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[2021] ZALAC 55
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Amalungelo Worker's Union obo Mayisela and Others v Commission for Conciliation, Mediation and Arbitration (JA 07/21) [2021] ZALAC 55; (2022) 43 ILJ 600 (LAC) (29 November 2021)
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA, JOHANNESBURG
Case
no: JA 07/21
In
the matter between:
AMALUNGELO
WORKERS’ UNION obo MAYISELA
AND
29
OTHERS
Appellant
and
COMMISSION
FOR CONCILIATION, MEDIATION
and
ARBITRATION
First Respondent
ELIZABETH
LERUMO
N.O.
Second Respondent
UNILEVER
SOUTH AFRICA (PTY) LTD
Third Respondent
Heard:
28 September 2021
Delivered:
Deemed to be the date the judgment is emailed to the parties 29
November 2021.
Coram:
Davis JA, Coppin JA et Kubushi AJA
JUDGMENT
COPPIN
JA
[1]
Relying on,
inter
alia
,
section 198B(3) of the Labour Relations Act
[1]
(“the LRA”) the appellants in the referral to the first
respondent (“the CCMA”), contended in essence,
that the
fixed-term employment of the appellant employees with the third
respondent (“Unilever”) had been converted
into permanent
and indefinite employment and sought a declaratory order to that
effect.
[2]
On 6 September 2018, the second respondent (“the arbitrator”),
acting
under the auspices of the CCMA, rendered an arbitration award
in which she found, essentially, that Unilever was in breach of
section
198B(3) of the LRA; that the appellant employees cited in
this matter, were deemed to be employed by Unilever on an indefinite
basis and were considered permanent employees of Unilever since April
2017. The arbitrator further ordered Unilever to assist the
appellant
employees to participate in its medical aid, pension, education and
home loan schemes and, significantly, that Unilever
pay them with
effect from April 2017 remuneration at a rate that was not “less
favourable” than the rate paid to Unilever’s
permanent
employees who performed the same or similar work as the appellant
employees.
[3]
On 12 September 2018 the arbitrator issued a variation award in terms
of which she
varied the award of 6 September 2018 by the insertion of
two paragraphs. Firstly, she inserted a paragraph 44 in which she
ordered
Unilever to hold a meeting with the representatives of the
appellant employees by no later than 30 September 2018 to quantify
the
amounts that were referred to in paragraph 43 of the original
award and further ordered Unilever to provide the appellants’
representative with “the schedule of quantified sum of money”
by no later than 14 October 2018. Secondly, she inserted
a paragraph
45 into the original award in terms of which the appellants are
directed to approach the Labour Court by way of contempt
proceedings
if Unilever fails to comply with the newly inserted paragraph 44.
[4]
This is an appeal against an order of the Labour Court (Olivier AJ)
in which it reviewed
and set aside the original and variation awards
of the arbitrator at the behest of Unilever; dismissed a stay
application brought
by Unilever and made no costs order. The appeal
is with the leave of that court (“the court
a quo
”).
[5]
Even though the parties had submitted in the court
a quo
comprehensive heads of argument that also dealt with the grounds of
review relating to the merits of the awards, the parties essentially
confined their arguments to the following jurisdictional points,
namely, firstly, whether the arbitrator had jurisdiction to arbitrate
the dispute because it was referred to the CCMA more than six months
after the dispute arose and no application to condone such
late
referral had been brought by the appellants; and secondly, whether
the arbitrator had the power (or jurisdiction) to award
the appellant
employees payments and benefits, such as medical aid, pension,
education and home loan schemes, in circumstances
where the
appellants, in their referral form to the CCMA only sought a
declaratory award that they were permanent employees as
envisaged in
section 198B read with section 198D of the LRA.
[6]
Having concluded that the test was whether the arbitrator was right
or wrong in assuming
jurisdiction, the court
a quo
went on to
consider the arguments made by the parties in respect of the issue of
jurisdiction.
