Shoprite Checkers (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2009 (3) SA 493 (SCA); [2009] 7 BLLR 619 (SCA); [2009] 3 All SA 466 (SCA); (2009) 30 ILJ 829 (SCA)) [2009] ZASCA 175; [2009] ZASCA 24 (27 March 2009)

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[2009] ZASCA 175
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Shoprite Checkers (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2009 (3) SA 493 (SCA); [2009] 7 BLLR 619 (SCA); [2009] 3 All SA 466 (SCA); (2009) 30 ILJ 829 (SCA)) [2009] ZASCA 175; [2009] ZASCA 24 (27 March 2009)
THE
SUPREME COURT OF APPEAL
REPUBLIC
OF SOUTH AFRICA
JUDGMENT
Case no: 315/08
SHOPRITE
CHECKERS (PTY) LTD
Appellant
and
COMMISSION
FOR CONCILIATION, MEDIATION AND
First
Respondent
ARBITRATION
COMMISSIONER
B MBHA NO
Second
Respondent
RETAIL
AND ALLIED WORKERS UNION
Third
Respondent
J
MAAKE
Fourth
Respondent
______________________________________________________________
Neutral citation:
Shoprite
v CCMA and others
(315/08)
[2008] ZASCA 24
(27 March 2009)
CORAM:
Navsa,
Jafta, Ponnan, Mlambo JJA and Leach AJA
HEARD:
6
March 2009
DELIVERED:
27
March 2009
CORRECTED:
SUMMARY: Review of CCMA award ─
standard ─ reasonableness ─ power of reviewing court ─
application of
s 145
of the
Labour Relations Act 66 of 1995
─
unacceptable delay in finalising labour matters.
______________________________________________________________
______________________________________________________________
ORDER
______________________________________________________________
On appeal from:
Labour
Court, Johannesburg (Zondo JP sitting as court of first instance).
1. The appeal is upheld and there is
no order as to costs.
2. The order of the LAC is substituted
as follows:
‘
(a) Both the appeal
and the cross-appeal are dismissed and each party is to pay its own
costs.
(b) The order of the
Labour Court is set aside and replaced with the following:
“
Both the review and
counter review applications are dismissed and there is to be no order
as to costs.” ‘
______________________________________________________________
JUDGMENT
______________________________________________________________
NAVSA
et
PONNAN JJA (Jafta, Mlambo
JJA and Leach AJA concurring):
[1] This is an appeal, with the leave
of this court, against a judgment of the Labour Appeal Court (the
LAC). Leave was granted
on the limited issue of the correctness of
the remedy afforded to Mr Jan Maake, the fourth respondent, which was
reinstatement
with retrospective effect to the time of dismissal.
[2] Regrettably, as will become
evident, this case has had a long and gruelling journey. Counsel for
the appellant urged us to give
due consideration to what he described
as systemic failures. We should all be concerned about the long
delays in finalising especially
labour matters. This is an aspect to
which we will revert later in this judgment.
[3] Mr Maake was employed by Shoprite
Checkers (Pty) Ltd (Shoprite), a national supermarket chain, in 1972.
At the material time,
he worked for Shoprite as a controller in its
delicatessen at its Silverton shop. Mr Maake’s problems leading to
the litigation
which culminated in the present appeal, started during
the last quarter of 2000 when, without authority, he consumed food
belonging
to Shoprite. The consumption of the food in the
delicatessen was captured on a surveillance camera and led to
disciplinary proceedings
against him during November 2000.
[4] At the disciplinary enquiry Mr
Maake was charged with three instances of misconduct, namely, of
eating (on three separate occasions)
Shoprite’s food without
authorisation, in areas where doing so was prohibited. It is common
cause that Shoprite’s rules prohibited
eating in most of the areas
in the store, including the delicatessen. He was found guilty on all
counts and his services were terminated
by Shoprite on 2 December
2000. By this time he had been employed by Shoprite for nearly 30
years.
