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[2011] ZASCA 57
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Confederation of South African Workers Union (CONSAWU) v Nedlac and Others (289/10) [2011] ZASCA 57; [2011] 3 All SA 497 (SCA); [2011] 10 BLLR 929 (SCA); (2011) 32 ILJ 1831 (SCA) (31 March 2011)
Links to summary
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case
No: 289/10
In
the matter between:
CONFEDERATION
OF SOUTH AFRICAN
WORKERS’
UNIONS (CONSAWU)
........................................................
Appellant
and
NEDLAC
..........................................................................................
First
Respondent
THE
MINISTER OF LABOUR
.................................................
Second
Respondent
COSATU
.........................................................................................
Third
Respondent
NACTU
.........................................................................................
Fourth
Respondent
FEDUSA
...........................................................................................
Fifth
Respondent
BUSINESS
SOUTH AFRICA
........................................................
Sixth
Respondent
Neutral
citation:
CONSAWU v Nedlac
(289/10)
[2011] ZASCA 57
(31 MARCH 2011)
Coram:
STREICHER, NUGENT, SNYDERS, BOSIELO and MAJIEDT JJA
Heard:
24 FEBRUARY 2011
Delivered:
31 MARCH 2011
Summary:
Labour Law – National Economic Development and Labour
Council – validity of clauses 9.3 to 9.6 of its constitution –
meaning of ‘to provide for’ in
section 4(d)
of the
National Economic Development and Labour Council Act, 35 of 1994
.
_____________________________________________________________________
ORDER
_____________________________________________________________________
On appeal from: North Gauteng
High Court, Pretoria (Msimeki J sitting as court of first instance)
The appeal is dismissed with
costs that include the costs of two counsel.
_____________________________________________________________________
JUDGMENT
_____________________________________________________________________
NUGENT and MAJIEDT JJA (SNYDERS
and BOSIELO JJA concurring)
[1] The National Economic
Development and Labour Council – NEDLAC – serves as a
forum for various constituencies to
find consensus on matters of
economic and labour policy. The principal constituencies are
business, labour and the state. Business
is represented by Business
Unity South Africa – a federation of employer and business
organisations. Three trade union federations
– Cosatu, Nactu
and Fedusa – represent labour (we will refer to them as the
founding federations).
[2] The Confederation of South
African Workers’ Unions (CONSAWU) applied to NEDLAC to gain
entry to its ranks but its application
was declined. CONSAWU applied
to the North Gauteng High Court for relief that we come to presently.
The application was dismissed
by Msimeki J and CONSAWU now appeals
with the leave of that court.
[3] The application cited NEDLAC,
the Minister of Labour, Business Unity South Africa, and the founding
federations as respondents.
At that stage CONSAWU claimed
declarations directed to the constitutional validity of the Act and
to the validity of parts of NEDLAC’s
constitution. NEDLAC and
the Minister opposed the application. When CONSAWU later withdrew its
claims directed at the constitutional
validity of the Act the
Minister ceased to have an interest in the matter and CONSAWU
withdrew the application so far as it concerned
the Minister. The
founding federations did not oppose the application, no doubt because
they associated themselves with NEDLAC’s
opposition. Business
Unity South Africa also did not oppose the application. In an
affidavit that was filed on its behalf later
in the proceedings it
explained that it had not opposed because the relief that was then
sought did not affect it directly. Only
CONSAWU and NEDLAC are thus
parties to this appeal.
[4] The
National Economic Development and Labour Council Act 35 of 1994
purports
1
to establish
NEDLAC as a juristic body having a constitution that would be adopted
at an ‘inaugural meeting’. The meeting
was to be convened
by the Minister of Labour. Present at that meeting were to be
representatives of the employer and employee interests
that were then
represented on the National Manpower Commission
2
(which would
then cease to exist) and the National Economic Forum, representatives
of the state, and representatives of community
and development
interests. Their duty at the meeting was, amongst other things, to
‘adopt a constitution for [NEDLAC]’.
3
The meeting
was duly held and a constitution was adopted.
[5] In keeping with the
provisions of the Act the constitution structured NEDLAC as a
corporate body that would have an executive
council (which would be
its governing body) and four chambers (each having a specialized
function). The members of NEDLAC would
be representatives of each of
four constituencies – organised business, organised labour, the
state, and organisations of
community and development interests –
nominated by the constituency concerned and appointed by the Minister
to the executive
council and the four chambers. The executive council
would comprise an equal number of representatives (not exceeding 18)
nominated
by each of the constituencies. The chambers would each
comprise an equal number of representatives (not exceeding six)
nominated
by organised business, organised labour and the state, and
such number of representatives of community and development interests
as the executive council would determine. As it turns out, those last
interests are represented on only one of the chambers. For
convenience we deal hereafter with only two of the constituencies –
organised business and organised labour.