[7]
Unilever essentially argued the following: section 198D of the LRA
prescribes that
the dispute arising from section 198B of the LRA must
be referred to the CCMA within six months of the dispute arising,
failing
which, an application for condonation for the late referral
ought to be made; that the dispute in this instance (i.e. about
whether
the appellant employees were permanent or fixed term
employees) arose in April 2017, when they were offered fixed term
contracts
and refused to sign them; the dispute therefore, had to be
referred to the CCMA by no later than the end of September 2017;
since
the dispute was only referred much later, i.e. in May 2018, and
no condonation application for the late referral had been brought
nor
granted, the CCMA had no jurisdiction to entertain the dispute.
[8]
In response, the appellants conceded that the dispute arose in April
2017 but argued,
in essence, that the dispute was “continuing
wrong (akin to an unfair labour practice)” and that there was
therefore
no late referral to the CCMA.
[9]
The court
a
quo
concluded that it was common cause that the dispute arose in April
2017. With reference to the question, whether the dispute was
a
continuing wrong, the court
a
quo
,
having referred to a passage of the judgement of this court in
SABC
[2]
,
and of the Labour Court in
Eskom
[3]
,
concluded that even though the appellant employees suffered the
effects of not been made permanent on a continuous basis, the
dispute
arose from a single event that occurred in April 2017 and does not
constitute a “continuing wrong”; that the
very nature of
the disputes contemplated in sections 198A, 198B, and 198C is that
“they recur on a monthly basis, for example,
less favourable
monthly remuneration or benefits”; and that there would be no
purpose to the time limit prescribed in section
198D(3) of the LRA if
all such disputes were considered as a “continuing
wrong”.
[10]
The court
a quo
held that condonation was required and that it
was not a matter of unfair discrimination or of an unfair labour
practice, as envisaged
in section 186(2) of the LRA; and that since
section 198D(3) is applicable, there can be no doubt that the failure
by the appellants
to comply with the time limit stipulated there
required condonation. Section 198D(6)) specifically provides
accordingly.
[11]
The court
a quo
further held that because the referral was
late and condonation was a requirement, absence of the same meant
that the matter was
not properly before the arbitrator; the
arbitrator had no jurisdiction to arbitrate the dispute; and on that
basis alone the review
of the main and variation awards had to
succeed and the application for a stay of the implementation of those
awards, brought by
Unilever, was essentially unnecessary, and had to
be dismissed.
[12]
Despite having reached such a decisive conclusion the court
a
quo
nevertheless went on to consider the second point, namely, whether
the arbitrator had the power to award equal benefits even though
it
had not been specifically requested by the appellants in the referral
form. Finding support for its reasoning on this point
in the decision
of the Labour Court in
Nama
Koi
[4]
the court
a
quo
held that section 198D of the LRA “does not automatically
entitle an applicant to compensatory relief in the event of a
declaratory order in his favour that his contract of employment is
deemed to be of an indefinite nature.”
[13]
The court
a quo
further held that relevant evidence would be
required for the assessment of the compensatory relief before it is
granted. It referred
in that regard,
inter alia
, to evidence
that compares the benefits received by permanent employees to those
received by the appellant employees. The court
a quo
further
concluded that there was no such evidence on record and since that
was lacking it was not within the power of the arbitrator
to grant
the impugned orders. The court
a quo
concluded finally that
the awards should be set aside on the second jurisdictional point as
well.
[14]
In sum, the court
a quo
accordingly made an order reviewing
and setting aside the original and variation awards, and dismissed
the stay application brought
by Unilever. All these applications had
been consolidated and were heard at once. There is no cross-appeal by
Unilever against
the dismissal of its stay application.
On
appeal
[15]
On appeal the parties, essentially, made the same arguments on the
issues of jurisdiction as
they made in the court
a quo
.
However, in respect of the main jurisdictional point, the appellants
denied that they had admitted that the dispute arose in April
2017,
and contended that the “wrong” occurred on the date of
commencement of employment of each of the (individual)
appellant
employees and continued daily until a dispute arose on 12 April 2018.
