
An implied term properly so called is a term that is introduced into
the contract as a matter of course by operation of law, either
the
common law, trade usage or custom, or statute, as an invariable
feature of such a contract, subject only to the parties’
entitlement
in certain, but not all, instances to vary it by
agreement. Where reliance is placed on such a term the intention of
the parties
will not come into the picture and the issue is the
purely legal one of whether in those circumstances in relation to a
contract
of that particular type the law imposes such a term on the
parties as part of their contract. A tacit term is a term that arises
from the actual or imputed intention of the parties as representing
what they intended should be the contractual position in a particular
situation or, where they did not address their minds to that
situation, what it is inferred they would have intended had they
applied
their minds to the question.
[12] In our law as it stands at present
11
the usual test for the existence of a tacit term is that of the
interfering bystander who asks what is to happen in the particular
situation and receives the answer: ‘Of course X will be the
position. It is too obvious for us to say so.’
12
The application of that test in relation to the term pleaded on
behalf of Mr McKenzie is destructive of the contention that his
employment
contract is subject to that term. I have little doubt that
the bystander’s query as to what would happen if Mr McKenzie was
unfairly
dismissed would have attracted the response: ‘That is
dealt with in the LRA. We don’t need to provide for it’, rather
than
the unequivocal and mutual agreement that is the necessary
cornerstone of a case founded on a tacit term. If the question had
been
posed in terms that suggested there might be a contractual
entitlement to the damages claimed in this case that might have been
welcomed
by Mr McKenzie, but I doubt that SAMSA would have agreed.
13
[13] That leaves, as the foundation for the
pleaded allegation, only the possibility of an implied term properly
so called. Such a
term could either be said to flow from the
provisions of
s185
of the LRA dealing with unfair dismissal or could
lie in a development of the common law in accordance with section
39(2) of the
Constitution. In argument the appellant based his case
on the first of these and it is that argument that I now address. In
doing
so I first address some issues of principle.
[14] The fundamental difference between
rights arising from a contract and rights arising from statute is
that the former depend upon
the actual or imputed consent of the
parties whilst the latter are imposed by the legislature in order to
give effect to social policies
underpinning the legislation. The
nature of the latter rights may vary. They may be conferred by way of
mandatory injunctions, such
as the provision in the Truck Acts
14
in England, which have been carried over into South African
legislation dealing with employment, in terms of which an employee’s
wages must be paid in cash in the currency of the country.
15
Alternatively they may prohibit or regulate conduct that might
otherwise be permissible such as the making of deductions from an
employee’s remuneration.
16
Rights to safe working conditions
17
and to compensation for injuries at work
18
are protective in nature. All of this has limited the extent to which
employers and employees are free to determine the terms of
their
relationship.
19
In most instances the employee cannot waive such statutory rights
because it would be contrary to public policy to permit such a
waiver,
20
although the parties to the contract can stipulate for more
favourable rights to vest in the employee.
[15] A relevant feature of some legislation
of this type is that it not only confers rights but also provides a
mechanism for the
enforcement of those rights.
Where that happens the question arises
whether those means are exclusive and provide the sole means of
enforcement or whether it is
open to the beneficiary of the right to
use the ordinary processes of the courts in order to enforce them.
Another question that
arises is whether the beneficiary of the right
enjoys not only the benefit of the right itself but also a right to
claim damages
if the right is infringed.
21
Our courts have frequently grappled with these questions and the
jurisprudence in that regard casts light upon the present problem.
[16] Where a
statute creates both a right and a means for enforcing that right the
position is that:
‘
We must look at the provisions of the Act in
question, its scope and its object, and see whether it was intended
when laying down
a special remedy that that special remedy should
exclude ordinary remedies. In other words, we have no right to
assume, merely from
the fact that a special remedy is laid down in a
statute as a remedy for a breach of a right given under statute, that
other remedies
are necessarily excluded.’
22
If on a proper interpretation of the
statute in question the legislature has confined a person harmed by a
breach of the right conferred
therein to the statutory remedy then
resort to other means of enforcement is excluded.
23
Accordingly both the scope of the right itself and the means of
enforcing that right are determined by the intention of the
legislature
as ascertained on a proper interpretation of the
legislation. It follows from the authorities mentioned in paragraph 7
of this judgment
that it is now clearly established that in order to
enforce the statutory right not to be unfairly dismissed as embodied
in section
185 of the LRA an injured party must have resort to the
tribunals established under the LRA, being either the CCMA or in some
instances
the Labour Court.
[17] Similarly whether a breach of a
statutory right or a failure to observe a statutory obligation gives
rise to claim for damages
is to a substantial measure determined by
the intention of the legislature as it emerges from the statutory
provision under consideration.
24
Whilst the interpretation of the statute may not be the only feature
in the analysis it is the proper starting point.
[18] The jurisprudential approach to
statutory interventions in the contract of employment differs in
different jurisdictions. The
distinction that Sir Otto Kahn-Freund
25
referred to between the ‘imperative’ norms (‘normative
provisions’) of the law of contract and the optional norms created
by the parties’ agreement provides a framework for considering the
issue. In many European jurisdictions the normative provisions
are
treated as inderogable
26
and, if arising from a collective bargain, are made part of the
contract of employment.
27
In jurisdictions with a common law heritage the more usual approach
is to distinguish provisions imposed from outside the contract
depending on whether they are imposed by statute as terms of the
contract; are statutory rights having their origin in the statute
but
not the contract of employment; or are incorporated into the contract
by the agreement of the parties. When dealing with legislative
provisions that give rights to workers and have an impact upon the
employment relationship it is appropriate to bear in mind that,
whilst having normative effect, they do not necessarily alter the
terms of the contract of employment. Thus Professor Mark Freedland
28
makes the point that:
‘…
legislative
provisions may expressly affect the contractual rights and
obligations arising under personal work or employment contracts…
This can be thought of as the subject of an implied term in the
personal work or employment contract. So also might we sometimes
regard a legislative norm which, although not expressly declaring
itself to do so, in fact shaped or altered the content of the
personal
work or employment contract. (
Note, however, that we are
not asserting that every such legislative norm must be regarded as
the subject of an implied term. Statutory
rights and obligations may
be associated with or attached to personal work or employment
contracts without necessarily taking the
form of implied terms of the
contract.
)’
29
(My emphasis.)
[19] Hugh
Collins makes the point that apart from the conceptually different
underpinnings of such rights and, in the case of statutes,
the
conditions attaching to the rights, it makes little difference to the
beneficiary of the right whether a right is incorporated
in a statute
or in the contract of employment by way of an implied term.