[6] Business
was represented at the inaugural meeting by Business South Africa.
4
Its
representatives became the initial members of the business
constituency on the various structures of NEDLAC. Labour was
represented
at the meeting by the founding federations.
5
Representatives
of each federation, in proportion to their respective paid-up
membership, became the initial members representing
organised labour.
[7] Clauses 9.3 – 9.6 deal
with entry to membership of NEDLAC after the inaugural meeting. They
provide as follows:
‘
9.3
Applications for admission to membership by organised business,
organised labour and the State after the inaugural meeting shall
be
made to the secretariat, in writing, in the form required by the
executive council. Such applications shall be considered according
to
the process outlined in 9.4 – 9.6 below.
9.4 The secretariat
on receiving such an application, shall submit such application to
the convenor of the affected constituency
on the executive council.
9.5 The convenor
shall, within one (1) month of receipt of an application from the
secretariat, convene a meeting within the affected
constituency to
consider the application. This shall be done in terms of the
procedures and criteria determined by each constituency.
9.6 In the event
that members of the affected constituency decide to approve a
nomination, then that nomination shall be forwarded
to the Minister
who shall appoint the representatives to the executive council and/or
chambers.’
[8] It is apparent from the
culmination of the process described by those clauses that clause 9.3
contemplates applications being
made to NEDLAC for approval of
nominations for appointment to membership of the various structures
of NEDLAC. Once such an application
is made it must be referred by
NEDLAC to the convenor of the constituency concerned. A meeting of
the constituency will then be
called to consider the application. The
application will then be considered in accordance with procedures and
criteria that the
constituency has determined for deciding such
applications (clause 9.5). Thus the effect of clause 9.5 is to
appoint each constituency
as the gate-keeper to the appointment of
members to represent that constituency on the structures of NEDLAC.
At present Business
Unity South Africa is the gate-keeper for
organised business and for organised labour the gate-keepers are the
founding federations.
The dispute in this matter centres on that
clause because the founding federations closed the gate to CONSAWU.
[9] In August 2003 CONSAWU wrote
a letter to the Executive Director of NEDLAC in which it made
‘application for membership
of NEDLAC’. We have pointed
out that the members of NEDLAC are representatives of the various
organisations and not the organisations
themselves so in that respect
the language was not strictly correct but that is of no consequence.
The application was referred
to the convenor of the labour
constituency in accordance with clause 9.4 and further information
was sought from CONSAWU.
[10] In July
2004 the convenor of the labour constituency replied to CONSAWU. He
told CONSAWU that the ‘criteria that had
been developed by the
founding federations to the labour caucus’ for ‘membership
of the organized labour constituency’
was that a federation
should represent at least 300 000 employed workers. It said that
on the information that CONSAWU had
provided it represented only
226 148 employed workers. That fell below the established
threshold and on that basis, it was
told, its ‘application for
membership’ was declined.
6
Correspondence
ensued that culminated in a letter from CONSAWU’s attorneys
advising that CONSAWU ‘had no option but
to turn to the Court
for the necessary relief.’ It then brought the application that
is the subject of this appeal.
[11] There has been some
vacillation by CONSAWU as to the nature of its case. The case that it
first advanced in its founding affidavit
was amended in the course of
the proceedings so substantially as to constitute a new case
altogether. We nonetheless find it necessary
to deal briefly with the
case that it first advanced.
[12] On the
case as it was first advanced it was not in issue that the Act
requires each constituency to set the criteria for entry
to
membership of that constituency on NEDLAC. That was precisely
CONSAWU’s complaint. It said that because the Act required
each
constituency to determine its own criteria for entry to NEDLAC it
offended various provisions of the Bill of Rights and it
sought
declarations to that effect.
7
[13] That case was later
abandoned. New relief was claimed in an amendment to the notice of
motion that withdrew all the claims
that had been made and
substituted them with altogether different claims. The constitutional
validity of the Act was no longer
placed in issue and CONSAWU
withdrew its application against the Minister. CONSAWU filed what it
called a ‘supplementary’
founding affidavit in support of
the new relief that was sought. That is the case that is now before
us.
[14] The case that CONSAWU now
advances is quite the opposite of the case that it initially
advanced. Far from the Act requiring
each constituency to be its own
gate-keeper for entry to NEDLAC – which is what CONSAWU said
initially – it now says
that the Act prohibits it. The
prohibition is said to be found in
s 4(b)
and
s 4
(d) of the
Act and it claimed an order declaring clause 9 to be in conflict with
those sections. It also claimed an order that NEDLAC
‘effects
compliance with the provisions of
section 4(b)
and
section 4(d)
of
the Act’ within a stipulated time. Significantly, it did not
specify what will constitute compliance.
