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[2020] ZALAC 6
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Lemley v Commission for Conciliation Mediation and Arbitration and Others (PA6/2018) [2020] ZALAC 6; (2020) 41 ILJ 1339 (LAC); [2020] 7 BLLR 676 (LAC) (4 March 2020)
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA, PORT ELIZABETH
Not
Reportable
Case
no: PA6/2018
In
the matter between:
EDWARD
LEMLEY
Appellant
And
Commission
for Conciliation Mediation
and
Arbitration
First Respondent
COMMISSIONER
COKILE N.O. Second
Respondent
T-SYSTEMS
SA (PTY) LIMITED
Third Respondent
Heard:
18 February 2020
Delivered:
04 March 2020
Summary:
Dismissal for operational requirement –severance pay –
employee who unreasonably refused employer’s offer
of
alternative employment not entitled to severance pay.
Coram:
Waglay JP, Murphy AJA and Savage AJA
Judgment
SAVAGE
AJA
[1]
This appeal,
with the leave of this Court granted on petition, is against the
judgment and order of the Labour Court (Lallie J)
on 19 January 2018
in terms of which the review application brought by the appellant, Mr
Edward Lemley, was dismissed with no costs
order.
[2]
The appeal
turns on the refusal by the third respondent, T-Systems SA (Pty) Ltd
(‘the respondent’), to pay the appellant
a severance
package after he was dismissed for operational reasons on 25
September 2009. On 13 May 2009, in light of his impending
dismissal
for operational requirements the appellant was made an offer of
alternative employment in East London with effect from
June 2009. The
appellant refused this offer on 25 May 2009, accepting that he gave
no reasons to the respondent for doing so. On
29 May 2009, a revised
offer was made to him in terms of which the third respondent
indicated its willingness to increase the rental
subsidy offered him
in East London in the amount of R4000 over a period of six months to
twelve months. This offer was rejected
by the appellant.
[3]
In the minutes
of a consultation meeting with his union on 11 June 2009, it was
recorded that:
‘
There
is no retrenchment on the table, with the plan being to use
identified
affected staff in alternative positions. Edward in this instance was
offered an alternative to relocate, at the same
level, but in another
locality. Edward responded that the option is not viable to him due
to his age and his family situation.
The company’s view is that
it is a reasonable offer
…’
[4]
The minute
continued that it was:
‘…
explained
that Edward has completed a significant amount of service (around 38
years) with the company and is currently of pensionable
age, being
57. The company’s offer is for him to take early retirement. If
he does that, he will lose out on [the] opportunity
to contribute to
his pension fund until natural retirement. Based on the combined
value of his individual contribution to the pension
fund plus the
company’s contribution (until the age of 63), the company is
willing to grant him that amount - as a settlement
value, which is
not seen as a retrenchment package. The value is approximately
R314 000’.
[5]
This offer was
not accepted and the minute recorded further that when the proposal
to move to East London was put to the appellant
he called the union
to indicate that travelling from Port Elizabeth on a Monday and
returning on Friday ‘
is
not what he is looking for in life
’.
[6]
In due course,
given his refusal to accept the alternative employment offered to
him, the appellant was dismissed for operational
requirements without
payment of a severance package.
[7]
Aggrieved the
appellant referred a dispute to the first respondent, the Commission
for Conciliation Mediation and Arbitration (“CCMA”).
On
14 July 2013 the second respondent, a commissioner of the CCMA, found
that the appellant had unreasonably refused the offer
of an
alternative position in East London. The dispute referred was
accordingly dismissed.
[8]
Dissatisfied
with this decision, the appellant took the matter on review to the
Labour Court. Lallie J found that ‘(t)
he
applicant’s argument that the award is not rationally connected
to the evidence tendered at arbitration is unsustainable
as the
arbitrator dealt with the issues before him, considered evidence and
made findings and a final decision based on the evidence’
.
The commissioner was found to have ‘
considered
objective facts as well as the applicant’s personal
circumstances’
and
the ‘
conclusion,
based on relevant authority that the applicant was not entitled to
severance pay cannot be faulted’
.
It was found impermissible for the appellant to ‘
augment
the reasons for refusing alternative employment on review
’
since it was for the review court to determine the reasonableness of
the commissioner’s arbitration award.
[9]
On appeal, the
appellant states that the commissioner erred in not finding that he
reasonably refused the alternative position offered
to him because
his personal circumstances which rendered it impossible to take up
the position; and in so doing that the commissioner
reached a
decision that no reasonable commissioner would have reached on the
facts of the case.