30
He writes:
‘
Mandatory
obligations remove from the parties to a contract the freedom to
choose some of the terms for their transaction. The most
straightforward example comprises legislation which determines that
every contract of a particular type is deemed to include a particular
term, regardless of the express terms of the contract and overriding
any contrary terms … The same effect can be achieved by granting
a
statutory right which cannot be excluded or qualified by contrary
agreement as in the case of the right of an employee to claim
unfair
dismissal against an employer.’
However,
to the obligee the origin of the right is of considerable importance
as it defines the scope of the obligation undertaken
in concluding
the contract of employment. It also makes a substantial difference
if, as is claimed to be the case here, a statute
creates both a
contractual right and a similar, but not entirely overlapping,
contractual right, because it imposes greater obligations
on the
obligee.
[20] When it is
argued that a statutory provision not only creates statutory rights
and remedies but also impliedly introduces terms
into certain types
of contract, in accordance with the approach adopted by our courts in
regard to the issues discussed above, the
enquiry commences by
examining the statutory provision in order to determine whether it
was intended that its provisions or some
part of them should be
incorporated in contracts of that class. In the present context that
involves asking whether the legislature,
in enacting section 185 of
the LRA and the sections that follow, intended not only to outlaw
unfair dismissals and provide statutory
remedies when they occur, but
also intended to incorporate into all contracts of employment a term
that they could not be terminated
unfairly. That is necessarily the
question inasmuch as Mr McKenzie’s contract of employment does not
contain any unusual features
that would serve to place it in an
exceptional category insofar as implication of this term from the LRA
is concerned.
[21] The LRA was enacted in order to give
effect to the labour rights now guaranteed by section 24 of the
Constitution
31
and in particular the right to fair labour practices. One of the most
important rights flowing from that constitutional guarantee
is the
right not to be unfairly dismissed embodied in s185 of the LRA.
32
Where an employee claims that their dismissal is unfair, whether
substantively or procedurally, or that they have been subjected
to an
unfair labour practice the LRA establishes the mechanism for
resolving disputes arising from that claim.
33
In the case of an unfair dismissal it also specifies the remedies
that are available to an aggrieved employee
34
and, where that remedy consists of compensation, establishes limits
on the amount of such compensation.
35
The statutory mechanism for resolving disputes over unfair dismissals
is by way of conciliation and if that fails arbitration before
either
the CCMA or the Labour Court.
[22] The arrangements in these sections
constitute a legislative scheme for giving effect to the right not to
be unfairly dismissed.
The scheme is enacted as a package embodying
the right itself together with sections that explain what is a
dismissal (s186); identify
automatically unfair dismissals (s187) and
state the test for determining when other dismissals are unfair
(s188); and prescribe
the procedures to be followed in relation to
dismissals for operational reasons (ss189 and 189A). It then
stipulates the mechanism
for dealing with disputes over unfair
dismissals (s191); deals with the onus of proof in proceedings
concerning such disputes (s192)
and prescribes the remedies that flow
from an unfair dismissal (ss193 and 194).
[23] In the
statutory formulation of the scheme it is nowhere said that it has
any contractual implications. That stands in sharp
contrast to the
provisions of section 23(3) of the LRA which provide that:
‘
Where applicable, a collective agreement varies any
contract of employment between an employee and employer who are both
bound by
the collective agreement.’
That section deliberately set out to
address the problematic issue of the incorporation of the provisions
of collective agreements
into contracts of employment so as to give
the employee and employer contractual remedies against one another,
such as the right
of the employee to be paid the agreed rate of
remuneration, or the right of the employer to demand that the
employee work agreed
overtime. This was an issue that had given rise
to much difficulty, both practically in cases where it was suggested,
following the
approach in England
36
,
that such a collective agreement was not legally binding at all
37
and conceptually in trying to suggest that collective bargaining
agents had authority to conclude contracts on behalf of union members
or that the collective agreements they concluded were enforceable as
contracts for the benefit of a third party.
38
The legislature accordingly took the step of making express provision
for incorporation of appropriate terms from the collective
bargain
into the individual contracts of employment of the workers.
[24] A similar approach to the
incorporation of provisions in a statute into a contract of
employment is to be found in section 4
of the Basic Conditions of
Employment Act,
39
which provides that:
‘
4. Inclusion of provisions in
contracts of employment.
A basic condition of employment constitutes a term of
any contract of employment except to the extent that—
(a) any other law provides a term that is more
favourable to the employee;
(b) the basic condition of employment has been replaced,
varied, or excluded in accordance with the provisions of this Act; or
(c) a term of the contract of employment is more
favourable to the employee than the basic condition of employment.’
The same approach
can be found in statutes in England that expressly embody provisions
to be incorporated into contracts of various
types such as the
provisions of sections 12 to 15 of the Sale of Goods Act, 1979 or
sections 8 to 11 of the Supply of Goods (Implied
Terms) Act 1973.
40
[25] Such instances are quintessential
examples of cases where a term is implied into a contract by
operation of law by virtue of
the terms of a statute as indicated by
Corbett AJA. However Mr McKenzie cannot rely upon that approach
because section 185 of the
LRA and the remaining sections that deal
with unfair dismissals do not contain any such express provision
incorporating them into
contracts of employment.
The
argument on his behalf is therefore that the incorporation is to be
implied from the terms of the relevant provisions of the LRA
read in
the light of the Constitution.
[26] The immediate
difficulty facing Mr McKenzie in advancing this argument is that
where the LRA intends to alter the terms of a
contract it says so as
it does in section 23(3). Its silence in the context of section 185
is a factor that counts strongly against
his contention. An even
greater difficulty emerges when the attempt is made to identify what
is to be incorporated into the contract
of employment and what part
of the statutory scheme is to be excluded. The manner in which Mr
McKenzie’s case has been pleaded
suggests that the only provision
from the statute that has been incorporated in the contract is the
provision in section 185 that
establishes the right not to be
unfairly dismissed. Although not an issue in this case the same logic
would result in the incorporation
from the same section of the right
not to be subjected to unfair labour practices. However in the
provisions that follow both of
these rights are hedged about with
qualifications and the impact of these qualifications must be
addressed. I have already referred
to those in relation to unfair
dismissal. It is helpful however to have regard also to the situation
in respect of unfair labour
practices.
[27] The concept of an unfair labour
practice is defined and limited in section 186(2). This stands in
sharp contrast to the position
under the 1956 LRA where the concept
was originally undefined. Then the Industrial Court was vested with
jurisdiction over,
41
and responsibility for giving content to, the unfair labour practice.
When constitutional protection against being subjected to unfair
labour practices was introduced the LRA was enacted to give content
to that constitutional right and did so by providing a definition
of
an unfair labour practice. The Constitutional Court has several times
held that one cannot in those circumstances have direct
resort to the
constitutional guarantee without an attack on the constitutionality
of the legislation in question.