[15] Its case
is founded upon two submissions that are advanced, it seems, to
buttress one another. We turn to those arguments presently
but for
the moment it is convenient to summarise what its case comes down to.
CONSAWU says that the Act does not permit a constituency
to be the
gate-keeper to its own constituency on NEDLAC. What the Act requires
is that the criteria for entry to each constituency
must be stated
expressly in the constitution with the consequence that they must be
determined by NEDLAC itself. By that it hopes
to escape being
beholden to the founding federations and to be able to appeal to the
other constituencies on NEDLAC.
8
[16] That
turnabout in its stance, says the General Secretary of CONSAWU in his
supplementary affidavit, was brought about by advice
that it received
from counsel who had replaced its earlier counsel.
9
Although it is
placed at the door of the ingenuity of counsel we still find it
remarkable that a substantial labour federation should
be so fickle
on such a fundamental feature of the institution that it wishes to
join.
[17] Nonetheless, that led to
considerable debate before us as to whether the Act indeed requires
NEDLAC itself to determine who
might or might not be admitted to
represent a constituency, or whether it is competent for that to be
decided by the constituency
itself. In our view one needs only to
know the nature of NEDLAC as it is described in the affidavits that
it filed to know that
the arguments advanced by CONSAWU cannot be
correct.
[18] NEDLAC is not a forum for
settling wages and conditions of employment, in which employers and
employees might each wish to
confront a friendly face. We pointed out
earlier that NEDLAC serves as a forum for attempting to reach
tripartite consensus on
national economic and labour policy. The
interest that each constituency has in the composition of the other
in those circumstances
is only to ensure that it properly represents
the most influential voice that has been chosen by that other
constituency. It is
naturally not for one constituency to decide for
the other which voice that might be. To leave out in the cold a voice
that any
particular constituency has chosen would undermine what
NEDLAC is all about. There would be no point at all in one
constituency
talking to a voice of its own choosing. Nor would there
be any point in talking to organisations which have such disparate
interests
that they are bickering amongst themselves. If that were to
occur then the constituencies might just as well each be talking to
themselves. The interest of each lies in confronting the most
influential and cohesive voice of the other and that must necessarily
be one that has been chosen by the particular constituency.
[19] NEDLAC
and all its founders – Business Unity South Africa,
10
the founding
federations, and the state – have made it perfectly clear on
the papers before us that that was the principle
upon which they
founded NEDLAC. Indeed, the ministry that was responsible for the Act
entered this case at the outset to defend
the constitutionality of
that principle when its presence in the Act was attacked. We would
require considerable persuasion that
although all those responsible
for founding NEDLAC were of one view parliament enacted the
legislation with something else in mind.
But CONSAWU says that
parliament indeed had something else in mind and we turn to the
grounds upon which it says that.
[20] We have pointed out that the
Act called upon the representatives of the constituencies at what was
called the ‘inaugural
meeting’ to adopt a constitution
for NEDLAC.
Section 4
required the constitution that they were to
adopt to ‘provide for’ various things. The two
subsections that are now
in issue required it to provide for the
following:
‘
(b)
the manner in which organized labour may nominate persons for
appointment as members and the manner in which members may be
removed.
(d) the criteria by
which and manner in which organized labour shall admit federations of
trade unions.’
[21] So far as
organised business is concerned those subsections are replicated in
ss 4(a)
and
4
(c). It was because of the impact that the case
might have on those equivalent provisions that an affidavit was filed
on behalf
of Business Unity South Africa in which it aligned itself
with what NEDLAC had said.
11
We deal
hereafter only with the provisions so far as they relate to organised
labour but it applies as much to organised business.
[22] CONSAWU’s
case rests on two submissions. For its first submission it refers us
to the definition of organised labour
in the Act, which means the
founding federations and ‘any association that is admitted
thereafter’
12
It says that
s 4(d)
requires the constitution to provide for the manner in
which and the criteria by which trade union federations are to be
admitted
to ‘organised labour’. It says that
s 4(b)
,
on the other hand, requires the constitution to provide also for the
manner in which organised labour may nominate persons for
appointment
as members of NEDLAC. It says that clause 9 of the constitution deals
only with the manner in which organised labour
may nominate persons
for membership of NEDLAC. It does not provide for the manner in which
and criteria by which federations might
be admitted to ‘organised
labour’ and in that respect it is deficient.
[23] Its case is sought to be
buttressed by its second submission. That submission, as we
understand it, is that the effect of
s 4(d)
is to empower NEDLAC
to set the criteria for admission to ‘organised labour’.
By providing in clause 9.5 that those
criteria are to be determined
by the labour constituency NEDLAC has unlawfully delegated its
authority.
