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[2022] ZALAC 6
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Austin-Day v ABSA Bank Ltd and Others (PA02/2020) [2022] ZALAC 6; [2022] 6 BLLR 514 (LAC) (8 March 2022)

IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA, PORT ELIZABETH
Not
Reportable
Case
No: PA02/2020
In
the matter between:
FELICITY
AUSTIN-DAY

Appellant
and
ABSA
BANK
LTD

First Respondent
THEODORUS
POTGIETER

Second Respondent
COMMISSION
FOR CONCILIATION MEDIATION
AND
ARBITRATION
(“CCMA”)

Third Respondent
Heard:

23 November 2021
Delivered:
08
March 2022
Coram:
Waglay JP, Coppin JA, and Kubushi AJA
JUDGMENT
KUBUSHI
AJA
Introduction
[1]       The
appellant hereby appeals, with leave of this court, against the whole
of the judgment
and order of the Labour Court (“the court
a
quo
”) handed down on 4 November 2019. The appeal seeks to
restore the arbitration award issued by the second respondent (the
commissioner who adjudicated the dispute under the auspices of the
Commission for Conciliation Mediation and Arbitration (“CCMA”)),

wherein he found the appellant’s dismissal by the first
respondent (“the bank”) to have been substantively unfair

and ordered her reinstatement.
[2]
At the time of her dismissal, the appellant was in the employment of
the bank as a
Branch Manager. The appellant was charged and dismissed
for misconduct, which was alleged to involve dishonesty and her
alleged
failure to comply with the bank’s policies and
procedures in the execution of her duties as a Branch Manager.
[3]
The bank, aggrieved by the award of the commissioner, brought an
application in terms
of section 145 of the Labour Relations Act,
[1]
in the court
a
quo
,
seeking to review and set it aside.
[4]       On
the date set for the hearing of the review application, the parties’
legal
representatives approached the judge allocated to hear the
matter with a draft consent order, which was curiously made an order

of the court, the effect of which was that the matter was remitted to
the CCMA for a further hearing before the same commissioner
in
respect of the “second charge”. The review application
was otherwise postponed indefinitely. Consequently, the parties

returned to arbitration and held a further hearing confined to what
was termed the second charge, in the consent order. Subsequent