42
But that confronts the whole notion of the incorporation into a
contract of employment of the statutory right not to be subjected
to
unfair labour practices with a fundamental and intractable dilemma.
It is this. If what is incorporated is simply a general right
not to
be subjected to unfair labour practices, without the incorporation of
the accompanying statutory provisions, of which the
definition is the
most important, then the incorporation goes further than the statute
from which it is derived. That is logically
impermissible when we are
dealing with incorporation by implication. If what is incorporated is
limited to the statutory notion of
an unfair labour practice, with
all its limitations, then incorporation serves no purpose as the
employee will gain no advantage
from it. That is a powerful
indication that no such incorporation is intended.
[28] The same logic
applies in relation to the incorporation of a prohibition on unfair
dismissals from the LRA into contracts of
employment. If, as was
ultimately suggested in argument on behalf of Mr McKenzie, the whole
statutory scheme is to be imported lock,
stock and barrel into the
contract of employment it would not only add nothing to the rights
that are possessed by all employees
under the LRA, but would exclude
the possibility of an action such as the present being pursued, both
because the amount being claimed
and the basis upon which it is
calculated lies beyond the statutory cap on compensation in section
194 of the LRA and because the
claim could only be pursued before the
CCMA. Such an incorporation is entirely pointless.
[29] Brennan CJ made this point in
Byrne
v Australian Airlines Ltd
43
,
a case that raised precisely the same issue as the present one,
namely an endeavour by two dismissed employees to claim compensation
under the statutory scheme embodied in an award under the Industrial
Relations Act as well as damages based on the contention that
their
unreasonable dismissal was in breach of an implied term of their
contracts of employment derived from the provisions of the
statutory
scheme. In rejecting the contractual claim he said:
‘
In a system of industrial regulation where some, but
not all, of the incidents of an employment relationship are
determined by award,
it is plainly unnecessary that the contract of
employment should provide for those matters already covered by the
award. The contract
may provide additional benefits, but cannot
derogate from the terms and conditions imposed by the award and, as
we have said, the
award operates with statutory force to secure those
terms and conditions. Neither from the point of view of the employer
nor the
employee is there any need to convert those statutory rights
and obligations to contractual rights and obligations. There is,
therefore,
an insuperable obstacle in the way of the appellants'
second argument that the terms of an award such as cl 11(a) are
implied terms
of the contract of employment.’
44
[30] The same conclusion was reached in the
United Kingdom in
Johnson v Unisys Ltd
45
when
confronted with the same problem. That case involved an employee who
was summarily dismissed at the age of 52 years from a company
that,
with a gap of three years, he had served for 23 years. An employment
tribunal, applying the English equivalent of the LRA provisions
governing unfair dismissals, held that the dismissal was unfair and
awarded him compensation in terms of the statute. Dissatisfied
with
the amount of the award he sought to pursue a claim for damages based
on his unfair dismissal contending that apart from the
statutory
regime and pursuant to the implied contractual term of trust and
confidence attaching to all contracts of employment it
was not open
to his employer to dismiss him in an unfair manner. Hence so he
contended he was entitled to damages for breach of contract
in
addition to the statutory compensation.
[31] The fundamental reason for the claim
failing was that recognising such an implied term in the contract of
employment
46
would be inconsistent with and render redundant the statutory scheme
in regard to unfair dismissals. Lord Nicholls of Birkenhead
put it in
this way:
‘
But there is an insuperable obstacle: the
intervention of Parliament in the unfair dismissal legislation.
Having heard full argument
on the point, I am persuaded that a common
law right embracing the manner in which an employee is dismissed
cannot satisfactorily
co-exist with the statutory right not to be
unfairly dismissed. A newly developed common law right of this
nature, covering the same
ground as the statutory right, would fly in
the face of the limits Parliament has already prescribed on matters
such as the classes
of employees who have the benefit of the
statutory right, the amount of compensation payable and the short
time limits for making
claims. It would also defeat the intention of
Parliament that claims of this nature should be decided by specialist
tribunals, not
the ordinary courts of law.’
Those remarks are
equally apposite to Mr McKenzie’s claim in the present case.
[32] In giving the leading opinion Lord
Hoffmann recognised that, in the absence of any other provision in
law that governed questions
of unfairness in regard to dismissal, it
would have been open to the courts to formulate rules by way of
implied terms governing
the issue of fairness in dismissal, in the
light of changes in understanding the employment relationship and
recognition of the role
that employment plays, not only in people
being able to support themselves and their families, but also in
giving them a sense of
self-worth and enabling them to play a proper
role in society.
47
However he regarded the comprehensive statutory scheme in the United
Kingdom as posing an insuperable obstacle to such a development
and
said the following:
‘
54.
My Lords, this statutory system for dealing with unfair dismissals
was set up by Parliament to deal with the recognised deficiencies
of
the law as it stood at the time of
Malloch
v Aberdeen Corporation
[1971] 1 WLR 1581.
The remedy adopted by Parliament was not to build
upon the common law by creating a statutory implied term that the
power of dismissal
should be exercised fairly or in good faith,
leaving the courts to give a remedy on general principles of
contractual damages. Instead,
it set up an entirely new system
outside the ordinary courts, with tribunals staffed by a majority of
lay members, applying new statutory
concepts and offering statutory
remedies. Many of the new rules, such as the exclusion of certain
classes of employees and the limit
on the amount of the compensatory
award, were not based upon any principle which it would have been
open to the courts to apply.
They were based upon policy and
represented an attempt to balance fairness to employees against the
general economic interests of
the community. And I should imagine
that Parliament also had in mind the practical difficulties I have
mentioned about causation
and proportionality which would arise if
the remedy was unlimited. So Parliament adopted the practical
solution of giving the tribunals
a very broad jurisdiction to award
what they considered just and equitable but subject to a limit on the
amount.
55. …
56. Part X of the
Employment Rights Act 1996 therefore gives a remedy for exactly the
conduct of which Mr Johnson complains. But Parliament
had restricted
that remedy to a maximum of £11,000, whereas Mr Johnson wants to
claim a good deal more. The question is whether
the courts should
develop the common law to give a parallel remedy which is not subject
to any such limit.
57. My Lords, I do
not think that it is a proper exercise of the judicial function of
the House to take such a step. Judge Ansell,
to whose unreserved
judgment I would pay respectful tribute, went in my opinion to the
heart of the matter when he said:
"there is not one hint in the authorities that
the...tens of thousands of people that appear before the tribunals
can have, as
it were, a possible second bite in common law and I ask
myself, if this is the situation, why on earth do we have this
special statutory
framework? What is the point of it if it can be
circumvented in this way? .... it would mean that effectively the
statutory limit
on compensation for unfair dismissal would
disappear."
