Baloyi v M & P Manufacturing (JA23/2000) [2000] ZALAC 28 (14 December 2000)

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[2000] ZALAC 28
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Baloyi v M & P Manufacturing (JA23/2000) [2000] ZALAC 28; [2001] 4 BLLR 389 (LAC); (2001) 22 ILJ 391 (LAC) (14 December 2000)

IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
HELD AT JOHANNESBURG
CASE
NO. JA 23/2000
MOSES BALOYI

Appellant
and
M
& P MANUFACTURING
Respondent
JUDGMENT
DAVIS
AJA:
[1] On 22 December 1999
Revelas J
sitting
in the Labour Court dismissed the application of the appellant for
reinstatement on the grounds of unfair dismissal with
costs. With
leave of the learned judge the appellant appeals against the order
concerned. In terms of Rule 9(3)(a) of the Rules
of this Court, the
heads of argument of the appellant and the respondent must include a
chronology of the material facts. Counsel
for both parties failed to
comply with this rule rendering the task of identifying the material
facts more difficult. The rule concerned
is intended to facilitate
the work of this court and its breach is a serious matter.
[2] Practitioners should be warned that an
appeal court is entitled to refuse to hear an appeal where there is
material non-compliance
with an important rule relating to heads of
argument and that where such refusal occurs this court may well
decide that any wasted
costs resulting from such refusal are to be
borne by the draftsman.
[3] The appellant was an employee of the
respondent until he was dismissed by it on 6 February 1998. The
appellant was a member of
a trade union which acted as his
representative at the respondent’s business.
[4] The appellant’s dismissal occurred
because of the respondent’s operational requirements
1
and in terms of provisions of section 189 of the Labour Relations Act
66 of 1995 (“the LRA”).
[5] The respondent has a small business run by
two brothers Mr Michael John Lawrensen and Mr Paul Edmund Lawrensen.
It manufactures
wrought iron furniture and decorations for the
domestic market. It employs three welding teams normally consisting
of welders, grinders
and welders’ assistants. In her judgment
Revelas J
said that the parties were agreed “that the
respondent adopted the LIFO method, together with skills and
disciplinary records as
the selection criteria for the retrenchment
exercise which it embarked on and which it announced to the union and
its employees on
20 January 1998”.
[6] In the course of her judgment the learned
judge rejected the applicant’s contention that his dismissal had
been automatically
unfair. She accepted that the two welders whose
services were retained had superior skills to those of the appellant
in that the
appellant needed supervision, whilst the others did not
and further in that he had the least artistic skills which were
required
for the manufacture of the bulk of the items produced by the
respondent. She went on to find that the selection criteria adopted
by the respondent were objective and fair She also found that the
respondent had deviated “from LIFO as the sole criterion”
and
that this had been sufficiently justified by it In the result she
found not only that the dismissal was for a fair reason but
that it
was also procedurally fair.
[7] Mr Bruinders, who appeared on behalf of the
appellant, contended that since the appellant was selected for
retrenchment because
he was less skilled and less “artistic” than
his two colleagues who were not retrenched and because of poor past
performance
and misconduct the respondent ought to have consulted
with him personally. Thus, appellant was denied an opportunity to
make representations
in support of his skills, past performance, or
work record and to question the credentials of the two welders who
were retained.
[8] According to Mr M
Lawrensen the selection criteria utilised in deciding on the
appellant’s retrenchment were “general working
skills, retaining
employees with superior work skills, records of poor performance,
misconduct, absenteeism and…length of service”.
[9] In regard to the
company’s manufacturing business he said that it manufactured
“decorative wrought iron furniture and household
accessories (l)ike
lamps, wall sconces, candle sticks and various other decorative
ornamental pieces for the home…artistic goods,
goods that are not
generally available on the side of the road or in normal retail
stores”
[10] Mr P Lawrensen
testified that the business did not consist of “repetitive work
that is done over and over again and he went
on to say that every job
done by the appellant could be different’ and he needed ‘a
certain amount of skill and flair to be able
to produce at the
maximum’”
[11] Mr M Lawrensen said that the other
welders “were more intuitive and more qualified to do the
work…(showing) more initiative
and intuition in assembling and
making artistic type of furniture”. He testified that the
appellant had “the poorest working
skills…(requiring) the most
supervision.” He went on to say that the respondent corrected the
appellant’s work “on numerous
occasions” and that they were
“continually assisting and supervising (him) more than the other
welders”.
