Minister of Labour and others v Schoeman and others (JA15/98) [1999] ZALAC 3 (23 February 1999)

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[1999] ZALAC 3
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Minister of Labour and others v Schoeman and others (JA15/98) [1999] ZALAC 3; [1999] 5 BLLR 457 (LAC); (1999) 20 ILJ 1514 (LAC) (23 February 1999)

IN THE LABOUR APPEAL COURT OF SOUTH AFRICA
Held in Johannesburg
LABOUR APPEAL COURT: Case No: JA15/98
Case No: JR1/98
MINISTER OF LABOUR
First appellant
THE DIRECTOR GENERAL OF LABOUR
Second appellant
and
SCHOEMAN, JOHANNES CORNELIUS BOSMAN
First respondent
THE PRESIDENT OF THE INDUSTRIAL COURT
Second respondent
MR A E JACOBS N.O.
Third respondent
ADV M GROBBELAAR N.O.
Fourth respondent
ADV JM JACOBS N.O.
Fifth respondent
___________________________________________________________________
JUDGMENT
__________________________________________________________________
[1] The repeal of the Labour Relations Act, No 28 of 1956 (“the
Act”) gave rise to a great deal of anxiety amongst the members
of
the industrial court. They feared that they might lose their jobs
as the projected new Labour Relations Act made no provision
for the
industrial court. Mr Schoeman, the first respondent herein, a
senior member of the industrial court, moved by that fear,
addressed
a letter to the Director General of Labour, second appellant, on 10
June 1996, demanding that the Department of Labour
should provide
him with suitable job security or, in lieu thereof, his remuneration
until he reached the age of 66 years.
[2] When his demand was not met, on 5 July 1996 he applied for the
establishment of a conciliation board under section 18 of the
Public
Service Labour Relations Act, 1994 (“the PSLRA”). When no board
was established within 10 days as required by the PSLRA,
he referred
the dispute to the industrial court on 2 August 1996. The essence
of his complaint in the court below was that the
Minister of Labour,
the first appellant herein, and the second appellant had failed to
consult timeously with him over the future
course of his career. He
sought, in the main, an order requiring the appellants to provide
him with work security consistent with
his career and status until
he reached the age of 66 years. In the alternative, he sought
compensation.
[3] The appellants raised, as a
point in limine
, the defence
that the first respondent was not an employee within the meaning of
the PSLRA. On the merits, the appellants maintained
that they had
complied with such duty as was imposed on them by the dictates of
fairness to consult with the members of the industrial
court over
their careers.
[4] The
point in limine
came before Messrs du Plessis and du
Plessis AMM, and was dismissed on 30 April 1997. On 11 August 1997
the application came before
a panel of three members of the
industrial court (Mr A Jacobs and Mesdames M Grobbelaar and JM
Jacobs) for a decision on the merits.
After hearing evidence, the
court handed down its judgment on 6 February 1998 holding that “the
conduct of [appellants] in creating
a situation of redundancy
without proper or any consultation with the applicant was unfair and
constituted an unfair labour practice.”
The court awarded the
first respondent compensation in the sum of R1,027,000,00 together
with costs.
[5] The present appeal is against both the judgments on the
point
in limine
and on the merits and against the award of
compensation. The first respondent has cross-appealed against the
award of compensation.
[6] The appellants also seek an order reviewing and setting aside
the decision of the industrial court on the grounds of appearance
of
bias. The appellants say that the perception of bias is created by
the tone and content of the judgment read in the context
of the
circumstances under which the hearing proceeded and the manner in
which the hearing was conducted. These circumstances
include the
fact that a member of the court complained before other members of
the same court that members of the court, including
one of those
members who had to decide the matter (i.e. the permanent member),
had been treated unfairly and the fact that the
witnesses who gave
evidence on behalf of that member were members of the same court,
including the president of that court.
[7] The first respondent and two of the members of the court
a
quo
oppose the application for review on various grounds.
However, in the view I take of the appeal, it is not necessary to
decide
the review.