58. I can see no
answer to these questions. For the judiciary to construct a general
common law remedy for unfair circumstances attending
dismissal would
be to go contrary to the evident intention of Parliament that there
should be such a remedy but that it should be
limited in application
and extent.’
[33] I find myself in respectful agreement
with this reasoning. I would add to it that there is the further bar
in South Africa that
the legislation in question has been enacted in
order to give effect to a constitutionally protected right and
therefore the courts
must be astute not to allow the legislative
expression of the constitutional right to be circumvented by way of
the side-wind of
an implied term in contracts of employment. I am
also fortified in that conclusion by the fact that it reflects an
approach adopted
in a number of other jurisdictions. In addition the
Constitutional Court has already highlighted the fact that there is
no need to
imply such provisions into contracts of employment because
the LRA already includes the protection that is necessary. The
passage
I have in mind is the following:
[42] The LRA includes the principles of natural justice.
The dual fairness requirement is one example; a dismissal needs to be
substantively
and procedurally fair. By doing so, the LRA guarantees
that an employee will be protected by the rules of natural justice
and that
the procedural fairness requirements will satisfy the
audi
alteram partem
principle and the rule against bias. If the
process does not, the employee will be able to challenge her or his
dismissal, and will
be able to do so under the provisions and
structures of the LRA. Similarly, an employee is protected from
arbitrary and irrational
decisions, through substantive fairness
requirements and a right not to be subjected to unfair labour
practices.’
48
[34] Two
recent articles – by Tamara Cohen
49
and John Grogan
50
respectively – nonetheless suggest that,
under the influence of constitutional norms, recent decisions of the
courts have gone
a long way towards implying in all employment
contracts, a general criterion of fairness, which, taken to its
conclusion, is capable
of including a contractual right not to be
unfairly dismissed. As Tamara Cohen puts it in her conclusion:
51
‘
No
longer is the employment contract the unfettered domain of the
employer but, thanks to the constitutional promise of fair labour
practices, has evolved to import considerations of fairness and
equity.’
[35] I
do not think the decisions they refer to go as far as the writers
suggest. While the Constitution guarantees to everyone
‘the right
to fair labour practices’,
52
and also calls upon courts, when developing the common law, to
‘promote the spirit, purport and objects of the Bill of Rights’,
53
it does not follow that courts are thereby enjoined to develop the
common law contract of employment by simply incorporating in
it the
constitutional guarantee. Where the common law, as supplemented by
legislation, accords to employees the constitutional
right to fair
labour practices there is no constitutional imperative that calls
for the common law to be developed. Indeed, to
duplicate rights that
exist by statute does no more than to create the ‘jurisdictional
quagmire’ that is referred to by Tamara
Cohen. As she rightly
points out, the consequence is that the carefully crafted structure
within which those rights were legislatively
created becomes
superfluous. John Grogan makes the same point:
‘
[T]he
distinction between the causes of action in claims for enforcement
of rights emanating from the contract of employment and
rights
emanating from the [Labour Relations Act] becomes very difficult,
perhaps in some cases impossible, to distinguish.’
In similar vein Pretorius and Myburgh
54
say that such an approach would have as its consequence that:
‘
most (if not all) unfair dismissals can now be
dressed up as a contractual claim and played out in the H[igh]
C[ourt]’
with the result that,
‘
the jurisdictional divide will surely be eroded to
the point of collapse’.
Professor Darcy du Toit sums it up as follows:
‘
To infer the existence of a common law right
duplicating the statutory right is to call into question the purpose
of enacting the
statutory right.’
55
[36] In
Mohlaka v
Minister of Finance
56
Pillay J reminds us that when applying a provision of the Bill of
Rights a court is called upon to apply or ‘if necessary’ develop
the common law only ‘to the extent that legislation does not give
effect to that right’. The employment relationship is governed
both
by rights that are created by agreement, and by rights that are
statutorily conferred, each of which has its proper place and
falls
to be vindicated in its appropriate sphere. In by far the majority of
cases the rights and obligations that are created by
contract will
play the lesser role and the statutory rights of employees will come
to the fore. In some instances the converse will
be true. In either
case I can see no justification for mechanically duplicating
statutory rights by importing them into the contract
with the
unfortunate consequences adverted to by the writers to whom I have
referred. I can see even less justification for importing
them in
part only with a view to procuring advantages not contemplated by the
statute.
[37] I share the view of Professor Halton
Cheadle, whose role in the drafting of the LRA is well documented,
that where, as here,
the employees are protected by the LRA, section
8(3) of the Constitution does not warrant or require an importation
from the realm
of constitutionally protected labour rights into
individual contracts of employment by way of an implied term.
57
The LRA specifically gives effect to the constitutional right to fair
labour practices and the consequent right not to be unfairly
dismissed. Accordingly the constitutional basis for developing the
common law of employment and thereby altering the contractual
relationships is absent.
[38] The two decisions that are said to
have had the effect of imputing into contracts of employment a right
to fairness, and in particular
a right to a fair hearing prior to
dismissal, are
Old Mutual Life Assurance Co.
SA Ltd v Gumbi
58
and
Boxer Superstores Mthatha v Mbenya.
59
It is as well to consider precisely what was decided in those cases.
[39] In
Gumbi
it was said that the focus of the appeal was ‘the employee’s
right to a pre-dismissal hearing under the common law’. The court
went on to say:
‘
An employee's entitlement to a pre-dismissal hearing
is well recognised in our law. Such right may have, as its source,
the common
law or a statute which applies to the employment
relationship between the parties (
Modise and Others v Steve's
Spar, Blackheath
2001 (2) SA 406
(LAC) ((2000) 21 ILJ 519;
[2000]
5 BLLR 496)
in para [21] and the authorities collected there). In
cases such as the present, the parties may opt for certainty and
incorporate
the right in the employment agreement (
Lamprecht and
Another v McNeillie
[1994] ZASCA 45
;
1994 (3) SA 665
(A) (1994) 15 ILJ 998;
[1994]
11 BLLR 1)
at 668 (SA)).’
[40] It is apparent
that there was no intention in that passage to lay down any new
principle of law, but only to reiterate what had
been said in the
cases referred to. However I do not think that where it refers to the
common law it is an altogether accurate reflection
of what was said
in those cases.
[41] The issue in
Modise
was whether the dismissal of the employees constituted an ‘unfair
labour practice’ as contemplated by the now repealed Labour
Relations Act 28 of 1956. One of the contentions advanced was that it
was an unfair labour practice to dismiss an employee without
first
giving the employee a hearing.
