Edcon Ltd v Pillemer NO and Others (191/08) [2009] ZASCA 135; [2010] 1 BLLR 1 (SCA); (2009) 30 ILJ 2642 (SCA) (5 October 2009)

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[2009] ZASCA 135
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Edcon Ltd v Pillemer NO and Others (191/08) [2009] ZASCA 135; [2010] 1 BLLR 1 (SCA); (2009) 30 ILJ 2642 (SCA) (5 October 2009)

Links to summary

THE
SUPREME COURT OF APPEAL
REPUBLIC
OF SOUTH AFRICA
JUDGMENT
Case No: 191/08
In
the matter between:
EDCON LTD
APPELLANT
v
B
PILLEMER NO
FIRST RESPONDENT
COMMISSION
FOR CONCILIATION SECOND RESPONDENT
MEDIATION
& ARBITRATION
P C REDDY
THIRD RESPONDENT
Neutral citation:
Edcon
v Pillemer
(191/2008)
[2009] ZASCA 135
(
5
October 2009).
Coram: Mpati P, Heher, Mlambo, Maya
JJA and Tshiqi AJA
Heard: 4 September 2009
Delivered: 5 October 2009
Summary: Labour Law –
Labour Relations Act 66 of 1995
– Commission for Conciliation
Mediation and Arbitration – Review of arbitration award
–Constitutional standard of reasonableness
applicable.
Labour
Law – fairness of dismissal – destruction of relationship of
trust – evidence showing destruction necessary.
________________________________________________________________
ORDER
________________________________________________________________
On appeal from:
Labour Appeal
Court, (Sangoni AJA with Wallis JA and Tlaletsi AJA concurring
sitting as court of appeal).
The following order is made:
The appeal is dismissed with costs including the costs
consequent upon the employment of two counsel.
________________________________________________________________
JUDGMENT
________________________________________________________________
MLAMBO JA
(MPATI P, HEHER,
MAYA JJA, TSHIQI AJA CONCURRING)
[1] The appellant (Edcon) had dismissed the third
respondent (Reddy) for misconduct. Contending that her dismissal was
unfair Reddy
referred a dispute to the second respondent, the
Commission for Conciliation Mediation and Arbitration (CCMA) for
resolution through
conciliation and, failing that, through
arbitration. The CCMA appointed the first respondent (Pillemer) to
arbitrate the dispute
after conciliation failed to resolve it.
Having conducted the arbitration proceedings
Pillemer made an award in which she concluded that Reddy’s
dismissal was substantively
unfair and ordered Edcon to reinstate her
but without arrear salary.
[2] Unhappy with the award Edcon launched review
proceedings in the Labour Court (LC) in terms of s 145
1
of the Labour Relations Act 66 of 1995 (LRA) with a view to setting
it aside. The LC (Pillay J) declined to set the award aside.

Undaunted, Edcon appealed to the Labour Appeal Court (LAC), with that
court’s leave, but that effort again came unstuck when
the LAC
dismissed the appeal, concluding that the award was unassailable. The
judgment of the LAC has been reported –
Edcon
Ltd v Pillemer NO & others
(2008) 29 ILJ
614 (LAC). Edcon’s appeal is before us with special leave of this
court.
[3] For appropriate appreciation of the matter, it is
prudent to traverse its factual background in some detail. Reddy was
the beneficial
user of a company vehicle, a Toyota Corolla (the
Corolla), courtesy of Edcon’s car scheme policy (the policy). In
June 2003 the
Corolla was involved in a collision with another
vehicle whilst driven by Reddy’s son, Andre. Reddy was not in the
Corolla at
the time. In terms of the policy Reddy was obliged,
amongst others, to report the accident to Edcon, the South African
Police Service
and the relevant insurance company within 24 hours and
not carry out repairs to the Corolla without the approval of the
insurance
company. Reddy did none of the above, arranging, instead,
with her husband to repair the Corolla at his panel beating shop at
own
cost. As fate would have it, a combination of factors led to
Edcon getting to know of the collision some six months later. This