[24] When those two submissions
are taken together the case that emerges comes down to this: CONSAWU
says that NEDLAC must state
in the constitution itself what the
criteria are for admission of a federation to ‘organised
labour’ so as to comply
with
s 4(d).
It may not permit
those criteria to be set by the constituency itself – as it has
purported to do in clause 9.5 – because
that would be an
unlawful delegation of its power to determine those criteria.
Needless to say, the second submission contradicts
the first and we
deal with it immediately.
[25] The
second submission rests on the supposition that clause 4(d) confers
power on NEDLAC to determine the criteria for admission
to ‘organised
labour’ and that is not correct. The section does not purport
to confer any powers on NEDLAC at all.
Indeed, we have considerable
doubt that NEDLAC even existed until the constitution was adopted.
13
Clause 4(d)
does no more than to require that the constitution that was to be
adopted must make provision for the relevant criteria.
So far as
clause 9.5 empowers the labour constituency to set those criteria the
labour constituency is not exercising delegated
powers when it does
so. It is exercising original powers that emanate from the
constitution. The submission has no merit but it
sows the seed for
the destruction of the other submission.
[26] The submission that we have
disposed of correctly identifies the criteria that are referred to in
clause 9.5 as being the criteria
that are required to be provided for
by
s 4(d).
The very foundation of that submission was that
clause 9.5 purports to delegate to the labour constituency the power
to set the
criteria referred to in
s 4(d).
If that is so it is
difficult to see how the first submission can be sustained. CONSAWU’s
argument becomes then no more than
a matter of form so far as it says
that the criteria themselves must be stated in the constitution.
Whether the criteria are to
be found in the constitution itself, or
whether they are to be found in the minute book of the constituency,
is a question of where
they are located and not whether they have
been provided for. Quite clearly they have been provided for. It was
precisely because
they have been provided for that CONSAWU found
itself being stopped at the gate.
[27] The fallacy in the
submission lies in its argument that clause 9.5 provides only for the
manner in which representatives for
membership of NEDLAC are
nominated, and does not deal with the manner in which and criteria by
which new federations might become
included in ‘organised
labour’. ‘Organised labour’ is not a corporate
entity or organisation of some kind
to which one might apply for
membership. The definition is merely descriptive of the group of
federations that are represented
on NEDLAC. Representation on NEDLAC
and inclusion amongst that group go hand in hand.
[28] It is true that clause 9
provides the process by which nominations are made for membership of
NEDLAC. Whatever one might make
of clause 9.3, which initiates the
process, its culmination in nominations being approved or rejected
makes it clear that that
is so. But in order to have its
representative appointed to NEDLAC the nominator must obviously be an
organisation that is entitled
to representation. The process of
deciding whether a nomination should be approved necessarily calls
for the decision-maker to
determine whether the nominator qualifies.
If the nominator does qualify, and its nomination is approved, then
by that fact alone
the nominator becomes included in the group that
is described as ‘organised labour’. To suggest that two
distinct processes
must be provided for and that both decisions may
not be made in the course of a single process is pedantry.
[29] The hurdle that was put up
to that construction of clause 9 was that clause 9.3 contemplates
applications being made by ‘organised
labour’. It was
argued that that means only federations that are already included
amongst ‘organised labour’.
On that construction clause
9.3 leaves no room for federations that are not yet included amongst
‘organised labour’
to make an application, which, so it
is argued, shows that the process is not one for admission to
‘organised labour’.
No doubt the logic is sound. But
where the broad scheme of the enterprise is clear we are not moved by
reliance upon what are clearly
a few inapt words here and there in a
document that is replete with imprecision. In our view the inclusion
of clause 9.5 places
it beyond dispute that the process incorporates
the requirements of both
s 4(b)
and s (4)(d).
[30] In our view both submissions
fail and the application was correctly dismissed. The appeal should
be dismissed with costs that
include the costs of two counsel.
___________________
R W NUGENT
JUDGE OF APPEAL
___________________
S A MAJIEDT
JUDGE OF APPEAL
STREICHER JA
:
[31] I disagree with my
colleagues Nugent and Majiedt JJA that the appeal should be
dismissed. In my view it should succeed.
[32] The Confederation of South
African Workers’ Unions (‘Consawu’), the appellant,
applied to the North Gauteng
High Court (Pretoria) for an order
declaring that the Constitution of the National Economic Development
and Labour Council (Nedlac),
the first respondent, does not comply
with the requirements of s 4(d) of the National Economic
Development and Labour Council
Act 35 of 1994 (the Act). The court
below dismissed the application but granted the appellant leave to
appeal to this court.