60
In a careful analysis Zondo AJP explained that the right to a hearing
before dismissal was an incident of the statutory right not
to be
subjected to an unfair labour practice, and that, as a general rule,
it ‘has no application to private contracts’.
61
The acting Judge President admitted of one exception to that general
rule when he said the following:
‘
However, there is one exception to the general rule
that the
audi
rule does not apply to private contracts. That
is where a private contract contains a provision which either
expressly or by necessary
implication incorporates the right to be
heard’.
[42] In saying that the acting Judge
President relied upon
Lamprecht
,
where an employee sought to review a decision to dismiss him on the
ground that the principles of fundamental or natural justice
(which
include the right to a hearing) had not been complied with. Harms JA
said that in order for the employee to succeed
‘
[i]t was accepted on his behalf that he had to prove
a contract (express or tacit) containing a provision (also either
express or
tacit) incorporating the rules of natural justice’.
The learned judge went on to cite as being
apposite the following dictum of Trollip J in
Grundling
v Beyers
:
62
‘
In a statute empowering an official or body to give a
decision adversely affecting the rights of liberty or property of an
individual,
a legal presumption usually operates that the
audi
alterem partem
rule has to be observed. There is no such
presumption in a contract. The obligation to afford a hearing
according to natural justice
must therefore be either an expressed or
necessarily implied term of the contract.’
63
[43] A more accurate summary of the law as
it was articulated in those cases would be that an employee is
entitled to a pre-dismissal
hearing where that right is conferred by
a statute or by an employment contract. The right arises
contractually where the contract
provides for it either expressly or
tacitly. If the passage I have referred to in
Gumbi
had been expressed in those terms, reflecting
what was said in the cases relied on, it would have said nothing that
was novel or controversial.
[44] Of even more practical importance in
Gumbi
is that, as
expressly stated in the passage quoted, a right to a pre-dismissal
hearing was indeed incorporated in the contract, as
envisaged by
Lamprecht
.
64
(A perusal of the record suggests that it was expressly incorporated
by the incorporation of a disciplinary code, as in
Denel
(Edms) Bpk
,
65
but whether the incorporation was express or tacit is not important.)
The court was not called upon in that case to decide in what
circumstances an employee had such a right. The sole dispute was the
ambit of that right, and in particular, whether the failure
by the
employee to take the opportunity to be heard had the result that the
employer had failed to fulfil its contractual obligation.
66
The entitlement to such a hearing was not in dispute nor were any of
the points considered in this case raised.
[45] In the course of his judgment,
however, and after referring to a case dealing with the requirements
for a fair hearing under
the old unfair labour practice
jurisdiction,
67
the learned judge added the following observation, without
elaboration and without citing authority to support it:
‘
It is clear however that co-ordinate rights
[co-ordinate with the contractual right] are now protected by the
common law: to the extent
necessary, as developed under the
constitutional imperative (s 39(2)) to harmonise the common law into
the Bill of Rights (which
itself includes the right to fair labour
practices (s 23(1)).’
For the reasons I have given that observation was not
necessary for the decision in that case and was clearly obiter.
[46]
Boxer
Superstores
followed shortly after
Gumbi
.
It concerned the jurisdiction of the high court to consider a claim
for declaratory relief arising from what was alleged to have
been a
breach of an employment contract. For the reasons that I have given
the question whether the high court has jurisdiction to
consider a
claim for breach of contract is not controversial. What was said to
be the novel question in that case was ‘whether
an employee may sue
in the High Court for relief on the basis that the disciplinary
proceedings and the dismissal was ‘unlawful’,
without alleging
any loss apart from salary’. Not surprisingly the court answered
that question in the affirmative, saying, amongst
other things:
68
‘
It would moreover be illogical to hold that an
employee can claim damages for breach of the common law contract of
employment in the
High Court – as in
Fedlife
and
Denel
– but cannot claim (as is
inter alia
here sought) a
declarator
.’
[47] Cameron JA nonetheless took the
opportunity to refer to
Gumbi
and said the following:
69
‘
This Court has recently held that the common-law
contract of employment has been developed in accordance with the
Constitution to
include the right to a pre-dismissal hearing. ...
This means that every employee now has a common-law contractual claim
– not merely
a statutory unfair labour practice right – to a
pre-dismissal hearing. Contractual claims are cognisable in the High
Court. The
fact that they may also be cognisable in the Labour Court
through that court’s unfair labour practice jurisdiction does not
detract
from the High Court’s jurisdiction.’
[48] I have already pointed out that what
was said to be the finding in
Gumbi
was obiter and I do not think that its repetition in
Boxer
Superstores
takes the matter further.
Moreover, the question whether the court had jurisdiction was
dependant on the pleaded claim, as the learned
judge correctly said,
70
and not upon the merit or otherwise of the claim. Whether the
contract relied upon by the employee indeed entitled her to a hearing
was accordingly not an issue before the court, and was not necessary
for its decision.
[49] It would be incomplete not to deal
with two further decisions of this court in the present context. One
is
Transman (Pty) Ltd v Dick
.
71
In that case an employee sought to review, on administrative law
principles, a decision to dismiss him. In asking whether the review
application was competent Jafta JA (writing for the majority) posed
the question before him as being ‘whether the chairperson’s
verdict [the chairperson of the disciplinary enquiry] and the
termination of employment constitute decisions which are reviewable
in administrative law’
72
and concluded that they were not. The learned judge went on to ask
whether the employee had ‘made out a case for a contractual
pre-dismissal hearing’ and concluded as follows:
73
‘
In the present case the duty was on the employee not
only to plead a contractual claim but also to prove the facts from
which the
contended tacit term could be inferred. This the employee
has failed to do and as a result there is no factual basis for
importing
into the employment agreement the term that he was entitled
to a hearing before the board terminated his employment. In fact he
has
failed to plead the terms of the employment agreement between
himself and the employer, Therefore he has not satisfied the
requirements
of the test for importing terms into a contract.
Accordingly the court below erred in assuming that his employment
contract was ‘subject
to an implied term that he would be afforded
a fair hearing before he was dismissed’. It follows that the appeal
must succeed.’
The minority similarly found that the employee had not
established the terms of the contract, let alone a term in the
contract entitling
him to a hearing.
[50] Over and above this however Jafta JA
also referred to
Gumbi
and said the following:
‘
Before the decision of this court in
Gumbi
the
right to a pre-dismissal hearing was not implied at common law and
this necessitated the development of the common law in terms
of
section 39(2) of the Constitution. As from the date of the delivery
of the judgment in
Gumbi
the right of every employee to a
pre-dismissal hearing is implied at common law. Since that judgment
was delivered after the cause
of action had arisen in the present
matter reliance [by the court below] on
Gumbi
was misplaced.’