was when Reddy, who was unhappy with the Corolla’s performance,
took it to a Toyota dealer for a check up. On inspection the
service
personnel discovered collision damage which had apparently not been
repaired properly. When the service personnel appraised
Reddy of this
fact she approached her manager, Mr Clive Dwyer, with a request to
authorise payment for the required repairs. She
did not, however,
disclose to Dwyer that the Corolla had been in a collision. He
discovered this when he contacted the service
personnel.
[4] On being confronted by Dwyer, Reddy initially denied
that the Corolla had been involved in a collision but later admitted
the
occurrence, stating that the collision had occurred whilst she
was driving it at a time when she was still employed by a company

that had later merged with Edcon. Dwyer referred the matter to Mr
Sayendiran Danny Naidoo, a security manager employed by Edcon,
for
investigation. When Naidoo spoke to Reddy, she repeated her lie that
she was the driver when the collision took place, stating
that a
minibus taxi had crashed into her. She did tell Naidoo, though, that
she had given the Corolla to her husband to repair
at his panel
beating shop. Naidoo recommended Reddy’s suspension on full pay
pending finalisation of his investigation. At Naidoo’s
request for
a further statement Reddy changed her version, this time stating that
the collision had occurred whilst Andre was driving,
but that she was
a passenger. Her final statement was when she came clean and told the
truth with an offer to repay the costs associated
with the required
repairs. Andre had also, in the mean time, made a statement to Naidoo
confirming that he was driving the Corolla
and that he was alone when
the collision occurred. It is common cause that in terms of the
policy Andre was entitled to drive the
Corolla as he was in
possession of a valid driver’s licence.
[5] In due course Edcon convened a disciplinary enquiry
to look into the matter, chaired by Ms Yasmeen Ismail, an employee.
The
charge levelled against Reddy was: ‘failure to be honest and
act with integrity in that you committed an act, which has affected

the trust relationship between the company and the employee in that
on 8 June 2003 to 8 October 2003: You failed to report an accident
of
a company vehicle . . . which your son was driving on the day of the
accident (8 June 2003) and this resulted in a breach of
trust between
yourself and the company’. Reddy pleaded guilty to the charge at
the commencement of the enquiry, stating that
her ignorance of the
policy rule that Andre was entitled to drive the Corolla had driven
her to be deceitful as an attempt to protect
him. She was found
guilty and dismissed from her employment.
[6] Ms Ismail’s decision to dismiss Reddy appears to
have been motivated by her view that Reddy had behaved without
integrity
and honesty, values regarded highly by Edcon. In this
regard Ms Ismail regarded Reddy’s unblemished record and character
as not
sufficiently mitigatory of her conduct. Reddy appealed her
dismissal and the resultant appeal hearing was chaired by Mr Loyiso

Maponya, another employee. Reddy’s grounds of appeal were:
‘
Penalty too harsh
– in that it is respectfully submitted that although serious
offences generally warrant dismissal, the nature of the offence
in
this instance had not completely destroyed the trust relationship
between the accused and the employer.
Inconsistency of Disciplinary
Penalty
–
Historical inconsistency – in that the employer has not dismissed
an employee guilty of a similar offence (uncontested) viz.
an auditor
by the name of Patience had acted dishonestly by failing to report an
accident and had eventually told the truth.
The accused wishes the
following to be considered
– That she has dedicated most part of her working life to the
company and is two years away from retirement age.
She accepts full responsibility
for all the necessary and reasonable costs of repairing the company
vehicle and therefore the company
will incur no loss.
She is diabetic and hypertensive
and the sequence of events have been stressful, seeing that she
always provided a loyal service
to the company.’
[7] Regarding the case of another employee (Patience
Mtsweni) who had apparently behaved in similar fashion to Reddy,
Maponya remarked:
‘
In examination of the
evidence before me it appears that Ms Reddy had established a prima
facie case of similarities that existed
between her case and that of
Ms Mtsweni.
I have noted the following
salient similarities:
Both of them were involved in an
act of dishonesty by failing to report the accident as per the
company car policy and disciplinary
procedures.
In both cases it was their kids
who caused an accident with the company car.
Both of them was their first
offence and it also appears that their line managers commended both
of them as good and hard working
employees.
Both of them had undertaken to
pay the cost for the repair of the company vehicle.
The company did not dispute the
above allegations of inconsistency, the only objection the company
had with this issue was the issue
regarding the amount that Ms Reddy
had undertaken to pay towards repair costs of the vehicle.’
Maponya, however, upheld the sanction of dismissal,
concluding that:
‘
In evaluating the nature and
the role played by Ms Reddy in the commission of the above
misconduct, it is clear that it resulted
in a negative impact on the
trust relationship. When Ms Reddy was confronted about the accident
she lied throughout the investigation,
with the aim to hide the true
facts of what really happened to the company car. It is trite law
that an act of dishonesty undermines
the trust relationship and
therefore may justify dismissal.
Ms Reddy has been remorseful for
her actions, however in the above case the gravity of her offence
does not justify a deviation
from the prescribed penalty.’
This turn of events prompted Reddy to initiate the CCMA
proceedings referred to earlier.
[8] When Pillemer became seized with the arbitration,
she identified the fairness or otherwise of the sanction of dismissal
as the
issue requiring determination. Analysing the evidence Pillemer
remarked that Reddy’s failure to report the collision in itself
was
not misconduct that warranted dismissal, but that the issue was
whether her lack of candour thereafter destroyed the trust