thereto, the commissioner issued a supplementary award, which also
formed part of the arbitration award which the bank sought to
review
and set aside.
[5]       When
the matter was referred back to the court
a quo
, the judge
presiding, correctly refused to entertain the supplementary award on
the ground that the first arbitration award was
final and binding and
the CCMA could not revisit the process of resolving a dispute which
it had already resolved, and had issued
an arbitration award, in
respect thereof. This aspect is not challenged on appeal and I, in
that sense, find it not necessary to
deal any further with the said
supplementary award, in this judgment.
[6]       The
court
a quo
found in favour of the bank. It reviewed and set
aside the award and replaced it with the order that the dismissal of
the appellant
was fair. It made no order in respect of costs.
Background
[7]       For
the appropriate appreciation of the matter, it is prudent to traverse
its factual
background in some detail. The appellant was employed by
the bank as a Branch Manager at its branch, at 6
th
Avenue,
Walmer Park, in Port Elizabeth. It is not in dispute that at the time
of the alleged misconduct of the appellant she had
been in the
employment of the bank for a period of approximately thirty-three
years with an unblemished record. She had, however,
worked as a
Branch Manager, in various branches of the bank, for a period of
fifteen years, preceding her dismissal.
[8]       The
conduct that led to the appellant’s dismissal emanates from the
following
set of facts: during her employment as the Branch Manager
at 6
th
Avenue, Walmer Park, the appellant decided to
deposit R100.00 of her own money into ten inactive accounts, opened
by ten different
customers, that were under her control at her
branch. An amount of R10.00 was deposited in each of those accounts.
The deposits
were made without the knowledge and/or consent of the
holders of those accounts. The effect of such deposits was that those
accounts,
which were inactive, were then recorded as activated
accounts in the branch’s books, and as such, constituted sales
in terms
of the branch’s performance. One of these accounts
was, subsequently, operated by the account holder who deposited
further
moneys into the account.
[9]       The
accounts in question, are referred to as “Transact Accounts”
which
are said, basically, to be transactional accounts aimed at
individuals who are either unemployed, or irregularly employed, and
who would make deposits of around R2 000.00, or less, in any
given month, into the respective accounts. Thus, the accounts
are
used predominantly by customers falling within the low income group.
Sales people of the bank would get people to open such
accounts,
which only become operational once a deposit is made into the
account. Otherwise they remain inactive. However, after
four months
if no deposit is made into the account it becomes dormant. Given the
basic nature of the accounts, no minimum opening
balances are
required and no minimum daily balance is required. Customers also do
not automatically receive monthly statements
in respect of such
accounts.
[10]     Each
of the bank’s branches has sales targets which are recorded
when a newly opened account
is activated. Although accounts are
opened when sales are registered, each specific account only becomes
activated once the customer
makes a deposit into the account and
starts transacting. Once an account is activated, it then starts
attracting costs in the form
of a cash deposit fee together with
administrative fees. It is at this time that the bank will be able to
make a return, based
on the fee charges generated for the
transactions that take place
[11]     During
a routine visit to the appellant’s branch by Mr Gareth
Sylvester Raynold Vallentyn’s
(“Mr Vallentyn”), the
area head manager of the bank’, the appellant voluntarily
informed him about the deposits
in question. Mr Vallentyn thereafter
informed the bank’s forensics department, which investigated
the matter. In its report,
forensics confirmed that they could not
detect any fraudulent conduct and made a recommendation that remedial
action be taken.
[12]     Further
investigations into the policy and procedures of the bank was
undertaken by the operations
consultant who recommended disciplinary
action against the appellant. She was charged with two counts of
alleged misconduct, as
follows:
Count
1: “It is alleged that you acted dishonestly, in the execution
of your duties as a Branch Manager of ABSA, 6
th
Avenue,
Walmer Park, when you made irregular cash deposits into customer
accounts;
Count
2: “It is alleged that you failed to adhere to the Group’s
laid down Policies and Procedures in the executions
of your duties as
a Branch Manager”.
[13]     Following
a disciplinary enquiry, the appellant was found guilty and dismissed.
The
reason for the dismissal of the appellant was recorded as follows:
‘
after
considering all the facts the decision is dismissal with contractual
notice – Guilty of charge of dishonesty within
ABSA ER do not
have a lesser sanction that dismissal ZERO-TOLERANCE’
.
[14]     As
earlier stated, the appellant, aggrieved by the decision, referred an
unfair dismissal dispute
to the CCMA. The dispute remained unresolved
after conciliation and a certificate to that effect was issued. The
matter then proceeded
to arbitration before the commissioner.
[15]     The
appellant challenged the substantive fairness of her dismissal on the
basis that she was not
guilty of the misconduct she was dismissed
for. She also challenged the fairness of the sanction of dismissal
and sought retrospective
reinstatement as relief. The procedural
fairness of the dismissal was not disputed.
[16]     What,
however, became a bone of contention before the arbitrator, in
respect of the two counts
of misconduct facing the appellant, was
whether the appellant had acted dishonestly when she deposited the
said amounts in the
customers’ accounts and whether in so
doing, she had contravened any policies of the bank and applicable
legislation.
[17]     Having
considered the evidence before him, and relying on the judgment in
Nedcor
Bank v Frank and Others
,
[2]
the commissioner found against the bank in relation to the central
issue of whether or not the appellant had acted dishonestly.
[18]     As
regards the second charge, the commissioner also made a finding that
that charge was irrelevant
for purposes of the arbitration because
the appellant was dismissed for dishonesty and not because she
transgressed the first respondent’s
policies, procedures and
legislation.  The commissioner, further made a finding that even
if the appellant had transgressed
any such policies, dismissal, under
such circumstances, had been unfair, and that the appellant deserved
to be reinstated.
[19]     Based
on the afore stated reasons, the commissioner found that the
appellant was entitled to the
relief she sought. Accordingly, the
dismissal was found to be procedurally fair, but substantively
unfair, and the bank was ordered
to reinstate the appellant in its
employ on terms and conditions no less favourable to her than those
that governed the employment
relationship immediately prior to her
dismissal.
[20]    The
bank was aggrieved by the findings of the commissioner and, thus,
filed a review application with
the court
a quo
seeking an
order to review and set aside the award issued by the commissioner.
[21]     In
its review application before the court
a quo
, the bank’s
contention was that the arbitration award was unreasonable, or not
one that a reasonable decision-maker could
have arrived at. In
particular, the bank contended that, firstly, the commissioner
ignored the evidence proving that, on a balance
of probabilities, the
appellant was guilty of dishonesty and that such misconduct was
serious, warranting dismissal; and secondly,
that even if the
commissioner was of the view that there were insufficient grounds to
support a finding of dishonesty, the evidence
overwhelmingly shows
that the appellant acted in flagrant breach of the accepted conduct
expected of a branch manager and was also
in breach of the policies
and procedures in place at the bank; and lastly, that the
commissioner confined the reason for the dismissal
of the appellant
to only one charge, whilst the appellant was in fact found guilty of
two charges, all of which led to her dismissal.
[22]     Even
though in its papers the bank’s grounds of review were based on
both charge 1 and charge
2, the court
a quo
in its judgment
did not address the grounds of review in respect of charge 2. Thus,
the grounds of review that came for determination
before the court
a
quo
related only to charge 1. The crux being whether the
appellant acted dishonestly in depositing her own money into the
customers’
accounts.
[23]     The
court
a
quo
reviewed and set aside the arbitration award, having found that the
commissioner ignored evidence and failed to apply his mind
to
critical issues that were before him when he sought to establish the
intention of the appellant. In its judgment, the court
a
quo
,
made a finding that the commissioner ignored the material that was
before him by concentrating on how the misconduct was perpetrated,