[51] I have already pointed out that what
was said in
Gumbi
in
that regard was obiter and not an authoritative finding by this
court. Clearly it also played no role in the decision that was
arrived at in
Transman
and its repetition in that case takes the matter no further.
[52] Finally there is
Murray
v Minister of Defence
,
74
in which an officer in the South African Navy claimed damages for his
alleged constructive dismissal. It is important to bear in
mind that
employees in his position are expressly excluded from the operation
of the LRA.
75
He relied in support of his claim upon his right to ‘fair labour
practices’ accorded to him by s 23(1) of the Constitution. In
that
regard the judgment records that ‘the parties agreed that the
plaintiff was entitled to rely directly on this right, as also
the
right to dignity,
76
which is a close associate of the right to fair labour practices’.
The approach that Cameron JA took to the matter was expressed
as
follows:
‘
However, it is in my view best to understand the
impact of these rights through the constitutional development of the
common-law contract
of employment. This contract has always imposed
mutual obligations of confidence and trust between employer and
employee. Developed
as it must be to promote the spirit, purport and
objects of the Bill of Rights, the common law of employment must be
held to impose
on all employers a duty of fair dealing at all times
with their employees – even those the LRA does not cover.’
[53] I do not think it is necessary to
elaborate upon the implications for that case of that ‘obligation
of confidence and trust’
which is well-established in our law.
77
It is sufficient to say that it was held to import into the contract
of employment a term that
‘
the employer would not without reasonable and proper
cause conduct itself in a manner calculated and likely to destroy or
seriously
damage the relationship of confidence and trust with the
employee: breach of the term would amount to a contractual
repudiation justifying
the employee in resigning and claiming
compensation for dismissal.’
[54] I am not sure that the common law
required development in order to reach that conclusion,
78
but that is by the by. What is important to bear in mind is that the
effect of any extended duty of fair dealing must be worked out
in
individual cases in the light of the statutory provisions giving
effect to the constitutional guarantee of fair labour practices.
The
constitutional rights that were drawn upon in that case for importing
into the contract a term protecting the employee against
constructive
dismissal are given full effect in relation to employees falling
under the LRA by the definition of ‘dismissal’
in s 186(1).
79
Murray
seems to me to
be authority for no more than the proposition that an employee who is
not subject to the LRA enjoys the same right
as other employees not
to be constructively dismissed, whatever else might have been said en
passant. It is possible that there is
some need to develop the common
law by importing into the contract of such employees terms that give
effect to their right to fair
labour practices but that is not a
matter that need now concern us.
[55] I do not think that any of the cases I
have referred to can be said to have decided authoritatively that the
common law is to
be developed by importing into contracts of
employment generally rights flowing from the constitutional right to
fair labour practices.
It is uncontroversial that the LRA is intended
to give effect to that constitutional right and I see no present
call, certainly not
in this case, for the common law to be developed
so as to duplicate those rights (at least so far as it relates to
employees who
are subject to that Act). The obiter dictum in
Gumbi
,
which has been reiterated without elaboration, and without apparent
consideration of the matters that have been dealt with in this
judgment, cannot be considered to be authoritative.
[56] In my view the
interpretation given to the cases mentioned goes further than the
judgments warrant and they provide no obstacle
to the correctness of
the analysis set out above. That analysis concludes that, insofar as
employees who are subject to and protected
by the LRA are concerned,
their contracts are not subject to an implied term that they will not
be unfairly dismissed or subjected
to unfair labour practices. Those
are statutory rights for which statutory remedies have been provided
together with statutory mechanisms
for resolving disputes in regard
to those rights. The present is yet another case in which there is an
attempt to circumvent those
rights and to obtain, by reference to,
but not in reliance upon, the provisions of the LRA an advantage that
it does not confer.
It is precisely similar attempts that in my view
occasioned the recent jurisdictional debate in cases such as
Chirwa,
Makhanya and Gcaba.
80
[57] In both
Constitutional Court decisions concerns are expressed that the cases
before the Court involved attempts to circumvent
the LRA.
81
That seems to me to have been a correct perspective but the problem
is resolved once it is recognised that we are not concerned with
jurisdictional issues but with the substantive rights of the parties.
Thus in
Wolfaardt
the issue was the plaintiff’s entitlement
to the benefit of the full fixed term for which he had contracted.
In
Chirwa
and
Gcaba
it was whether the conduct
complained of constituted administrative action. All three claims
were advanced on a basis that placed
them within the jurisdiction of
the High Court, but in the latter two the claims were without merit
because they did not involve
administrative action.
[58] In the present
case the issue is whether Mr McKenzie’s contract contains a term
implied by law as pleaded by him. That is a
question within this
Court’s jurisdiction and in my view the answer is that it does not.
What creates difficulties is when the
merits of a claim are confused
with the jurisdiction to deal with it. Once it is shown that claims
such as the present one or those
in
Chirwa
and
Gcaba
are
without merit they will no longer be pursued in any court and one
suspects that the jurisdictional quagmire will prove to be nothing
more than a muddy puddle that should have been avoided had the
parties focussed on the merits of the claims rather than trying to
avoid them by way of jurisdictional challenges. In the present case
there was nothing wrong in Mr McKenzie pursuing his claim in
the High
Court. However, it is not a good claim and the only viable claim he
could have brought based on those allegations had to
be pursued, as
indeed it was, before the CCMA.
[59] That
conclusion suffices to justify a finding that the second of the
special pleas should have been upheld on the basis, not
that it
raised a question of jurisdiction, but on the footing that it placed
in dispute and required a decision on the merits of
Mr McKenzie’s
contention that his contract of employment was subject to a term that
it would not be terminated without just cause.
That contention is
without merit.
[60] For the sake
of completeness I should say that I do not find it necessary to refer
to all of the cases in the High Court and
Labour Court where the
issues canvassed at length in this judgment have been considered.
Some are in my view wrong for the reasons
I have given.
82
Others correctly recognise the difficulties that are identified in
this judgment in holding that contracts of employment are subject
to
implied terms derived from and embodying some, but not all, of the
provisions of the LRA.
83
It would cause an already lengthy judgment to assume unmanageable
proportions were I to deal with all of them. The extent to which
they
are in my view either correct or in error will I trust be apparent
from what appears above. In most of them the proper issues
have been
obscured by erroneously characterising the issue as one of
jurisdiction when in truth it has been something else entirely.
[61] I conclude
therefore that the claim ought to have been dismissed, on the basis
set out in paragraph 47 above, and that the
appeal must succeed.