relationship, justifying her dismissal. Pillemer also determined,
referring to s 138
2
of the LRA, that as arbitrator she was entitled to have regard to
certain correspondence from Dwyer and one Val Barnes, also a
manager
employed by Edcon, who had at some stage worked with Reddy. Both had
not testified in the arbitration but their views,
captured in the
correspondence, were a disavowal of a breakdown in the trust
relationship.
[9] Pillemer found that no direct evidence had been led
by Edcon to show that the trust relationship had been destroyed by
Reddy’s
misconduct and lack of candour. She further found that for
a decision to dismiss a person with Reddy’s track record of 43
years
unblemished employment with Edcon and related companies, the
misconduct committed had to be gross and evidence was necessary to

show that the trust relationship had in fact been destroyed. She went
on to find that Reddy’s long and unblemished track record
militated
against a decision to dismiss her under the circumstances. She also
found that the views expressed by Barnes and Dwyer
were an indication
that dismissal in those circumstances was not an inevitable result.
She consequently concluded that Edcon had
failed to prove that
dismissal was a fair sanction.
[10] Before us counsel for Edcon, Mr Redding SC,
essentially argued that the award issued by Pillemer was defective,
rendering it
liable to be set aside. This argument was premised on
three bases:
(1) that Pillemer failed to appreciate the extent of
Reddy’s dishonesty in the context of Edcon’s own rules. He argued
that
this failure by Pillemer prevented her from appreciating the
justification for Edcon’s decision to dismiss Reddy;
(2) that Pillemer’s admission of hearsay evidence
without proper consideration of the provisions of s 3(1)(c) of the
Law of Evidence
Amendment Act 45 of 1998 rendered her award
defective; and
(3) that Pillemer’s finding that the appellant had led
no evidence regarding the alleged destruction of the trust
relationship
was erroneous.
[11] This being a review of an award of a CCMA
commissioner, it is worthwhile to revisit the jurisprudence that has
developed around
CCMA arbitration awards. The standard employed in
the review of awards issued by CCMA commissioners is an area that has
occupied
the minds of judges of the LC and LAC since the inception of
the labour dispensation ushered in by the LRA. Until the LAC’s
decision
in
Carephone (Pty) Ltd v Marcus NO &
others
(1998)
19 ILJ 1425 (LAC),
the standard of review
applicable to CCMA awards was far from certain in view of the
divergence of views among LC judges at the
time about the
applicability of s 145 and s 158(1)(g)
3
of the LRA in the review of CCMA arbitration awards.
4
The LAC in
Carephone
found that the administrative justice provisions in the Constitution
5
were integral to the functions of CCMA commissioners when arbitrating
disputes. The court, having concluded that substantive rationality