Hence (i.e., according to them) the dispute was
timeously referred to
the CCMA on 16 April 2018 (as per the award). The appellants also
submitted that the dispute concerned “a
continuing wrong (akin
to an unfair labour practice)”. It continued monthly and
therefore the referral to the CCMA was not
late.
[16]
On the other hand, Unilever’s counsel argued that the dispute
arose in April 2017 when
the appellant employees refused to accept
and sign written, fixed-term employment offers that were made to them
by Unilever; that
it was not a continuing wrong and that the dispute
had been referred late.
Discussion
[17]
It is not at all clear whether the dispute that was referred to the
CCMA in this matter was ever
conciliated before the date of the
arbitration. There is a copy of a certificate in the appeal record,
not verified under oath,
purportedly dated 16 May 2018 and signed by
a commissioner purporting to certify that the matter was referred to
conciliation and
unsuccessfully conciliated on 19 April 2018. But,
worryingly, the arbitration record confirms the contrary. The
following was stated
by the arbitrator at the outset of the
arbitration in that regard: “Today is the 21
st
August 2018. This case is set down for arbitration. The schedule time
was 9 o’clock, then I’ve noticed that the file,
inside
the file that the case was never conciliated. However, I offered the
parties an opportunity to conciliate, hence [the] case
now remains
unresolved, then what is going to happen, I’m now going to
proceed with arbitration.” The parties did not
dispute the
truth of that assertion.
[18]
Unilever contends that the dispute as contemplated in section 198D of
the LRA arose in April
2017. The appellant employees, however, deny
that, contend that the dispute only arose on April 2018, and seem to
be saying that
the wrong giving rise to the dispute occurred since
April 2017, and each time since then, when they were not paid the
same, or
afforded the same benefits as Unilever’s permanent
employees.
[19]
Section 198D(1) refers to “any dispute arising from the
interpretation and application
of section 198A, 198B and 198C”
and provides that such “may be referred” to the CCMA or
Council “with jurisdiction
for conciliation and, if not
resolved, to arbitration.” Subsection (3) of that section deals
with the actual referral of
the dispute referred to in section
198D(1). It provides: “
a
party to a dispute contemplated in subsection (1)
,
other than a dispute about a dismissal in terms of section 198A(4),
may refer the dispute, in writing, to the Commission or to
the
bargaining council,
within six
months after the act or omission concerned.
”
(My emphasis)
[20]
The “act or omission” referred to in subsection (3) is
clearly that which gave rise
to the dispute. And the dispute, as long
as it is the same one, only has one initial date on which it arose.
The fact that the
dispute is ongoing, in the sense that it recurs
after it first arose, may be because it is either never resolved, or
satisfactorily
resolved. But does that not imply that the parties, as
it were, necessarily have a new “act or omission” or
“wrong”
every time the same dispute erupts again.
[21]
The appellant employees’ reliance on what this court held in
SABC
and
what the Supreme Court of Appeal held in
Lombo
[5]
,
or any of the decisions allegedly based on them, is misplaced. The
facts of those cases are distinguishable on their facts. There
the
courts were not dealing with the interpretation of section 198D of
the LRA, or anything approximating the wording of that section,
or
sections 198A, B or C, to which section 198D applies.
[22]
In any event, as explained in
Eskom
,
[6]
not even all unfair labour practices which occur on a monthly basis
constitute “a continuing wrong” as envisaged in
SABC
.
To use the language of section 198D, what would occur in certain
instances is not the act or omission, for example, to promote
(as in
Eskom
)
or not to employ persons on a permanent basis (as alleged in this
instance), but the consequences of the failure to promote or
the
failure to appoint on a permanent basis, which would constitute the
concerned act or omission. However, in light of the outcome
of the
analysis in this matter, it is not necessary to elaborate on that
aspect.
[23]
Section 198D does not treat “dispute”, and the “act
or omission” giving
rise to the dispute, as synonymous. Section
198D(3) does not provide that the dispute must be referred within six
months of it
arising, but that the dispute must be referred within
six months after “the act or omission concerned.” The
section
recognises that there is an act, or omission (alleged or
otherwise) that gave rise to, or preceded, the dispute. The crucial
starting
date of the time limit is after the act, or omission,
concerned. It is thus important to establish that date in order to
determine
whether, in more general parlance, the “dispute”
was referred in time.