The only remaining question is then that of the costs of this
litigation. It is true that the claim was unduly
ambitious and has
failed. Indeed in the course of argument Mr McKenzie’s attorney had
grave difficulty in defending it on the merits.
However it is plain
that there are those in the labour law community who might have
regarded it as sound and it found some superficial
support in
authority. The case is one falling in the employment arena and also
raises points of constitutional significance. In both
areas our
courts are reluctant to penalise an individual who unsuccessfully
seeks to vindicate rights having their foundation in
the Constitution
and employment laws giving effect to constitutional rights. SAMSA is,
if not an organ of state, at least a public
body fulfilling public
functions. In my view the fair order to make is that both parties
should be responsible for their own costs
both in this Court and
below. Mr McKenzie’s lack of success is then reflected in his
having to pay his own costs in the condonation
applications.
[62] Accordingly
the following order is made:
1. The late lodging
of the application for leave to appeal is condoned.
2. Leave to appeal
is granted.
3. The appeal is upheld and the order of the court below
is altered to read:
‘
The plaintiff’s claim is dismissed and both parties
are to pay their own costs.’
4. The parties will pay their own costs in this appeal
including the costs of the applications for condonation.
M J D WALLIS
ACTING JUDGE OF APPEAL
APPEARANCES:
FOR APPELLANT: B MALAN (attorney)
Instructed
by
MALAN INC, PRETORIA;
WEBBERS ATTORNEYS, BLOEMFONTEIN
FOR RESPONDENT: M. G. KHOZA SC (with M.J. RAMAEPADI)
Instructed by
DYASON INC, PRETORIA;
BOKWA ATTORNEYS, BLOEMFONTEIN.
1
We were informed from the Bar that the learned acting judge has
regrettably since died.
2
Act 59 of 1959.
3
Leave to appeal was refused on 26 November 2008. Whilst the
application for leave to appeal is dated 19 December 2008 it was
only
lodged with this Court on 15 January 2009, outside the period
of 21 days provided for in section 21(2) of Act 59 of 1959.
4
M
asuku and Another v State President
and Others
1994 (4) SA 374
(T) at
378J-379 (A);
Makhanya v University of Zululand
[2009]
ZASCA 69
para 29.
5
[2009] ZACC 26
;
[2009] 12 BLLR 1145
(CC). This in turn endorsed the
approach of this court in
Makhanya v University of Zululand,
above.
6
2009 (2) SA 628
(ECD) para 66.
7
Footnote 6,
supra
, para 93.
8
There is authority for this approach. Cheadle AJ said in
Booysen
v SAPS and another (
2009) 30 ILJ 301 (LC) para 37: ‘The right
to fair labour practices is given effect to by the LRA and other
labour legislation.
Apart from challenges to the constitutionality
or interpretation of that legislation or the development of the
common law where
there is no legislation, the right plays no other
role and does not constitute a separate source for a cause of
action.’
9
Fisheries Development Corporation of SA Ltd v
Jorgensen and another; Fisheries Development Corporation of SA Ltd v
AWJ Investments
(Pty) Ltd and others
1979
(3) SA 1331
(W) AT 1334D
;
De Polo v Dreyer
1990 (2) SA 290
(W) at 300G-H.
10
1974 (3) SA 506
(A) at 531D-532G.
11
The English law from which we have derived this test has recently
undergone some restatement in A
ttorney General of Belize and
others v Belize Telecom Ltd and another
[2009] UKPC 11
;
[2009] 2
All ER 1127
(PC).
12
Alfred McAlpine & Son (Pty) Ltd v Transvaal Provincial
Administration
1974 (3) SA 506
(A) at 532G-533C
; Delfs v
Kuehne & Nagel (Pty) Ltd
1990 (1) SA 822
(A) at 827B-828B;
Wilkins NO v Voges
[1994] ZASCA 53
;
1994 (3) SA 130
(A) at 136H-137D.
13
See the remarks of Jenkinson J in
Gregory v Philip Morris Ltd
(1988) 80 ALR 455
at 459 and the judgment of McHugh J and Gummow
J in
Byrne v Australian Airlines Ltd
[1995] HCA 24
;
185 CLR 410
at 443 to
446.
14
The Truck Act 1831; Truck Amendment Act 1887 and the Truck Act
1896.
15
Now embodied in
section 32(1)
of the
Basic Conditions of Employment
Act 75 of 1997
. Hereafter the BCEA
16
Section 34
of the BCEA.
17
Under the
Occupational Health and Safety Act 85 of 1993
.
18
Under the Compensation for Occupational Injuries and Diseases Act
130 of 1993
19
R v Canqan and others
1956 (3) SA
366
(E) at 367H-368A;
National Automobile and Allied Workers
Union (now known as National Union of Metalworkers of South Africa)
v Borg-Warner SA (Pty)
Ltd
1994 (3) SA 15
(A) at 23B-D.
20
Ritch and Bhyat v Union Government (Minister of Justice)
1912
AD 719
at 734-5;
South African Co-operative Citrus Exchange Ltd v
Director-General: Trade and Industry
and another
[1997] ZASCA 6
;
1997 (3)
SA 236
(SCA) at 242H-243D and 244D-E.
21
The right to an interdict is generally recognised.
Madrassa
Anjuman Islamia v Johannesburg Municipality
1917 AD 718.
22
Coetzee v Fick and another
1926 T.P.D. 213
at 216 approved in
Da Silva and another v Coutinho
1971 (3) SA 123
(A) at 135.
23
Callinicos v Burman
1963 (1) SA 489
(A) at 497H - 498A
24
Olitzki Property Holdings v State Tender Board
and another
2001 (3) SA 1247
(SCA)
para 12.;
Steenkamp NO v Provincial
Tender Board, Eastern Cape
2007 (3) SA
121
(CC) para 40.
25
Sir Otto Kahn-Freund, ‘A Note on Status and Contract in British
Labour Law’ (1967) 30
Mod LR
635 at 641. The note concerns
the enforceability of collective agreements an issue dealt with in
this country in section 23 of
the LRA.
26
As in South African law is the case with statutory rights that
cannot be waived. See footnote 20 above.
27
Lord Wedderburn,
Labour Law and Freedom: Further Essays in Labour
Law
(1995) 212
et seq
. This is the position achieved in
South Africa by section 23(3) of the LRA.
28
Professor of Employment Law in the University of Oxford and one of
the world’s foremost scholars in this field.
29
Mark Freedland,
The Personal Employment Contract
(2003) 120.
30
Hugh Collins,
The Law of Contract
, 3ed, 233-235.
31
At the time of its enactment it was section 27 of the Interim
Constitution.