was required of ‘administrative decision makers’, formulated the
standard of review applicable to CCMA awards as follows:
‘
Many formulations have been
suggested for this kind of substantive rationality required of
administrative decision makers, such
as “reasonableness”,
“rationality”, “proportionality”, and the like . . . It seems
to me that one will never be able
to formulate a more specific test
other than, in one way or another, asking the question: is there a
rational objective basis justifying
the connection made by the
administrative decision maker between the material properly available
to him and the conclusion he or
she eventually arrived at?’
6
[1
2] The
controversy regarding the reviewability of CCMA awards did not go
away, however, as a divergence of views began to emerge
again from
the LAC regarding the ambit of the
Carephone
standard. One view was that the standard of review of a CCMA award
was whether an award was justifiable in relation to the reasons
given
for it.
See
Mzeku &
others v Vokswagen SA (Pty) Ltd & others
(2001) 22 ILJ 1575 (LAC);
[2001] 8 BLLR 857
(LAC) at para 60;
Adcock
Ingram Critical Care v CCMA & others
(2001) 22 ILJ 1799 (LAC);
[2001] 9 BLLR 979
(LAC) at para 22;
Waverley Blankets Ltd v CCMA & others
(2003) 24 ILJ 388 (LAC);
[2003] 3 BLLR 236
(LAC) at para 41;
Branford
v Metrorail Services (Durban) & others
(2003) 24 ILJ 2269 (LAC);
[2004] 3 BLLR 199
(LAC) at para 20.
The other, broader view, was whether the award was justifiable not
only in relation to the reasons given
for it, but also taking account
of the material placed before the commissioner. See
Toyota
SA Motors (Pty) Ltd v Radebe & others
[2000]
21 ILJ 340 (LAC) at para 53;
Shoprite Checkers
(Pty) Ltd v Ramdaw NO & others
(2001) 22
ILJ 1603 (LAC);
[2001] 9 BLLR 1011
(LAC) at para 101.
[13] The uncertainty created had the consequence that
the review of CCMA awards continued to clog the rolls of our Labour
specialist
courts. It was therefore inevitable that the
Constitutional Court would at some stage be drawn into the debate.
This eventually
occurred in the matter of
Sidumo
& another v Rustenburg Platinum Mines Ltd & others
(2007) 28 ILJ 2405 (CC). That
matter had its origin in the dismissal of the appellant (Sidumo) who
had then obtained an award in
the CCMA reversing his dismissal on the
basis that it was too harsh. A review of the award failed in the LC
and an appeal to the
LAC also failed. See
Rustenburg
Platinum Mines Ltd v CCMA & others
[2004]
1 BLLR 34
(LAC). This is one of those decisions emanating from the
LAC in which the so-called broad standard of review was favoured.
7
[14] That decision came on appeal to this court. See
Rustenburg Platinum Mines Ltd (Rustenburg
Section) v Commission for Conciliation, Mediation and Arbitration
2007 (1) SA 576
(SCA);
[2006] 11 BLLR 1021
(SCA); (2006) 27 ILJ 2076
(SCA). The appeal succeeded in this court and part of the reasoning
is found in paras 29 and 30 to the
following effect:
‘
[29] For what both
Carephone
and PAJA required the LAC to do was to consider whether the
commissioner’s decision to reinstate Sidumo was “rationally
connected”
to the information before him and
to
the reasons he gave for it
.
“Rational connection” requires, as Froneman DJP explained in
Carephone
(para [37]), in a passage this Court approved and applied in the
light of PAJA, that there must be a rational objective basis
justifying the connection the commissioner made between the material
before him and the conclusion he reached.
[30] The LAC did not apply this
test. Nor did it refer to
Carephone
,
or indeed to PAJA. Instead it asked whether considerations existed,
which the commissioner had taken into account, that were “capable