rather than on the reasons for it.  According to the court
a
quo
, in
so doing, the commissioner failed to arrive at a conclusion that a
reasonable decision-maker would have reached, namely, that
the
appellant was dishonest.
Before
this Court
[24]     Before
this court the issues were the same as those argued at arbitration
and in the court
a quo
. The cardinal issue being whether the
conduct of the appellant amounted to dishonesty.
[25]     The
standard of review has been determined in the Constitutional Court
decision in
Sidumo
& Another v Rustenburg Platinum Mines Ltd & Others
,
[3]
where the court held, at para 110 thereof, as follows:
‘
110.   The
better approach is that section 145 is now suffused by the
constitutional standard of reasonableness.
That standard is the one
explained in
Bato
Star
:
[4]
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.’
[26]     Therefore,
following on the approach enunciated in
Sidumo
, this court has
to determine whether based on the material that was before the
commissioner, the court
a quo
correctly came to the conclusion
that the commissioner’s conclusion was one that a reasonable
decision-maker could not reach.
[27]     The
evidence that the commissioner considered when determining whether or
not the appellant acted
dishonestly, is summarised as follows in the
arbitration award:
‘
12.     The
case presented on behalf of the respondent in support of the
respondent’s contention
that the applicant acted dishonestly
was that she stood to gain by her actions in that the branch would
then meet the target regarding
sales and she personally stood to gain
as she might face repercussions if she did not meet target. The
evidence tendered further
on behalf of the respondent was that the
applicant accessed the accounts in her personal capacity and thus
opened the bank to claims
of money laundering. The case was further
that the applicant in acting as she did, contravened a number of
policies and applicable
legislation.
13.      The
evidence lead, further established that the applicant, of her own
accord, whilst Mr Vallentyn
was doing a routine inspection, informed
him that she had opened accounts. She did this in an acknowledgement
seeking manner for
her innovationary (sic!) thoughts and actions. The
accounts were opened openly over the counter with her name in details
as a depositor.
The respondent’s case from these facts is that
the applicant [appellant] acted dishonestly because she stood to gain
from
depositing the moneys because she was behind on targets. The
applicant’s version on these facts was that she did not intend

to be dishonest. That she in fact was not dishonest and acted openly.
She could deposit the moneys at an ATM incognito if she wished
to be
dishonest.’
Based
on this evidence, the commissioner found that the dismissal was
unfair.
[28]     In
coming to such a finding, on this point, the commissioner reasoned as
follows:
‘
16.     The
respondent based its case relating to dishonesty on the assumption
that the applicant opened
the accounts to boost the performance of
the branch to such an extent that the applicant would meet target.
The applicant on the
other hand stated that she was not short of her
target and even if it was so it would only result in a discussion on
how her performance
could be bettered. Mr Vallentyn was quite adamant
that even if the applicant was on target there was pressure on all
managers to
perform above target
per
month just in case the next month’s target would not be reached
so that an average over a year could be above target. The
argument
effectively puts an end to the contention that the applicant having
been found guilty of dishonesty, it was for the commissioner
to make
a finding that the bank had proven dishonesty in order to come to the
finding that the dismissal was fair. The applicant
acted dishonestly
because she wanted to boost her target as Mr Vallentyn testified that
she had more than two months to reach her
target should she not have
met it
.
17.      The
respondent also argued on the one hand, that the applicant’s
evidence that she
acted openly by depositing the moneys over the
counter on her name is of no relevance as it does not show that she
had no intention
to be dishonest because it would be hidden amongst
all the other transactions, it is not reconcilable with the argument
on the
other hand that the applicant informed Mr Vallentyn of her
actions because she was scared that she would be caught out. The two