32
Fedlife Assurance Limited v Wolfaardt
2002 (1) SA 49
(SCA)
para2.
33
Section 191 of the LRA.
34
Section 193 of the LRA.
35
Section 194(1) of the LRA.
36
The progenitor of the approach was Sir Otto Kahn-Freund in
The
System of Industrial Relations in Great Britain
(1954) ed
Flanders and Clegg. It was accepted as correct by the Donovan
Commission in its report (Cmd 3623) and was held to be a
correct
reflection of the law in
Ford Motor Company v Amalgamated Union
of Engineering and Foundry Workers
[1969] 2 All ER 481.
Halsbury’s Laws of England, 5
th
ed (Mackay), Vol 39,
para 91footnotes 3 and 4.
37
Consolidated Frame Cotton Corporation Limited v Minster of
Manpower
1985 (1) SA 191
(D) at 198H-I and (on appeal)
1985 (1)
SA 200
(N) at 205G-H.
38
Halsbury,
op cit
, para 91, Lord Wedderburn,
The Worker and
the Law
, 3 ed, 329-343; M J D Wallis,
Labour and Employment
Law, (loose-leaf, Issue 5) para 44.
39
Act 75 of 1997.
40
Examples of such statutorily imposed terms in the context of
employment are given in Halsbury’s Laws of England, 5
th
ed (Mackay), Vol 39, para 89,fn1.
41
Arising from sections 43 and 46 of the Labour Relations Act 28 of
1956.
42
Ingledew v Financial Services Board: In re Financial Services
Board v Van der Merwe and another
[2003] ZACC 8
;
2003 (4) SA 584
(CC);
Minister
of Health and another NO v New Clicks South Africa (Pty) Ltd and
others (Treatment Action Campaign and another as Amici
Curiae)
2006
(2) SA 311
(CC) paras 433 to 437;
SA National Defence Union v
Minister of Defence and others
[2007] ZACC 10
;
2007 (5)
SA 400
(CC) paras 51 and 52;
MEC for Education, KwaZulu-Natal,
and others v Pillay
[2007] ZACC 21
;
2008 (1) SA 474
(CC) para
40.
43
[1995] HCA 24
;
185 CLR 410.
44
Para 11 at 421.
45
[2001] UKHL 13
;
[2001] 2 All ER 801
(HL). Lord Steyn dissented in
that case and suggested that it should be reconsidered in
Eastwood
v Magnox Electrical plc
[2004] UKHL 35
;
[2004] 3 All ER 991
(HL), but his appears to be a lone voice.
46
It must be born in mind that in English law the approach of courts
to the implication of terms in contracts of employment may not
proceed in quite the same way as with the implication of terms in
other contracts. Halsbury,
supra
, para 90
47
In para [43] relying on the minority judgment of
McLachlin J (as she then was) in
Wallace v
United Grain Growers Ltd
(1997) 152 DLR
(4
th
) 1 paras 135
to 146;
[1997] 3 S.C.R. 701
;
1997
CanLII 332
(S.C.C.). However in that case
Iacobucci
J, speaking for the majority rejected such an implied term and said:
‘In the context of the accepted theories on the
employment
relationship, such a law would, in my opinion, be overly intrusive
and inconsistent with established principles of employment
law, and
more appropriately, should be left to legislative enactment rather
than judicial pronouncement.’
48
Per Skweyiya J in
Chirwa v Transnet Ltd and Others
[2007]
ZACC 23
;
2008 (4) SA 367
(CC). See also
Jooste v Score
Supermarket Trading (Pty) Ltd (Minister of Labour Intervening)
1999
(2) SA 1
(CC) paras16 to 18.
49
Tamara Cohen ‘Implying Fairness into the Employment Contract’
(2009) 30
ILJ
2271.
50
John Grogan ‘Re-interpreting Chirwa: New Twist in the
jurisdictional debate’
Employment Law
Vol 25(5) 4.
51
Page 2294.
52
Section 23.
53
Section 39.
54
Paul Pretorius SC and Anton Myburgh ‘A Dual System of Dismissal
Law: Comment on Boxer Superstores Mthatha & another v Mbenya
(2007) 28
ILJ
2209 (SCA)’ (2007) 28
ILJ
2172 at 2174
and 2176.
55
Darcy du Toit ‘Oil on Troubled Waters? The Slippery Interface
between the Contract of Employment and Statutory Labour Law’
(2008) 125
SALJ
95
at 96-7.
56
(2009) 30
ILJ
622 (LC).
57
Current Labour Law 2008
at 181. Ms Cohen correctly says that
this is a valid criticism. Professor du Toit, op cit fn 6 echoes it.
58
2007 (5) SA 552
(SCA).
59
2007 (5) SA 450
(SCA).
60
Para 12.
61
Para 15.
62
1967 (2) SA 131
(W).
63
I think it is clear that when referring to an
implied term of the contract the learned judge was referring to a
tacit term as explained
in
Alfred McAlpine & Son (Pty)
Ltd v Transvaal Provincial Administration
,
above.
64
‘
In cases such as the present,
[my emphasis] the parties may opt for certainty and incorporate the
right in the employment agreement.’
65
2004 (4) SA 481
(SCA).
66
Para 9.
67
Slagment (Pty) Ltd v Building, Construction and Allied Workers'
Union and Others
1995 (1) SA 742
(A).
68
Para 8.
69
Para 6.
70
Paras 9 and 10.
71
2009 (4) SA 22
(SCA).
72
Para 19.
73
Para 31.
74
2009 (3) SA 130
SCA).
75
Section 2 of the LRA provides that it does not
apply to members of the National Defence Force.
76
Section 10 of the Constitution.
77
Council for Scientific and Industrial Research v Fijen
1996
(2) SA 1
(A) at 9H-J; Wallis,
Labour and Employment Law
,
supra
, paras 20 and 25.
78
See for example,
Groenewald
v Cradock Munisipaliteit
1980 (4) SA
217
(E), cited by Cameron JA in para 10.
79
‘Dismissal’ is defined to mean, amongst other
things, ‘that an employee terminated a contract of employment with
or without
notice because the employer made continued employment
intolerable for the employee’.
80
Footnotes 48 and 5 above.
81
Paras 41 (per Skweyiya J) and 104-112 and 124 (per Ngcobo J) in
Chirwa
and paras 32 and 56 of
Gcaba.
82
For example
Key Delta v Marriner
[1998] 6 BLLR 647
(E).
83
Mohlaka v Minister of Finance & others
(2009) 30 ILJ 622
(LC);
[2009] 4 BLLR 348
(LC) although the remark in para 17 is
incorrect and inconsistent with my conclusion in this case.