[8] Apart from the question of the appropriateness of the
compensation awarded, two issues arose in this appeal, namely:
(a) Is the first respondent an employee within the meaning of the
PSLRA?
(b) Did the Department consult timeously and properly with the
members of the industrial court, including the first respondent,
in
respect of the phasing out of the industrial court?
[9] A negative answer to the first question will dispose of the
appeal and render it unnecessary to decide the second question.
[10] For the industrial court to have jurisdiction in respect of the
dispute referred to it by the first respondent under sections
18 and
24 of the PSLRA, it was necessary for the first respondent to
establish that he was an employee within the meaning of section
1(xi) of the PSLRA. That section defines “employee” to mean:-
“an officer or employee as defined in section 1(1) of the Public
Service Act, and includes, for the purposes of sections 18,
22(2)(a), 23, 24 and 25, as well as section 22 in so far as it
pertains to the said sections, a person who was such an officer
or
employee, but does not include -
(a) a person employed in terms of an Act other than the Public
Service Act or the Correctional Services Act, 1959 (Act No. 8 of
1959); and
(b) a person whose salary and conditions of employment are
determined according to general education policy in terms of section
2(1)(b) and (2) of the National Policy for General Education Affairs
Act, 1984 (Act No 76 of 1984);”
[11] The appellants contend that the first respondent falls within
the exclusion in paragraph (a) in that he is a person employed
in
terms of the Act which is “an Act other than the Public Service
Act or Correctional Services Act”.
[12] The industrial court is a creature of the Act. It was created
by section 17(1)(a) of the Act. In terms of section 17(1)(b),
members of that court “shall be appointed by the Minister”.
Members are appointed “on such conditions as [the Minister]
may
with the concurrence of the Minister of Finance determine”.
(Section 17(1)(c)). Members of the industrial court are, therefore,
appointed in terms of the Act. They are, as a consequence, “persons
employed in terms of an Act other than the Public Service
Act”.
They are not, therefore, employees within the meaning of section
1(xi) of the PSLRA.
[13] That the employment contract which the first respondent
concluded with the Department of Labour incorporates, by reference,
certain features of the Public Service Act, matters not. In terms
of section 17(1)(c) of the Act, the Minister may determine the
conditions of employment to be applicable to members of the
industrial court. What the Minister did was merely to determine
that
certain provisions of the Public Service Act will be applicable
to the employment of the first respondent in accordance with section
17(1)(c) of the Act. The incorporation, by reference, of certain
provisions of the Public Service Act does not make the appointment
of the first respondent one in terms of the Public Service Act.
Indeed the contract of employment expressly states that the first
respondent “dien kragtens artikel 17".
[14] The first respondent, who appeared in person, contended that he
is an employee as defined in the PSLRA. As I understood the
argument it proceeded on the basis that the phrase “but does not
include” qualifies, and, therefore, applies to former employees.

And so, he argued, the exclusionary clause has no application to
persons who are still in employment. The first respondent
was
constrained to concede that had the phrase “and includes, for the
purposes of sections 18, 22(2)(a), 23, 24 and 25, as well
as section
22 in so far as it pertains to the said sections, a person who was
such an officer or employee,” been omitted from
the definition, he
would been hit by the exclusionary clause. He contended, however,
that the inclusion of this phrase require
that the remainder of the
definition be given an interpretation which it would otherwise not
have had.
[15] There are a number of considerations militating against this
argument. Upon a proper construction the section does not lend
itself to the interpretation contended for. The section
contemplates two classes of employees, namely, those who are still
in
employment and those who were but are no longer in employment
because they may have been dismissed but are challenging their
dismissal.
It makes both these classes of employee subject to the
same qualifications, namely, that they must not have been employed
in terms
of statute other than the Public Service Act or the
Correctional Services Act. Had the exclusionary clause been
intended to apply
to former employees only, the legislature would
surely have used the past tense in subparagraphs (a) and (b) and not
the present
tense as it did.
[16] Apart from the aforegoing, if the exclusionary clause were to
apply to former and not present employees, an anomaly would
result.