[33] Nedlac is a juristic person
established by the Act. It is governed by an executive council and in
addition consists of four
chambers namely the public finance and
monetary policy chamber, the trade and industry chamber, the labour
market chamber and the
development chamber (s 2). The council
consists of members who represent organised business, members who
represent organised
labour, members who represent organised community
interests and members who represent the State (s 3(1)). The
members representing
organised business and organised labour are
appointed by the Minister of Labour from persons nominated by the
relevant constituency
(s 3(2) and (3)). The members representing
the organised community interests are appointed by the Minister
without Portfolio
in the Office of the President and from persons
nominated by that constituency (s 3(4)) and the members
representing the State
are appointed by the President (s 3(6)).
[34] In terms of s 1 of the
Act ‘organised business’ means business represented by
those employer and business
associations and federations of such
associations that are the founding parties of Nedlac and any
association that is admitted
thereafter. ‘Organised labour’
means the federations of trade unions that are the founding parties
of Nedlac and any
association that is admitted thereafter. Cosatu,
Fedsal (now Fedusa) and Nactu, three federations of trade unions,
were founding
parties of Nedlac and, at present constitute ‘organised
labour’ as defined in the Act.
[35] From the aforegoing it is
clear that in terms of the Act there are four constituencies each of
which is represented on the
council. Membership of a constituency
should therefore not be equated with membership of the council.
Whereas membership of the
council is provided for in the Act
admission to a constituency is in terms of s 4(d) of the Act to
be provided for in the
constitution of Nedlac. The section reads:
‘Subject to the provisions of this Act, the constitution of the
Council shall
provide for … the criteria by which and manner
in which organised labour shall admit federations of trade unions’.
[36] Consawu applied for
admission to the labour constituency of Nedlac but was advised by Mr
Ebrahim Patel, the convenor of the
constituency, that its membership
did not meet the threshold of 300 000 members established by the
constituency. According
to the evidence presented by the respondents
the members of the labour constituency initially agreed on a
threshold of 200 000
members for admission to the constituency.
The threshold was subsequently increased, first to 250 000 and
thereafter to 300 000.
No minutes recording those increases
could be located. According to Patel discussions in the constituency
take place informally.
[37] Consawu did indeed not have
300 000 members. Nedlac contends that the threshold was
established in terms of clause 9(5)
of its constitution which, so it
submits, provides that admissions to a constituency should be done in
terms of criteria determined
by the relevant constituency. The
appellant on the other hand contends that clause 9(5) deals with
membership of the executive
council of Nedlac and not with membership
of the labour constituency. In the alternative the appellant contends
that, in so far
as it may be held that clause 9(5) deals with
admission to the labour constituency, it is contrary to s 4(d)
of the Act and
therefore invalid. In order to understand the
appellant’s submissions it is necessary to quote clauses 9.1 to
9.6 of the
Nedlac Constitution. The clauses read:
‘
9.
ADMISSION OF MEMBERS
9.1
The State, organised business and organised labour shall nominate not
more than 18 representatives as members of the executive
council and
not more than six representatives of each chamber.
9.2
Unless otherwise agreed within each constituency, representation at
the inaugural meeting shall be determined as follows:
9.2.1
for organised business, by Business South Africa;
9.2.2
for the State, by the President of the Republic of South Africa;
9.2.3
for organised labour, by proportional representation according to
paid-up membership of the founding trade union federations
–
Cosatu, Fedsal and Nactu;
9.2.4
for the organisations representing community and development
interests, by the Minister without portfolio in consultation
with
organised business, organised labour and the Minister.
9.3
Applications for admission to membership by organised business,
organised labour and the State after the inaugural meeting shall
be
made to the secretariat, in writing, in the form required by the
executive council. Such applications shall be considered according
to
the process outlined in 9.4 - 9.6 below.
9.4
the secretariat on receiving such an application, shall submit such
application to the convenor of the affected constituency
on the
executive council.
9.5
the convenor shall, within one (1) month of receipt of an application
from the secretariat, convene a meeting within the affected
constituency to consider the application. This shall be done in terms
of the procedures and criteria determined by each constituency.
9.6
In the event that members of the affected constituency decide to
approve a nomination, then that nomination shall be forwarded
to the
Minister who shall appoint the representatives to the executive
council and/or chambers.
…
.’
[38] Clause 9(1) prescribes what
number of representatives each of the organised business and
organised labour constituencies may
nominate to the executive council
and chambers. It does not deal with membership of the two
constituencies. Clause 9.2 deals with
the representation of the
various constituencies at the inaugural meeting of Nedlac and does
not deal with membership of the various
constituencies either.
Clauses 9.3 to 9.6 deal with the representation of the various
constituencies after the inaugural meeting
and does not deal with
membership of the various constituencies either. Clause 9.3 speaks of
‘[a]pplications for admission
to membership by organised
business, organised labour and the State after the inaugural
meeting’. Organised labour means
labour as represented by the
federations of trade unions that are the founding parties of Nedlac
and any federation admitted subsequently.