[5] It is unchallenged that, at the
time of the commission of the offences by Mr Maake, shrinkage at
Shoprite’s Silverton store
was becoming an increasing problem. The
precise nature of the shrinkage is not known.
1
We do know that shrinkage at the store had increased from 1.5 per
cent to 4 per cent ─ the norm for such stores is 1.5 per cent.
This
led to the installation of cameras within the store, in an attempt to
identify those responsible for the shrinkage.
[6] It is undisputed that, during the
period 14 September 2000 – 21 October 2000, the camera
captured Mr Maake in the delicatessen
eating items of food. On at
least two occasions Mr Maake was consuming food that clearly belonged
to Shoprite. The video clips
show Mr Maake, on each occasion, taking
an item, first from a table and then off a plate, before consuming
it. Neither the nature
of the food, nor its value, was established.
[7] Mr Maake did not appeal his
dismissal internally.
[8] The Retail and Allied Workers
Union (RAWU), of which Mr Maake was a member, referred the matter, on
his behalf, to the Commission
for Conciliation, Mediation and
Arbitration (the CCMA) in terms of the Labour Relations Act 66 of
1995 (the LRA), initially for
conciliation and later for arbitration.
[9] On 3 April 2001, Commissioner
Mathee found that Shoprite had not acted substantively or
procedurally fairly and ordered Mr Maake’s
retrospective
reinstatement to the date of his dismissal.
[10] On 10 May 2001, Shoprite,
dissatisfied that it had to reinstate Mr Maake, launched a
review application in the Labour
Court in terms of s 145 of the
Act. The Labour Court (Waglay J) handed down its judgment and made
the following order on 10
May 2002:
‘
In the result I am
satisfied that [Ms Mathee] did in fact commit gross misconduct in
relation to her duties as arbitrator and the
award is therefore
liable to be reviewed and set aside.’
It took almost a year for this review
process to run its course.
[11] The matter was referred back to
the CCMA for arbitration afresh. The Commissioner involved in the new
arbitration was the second
respondent, Commissioner Mbha. Arbitration
commenced on 13 September 2002 and was finalised on 7 August
2003 ─ a period
of almost 11 months. The Commissioner found that Mr
Maake had breached the rule referred to above. He held, however, that
dismissal
was not peremptory. He considered, in relation to the
offence in question, that discipline in the workplace had to be
progressively
imposed. He took into account Mr Maake’s clean
long service record and in the totality of the circumstances held
that dismissal
was too harsh a sanction.
[12] Commissioner Mbha held that Mr
Maake should be given a ‘severe’ final written warning, valid for
six months. Shoprite was
ordered to reinstate Mr Maake. The
reinstatement would take effect from the date of the award and not
from the time of dismissal.
[13] That award was once again taken
on review by Shoprite in terms of s 145 of the Act. Shoprite, it
appears, was intent on
securing Mr Maake’s dismissal. It complained
that the Commissioner had failed to take into account that
reinstatement would set
a precedent amongst its other employees who
would, as a consequence, be left with the impression that
unauthorised consumption
attracted only the sanction of a written
warning. Shoprite contended that this would lead to inconsistency in
applying discipline
─ several people had already been dismissed for
the same offence. It was also submitted that reinstatement would mean
that Shoprite
would be required to continue employing dishonest
people.
[14] Mr Maake, in turn, launched a
counter application, challenging the finding that he was guilty of
misconduct and, in addition,
complained about the terms of his
reinstatement and the sanction imposed. During the disciplinary
proceedings Mr Maake had denied
that he was the person on the video
clips. During the arbitration proceedings however, Mr Maake
ultimately admitted that he was
that person. His case then was that
he had authority to taste food prepared in the delicatessen and was
therefore only doing his
job rather than being guilty of misconduct.
In his counter application he reverted to his earlier denial that he
was the person
who featured in the video clips consuming food. It is
safe to say that Mr Maake was not contrite.
[15] The second review application,
once again, came before Waglay J who encountered problems with the
record of the second arbitration.