contentions are mutually exclusive. The applicant’s version
that she did not intent to be dishonest and in fact was not dishonest

is thus more probable.
18.
The respondent had to, in order to be successful in showing that it
acted substantively
fair in dismissing the applicant based on
dishonesty must show that the applicant intended by her actions to be
dishonest. The
facts of the case before me does not support a finding
of dishonesty because the applicant acted openly by depositing the
moneys
over the counter with her name as depositor and in a manner
seeking approval from Mr Vallentyn for her innovative thoughts and
actions divulged to him. It cannot be said that a person under these
circumstances had the intention to be dishonest. The applicant

readily conceded that in hindsight her actions were foolish. Her
foolishness, however, does not make her guilty of dishonesty on
all
the facts presented to me.
19.      I
find that the applicant was not guilty of dishonesty. She was
dismissed for dishonesty.
My duty is to decide whether the respondent
acted substantively fair in dismissing the applicant (procedure was
not challenged)
based on the reasons given for her dismissal. . .’
[29]    The
Bank’s submission that the appellant wanted to deceive the bank
by boosting her branches sales
and that she was in trouble with her
performance, holds no water. I am more inclined to be supportive of
the argument raised by
the appellant in the heads of argument.
[30]     As,
correctly argued by the appellant, the record indicates that on the
common cause evidence
before the commissioner, the appellant’s
performance target, or “bucket” for transaction accounts,
already stood
at 103% on year-to date basis, at the time of the
incident. At best she stood to boost that figure to 105%. Therefore,
she was
not in trouble as suggested by the bank, as far as her
performance was concerned.
[31]     Mr
Vallentyn conceded that the transactional accounts “buckets”
were seen as a whole;
when it comes to formal performance evaluation,
the time for assessing the year’s performance was still some
two months away,
and that the appellant was already at 103% of her
performance target for this bucket on a year to year-to-date basis.
Thus, at
worst for the appellant, even if the performance was reduced
by the 10 accounts in question, her performance for savings accounts

would have stood at 91% - which is a figure which would not have put
her in trouble. Mr Vallentyn conceded, readily so under
cross-examination,
that faced with a figure of 91% for savings
accounts he would have done nothing more that have a discussion with
the appellant
about how that figure could be boosted to a figure of
100% or more.
[32]     There
is nothing on record that indicates that the appellant stood to gain
any kind of reward
on account of adding ten accounts. There was no
performance bonus or other kind of incentive that was within reach at
the time
that could be achieved by the artificial addition of the ten
savings account.
[33]     Without
any shred of evidence that suggest that the appellant was dishonest
in her conduct, as
I have already indicated here above, the
acceptance of the appellant’s explanation, in my view, was
reasonable.
[34]     The
bank’s contention that the appellant disclosed her conduct when
it was on the verge
of being discovered, is without merit. There is
no evidence on record that indicates as such. However, the common
cause evidence
is that the bank did not routinely audit accounts that
had become activated. There is also no dispute that the appellant
voluntarily
and freely mentioned her conduct to Mr Vallentyn and to
her staff, in the excitement of having thought of something which, to
her,
appeared like a good idea and innovative with the hope of
motivating their performance. If anything it appears that the
appellant
thought this was a good way of trying to motivate the
account holders to use the accounts. In fact, one of the 10 accounts
opened
did get the result the appellant had hoped for, the account
was then utilised. The findings of the commissioner in this regard is

thus patently reasonable.  it would have been inconceivable that
she would have voluntarily made the disclosures to Mr Vallentyn
if
the intention was to deceive.
[35]     She,
in addition, left, freely so, a paper trail in respect of the
deposits by entering her name
and identity number on the deposit
slips. She had an alternative means of depositing the amounts
anonymously at the ATM, but she
opted not to do so; she could still
have entered a false name and identity number on the deposit slips,
this also she did not do.
[36]     There
is undisputed evidence that she wanted to motivate her staff. This is
indicated by her undisputed
evidence that she voluntarily shared what
she had done, freely with her staff. The evidence is further that the
list of accounts
into which she deposited the R10.00’s was
supplied to her by one of her staff members. She thus acted openly
and to the knowledge
of the staff at the branch.
[37]     Even
though, the commissioner made an error in finding that the appellant
conceded in hindsight
that her actions were foolish, it is quite
clear from the record that the evidence of the appellant is that she
acted with lack
of judgment. This error by the commissioner cannot
come to the assistance of the bank in any way. It cannot be said that
due to
such error the dismissal of the appellant was fair. To the
contrary, the concession by the appellant as correctly captured in
the
record, goes to show contrition on the part of the appellant
which is a further indication that she did not act with the intention