Applications by organised
business or organised labour for admission to membership can
therefore not be applications for membership
of the organised
business constituency or organised labour constituency, they can only
be applications for membership of the executive
council and chambers
of Nedlac. The applications are to be made to the secretariat of
Nedlac and are then to be dealt with in terms
of clauses 9.4 and 9.6.
The secretariat of Nedlac refers the applications to the relevant
constituency (cl 9.4) which is to
consider them in terms of the
procedures and criteria determined by each constituency (cl 9.5).
If approved the applications
culminate in nominations and
appointments to the executive council or one of the chambers of
Nedlac (cl 9.6). In other words,
in the case of organised
labour, Cosatu, Nactu and Fedusa being the founding members of Nedlac
and constituting organised labour
in terms of the Act, would submit
their applications for membership of the executive council and
chambers of Nedlac to the secretariat
of Nedlac. The secretariat will
refer the applications to the convenor of the labour constituency
whereupon the labour constituency
ie Cosatu, Nactu and Fedusa will
consider the applications in terms of the procedures and criteria
determined by the constituency
and will decide who should be
nominated. The agreed nominations are forwarded to the minister who
is obliged to appoint the nominees
as the representatives of
organised labour to the executive council and the chambers.
[39] Clauses 9.3 to 9.6 thus
interpreted, purport to give effect to s 4(b) of the Act which
provides that Nedlac’s constitution
‘shall provide . . .
for the manner in which organised labour may nominate persons for
appointment as members . . . .’
It does not give
effect to s 4(d) which deals with the admission of federations
of trade unions as members of organised labour
as defined in the Act.
[40] But, even if clause 9.5 of
the constitution is interpreted to deal with applications for
admission to the labour constituency
I am of the view, for the
reasons that follow, that it does not comply with s 4(d) of the
Act.
[41] Nedlac is a body created by
the legislature and is publicly funded (s 7(3)). The legislature
prescribed its objects, powers
and functions. One of the powers so
conferred on Nedlac is the power to adopt a constitution which
provides for the matters stated
in s 4 of the Act. One of the
matters that had to be provided for is ‘the criteria by which
and the manner in which
organised labour shall admit federations of
trade unions’ (s 4(d)). The legislature therefore
conferred on Nedlac the
power and the function to determine the
criteria for admission of federations of trade unions as members of
the labour constituency.
Nedlac purported to exercise that power and
perform that function by requiring the labour constituency itself to
determine the
criteria for admission. By doing so Nedlac delegated
the power conferred on it to the labour constituency. The question to
be decided
in this appeal is whether the legislature intended the
power and function conferred on Nedlac to be delegable.
[42] Having conferred authority
on Nedlac to determine the criteria for admission to the labour
constituency one must assume that,
unless there are indications to
the contrary, the legislature intended Nedlac and not someone else to
do so. Sir William Wade and
Christopher Forsyth
Administrative Law
9 ed (2004) p 317 say:
‘
There
is no general principle that administrative functions are delegable.
The principle is rather that, where any sort of decision
has to be
made, it must be made by the authority designated by Parliament and
by no one else.’
Lawrence Baxter
Administrative
Law
(1984) p 434 states:
‘
In
modern democracies original power derives from the political
authority of elected legislatures. Because of the practical
requirements
of government it is recognized that such bodies may
delegate their powers. In South Africa, Parliament is recognized to
have unlimited
powers of delegation. Considerable latitude is also
given to such “original” authorities as provincial
councils. But
all other administrative authorities are treated as
delegees
,
power having been delegated to them by the original authority. Not
being the direct repositories of public trust they are not
permitted
the same freedom to choose who shall exercise their powers. There is
a presumption that they may not further delegate
(ie sub-delegate)
their powers:
delegatus
non potest delegare
.’
In
Attorney-General, OFS v
Cyril Anderson Investments (Pty) Ltd
1965 (4) SA 628
(A) at
639C-D Botha JA said:
‘
The
maxim
delegatus
delegare non potest
is
based upon the assumption that, where the legislature has delegated
powers and functions to a subordinate authority, it intended
that
authority itself to exercise those powers and to perform those
functions, and not to delegate them to someone else, and that
the
power delegated does not therefore include the power to delegate. It
is not every delegation of delegated powers that is hit
by the maxim,
but only such delegations as are not, either expressly or by
necessary implication, authorised by the delegated powers.’
[43] There is no express
indication to be found in the Act that the legislature intended
Nedlac to have the power to authorise somebody
else to determine ‘the
criteria by which and the manner in which organised labour shall
admit federations of trade unions’
to the labour constituency.
In my view such power was not conferred on Nedlac by necessary
implication either.