His judgment reflects that there
was no transcript available. During the hearing before Waglay J, a
transcript of Commissioner
Mbha’s handwritten notes was provided
and the parties were agreed that they were a fair reflection of the
arbitration proceedings
and were prepared to have the matter decided
on that basis.
[16] On 13 August 2004, Waglay J,
probably to the distress of both parties, stated the following in his
judgment:
‘
In this matter having
regard to the summary of evidence I am satisfied that the decision of
[Commissioner Mbha] was not one open
to be reviewed. However, I am
mindful of the fact that there is discontent on the part of both
parties. Because of the unhappiness
compounded by the absence of a
proper record I believe that the best course to follow is to refer
the matter back…for [it] to
be arbitrated afresh before a
[different] Commisioner.’
Yet again, Waglay J ordered that the
matter be referred back to the CCMA for arbitration before a
different Commissioner. Like the
first, the second review had also
taken almost one year to be finalised.
[17] Shoprite, with the leave of the
Labour Court granted on 18 July 2005,
2
appealed that order to the LAC, contending, inter alia, that Waglay J
should have decided the matter on the transcript presented
to him. Mr
Maake and his union, both noted a cross-appeal, maintaining that a
reinstatement order retrospective to the time of
dismissal was
justified.
[18] The matter was heard by the LAC
on 15 September 2006, more than a year after leave was granted.
Judgment was handed down on
21 December 2007, more than 15
months later. Zondo JP, writing for a unanimous court, said the
following about the Labour
Court’s approach to the matter (set out
in para 16 above):
‘
If that order…was
given effect to, the new commissioner…would have been the third
commissioner and the parties and the witnesses
who had already
testified in the previous two arbitrations…would be called to
testify and those [who] had given evidence in the
disciplinary
hearing would have [been] subjected to cross-examination for the
fourth time on the same events.’
[19] The learned Judge-President went
on to record the following:
‘
The order of the
Labour Court in the second review application was issued on 13
th
August 2004. That would have been over three and a half years since
the fourth respondent’s dismissal. What would happen if some

important witnesses who had given evidence in the earlier two
arbitrations were, for some or other reason, no longer available
to
give evidence? What would happen if the unavailability of some or
other important witness who had testified in the earlier arbitrations

led to a result which could not have ensued if he had been available
and had given evidence? Of course, the result could well be
a
miscarriage of justice.’
[20] The LAC decided the appeal by
Shoprite and the cross-appeal by Mr Maake. It held that the
finding by Commissioner Mbha
that dismissal was not warranted was
unassailable. In respect of Mr Maake’s submission that a final
warning as a sanction was
unjustified, Zondo JP rightly disagreed.
[21] The LAC held that Commissioner
Mbha erred in not ordering retrospective reinstatement. It found that
denying Mr Maake the benefit
of reinstatement up to the time of
dismissal would, in the light of the sanction of a final warning, be
too punitive. The LAC took
into consideration the period of more than
two and a half years that had passed from the time of Mr Maake’s
dismissal up to the
time of Commissioner Mbha’s award and that he
had been without remuneration for that period. The LAC found that
Commissioner
Mbha’s failure to order retrospective reinstatement
was not justifiable, nor reasonable nor rational. In arriving at this
decision
the court took into account Mr Maake’s length of service,
his clean disciplinary record and the ‘indignity’ of the
preceding
two and a half years without income. Zondo JP accepted that
shrinkage was a problem for Shoprite but concluded that, in the
totality
of the circumstances, it was unreasonable to deny Mr Maake
the benefit of his salary for the period between his dismissal and
Commissioner
Mbha’s award.
[22] In the result, on 21 December
2007 the LAC made the following order:
‘
1. The appeal is
dismissed and the cross-appeal is upheld in part.
2. Each party is to pay
its own costs in regard to the appeal and cross-appeal.
3. The order of the
Labour Court is set aside and replaced with the following order:
“
(a) The review
application is dismissed.
(b) There is to be no
order as to costs.
(c) The counter-review
application is granted in part.