[24]
It seems to me that as all acts, or omissions, have consequences, a
further distinction needs
to be drawn between “the act or
omission” and its consequences or effects. Unless such a
distinction is drawn the time
limits provided in the LRA for referral
of a dispute to the CCMA or council, including section 198D, would be
entirely valueless
and the true rationale for such time bars would be
undermined
[7]
. Since an employee
could then basically start counting the time whenever he or she
experienced a consequence of the act or omission
that gave rise to
the dispute, having (arbitrarily, or deliberately, in order to meet
the time limit for referral) construed or
proffered that as the
actual “act or omission”. Seemingly, this is what
Unilever is effectively suggesting the appellants
did in this
instance.
[25]
In terms of section 198D, the clock starts after the act or omission
concerned occurs, and not
when a consequence of that act or omission
is experienced or becomes manifest.
[26]
In this instance, it is therefore essential to identify the act or
omission that gave rise to
the dispute that was referred to the CCMA,
to determine when it gave rise to a dispute, and to distinguish it
from its consequences
or effects.
[27]
The act, or omission, the appellants complained of (i.e. in respect
of each individual appellant
employee) was that they were not made
permanent by Unilever (presumably, on their interpretation of the
law) as the law requires.
As a main argument they contend,
essentially, that they were permanent employees from April 2017,
having worked for Unilever from
that date without written contracts,
certain of them who were not employed by then were permanent from
inception of their employment
- not by agreement with Unilever, but
(presumably) by dint of the law, and that the dispute in that regard
only arose on 12 April
2018.They denied being offered fixed-term
employment contracts in April 2017 and of having refused to sign
them.
[28]
The version proffered by the appellants is untenable and does not
align with the facts, the probabilities
and the law. In the first
place, it is apparent from the award that all the appellant employees
had been engaged by Unilever on
fixed-term contracts long before
April 2017, and as far back as 2013, 2014 and 2015, and that since
April 2017 all the appellant
employees were working at Unilever
without a written contract. The only witness for the appellants at
the arbitration, Mr Quentin
Seku, had been employed on a fixed-term
contract since August 2013 and without a written contract since April
2017, implying that
there was a written fixed-term contract in place
since 2013 to April 2017.
[29]
Even though the witness for Unilever, Mr Maepa, testified at the
arbitration that the appellant
employees had been presented with
written offers of employment in April 2017 and that they had refused
to sign them, the arbitrator
(arguably erroneously) found that “no
evidence” had been given in that regard. And found that since
April 2017 until
18 August 2018 Unilever had failed to give effect to
the provisions of section 198B of the LRA and that the appellant
employees
were considered permanent employees since April 2017.
[30]
These findings of the arbitrator imply that she had found effectively
that since 1 April 2017
until 18 April 2017 the appellant employees
were employed on a fixed-term basis, albeit tacitly, since there were
no written contracts
in place to that effect. Unless that was the
case Unilever could not have “failed to give effect to the
provisions of section
198B of the LRA”. That section regulates
fixed-term contracts concluded with employees earning below a certain
threshold.
[31]
But that finding, i.e., effectively, albeit by implication, that
there were fixed term contracts
in place, was arbitrary and not based
on the law or the facts. It is an established principle that unless a
contrary intention
can be inferred from the facts, it will generally
be assumed, if an employee is allowed to work beyond the end of a
fixed term
contract, that the contract is tacitly converted into one
of indefinite duration, terminable by reasonable notice given by
either
party
[8]
.
[32]
Turning to the facts of this case, there is no basis for not
inferring or concluding that when
the written fixed-term contracts of
the appellant employees ended (presumed to be at the end of March
2017), from 1 April 2017
they were no longer employed on a fixed-term
basis but on an indefinite basis terminable on reasonable notice. The
inference to
that effect is strong, but would even be stronger if it
is accepted that when Unilever presented the appellant employees with
fixed-term
offers in April 2017 they refused to accept them.