[12] It was common
cause that the proposed retrenchments were discussed with
representatives of the National Union of Metal Workers
of South
Africa (“NUMSA”)of whom appellant was a member. During a
meeting held between respondent and NUMSA ON 6 February 1998
respondent showed Mr Mabho of NUMSA and applicant’s order book and
financial statements on the basis of which the Lawrensens sought
to
justify to Mabho the reasons for the decision to retrench.
[13] At this meeting
respondent insisted that it could not adopt the LIFO principle only
as the criterion for retrenchment of a
welder because this would
entail the retrenchment of another welder who was far superior in
ability to appellant.
[14] Notwithstanding
that Mr Mabho expressed the dissatisfaction of NUMSA with this
decision to retrench appellant and contested
the amount and delivery
of the information provided by respondent, it is clear from the
record that respondent consulted with NUMSA
about the retrenchments
in the manner prescribed in terms of section 189(1)(c) of the LRA
[15] The nature of
the consultation process is described by Mr M Lawrensen in a letter
of 6 February 1998 which he addressed to
Mr Mhabo as follows:
“As advised the reasons for the retrenchment
are as a result 1. of the general downturn in the economy. 2. The
decline in the financial
position of the company due our failure to
secure another hotel order/orders. 3. General reduction in work. 4.
Decline in the demand
for our products
This has necessitated
us having to reduce the number of staff by one production team. We
intended retrenching one production team
as a whole but after
discussions with yourselves we agreed to compromise and retrench
Mthetho Mhi and Tobi Mcingeni. It was never
our intention to
terminate their services as they are outstanding workers, however in
the spirit of co-operation we reluctently agreed.
The criterea which we
followed in the selection of the employees we intended to retrench
was based on 1. General working skills.
2. Retaining employees with
superior work skills to others 3. The records of poor performance,
misconduct and absenteeism 4. Length
of service.
Using this criterea we
decided to include Moses Baloyi as our candidate for retrenchment
among the three ‘welders’. Notwithstanding
the fact that Moses
Baloyi was employed prior to Lucky we have had to, in the interests
of the company, consider the other criterea
which outweigh your LIFO
policy. It must be borne in mind that Moses Baloyi was only
employed two and three months before the other
two ‘welders’.
Being a very small
company the other criterea besides length of service are very
important to us, in fact they could make the difference
between
success and failure of the company. Moses unfortunately has the
poorest working skills, requires the most supervision and
has the
worst disciplinary record of the three ‘welders’. We are
therefore of the opinion that it is in the best interest of
the
company and rest of the employees that Moses Baloyi was selected for
retrenchment and will accordingly by retrenched by ourselves.
We confirm that we have
as agreed, terminated the services of all our contract workers with
immediate effect in line with your policy.
As agreed the
retrenchment will take effect on Friday, 6 February 1998 and letters
of retrenchment will be handed to Moses Baloyi,
Mthetho Mhi, Tobi
Mcingeni.
Taking all the above
into consideration we believe that the retrenchments and selection of
candidates are the only alternative left
to us and we trust you will
agree that litigation in this regard will be uncalled for.”
[16] Wisely Mr Bruinders did not argue that
there had been no compliance by respondent with its duty to consult
with NUMSA in terms
of section 189(1). However in developing his
argument that, in addition to consulting with NUMSA, respondent was
obliged to afford
appellant a hearing, he referred to the testimony
of Mr M Lawrensen to the effect that appellant had not been invited
to join the
meeting with NUMSA as he had been nominated as a
candidate for retrenchment. Mr Bruinders contended that this
explanation was legally
invalid and that appellant should have been
afforded an opportunity to answer allegations about his lack of
“artistic flair”
and skill as a welder. As respondent had
employed subjective criterea in arriving at its decision to retrench
appellant, the latter
should have been afforded a proper opportunity
to counter such subjective assessments.