(d) The commissioner’s
decision not to make the operation of the order of reinstatement
retrospective to the date of dismissal
is hereby reviewed and set
aside.
(e) There is to be no
order as to costs.
(f) The commissioner’s
arbitration award is amended by the addition of the following order
thereto:
“(i) The order
reinstating the applicant is to operate with retrospective effect to
the date of the applicant’s dismissal.”
’
[23] It is against that order that
Shoprite sought leave to appeal from this court. In granting leave
this court stated:
‘
The appeal is limited
to the correctness or otherwise of the remedy that was allowed to [Mr
Maake].’
Put differently, the question is
whether the LAC ought to have substituted the award by Commissioner
Mbha in the terms set out in
the preceding paragraph.
[24] As was stated in
Sidumo
v Rustenburg Platinum Mines Ltd
2008 (2)
SA 24 (CC) para 55, the starting point in an enquiry such as the
present is the Constitution. Everyone – employees
and employers
alike – has a right to fair labour practices (s 23(1)). The primary
purpose of the
Labour Relations Act
('LRA') is to give effect to the
fundamental rights conferred by
s 23.
[25] In deciding how commissioners
should approach the task of determining the fairness of a dismissal,
it is important to bear
in mind that security of employment is a core
value of the Constitution which has been given effect to by the LRA.
3
Thus whilst the decision to dismiss belongs to the employer, the
determination of its fairness does not.
4
The statutory scheme requires a commissioner to determine whether a
disputed dismissal was fair.
[26] No appeal lies against a decision
of a commissioner. The only remedy available to a party in a matter
such as the present one
is to institute review proceedings in the
Labour Court. Section 158(1)(
g
)
confers on the Labour Court the power to review the performance or
purported performance of any function provided for in the LRA
on any
grounds that are permissible in law. That power, whilst fairly wide,
is subject to s 145, which to the extent here relevant,
provides:
'(1) Any party to a
dispute
who alleges a defect in any arbitration proceedings under the
auspices of the Commission may apply to the Labour Court for an order

setting aside the arbitration award –
(a) within six weeks of
the date that the award was
served
on the applicant, ...
. . .
(2) A defect referred to
in subsection (1), means –
(
a
) that
the commissioner–
(i) committed misconduct
in relation to the duties of the commissioner as an arbitrator;
(ii) committed a gross
irregularity in the conduct of the arbitration proceedings; or
(iii) exceeded the
commissioner's powers; or
(
b
) that
an award has been improperly obtained.'
The general powers of review of the
Labour Court under s 158(1)(
g
)
are therefore circumscribed by the provisions of s 145(2) which
prescribe the grounds upon which arbitral awards of CCMA
commissioners
may be reviewed. It follows that a party who wishes to
challenge an arbitral award under s 145(2) can only do so on one or
more
of the grounds envisaged in that section.
[27] Section 145 is now suffused by
the constitutional standard of reasonableness, the question to be
asked being: 'Is the decision
reached by the commissioner one that a
reasonable decision-maker could not reach?'
5
Applying that standard will give effect not only to the
constitutional right to fair labour practices, but also the right to
administrative
action which is lawful, reasonable and procedurally
fair.
6
[28] There may well be a fine line
between a review and an appeal, particularly where ─ as here ─
the standard of review almost
inevitably involves a consideration of
the merits. However, whilst at times it may be difficult to draw the
line, the distinction
must not be blurred.
7
The drafters of the LRA were clearly alive to the distinction. They
accordingly sought to introduce a cheap, accessible, quick
and
informal alternative dispute resolution process. In doing so, appeals
were specifically excluded. They said:
'In order for this
alternative process to be credible and legitimate and to achieve the
purposes of the legislation, it must be
cheap, accessible, quick and
informal. These are the characteristics of arbitration, whose
benefits over court adjudication have
been shown in a number of
international studies. The absence of an appeal from the arbitrator's
award speeds up the process and
frees it from the legalism that
accompanies appeal proceedings. It is tempting to provide for appeals
because dismissal is a very
serious matter, particularly given the
lack of prospects of alternative employment in the present economic
climate. However, this
temptation must be resisted as appeals lead to
records, lengthy proceedings, lawyers, legalism, inordinate delays
and high costs.