of sustaining” his finding. In effect, the LAC asked whether there
was material on record that could support the view that, despite
his
errors, the commissioner had nevertheless “got it right”. In so
approaching the matter, the LAC treated the mine’s challenge
to the
decision as an appeal. In my respectful view, this was incorrect. The
question on review is not whether the record reveals
relevant
considerations that are capable of justifying the outcome. That test
applies when a court hears an appeal: then the enquiry
is whether the
record contains material showing that the decision –
notwithstanding any errors of reasoning – was correct.
This is
because in an appeal, the only determination is whether the decision
is right or wrong.’
[1
5] When
the matter was eventually heard in t
he
Constitutional Court, that court exhaustively considered the
jurisprudence regarding administrative review in general and
specifically
in relation to CCMA awards as well as the impact of the
Constitution. The court reasoned the matter for present purposes as
follows:
‘
[106] The
Carephone
test, which was substantive and involved greater scrutiny than the
rationality test set out in
Pharmaceutical
Manufacturers
,
was formulated on the basis of the wording of the administrative
justice provisions of the Constitution at the time, more
particularly,
that an award must be justifiable in relation to the
reasons given for it. Section 33(1) of the Constitution presently
states that
everyone has the right to administrative action that is
lawful, reasonable and procedurally fair. The reasonableness standard
should
now suffuse section 145 of the LRA.
[107] The
reasonableness standard was dealt with in
Bato
Star
.
In the context of section 6(2)(h)
of
PAJA, O’Regan J said the following: “[A]n administrative decision
will be reviewable if, in Lord Cooke’s words, it is one
that a
reasonable decision-maker could not reach.”
[108] This
Court recognized that scrutiny of a decision based on reasonableness
introduced a substantive ingredient into review
proceedings. In
judging a decision for reasonableness, it is often impossible to
separate the merits from scrutiny. However, the
distinction between
appeals and reviews continues to be significant.
[109] Review
for reasonableness, as explained by Professor Hoexter, does threaten
the distinction between review and appeal. The
Labour Court in
reviewing the awards of commissioners inevitably deals with the
merits of the matter. This does tend to blur the
distinction between
appeal and review. She points out that it does so in the limited
sense that it necessarily entails scrutiny
of the merits of
administrative decisions. She states that the danger lies, not in
careful scrutiny, but in “judicial overzealousness
in setting aside
administrative decisions that do not coincide with the judge’s own
opinions”. This Court in
Bato
Star
recognized that danger. A judge’s task is to ensure that the
decisions taken by administrative agencies fall within the bounds
of
reasonableness as required by the Constitution.
[110] To
summarise,
Carephone
held that s 145 of the LRA was suffused by the then constitutional
standard that the outcome of an administrative decision should
be
justifiable in relation to the reasons given for it. The better
approach is that s 145 is now suffused by the constitutional
standard
of reasonableness. That standard is the one explained in
Bato
Star
:
Is the decision reached by the commissioner one that a reasonable
decision-maker could not reach? Applying it will give effect
not only
to the constitutional right to fair labour practices, but also to the
right to administrative action which is lawful,
reasonable and
procedurally fair.’
And further
‘
[119] To
my mind, having regard to the reasoning of the commissioner, based on
the material before him, it cannot be said that his
conclusion was
one that a reasonable decision-maker could not reach. This is one of
those cases where the decision-makers acting
reasonably may reach
different conclusions. The LRA has given that decision-making power
to a commissioner.’
Reduced to its bare essentials, the standard of review
articulated by the Constitutional Court is whether the award is one
that
a reasonable decision maker could arrive at considering the
material placed before him.
[16] It is therefore the reasonableness of the award
that becomes the focal point of the enquiry and in determining this
one focuses
not only on the conclusion arrived at but also on the
material that was before the commissioner when making the award. It
is remarkable
that the constitutional standard of ‘reasonableness’
propounded by the Constitutional Court in
Sidumo
is conceptually no different to what the LAC said in
Carephone
.
The only difference is in the semantics – the LAC had preferred
‘justifiability’ whilst the Constitutional Court has preferred

