L & C Steinmuller (Africa) Ltd v Shepherd (JA40/2002) [2004] ZALAC 11; (2005) 26 ILJ 2359 (LAC) (9 July 2004)

About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Labour Appeal Court
SAFLII
>>
Databases
>>
South Africa: Labour Appeal Court
>>
2004
>>
[2004] ZALAC 11
|

|

L & C Steinmuller (Africa) Ltd v Shepherd (JA40/2002) [2004] ZALAC 11; (2005) 26 ILJ 2359 (LAC) (9 July 2004)

IN THE LABOUR
APPEAL COURT OF SOUTH AFRICA
CASE
NO: JA 40/2002
In
the matter between:
L
& C STEINMULLER (AFRICA) LTD
First
Appellant
KLOCKNER-BECORIT
CORPORATION SA (PTY) LTD
Second
Appellant
STEINMULLER
MINING & PIPING SYSTEMS (PTY) LTD
Third
Appellant
and
HENDRIK
SHEPHERD
Respondent
JUDGMENT
WILLIS
JA
:
[1]
The respondent (to whom I shall refer as “the employee”)
referred a dispute concerning an alleged unfair labour practice
relating to his dismissal by the second appellant to the now defunct
Industrial Court in terms of section 46 (9) of the old Labour
Relations Act, No.28 of 1956 (“the old Act.”). As the alleged
unfair labour practice arose prior to November, 1996, the dispute
must, in terms of item 21 of schedule 7 of the current Labour
Relations Act, No 66 of 1995 (“the LRA”), be determined as if the
old Act had not been repealed. Since the abolition of the industrial
court, unfair labour practice disputes that arose before the
new Act
are dealt with by commissioners of the Commission for Conciliation,
Mediation and Aribitration (“the CCMA”) exercising
the same
powers that the Industrial Court had. A commissioner of the
Commission for Conciliation Mediation and Arbitration (“the
CCMA”)
gave a judgment on 2
nd
September, 2002. The final paragraph of that judgment reads as
follows:
“
For
the reasons stated above I am of the view that the applicant’s
dismissal with effect from 31
st
May 1994 constituted an unfair labour practice. No other finding or
order is made in terms of the parties’ agreement that I, at
this
stage, only make a finding as to the merits of the dispute. All other
possible orders are reserved for decision once the parties,
or any
one of them approach the CCMA to this effect.
”
The
appellants appeal against that judgment and order.
[2]
The employee had held the position of contracts manager in the second
appellant at the time that the business of the second appellant
had
been amalgamated with several other businesses, resulting in a
restructuring and certain retrenchments within the second appellant
and the other businesses. The second appellant and the other
businesses were amalgamated in the third appellant. The third
appellant
is a wholly owned subsidiary of the first appellant. The
new business that was created was that of the third appellant. The
restructuring
exercise, although it had been conceived in 1993 and
the initial consultation processes had begun then, was only finalized
in 1994.
[3] The
employee was offered the position of business manager, mining, in the
third appellant on the same terms and conditions as
applied in his
position with the second appellant. This took place on 2
nd
February, 1994. The employeee discussed aspects pertaining to the new
position with the director to whom he would be required to
report in
the new structure, Mr Szerdahelyi. This took place on 3
rd
February, 1994. The employee had previously reported to Mr Eales, the
managing director of the second appellant. He became a director
in
the third appellant and reported also to Mr Szerdahelyi.
[4] The
employee addressed a memorandum to Mr Szerdahelyi on 17
th
February, 1994 in which he indicated that he would accept the
position subject to certain conditions. Among them were that he be
transferred to Rivonia and be paid a tax-free relocation allowance,
that he be compensated for any losses incurred in selling his