Appeals have a negative impact on reinstatement as a
remedy, they undermine the basic purpose of the legislation and they
make
the system too expensive for individuals and small business.
Without reinstatement as a primary remedy, the draft Bill's
prohibition
of strikes in support of dismissal disputes loses its
legitimacy.
Prior to the
establishment of the present LAC, it was argued that an appeal
structure would provide the consistency required to
develop coherent
guidelines on what constitutes acceptable industrial relations
practice. This has not been the case. The LAC's
judgments lack
consistency and have had little impact in ensuring consistency in
judgments of the industrial court. The draft Bill
now regulates
unfair dismissal in express and detailed terms and provides a Code of
Good Practice to be taken into account by adjudicators.
This will go
a long way towards generating a consistent jurisprudence concerning
unfair dismissal despite the absence of appeals.'
8
[29] Returning to the facts of this
case. In our view, the LAC appears in this particular instance to
have misconceived the nature
of its function. The LAC concluded that
Waglay J ought to have finalised the review application instead of
setting aside the arbitral
award and remitting the matter to the CCMA
for a hearing
de novo.
Ordinarily, in those circumstances the LAC ought itself to have
remitted the matter to the Labour Court for finalisation. It chose

instead to finalise the matter itself. Given the inordinate length of
time that had passed since the dismissal, one would hesitate
to
criticise the approach of the LAC.
[30] In following this approach
however, it effectively stepped into the shoes of the Labour Court
and was thus exercising, not
its traditional appeal powers, but
rather the fairly circumscribed s 145(2) review powers of the Labour
Court. Its warrant for
interference with the award of the arbitrator
was narrowly confined. Tellingly, Waglay J stated in his judgment
that [w]hen consideration
is given to the limited record, the
findings of the [arbitrator] cannot be faulted’. This ‘limited
record’ was ultimately
the record on which the matter was decided
by the LAC. Given the decision-making powers conferred upon the
arbitrator and having
regard to the reasoning of the commissioner, it
cannot be said that his conclusion was one that a reasonable
decision-maker could
not reach.
[31] Since the decision in
Sidumo
during the first half of 2008 numerous cases have been decided in
labour courts based on the reasonableness test formulated therein.
9
A multitude of arbitrations would no doubt have occurred from that
time, with commissioners discharging their duties and obligations
in
terms of the
Labour Relations Act in
the manner carefully and
comprehensively spelt out by the Constitutional Court in that
decision. Courts should strive to ensure
a cohesive and consistent
jurisprudence which promotes the rule of law. Workers and employers
alike are entitled to certainty in
the law as they strive to regulate
their relationship in an environment that is often prone to disquiet
and tension.
[32] There was, in any event, a
further limitation on the powers of interference by the LAC.
Section
193(1)(
a
)
provides that if the arbitrator finds that the dismissal is unfair,
he or she may order the employer to reinstate the employee
from any
date not earlier than the date of dismissal. Those words clearly
confer a discretion upon the arbitrator to order reinstatement
which
is not retrospective to the date of dismissal. The LAC in
NUMSA
v Fibre Flair CC t/a Kango Canopies
10
held that the test for
interference in a discretion exercised in terms of
s 193(1)(a)
is
that formulated in
Ex Parte
Neethling.
11
It has not been shown in
this matter that the arbitrator exercised his discretion capriciously
or upon a wrong principle or upon
any other ground justifying
interference.