[44] The object of the
legislature in creating Nedlac was to create a body consisting of
representatives of organised labour, organised
business, the State
and community organisations which could assist in the formulation of
a co-ordinated policy on social and economic
matters by inter alia
seeking to reach consensus and conclude agreements on matters
pertaining to social and economic policy, by
considering all proposed
labour legislation relating to labour market policy before it is
introduced in Parliament and by considering
all significant changes
to social and economic policy before they are implemented or
introduced in Parliament (s 5 of the
Act). In order to achieve
its object the various constituencies particularly business and
labour need to be adequately represented
in Nedlac. Not only will the
work of Nedlac be of very little value if the constituencies are not
adequately represented but it
is also unlikely that organised labour
will be interested in being represented on this body and in spending
time and effort in
trying to reach consensus with an unrepresentative
business constituency and vice versa.
[45] Each constituency has an
interest in the proper functioning of Nedlac and therefore has an
interest in the composition of Nedlac.
Nedlac itself submits that its
proper functioning requires that only the most representative
federations of organisations take
part in the negotiations. It
submits that it is impracticable to include in Nedlac’s process
a host of representative employee
or employer organisations. In these
circumstances it is unlikely that the legislature would have intended
to confer the authority
to determine the criteria for admission to
the labour constituency to someone other than Nedlac in which each
constituency is represented.
It is particularly unlikely that it
would have intended that the authority could be delegated to the
labour constituency. The legislature
no doubt considered the founding
parties of organised business and organised labour to be
substantially representative of their
respective constituencies. But
circumstances may change, other federations of trade unions and other
business associations may
be formed causing the existing members of
the relevant constituencies no longer to be adequately representative
of their constituencies
and making it desirable that new members be
admitted. However, although the admission of a new member to for
example the labour
constituency may be in the interests of the proper
functioning of Nedlac it may not be in the interests of the incumbent
members
of the constituency. The incumbent members of the labour
constituency may well consider it in their interests that they and
not
other trade union federations should speak on behalf of labour.
For these reasons they may be unduly reluctant to admit other trade
union federations to the detriment of the proper functioning of
Nedlac ie they may be influenced by their own interests as opposed
to
the interests of Nedlac in determining the criteria for admission to
the labour constituency. That trade unions are often in
competition
with one another and that a federation of trade unions may aspire to
be the only representative of workers is confirmed
by statements made
by Cosatu’s president and by Mr Ebrahim Patel, at the time the
convenor of the labour constituency at
Nedlac. In a keynote address
of the Cosatu president to Cosatu’s Central Committee in April
2003 he said: ‘Let me repeat
the call we have been making: in
the context of the challenges we face, the need to create one
federation in one country cannot
be over-emphasised.’ Mr Patel
stated in his answering affidavit: ‘It is an historical truism,
not only in South Africa
but elsewhere in the democratic world, that
trade unions are more often than not involved in a keenly competitive
relationship
with rival unions.’
[46] Nedlac submits that the
individual constituencies are best placed to appreciate what criteria
would ensure effective membership
in order to achieve the purposes of
the Act. It was also suggested that the legislature could not have
intended that business should
be able to prescribe to labour by whom
it should be represented and vice versa. It may be that the
individual constituencies are
best placed to appreciate what criteria
would ensure effective membership in order to achieve the purposes of
the Act but, as pointed
out above, there is a danger that they may be
influenced by self interest not to act in the best interest of
Nedlac. To require
Nedlac itself to determine the criteria for
admission to a particular constituency is also not to allow one
constituency to prescribe
to another by whom it should be
represented. First, representation on the council as opposed to
representation in the labour constituency
is decided upon by each
constituency and nobody else. The constituency nominates its
representatives and the minister concerned
is obliged to appoint the
nominees. Second, the criteria has to be provided for in the
constitution of Nedlac which requires the
agreement of all the
constituencies. The business constituency cannot force labour to
agree to criteria for admission that are
not acceptable to labour and
vice versa. Each constituency can use its superior knowledge,
assuming that it has such knowledge,
of what criteria would ensure
effective membership in order to achieve the purposes of the Act, to
persuade the other constituencies
to agree to what it considers to be
the appropriate criteria. The legislature had no reason to think that
the constituencies would
not be able to reach agreement and, in the
event, none of the other constituencies would seem to have a problem
with the criteria
determined by the labour constituency.
[47] It was further suggested
that the fact that the criteria determined by the labour constituency
would appear to be acceptable
to the other constituencies renders
this application academical. I do not agree. Should the appeal
succeed Nedlac would be compelled
to spell out in its constitution
what the criteria for admission to the labour constituency are and
the labour constituency will
be prevented from unilaterally adjusting
the criteria at informal meetings. The Nedlac constitution provides
that it may only be
amended by the executive council and that an
endorsement by two thirds of each of the constituencies is required.