[17] In support of this submission Mr Bruinders
relied upon a passage in the judgment of
Joffe J
in
Brenner
& Buchman (Pty) Ltd v S A Commercial Catering the Allied Workers
Union and Others
(1994) 15 ILJ 604 (LAC) at 609 B-F “Furthermore,
it is clear that after the selection process had taken place none of
the proposed
retrenched employees were given an opportunity of making
representations to the appellant. In the circumstances they were
entitled
to do so and the failure to give them this opportunity also
constituted an unfair labour practice. In this regard reference is
made
to
Rycroft and Jordaan,
Guide to the South African
Labour Law
, where the following is stated:
‘In addition to general consultation with
worker representatives, there may be a need for individual
consultation. The more vague
and subjective the criteria adopted for
redundancy selection, the more powerful is the need for the employee
to be given an opportunity
of personal consultation before he is
judged by it. In cases where the selection criteria are based on an
employee’s performance
and past work record, the rules related to
procedural fairness in the cases of dismissal based on misconduct or
incapacity have been
held to apply: retrenched workers should be
given the opportunity to ‘defend’ their work records, and to
question those of others’.”
[18] The difficulty with applying this
dictum
to the facts of the present case is that it was predicated upon the
concept of an unfair labour practice which was central to the
legal
dispensation regulated in terms of the Labour Relations Act 28 of
1956 [as amended]. Under the LRA the concept of an unfair
labour
practice is only directly relevant to the transitional arrangements
regulated in terms of Schedule 7 to the Act. Accordingly
the premise
upon which
Joffe J’s
judgment is based in
Brenner’s
case is not applicable to the present dispute which stands to be
decided in terms of the LRA.
[19] A further question was raised as to
whether section 185 which provides that every employee has a right
not to be unfairly dismissed
imports a concept of fairness similar to
an unfair labour practice into the LRA. This submission needs to be
considered within the
context of section 189 of the LRA, subsection
(i) which provides,
inter alia
,
as follows:
When an employer contemplates dismissing one
or more employees for reasons based on the employer’s operational
requirements, the
employer must consult
……. (c) if there is no workplace forum in
the workplace in which the employees likely to be affected by the
proposed dismissals
are employed, any registered trade union whose
members are likely to be affected by the proposed dismissals;
(d) if there is no such trade union, the
employee likely to be affected by the proposed dismissals or their
representatives nominated
for that purpose.
Section 189(2) provides that” [t]he
consulting parties must attempt to reach consensus on
(a) appropriate
measures
to avoid dismissals;
to minimise the number of dismissals;
to change the timing of the dismissals; and
to mitigate the adverse effects of the
dismissals;
(b) the method for selecting the employees to
be dismissed; and
(c) the severance pay
for dismissed employees.”
[20] In short, section 189 (1) provides for the
identity of the parties to be involved in the process of consultation
with the employer.
Section 189(2) sets out the agenda and objectives
of the process to be adopted by an employer when the latter
contemplates dismissing
employees for reasons based upon operational
requirements.
[21] Read together, the
two subsections represent the codification of the standards which had
previously been developed by way of
the principle of fairness as
contained in the concept of an unfair labour practice. Section 185
may well require that an employer
must comply with both the substance
and the form of the requirements as contained in section 189, but it
adds nothing to the content
of the process to be followed.
Given the nature of the detailed codification
of the procedure to be adopted for such dismissals, it cannot be said
that some residual
test remains, notwithstanding that the employer
has complied meticulously with the requirements as laid out in
section 189(1) and
(2).
[22] It was not contended that respondent did
not follow the proper procedures in dealing with NUMSA nor, in the
light of the meetings
to which reference has already been made, could
such an argument have been justified. The argument that the
appellant should have
been afforded a hearing in person in
circumstances where the union which represented him had properly been
consulted runs counter
to the express terms of the section. CF.
Benjamin and Others v Plessey Tellumat SA LTD
(1998) 19 ILJ
595 (LC) at para 31.
[23] In keeping with a
premise of the Act, section 189(1) envisages that the collectivities
of management and labour represented by
trade unions should engage in
an appropriate process of consultation, save where the affected
employees are not so represented.
To interpret the section so as to
allow an employee represented by a union to engage in a parallel
process of consultation would
undermine the very purpose of the
section.
[24] In the result the
appeal is dismissed with costs.
_______________
DAVIS AJA
I agree.
_______________
ZONDO JP
I agree.
_______________
GOLDSTEIN AJA
For the Appellant:
T. Bruinders
Instructed by Cheadle, Thompson & Haysom
For the Respondent:
A.J. Nel
Instructed by Snyman van der Heever Heyns Inc.
Date of Hearing:
15 November 2000.
Date
of Judgment:
14 December 2000.
1
The term “operational requirements” is defined in
section 213 of the LRA to mean “requirements based on the
economic, technological,
structural or similar needs of an
employer;….”