to be dishonest.
[38]     Moreover,
even if it were to be accepted that the appellant breached any one of
the policies,
procedures and applicable legislation of the bank by
her conduct, this does not justify a sanction of dismissal under the
particular
circumstances of this matter. Besides, on the evidence as
it stands, there is no specific clause of any specific policy and
procedure
that could be convincingly pointed out that was breached by
the appellant.
[39]     There
is no evidence that the appellant acted in bad faith or that by her
actions, she exposed
the bank to any material risk.
[40]     On
the other hand, as the commissioner found, the bank, as the custodian
of its own policies and
the legislation relied upon, should have
contacted the nine clients, who did not operate the accounts, stating
that their accounts
had been accessed by a private person and
activated and for that reason had to be de-activated, or that they
may open new accounts,
or something to that effect. This it did not
do. Similarly, the tenth person, who as I have stated earlier, after
his or her account
was activated, started operating on the account,
should have been informed that the account had been irregularly
activated by a
private person and that the account must now be
de-activated, and if he or she still wanted to do business with the
bank to re-open
the account. But, the bank did none of that, but
happily enjoyed the benefit of what they considered to be “dishonest
conduct”.
[41]     If
there was any misconduct, it was not serious enough to warrant
dismissal. The evidence on record
is that when Mr Vallentyn and
forensics learnt about this unfortunate incident, they did not give
an indication that this was a
serious transgression. It must have not
been serious, for if it was so, forensics would have immediately,
indicated as such to
the appellant, and besides, forensics found no
evidence of fraudulent conduct on the part of the appellant. It
merely recommended
remedial action after its investigation.
[42]     The
appellant’s unblemished record of thirty-three years of service
also speaks for itself
and militates against the sanction of
dismissal. The further unchallenged evidence that the appellant will
never do it again and
the fact that she conceded in evidence that in
hindsight she realised that she made an error of judgment, also
confirms in her
favour that dismissal was unwarranted.
[43]     The
prejudice argued orally before this court by the Bank’s counsel
could not be substantiated.
There is hardly any evidence on
record of any prejudice suffered either by the bank or by the
customers whose bank accounts were
used. The prejudice contended for
by the bank’s counsel that the appellant’s conduct would
open the bank to money laundering
activities is without merit. At the
level and scale of money that is involved in this matter, the
allegations of money laundering
are outrageous and farfetched and
require no further comment.
[44]     The
further contention that the customers, whose accounts were accessed
without their knowledge,
would be prejudiced by the bank charges
which would be accumulated in the accounts without their knowledge
and consent, is also
meritless. On its own version, the Bank
confirmed that when the bank charges that accumulated after the
accounts have been activated,
are not paid, the amounts are
eventually written off after a period of time.
[45]     These,
in my view, are findings that a reasonable arbitrator would readily
make.
[46]     It
is trite that once it is found that the dismissal was substantively
unfair, reinstatement is
the primary remedy envisaged by the LRA.
[47]     In
the circumstances, the appeal stands to be upheld and I make the
following order:
(i)
The appeal is upheld.
(ii)
The order of the court
a
quo
is
set aside and is substituted with the following order: “The
review application is dismissed.”
(iii)
There is no order for costs.
________________
Kubushi
AJA
Waglay
JP and Coppin JA concur.
APPEARANCES:
FOR
THE APPELLANT:

A C Oosthuizen
F Le Roux
Instructed by Kaplan
Blumberg Attorneys
FOR
THE FIRST RESPONDENT:
M Pillemer
Instructed by Stone Wylie
Attorneys
[1]
Act 66 of 1995.
[2]
[2002] 7 BLLR 600
(LAC) para 15.
[3]
2008 (2) SA 24
(CC); [2007] 28 ILJ
2405 (CC).
[4]
Bato Star Fishing (Pty) Ltd v
Minister of Environment Affairs & Others
[2004] ZACC 15
;
2004 (4) SA 490
(CC);
2004 (7) BCLR 687
(CC).