[10]
The third
respondent opposes the appeal on the basis that the award fell within
the bounds of reasonableness required, taking all
factors into
account in deciding whether the alternative employment offered to the
appellant was reasonable. The offer of an alternative
to retrenchment
made was reasonable, more so when the appellant had conceded in
cross-examination that he did not, when alternatives
to retrenchment
were being considered, communicate the reasons why he could not
accept the offer to the third respondent. The appellant
was the only
person to reject the offer of alternative employment
Evaluation
[11]
Section 41(2)
of the
Basic Conditions of Employment Act 75 of 1997
requires an
employer to pay at least one week’s remuneration for each
completed year of continuous service to an employee
who is dismissed
for reasons based on the employer’s operational requirements.
In terms of
s 41(4)
, an employee who unreasonably refuses to accept
the employer’s offer of alternative employment is not entitled
to severance
pay in terms of subsection (2).
[12]
In
issue in this appeal is whether the decision reached by the
commissioner that the appellant unreasonably refused to accept the
employer’s offer of alternative employment in East London was
one that a reasonable decision-maker could not reach.
[1]
On the material before the commissioner, it was apparent that the
appellant initially refused the offer made without providing
any
reasons. When a revised offer was made to him days later increasing
the period of a rental subsidy offered to him, this too
was refused
without any reasons. Although on 11 June 2009 it was stated in
general terms that the alternative employment offered
was not viable
due to the appellant’s age and his family situation, there is
no dispute that the appellant did not inform
the third respondent of
what the nature of his family constraints were, or whether the third
respondent could assist in accommodating
the appellant in respect of
such constraints. In addition, the appellant rejected a further offer
that the third respondent subsidise
the shortfall in his pension fund
to allow him to take early retirement seeking instead that his full
severance benefit be paid
to him.
[13]
The
import and purpose of
s 41(4)
is clear: an employee is not entitled
to insist on being paid severance pay where he or she unreasonably
refuses to accept the
employer’s offer of alternative
employment.
[2]
There are
compelling reasons why the legislature saw fit to limit the payment
of severance pay in this manner. Not only does it
incentivise an
employer to provide alternative employment, but it also seeks to
limit job losses on retrenchment.
[3]
[14]
The finding of
the commissioner that there were no sound reasons for the appellant’s
refusal to accept the alternative employment
offered was not one that
a reasonable decision-maker could not reach. The appellant took no
steps to engage with the third respondent
in any meaningful way
regarding the difficulties he may have faced in accepting the
alternative position offered. Instead, he elected
to refuse the offer
without advancing reasons and took no steps to discuss or engage on
the matter with the third respondent. The
revision to the offer made
was simply rejected and the offer of a pension fund payment to allow
for early retirement was equally
not accepted, in circumstances in
which the third respondent had taken steps to resolve the issue in a
constructive manner. When
the issue of his family circumstances was
raised on 11 June 2009 no further steps were taken to detail these
circumstances or discuss
the matter further with the third
respondent. The appellant’s approach to the offer made was
obtuse and unreasonable in the
circumstances. His age and years of
service do not alter the fact that he unreasonably refused the offer
of alternative employment
made to him. It follows that the Labour
Court correctly dismissed the review application.
[15]
For all of
these reasons, the appeal must fail. Although the third respondent
sought its costs, having regard to issues of fairness
and equity, I
am not persuaded that a costs order is warranted in this matter.
Order
[16]
For
these reasons, the following order is made:
1.
The appeal is
dismissed.
____________________
SAVAGE
AJA
Waglay
JP and Murphy AJA agree.
APPEARANCES:
FOR
THE APPELLANT:
Adv
Marius Grobler
Instructed by Labuschagne
Van der Walt Inc.
FOR
THE THIRD RESPONDENT:
Adv Patrick Botha
Instructed
by Mohlaba & Moshoana Inc.
[1]
Sidumo
& another v Rustenburg Platinum Mines Ltd & others
[[2007] 12 BLLR 1097 (CC); 2008 (2) SA 24 (CC); (2007) 28 ILJ 2405
(CC); 2008 (2) BCLR 158 (CC) at para 110.
[2]
Pretorius
v Rustenburg Local Municipality & others
(2008) 29 ILJ 1113 (LAC).
[3]
Irvin
& Johnson Ltd v CCMA & others
(2006) 27 ILJ 935 (LAC).