existing house and buying a new one, a housing subsidy and collateral
security? for the new house, payment of his transfer and legal
fees,
a tax-free travel allowance, and that his car allowance and benefits
be increased. Mr Szerdahelyi replied in writing on 21
st
February advising that the employee’s expectations “
are
beyond what is possible now and for the foreseeable future. We would
appreciate a discussion, at your earliest convenience, to
review
possible alternative positions within the group.
”
[5] It
would appear that meetings took place between the employee and Mr
Szerdahelyi between 17
th
and 21
st
February, 1994. Nothing turns on this other than that the fact that
such meetings did take place indicates that the employer was
prepared
to consider the matter. The two men met on 7
th
March, 1994 to discuss the matter further. No resolution was reached
and a letter was then sent to the employee on 10
th
March, 1994 advising that the employee’s services would be
terminated with effect from 31
st
May, 1994 by reason of his redundancy. The employee’s attorneys
addressed a letter to the “Steinmuller Groep van Maatskappye”
on
24
th
August, 1994 in which the fairness of the employee’s dismissal was
disputed. This was the issue before the Industrial Court which
was
dealt by the commissioner of the CCMA.
[6]
The
commissioner found that the appellants “
never
entered into a meaningful consultation with the applicant in order,
first of all, to discuss and motivate the third respondent’s
reasons for not being in a position to accede to any of the
conditions laid down by the applicant, and secondly, to make a
serious
and bona fide endeavour to reach consensus with the applicant
on the terms and conditions under which he should, or be prepared,
to
accept the job offer made to him, and, failing that, put the
applicant in a position either to accept the third respondent’s
job
offer on terms and conditions spelled out by it, or to accept the
alternative of being dismissed for operational reasons.
”
He went on to say in his judgment:
“
I
am of the view that the third respondent acted unfairly in not, first
of all, making a reasonable effort to convince the applicant
to
accept the job offer on its face value as a means for avoiding his
dismissal by engaging in bona fide and meaningful discussions
regarding his expectations to the extent of at least trying to
convince him that his expectations were unreasonable, and, secondly,
to put him in a position to either accept the job offer unequivocally
or run the risk that the job offer would be withdrawn.
”
[7]
In my opinion, there were meaningful consultations, on several
occasions, both after the employee was made the offer and after
he
rejected it and made counter-proposals. I do not see what more could
reasonably have been expected of the appellants. Neither
in law nor
in fairness, is there is any obligation that rests upon an employer
who offers an employee alternative employment in
order to avoid
retrenchment to make an effort to
convince
the employee to accept the alternative offer. This is the position
both under the old Act and the LRA. In the circumstances of the
present case, the notion is ridiculous. The Industrial Court was
plainly wrong in making such a finding. On the facts before us,
there
was no unfair labour practice committed by the appellants relating to
the dismissal of the employee. Accordingly the appeal
must be upheld.
[8] As
to costs, in terms of section 17(12)(a) of the old Act the Industrial
Court could make a costs order “according to the requirements
of
law and fairness” and section 17 (21A) (c) provided similarly for
the Labour Appeal Court. See also
National
Union of Mineworkers v East Rand Gold & Uranium Co Ltd
(1991)
12 ILJ 1221 (A) at 1241J-1243E and
Callguard
Security Services (Pty) Ltd v Transport & General Workers Union &
Others
(1197) 18 ILJ
380 (LC) at 389 H to 390A. It seems appropriate that, in this case,
costs should follow the result both in the Industrial
Court and this
Court.
[9]
The following order is made:
The
appeal is upheld;
The
order of the Industrial Court is set aside and the following
substituted therefor:
“
The
application is dismissed with costs.”
The
respondent is to pay the appellants’ costs in the appeal.
N.P.
WILLIS
JUDGE
OF APPEAL
I
agree.
R.
M. M. ZONDO
JUDGE
PRESIDENT
I
agree.
C.
N. JAFTA
ACTING
JUDGE OF APPEAL
Counsel
for Appellant:
W.G.
La Grange
Attorneys
for Appellant: Bell Dewar & Hall
Counsel
for Respondent:
P.G.
Leeuwner
Attorneys
for Appellant: Retief Venter
Date
of hearing: 4
th
June, 2004
Date
of Judgment: 9 July, 2004