the term ‘reasonableness’.
[17] With this treatise of the law regarding the
standard of review applicable to CCMA awards I return to the facts.
The thrust
of Edcon’s case is that Pillemer had ample material
before her showing that the trust relationship between it and Reddy
had been
destroyed by Reddy’s misconduct and lack of candour. This,
it was submitted, showed that the decision to dismiss her was
justified.
The determinant issue in the appeal must therefore be
whether the trust relationship between Edcon and Reddy had been shown
in
the arbitration to have been destroyed. This calls for an
examination of Pillemer’s reasons for her conclusion and the
material
that was available to her in arriving at it.
[18] As already stated, Pillemer concluded that Edcon
had failed to show that the trust relationship had been destroyed by
Reddy’s
deceitful conduct. Both the LC and LAC upheld this
conclusion. Naidoo was Edcon’s sole witness in the arbitration and
Reddy testified
in support of her own case. The records of the
disciplinary enquiry and appeal hearing, as well as all statements
collated by Naidoo
during the investigation, were also before
Pillemer as well as the correspondence from Barnes and Dwyer.
[19] It is to Naidoo’s testimony, as Edcon’s sole
witness in the arbitration, as well as the documentary evidence
referred to
above, that one must look to see if indeed there was
evidence showing that Reddy’s conduct had destroyed the trust
relationship
between her and Edcon. Naidoo’s testimony in the
arbitration was mainly to recount the investigative history of the
matter. He
also testified that Edcon was intolerant towards
dishonesty and that employees were generally dismissed if they
committed dishonest
acts. This, he said, was one of Edcon’s core
values. As already mentioned Naidoo was the investigator of Reddy’s
misconduct
and fielded some of her lies. It was at his
recommendation, as investigator, that Reddy was suspended and
eventually disciplined.
What becomes immediately apparent is that
Naidoo’s evidence did not, and could not, deal with the impact of
Reddy’s conduct
on the trust relationship. Neither did Naidoo
testify that Reddy’s conduct had destroyed the trust relationship.
This was the
domain of those managers to whom Reddy reported. They
are the persons who could shed light on the issue. None testified.
[20] Edcon’s policy regarding the misconduct at issue
here was also before Pillemer. But that document is just that – a
policy
– and is no evidence of the consequences of misconduct based
on it. On its own it evinces Reddy’s failure to comply with its

dictates. It cannot be correct that mere production thereof would
suffice to justify a decision to dismiss. The gravaman of Edcon’s

case against Reddy was that her conduct breached the trust
relationship. Someone in management and who had dealings with Reddy

in the employment setup, as already alluded to, was required to tell
Pillemer in what respects Reddy’s conduct breached the trust

relationship. All we know is that Reddy was employed as a quality
control auditor; no evidence was adduced to identify the nature
and
scope of her duties, her place in the hierarchy, the importance of
trust in the position that she held or in the performance
of her
work, or the adverse effects, either direct or indirect, on Edcon’s
operations because of her retention, eg because of
precedent or
example to others. In
De Beers Consolidated
Mines Ltd v CCMA & others
(2000) 21 ILJ
1051 (LAC) at paras [17] to [27] Conradie JA considered the
relationship between an employee’s dishonesty and continued

employment, and the bearing of such factors as long service, which
Pillemer also considered. In the present context he said (at
para
[23]):
‘
The seriousness of dishonesty
– ie whether it can be stigmatized as gross or not – depends not
only, or even mainly, on the
act of dishonesty itself but on the way
it impacts on the employer’s business’.
But to get here evidence showing adverse impact, if any,
on the ‘business’ is critical.
[21] It also cannot be correct as submitted by Mr
Redding, that Ismail and Maponya, who were the internal
disciplinary enquiry
and appeal chairpersons respectively, provided
the management view regarding the damaged trust relationship. It
needs hardly be
stated that their role in those proceedings was not
as witnesses. They were there to ensure that a fair conclusion was
reached
by Edcon regarding Reddy’s fate. In fact Ismail did not
make a positive finding in this regard save to state that Reddy had
not
conducted herself with the integrity and honesty expected by
Edcon, whilst Maponya did state that her conduct had had an impact
on
the trust relationship. Maponya, as a matter of fact, had no evidence
suggesting a breakdown in the trust relationship and one
can only
surmise that he relied on his opinion as an employee in making this
finding. The surprising feature regarding the findings
by Ismail, and
especially Maponya, is that Barnes had testified in the disciplinary
enquiry and stated that she could still work
with Reddy. She was not
challenged by Naidoo.
[22] Pillemer was entitled and in fact expected, in the
scheme of things, to explore if there was evidence by Edcon and/or on
record
before her showing that dismissal was the appropriate sanction
under the circumstances. This was because Edcon’s decision was

underpinned by its view that the trust relationship had been
destroyed.
She
could find no evidence suggestive of the alleged
breakdown and specifically
mentioned this as one of her reasons for
concluding that Reddy’s dismissal was inappropriate. A reading of
the award further reveals
that in addition to this finding Pillemer
also found that in the context of that matter Reddy’s long and
unblemished track record
was also an important consideration in
determining the appropriateness of her dismissal.
[23] It is inevitable that courts, in determining the
reasonableness of an award, have to make a value judgment as to
whether a
commissioner’s conclusion is rationally connected to
his/her reasons taking account of the material before him/her. That
this
is the correct approach has been stated on a number of occasions
by the LAC,
8
this court in the
Sidumo
matter
9
as well as the Constitutional Court in the same matter
10
.
In my view, Pillemer’s finding that Edcon had led no evidence
showing the alleged breakdown in the trust relationship is beyond