A member of the industrial court would be an employee as defined in
the section while still in employment. Once the same
member leaves
his/her employment, he would cease to be an employee as the
exclusionary clause would then be applicable as he would
be a person
employed in terms of an Act other than the Public Service Act or the
Correctional Services Act. Yet the very purpose
of including former
employees within the definition of an employee was to protect former
employees who might have a cause for complaint
against their former
employer. The legislature could not have intended such an anomalous
result.
[17] I conclude, therefore, that the first respondent is not an
employee within the meaning of section 1(xi) of the PSLRA. The
industrial court had, as a consequence, no jurisdiction to determine
the alleged dispute. The
point in limine
, ought to have been
upheld.
[18] In view of the conclusion I have reached on the point
in
limine
, it is not necessary to decide the second issue. A
necessary consequence of upholding the appeal is the dismissal of
the cross-appeal.
[19] Mr Brassey, who, together with Mr Van der Riet, appeared on
behalf of the appellants, pressed for the costs of the review
against the first respondent. Mr Vorster, who appeared on behalf of
the fourth and the fifth respondents, did not ask for costs.
[20] It is trite that the award of costs is a matter which is
largely within the discretion of the court. In regard to the costs
of the issues which have not been decided, the court may, in the
exercise of its discretion either direct that neither party pay
such
costs or award those costs to the party who was substantially
successful.
Read v South African Medical and Dental Council
1949 (3) SA 997
(T) at 1026-1028
, and
BEF Pty Ltd,
Cape Town Municipality and others
1990 (2) SA 337
(C) at 346B-347D.
In the latter case, Grosskopf J, as he then was, after reviewing the
relevant authorities, concluded at 347B:
“The principles, therefore, are that I may either order the costs
of the undecided issues to be costs in the cause and to be
paid by
the substantially unsuccessful party, or I may, if the circumstances
warrant make a special order that neither party pay
costs of
unresolved issues.”
[21] It seems to me that there is no reason both either in principle
or logic why the principles applicable to an award of costs
on
unresolved issues should not be applicable to the award of costs in
regard to review proceedings which were not decided. Where
the
court is called upon to decide both the review and an appeal, and
the court takes a firm view of the appeal, the court cannot
be
required to determine the review merely in order to settle liability
for costs. In my view the court has a discretion either
to order
that the costs of the review be costs in the cause or to make no
order in respect thereof.
[22] Relevant considerations in the present case include the
following: counsel for the appellants did not seek an award of costs
against the fourth and fifth respondents; the appellants would in
any event have brought the review proceedings with or without
the
opposition by the first respondent; the opposition by the first
respondent did not significantly increase the costs; having
regard
to the fact that the appellants rely, for their review, on perceived
bias as opposed to actual bias, I cannot, without deciding
the
review, conclude that the first respondent’s opposition to the
review proceedings was without merit; and not having decided
the
review, I am unable to say which side is right.
[23] In all the circumstances I conclude that justice and fairness
require that no party be ordered to pay the costs of the review
proceedings.
[24] As for the costs of the appeal, the general rule that the costs
should follow the result must apply.
[25] In the event, I make the following order:
(a) The appeal is upheld and the order of the industrial court is
set aside and there is substituted therefor the following order:
(1) The point
in limine
is upheld.
(2) The application is dismissed.
(3) No order is made as to costs.
(b) No order is made on the application for review.
(c) The first respondent is ordered to pay the costs of the appeal
and the cross-appeal, such costs to include the costs consequent
upon the employment of two counsel.
_____________________
Ngcobo AJP
I agree,
_______________
Kroon JA
I agree,
________________
Conradie JA
Date of hearing: 16 February 1999
Date of judgment: 23 February 1999
Appearances:
For the appellant: MSM Brassey SC, (with him JG Van der Riet)
instructed by Cheadle Thompson & Haysom
For the first respondent: Adv JCB Schoeman (appeared in person)
For the fourth and fifth respondent: L. Vorster SC instructed by the
State Attorney