[33] It is true that the systemic
failures referred to by Shoprite’s counsel made life difficult for
both parties. The delays
in no way serve to detract from the
correctness of Commissioner Mbha’s reasoning. Nor do they bring the
matter within the terms
of
s 145(2)
of the LRA. It remains eminently
reasonable. It should also be borne in mind that, by the time the
matter came before the LAC,
further systemic delays had impacted on
both employer and employee. The answer is to eliminate systemic
failure rather than punish
either employers or employees
unjustifiably. By interfering with the decision of the arbitrator,
the LAC was therefore in effect
substituting its discretion for that
of the arbitrator. That it was not permitted to do.
[34] It follows that the appeal should
succeed. Before concluding it is, however, necessary to deal with one
remaining aspect. It
is the question of the delays in finalising this
matter. It is necessary to record that neither Mr Maake nor the union
were represented
at the hearing of this appeal. Both filed notices to
abide the decision of this court. A period of more than eight years
has passed
since Mr Maake was dismissed. The entire scheme of the LRA
and its motivating philosophy are directed at cheap and easy access
to dispute resolution procedures and courts. Speed of result was its
clear intention. Labour matters invariably have serious implications

for both employers and employees. Dismissals affect the very survival
of workers. It is untenable that employees, whatever the
rights or
wrongs of their conduct, be put through the rigours, hardships and
uncertainties that accompany delays of the kind here
encountered. It
is equally unfair that employers bear the brunt of systemic failure.
The Registrar has been directed to serve this
judgment on the
Director of the CCMA. No doubt the LAC and the Labour Court will
address the issues referred to above.
[35] For all the reasons set out
above, the following order is made:
1. The appeal is upheld and there is
no order as to costs.
2. The order of the LAC is substituted
as follows:
‘
(a) Both the appeal
and the cross-appeal are dismissed and each party is to pay its own
costs.
(b) The order of the
Labour Court is set aside and replaced with the following:
“
Both the review and
counter review applications are dismissed and there is to be no order
as to costs.” ‘
_________________
M S NAVSA
JUDGE OF APPEAL
_________________
V M PONNAN
JUDGE OF APPEAL
APPEARANCES:
For
Appellant: A T Myburgh
Instructed
by
Perrott,
Van Niekerk, Woodhouse, Matyolo Inc Johannesburg
Lovius
Block Bloemfontein
For
Respondent: -
1
During arbitration proceedings Mr Jurie Kemp, who
was the store manager at the relevant time, testified that theft by
customers,
incorrect pricing of goods and pilferage by staff could
all be contributing factors. We do not know in which departments the

problem was most prevalent.
2
The application for leave to appeal was disposed
of 11 months after judgment.
3
Sidumo
para 72.
4
Sidumo
para 75.
5
Sidumo
para 110.
6
Sidumo
para 110.
7
Sidumo
paras 109
& 244.
8
Explanatory Memorandum (1995) 16
ILJ
278 at 318, as cited in
Sidumo
para 244.
9
In the
Industrial Law Journal
Vol
29 July 2008 Nicola Smit sets out the following list of cases
decided in 2008 which applied the test of the reasonable decision

maker:
Edcon
Ltd v Pillemer NO
(2008) 29
ILJ
614 (LAC),
Ster Kinekor Films (Pty) Ltd
v Maseko NO
[2008] JOL 21393
(LC),
Mkhwanazi v Moodley NO
(2008)
29
ILJ
1535 (LC),
Hulett Aluminium (Pty) Ltd v
Bargaining Council for the Metal Industry
(2008) 29
ILJ
1180
(LC)
[2007] ZALC 93
; ,
[2008] 3 BLLR 241
(LC),
Coca-Cola
Fortune (Pty) Ltd v CCMA (Sibiya)
[2008] JOL 21186
(LC),
Consol
Speciality Glass v NBC Cleaning Industry
[2008] JOL 21073
(LC),
MEC for Health
(Gauteng) v Mathamini
(2008) 29
ILJ
366 (LC) and
Astore Africa (Pty) Ltd v
CCMA
[2007] ZALC 54
;
[2008] 1 BLLR 14
(LC). No doubt
this list has grown considerably since then.
10
[2006] 6 BLLR 631
(LAC).
11
1951 (4) SA 331
(A) at 335E.