[48] The court below and the
appellant rely on the decision in
Minister of Agriculture,
Economics and Marketing & another v Peyper
1964 (1) SA 206
(T) in support of the finding that the Nedlac constitution provides
for the criteria by which organised labour shall admit federations
of
trade unions. The Marketing Act 26 of 1937 provided for the
proclamation of schemes to control the marketing of certain
agricultural
products. Section 18(1)(e)
bis
provided that the
Scheme should ‘provide for the establishment of one or more
reserve funds . . ..’ The Milk Scheme
proclaimed in terms of
the Marketing Act provided that the board constituted in terms of the
Scheme should establish one or more
reserve funds into which shall be
paid certain amounts. It was submitted that this was not a power that
could be delegated to the
board. The court held that the Act required
the Scheme to make provision for the establishment of reserve funds
and that the Scheme
did so. In my view a reserve fund could only be
established through some agency such as the board. Provision for the
establishment
of a reserve fund therefore meant that an agency had to
be charged with the duty of establishing a reserve fund or funds.
That
is exactly what the Milk Scheme did. Providing for ‘the
criteria by which and the manner in which organised labour shall
admit federations of trade unions’ does not mean that an agency
has to be charged with the duty of determining the criteria.
In my
view it means and was intended by the legislature to mean that the
criteria have to be spelled out in the constitution. Other
matters
that ‘shall be provided for’ in the constitution are the
manner in which organised business and organised labour
may nominate
persons for appointment as members, the manner in which members may
be removed, ‘the appointment of alternates
to members’,
‘the appointment of
ex officio
members’, ‘the
removal of members’, ‘the appointment, removal, duties
and powers of the chairpersons . . .’,
‘the
establishment, composition, and functions of the executive council’,
‘the keeping of minutes’, ‘the
manner in which
decisions are taken’, ‘the amendment of the constitution’
etc. These are clearly all matters
that were required to be spelled
out in the constitution.
[49] Nedlac’s case is that
it would be inappropriate for anybody except the labour constituency
to determine the criteria
by which organised labour should admit
federations of trade unions. However, one should not lose sight of
the fact that in interpreting
the Act one is trying to give effect to
the intention of the legislature. If the legislature was of that view
it would not have
required the Nedlac constitution to provide for
such criteria it would simply have stated that organised labour
should determine
the criteria. The fact that it did not do so is in
my view a clear indication that the legislature was not of that view.
[50] For these reasons I am
satisfied that the legislature was not of the view that the Nedlac
constitution failed to provide for
‘the criteria by which
organised labour shall admit federations of trade unions’ and
that a provision in the constitution
that such criteria should be
determined by the labour constituency is not authorised by the Act.
[51] I would accordingly have
upheld the appeal and have granted the application.
_________________
P E STREICHER
JUDGE OF APPEAL
APPEARANCES:
For
appellant: M Khoza SC
Instructed
by:
Ramushu
Mashile Twala Inc, Johannesburg
Honey
Attorneys, Bloemfontein
For
respondent: K S Tip SC
N
H Maenetje
Instructed
by:
Cheadle
Thompson & Haysom, Johannesburg
Webbers,
Bloemfontein
1
The
Act seems to us to be conceptually flawed. The Act purports both to
create NEDLAC and to provide for its creation by the adoption
of a
constitution by its founding members. In that way NEDLAC purports to
come into existence by pulling itself up by its bootstraps.
Despite
its express language we think that the effect of the Act was not to
create NEDLAC but instead to decree that NEDLAC should
be created in
the manner and form provided for in the Act.
2
Established
by s 2A of the Labour Relations Act 28 of 1956.
3
Section
9(6).
4
NAFCOC
was later admitted and the two organisations subsequently
amalgamated to form Business Unity South Africa.
5
Fedusa
was then known as Fedsal.
6
The
convenor of the labour constituency said in the answering affidavit
filed on behalf of NEDLAC that the application was neither
granted
nor refused but placed on hold until such time as CONSAWU
demonstrated that it had the threshold membership.
7
A
subsidiary claim was advanced should its main claim fail but that is
not material.
8
Amendments
to the constitution are made by the executive council and require
the support of two thirds of each constituency represented
on the
executive council.
9
Who
is not necessarily counsel who argued the matter before us.
10
In
an affidavit that was filed by Business Unity South Africa when
CONSAWU altered its case it associated itself with what NEDLAC
had
said concerning the functioning of NEDLAC and in particular the
deponent confirmed ‘that it is an important feature
of the
composition of NEDLAC that each of the constituencies should itself
be able to determine the criteria for its membership
in order ...
that it should be in a position to participate effectively in the
business of NEDLAC’.
11
See
footnote 10.
12
“
Organised
labour” means the federations of trade unions that are the
founding parties of [NEDLAC] and any association that
is admitted
thereafter’.
13
See
footnote 1.