Wyeth SA (Pty) Ltd v Manqele and Others (JA 50/03) [2005] ZALAC 1; (2005) 26 ILJ 749 (LAC); [2005] 6 BLLR 523 (LAC) (23 March 2005)

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Wyeth SA (Pty) Ltd v Manqele and Others (JA 50/03) [2005] ZALAC 1; (2005) 26 ILJ 749 (LAC); [2005] 6 BLLR 523 (LAC) (23 March 2005)

28
IN THE LABOUR APPEAL
COURT OF SOUTH AFRICA
(HELD AT JOHANNESBURG)
CASE NO: JA 50/03
In the matter between :
WYETH
SA (PTY) LTD Appellant
and
MANQELE,
T First Respondent
MOLETSANE, R NO Second Respondent
THE COMMISSION FOR CONCILIATION,
MEDIATION
AND ARBITRATION Third Respondent
SECURITY
RETAIL TRANSPORT &
ALLIED
WORKERS UNION OF
SOUTH AFRICA Fourth Respondent
NICHOLSON
JA; PILLAY AJA; NKABINDE AJA
JUDGMENT
NKABINDE
AJA:
INTRODUCTION AND FACTUAL BACKGROUND
[1] This is an appeal against the judgment of the Labour
Court in which that Court dismissed an application to review the
ruling by
the second respondent (“the commissioner”) that the
first respondent, Mr T Manqele (“Manqele”), is an employee as
defined
in terms of s 213 of the Labour Relations Act No. 66 of 1995
(“the LRA”).
[2] The facts of this case, briefly dealt with
hereunder, are relatively simple but give rise to interesting and
controversial points
of law.
[3] On 14 March 2000 and pursuant to an interview the
appellant made a written offer of employment (“the contract”) to
Manqele
for a position of a sales representative in the Nutritional
Division at its Midrand offices. The commencement date was 1 April
2000.
The contract deals,
inter alia,
with employment duties, termination of employment, remuneration,
hours of work, medical aid fund, free life assurance, overtime,
sick
leave
et cetera.
The
appellant sought written acceptance of the offer. On 15 March 2000
Manqele accepted the offer by signing the contract in a space
provided.
[4] The
appellant undertook to provide Manqele with a company motor vehicle
for company business and reasonable use for private purposes
as part
of his remuneration package.
[5] Prior to the offer on 14 March 2000 and the
acceptance thereof on 15 March 2000 the appellant advised the
employee to look for
a new motor vehicle for a maximum purchase price
of R124 000, 00 as the company which financed the motor vehicle was
not prepared
to finance second-hand motor vehicles. The employee
selected a BMW 316 motor vehicle which upon inspection, by the
financing company,
turned out to be a second hand motor vehicle.
Accordingly the appellant’s Human Resources Manager, Mr G
Whitefield (“Whitefield”),
maintained that such vehicle could not
be financed. Manqele was advised again to find a new motor vehicle.
On 14 March 2000 he identified
an Opel Astra motor vehicle. It is
then that Whitefield, allegedly believing that the issue of a new
motor vehicle had been resolved,
made the aforementioned offer of
employment to Manqele which the latter accepted on the next day. A
few days thereafter Whitefield
was advised by the financing company
that the selected ‘Opel Astra motor vehicle had gone out of
production some time ago and could
therefore not be a new motor
vehicle’ as allegedly represented by Manqele. Whitefield made
enquiries about the Opel Astra. According
to him he considered
Manqele’s alleged misrepresentation in a serious light. He then
discussed the matter with senior management.
Prior to 1 April 2000,
being Manqele’s date of commencement, Whitefield terminated the
contract of emplyment because ‘the parties
had been unable to reach
consensus as to the condition of the motor vehicle as stipulated in
the letter of employment’. Manqele
nevertheless reported for work
on the commencement date. He was advised by the appellant’s human
resources officer that ‘he would
not be employed by the appellant
and that he should leave the premises’. He then left the premises.
[6] Manqele alleged
an unfair dismissal in terms of s 191(1) of the LRA and referred the
matter to the third respondent, the Commission
for Conciliation,
Mediation and Arbitration (“the CCMA”), for conciliation. He was
and continues to be assisted by the fourth
respondent, Security
Retail Transport & Allied Workers Union of South Africa (“RAWU”).
The matter was set down for conciliation
but the appellant, according
to the certificate of outcome, failed to attend the conciliation. The
dispute remained unresolved. It
was then referred to arbitration.
[7] At the
arbitration the appellant raised a jurisdictional point contending
that the CCMA lacked jurisdiction to conciliate the
dispute because
no employment relationship had come into existence between itself and
Manqele. The parties agreed that this point
be determined on the
papers.
[8] The Commissioner, in dismissing the point raised,
determined that-
“30. From the definition… it is apparent that the Act
envisaged a dismissal as also including cancellation of
a contract
of employment.
31. In
casu
this is exactly what happened, the respondent
terminated the contract of employment.
32. …
only the employee can be dismissed. In my view Mr Manqele became an
employee the moment he accepted an offer of employment.”
[9] On review in terms of s 158(1) (g) of the LRA the
appellant raised two grounds, contending that the commissioner
committed:-
(a) a gross irregularity in handing down a ruling in
circumstances where another commissioner had heard oral submissions
from the
parties’ respective representatives concerning the merits
of the matter ; and
(b) a
material error of law entailing non-performance of his duties
alternatively that he arrived at an unjustifiable conclusion in
determining that Manqele was an “employee” of the appellant as
defined in s 213 of the LRA.