[33]
However, even if the latter evidence is excluded (which would not be
justified on the probabilities),
it was common cause that when
Unilever presented the Appellant employees with written fixed-term
offers in March or April 2018
they refused to accept them and,
instead referred the dispute, which is the subject of this matter, to
the CCMA. Thus, further
buttressing the inference that from April
2017 the appellant employees were not on fixed term contracts, but
employed on an indefinite
basis.
[34]
If that is so, as it must have been, then Unilever could not in that
time, when the employment
was for an indefinite period, have been in
breach, or in contravention, of section 198B of the LRA. The section
would not have
been applicable. In any event, section 198B(5)
provides: ” Employment in terms of a fixed term contract
concluded or renewed
in contravention of subsection (3) is deemed to
be of indefinite duration.”
[35]
The only period relative to the facts of this matter, when Unilever
could conceptually have been
in contravention of section 198B, is
when the fixed-term contacts were in place or were to be renewed, and
that period, we know,
is the period preceding April 2017. Thus the
“act or omission concerned”, being an alleged failure by
Unilever to comply
with section 198B, could only have occurred
before, or in, April 2017. For as long as no fixed-term contracts
were in place, the
act or omission concerned could not have recurred,
nor could it have been “ongoing” in the absence of such
contracts.
[36]
It was therefore incumbent upon the appellant employees to have
referred that act or omission to the
CCMA (in this instance) within
six months after it had occurred. Essentially it cannot be contested
that they only referred that
dispute more than a year after the act
or omission concerned, by which time it was late. Notwithstanding the
condonation that was
required for such lateness, as envisaged in
section 198D(6) of the LRA, the same was never sought or granted. The
arbitrator, apparently,
entertained and endeavoured to resolve the
dispute oblivious to such lateness.
[37]
The court
a quo
’s ultimate finding that the CCMA (and
the arbitrator) did not have jurisdiction in respect of the matter is
therefore unassailable.
[38]
Since that finding on jurisdiction is decisive of the review
application in respect of both awards
it is not necessary to deal in
the circumstances with the question of the arbitrator’s powers
to make specific orders for
payment, et cetera. That issue, in light
of the decision on the jurisdiction of the arbitrator and the CCMA to
entertain the matter
in the first place, is rendered moot.
[39]
It follows that the appeal must fail. As far as the costs are
concerned – taking all facts,
circumstances, the law and
fairness into account, a costs order is not appropriate.
[40]
In the result, the following is ordered:
40.1
The appeal is dismissed;
40.2
There is no costs order.
P
Coppin
Judge
of the Labour Appeal Court
Davis
JA and Kubushi AJA concur in the judgment of Coppin JA.
APPEARANCES:
FOR
THE APPELLANT:
Mr
M.D Maluleke with Mr SM Sebola
Instructed
by Sebola Nchupetsang Sebola
Inc.
FOR
THE THIRD RESPONDENT:
FA Boda SC
Instructed
by Norton Rose Fulbright Inc.
[1]
Act
66 of 1995.
[2]
South
African Broadcasting Corporation Ltd v Commission for Conciliation,
Mediation and Arbitration and others
[2010]
3 BLLR 251
(LAC) para 27.
[3]
Eskom
Holdings SOC Ltd v NUM obo Kyaya and others
[2017] 8 BLLR 797
(LC) para 32.
[4]
Nama
Koi Local Municipality v South African Local Government Bargaining
Council and others
(2019) 40 ILJ 2092 (LC) paras 33-35.
[5]
Lombo
v African National Congress
2002 (5) SA 668
(SCA) paras 26-27.
[6]
See
Eskom
(above) para 32.
[7]
Compare
Eskom
(above) para 32.
[8]
See,
inter
alia
,
Department
of Agriculture (Department of Agriculture, Forestry and Fisheries) v
Teto and Others
[2020]
ZALAC 19
; (2020) 41 ILJ 2086;
[2020] 10 BLLR 994
(LAC) (28 May 2020)
para 20 and the authorities cited there.