reproach. In the absence of evidence showing the damage Edcon asserts
in its trust relationship with Reddy, the decision to dismiss
her was
correctly found to be unfair. She cannot be faulted on any basis and
her conclusion is clearly rationally connected to
the reasons she
gave, based on the material available to her. She did not stray from
what was expected of her in the execution
of her duties as a CCMA
arbitrator. The challenge, therefore, to Pillemer’s award on this
basis is without merit. I have no hesitation
in concluding that the
award issued by her is properly compliant with the constitutional
standard of reasonableness propounded
in
Sidumo
.
This conclusion on its own is, in my view, dispositive of the appeal.
I find it unnecessary therefore, in view of this conclusion,
to
consider the other interesting point regarding the admissibility of
hearsay evidence, raised on behalf of Edcon.
[24] The appeal is dismissed with costs including the
costs consequent upon the employment of two counsel.
_________________
D MLAMBO
JUDGE OF APPEAL
APPEARANCES:
COUNSEL FOR APPELLANTS: A I S Redding SC
INSTRUCTED BY: Deneys Reitz Inc, Durban
CORRESPONDENT: Lovius Block, Bloemfontein
COUNSEL FOR RESPONDENT: C G Marnewick SC; U Madhoo
INSTRUCTED BY: Naidoo & Company, Durban
CORRESPONDENT: Mpobole & Ismail, Bloemfontein
1
Section 145 provides: ‘
Review of arbitration
awards
(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 â€“
(a) . . .
(b) . . .
(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.
(3) . . .
(4) . . .’
2
Section 138(1) provides: ‘The commissioner may
conduct the arbitration in a manner that the commissioner considers
appropriate
in order to determine the
dispute
fairly and quickly, but must deal with
the substantial merits of the
dispute
with the minimum of legal formalities.’
3
The section provides: ‘
The Labour Court may –
(g) subject
to s 145, review the performance or purported performance of any
function provided for in
this Act
on any grounds that are permissible in law.’
4
Some judges of the LC had favoured reviewing CCMA awards under s
158(1)(g) having branded s 145 as too restrictive and
unconstitutional
and as such inconsistent with the administrative
justice dictates of the Constitution of the Republic of South
Africa, Act 108
of 1996. Another view favoured by some LC judges was
that only s 145 was applicable in the review of CCMA awards. In
Carephone
the LAC settled that controversy by concluding that s 145 and 158
had specific functions but that only s 145 was applicable in
the
review of CCMA awards.
5
Constitution of the Republic of South Africa Act
108 of 1996.
6
At para 37.
7
The LAC had reasoned that the reasons of the
commissioner which were attacked in the LC review could not on their
own sustain
the award but that there were other reasons which were
not challenged in the review which rendered the award unassailable
on
appeal.
8
Carephone
supra in para 36: ‘In determining whether
administrative action is justifiable in terms of the reasons given
for it, value judgments
will have to be made which will, almost
inevitably, involve the consideration of the “merits” of the
matter in some way or
another. As long as the judge determining this
issue is aware that he or she enters the merits not in order to
substitute his
or her own opinion on the correctness thereof, but to
determine whether the outcome is rationally justifiable, the process
will
be in order.’
9
Rustenburg Platinum Mines Ltd (Rustenburg
Section)
supra in para 31: ‘In a review,
the question is not whether the decision is capable of being
justified (or, as the LAC thought,
whether it is not so incorrect as
to make intervention doubtful), but whether the decision-maker
properly exercised the powers
entrusted to him or her. The focus is
on the process, and on the way in which the decision-maker came to
the challenged conclusion.
This is not to lose sight of the fact
that the line between review and appeal is notoriously difficult to
draw. This is partly
because process-related scrutiny can never
blind itself to the substantive merits of the outcome. Indeed, under
PAJA the merits
to some extent always intrude, since the court must
examine the connection between the decision and the reasons the
decision-maker
gives for it, and determine whether the connection is
rational. That task can never be performed without taking some
account
of the substantive merits of the decision.’
10
At para 109