[10] The Labour
Court dismissed the application with costs and found that Manqele, as
a party to a valid and binding contract of employment,
is an
“employee” for the purpose of a claim under Chapter VIII of the
LRA.
[11] On appeal, leave having been granted by the Court a
quo, the appellant’s main ground of appeal is that the Court a quo
erred
in finding that the definition of employee as contemplated in s
213 of the LRA includes a person who has entered into a contract
of
employment but has not commenced employment. It is contended that the
court
a quo
ought to
have found that the commissioner, in finding that Manqele was an
employee on the basis of him having concluded a contract
of
employment with it even though the former had not yet commenced
working, committed misconduct in the performance of his duties,
alternatively, committed gross irregularities in the proceedings, and
further alternatively, exceeded his powers.
[12] Basically
the appeal concerns two questions –
(a) whether or not the contract of employment was
concluded between the appellant and Manqele when it was cancelled by
the former
prior to the date of commencement; and
(b) whether the provisions of the LRA are available to
a person whose contract of employment is terminated prior to the
commencement
of employment and specifically whether the definition of
“employee” includes persons in the position of Manqele .
WAS A CONTRACT CONCLUDED?
[13] The first issue is whether a contract of employment
was concluded or not. In law the legal relationship between the
parties
may be gathered,
inter alia,
from a construction of the contract which they have or might have
concluded (See Smit v Workmen’s Compensation Commissioner
1979 (1)
SA 51
(A) at 64B; Liberty Life Association of Africa Ltd v Niselow
(1996) 17 ILJ 673 (LAC) at 683D-E; SA Broadcasting Corporation v
McKenzie
(1999) 20 ILJ 585 (LAC) at 591E). Regard must also be had to
the realities of the relationship and not what the parties have
chosen
to call the contract (See Dempsey v Home & Property (1995)
16 ILJ 378 (LAC); Brassey ‘The nature of Employment’ (1990) 11
ILJ 889 at 921). At common law an employee in a contract of
employment commits a breach thereof he reneges on his duty of placing
his personal service at the disposal of the employer. The employer on
the other hand breaches the contract of employment if he reneges
on
his undertaking to pay the salary or wages agreed in consideration
for services rendered.
[14] The appellant’s
contention, as evident from the averments in the founding affidavit
deposed to by Whitefield, is, firstly,
that the contract of
employment was not concluded or finalised because ‘an important
term of the agreement concerning the vehicle
… still had to be
finalised’ and that ‘the parties could not reach an agreement on
the price or type of vehicle to be purchased’.
Counsel for Manqele
submitted that a contract of employment had been concluded. It is
beyond question that the terms sought to be
introduced on behalf of
the appellant by Whitefield do not form part of the written contract.
The undertaking by the appellant, evidently
as part of its
obligations in terms of the contract, was to provide Manqele with a
company car for both company business and reasonable
use for private
purposes. According to the parol evidence rule ‘when a contract
has been reduced to writing, the writing is in
general regarded as
the exclusive memorial of the transaction and no evidence to prove
its terms may be given save the document or
secondary evidence of its
contents, nor may the contents of such documents be contradicted,
altered, added to or varied…’ (See
Union Agreement v Vianini
Pipes (Pty) Ltd
1941 AD 34
at 47). Accordingly, the appellant is not
entitled to introduce or add new terms or vary the terms of the
contract. In any event
that, in my view, did not materially change
the purpose of the contract least of all the essence of the intention
and the realities
of the relationship between the parties.
[15] There is no doubt that the parties had concluded a
contract of employment when the appellant reneged before the
commencement
date.
WAS MANQELE AN EMPLOYEE?
[16] Having concluded that an employment contract was
concluded between the appellant and Manqele, the next question for
consideration
is whether Manqele was an employee as defined in s 213
of the LRA. The appellant’s contention is that he was not because
he had
not worked and was neither remunerated nor entitled to
remuneration as contemplated in the definition. In essence the
contention
on behalf of Manqele is that the definition should be
interpreted extensively to include a person in the position of
Manqele.
[17] ‘Like the
yogi contemplating his navel’, says C D Drake in Wage-Slave or
Entrepreneur? (1968) 31 The Modern Law Review 408
‘although without
the same apparent satisfaction, the labour lawyer is necessarily
drawn to the contemplation of the mystery comprised
in the word
“servant” or “employee” (See Brassey, supra, at 889).
Although that was stated in the context of comparing an
“employee”
with an independent contractor it certainly characterizes the quest
for an understanding of the definition in this
case.
[18] Section 213 defines an ‘employee’ as-
“(a) any person, excluding an independent contractor, who works
for another person or for the State and who receives, or is entitled
to receive, any remuneration;
any other person who in any manner assists in carrying on or
conducting the business of an employer,…”.
The
Employment Equity Act No. 55 of 1998
and the Skills Development Act
No. 97 of 1999 contain the same definition of ‘employee’.
PREVIOUS DEFINITIONS OF EMPLOYEE
[19] In determining what the definition of employee
really means it is necessary to investigate the manner in which the
word has
been defined in previous statutes. The earliest labour
legislation that is relevant is the Transvaal Industrial Disputes
Prevention
Act No. 20 of 1909 in which an ‘employee’ was defined
to mean ‘any white person engaged by an employer to perform, for
hire
or reward, manual, clerical, or supervision work in any
undertaking, trade, or industry to which this Act applies…’.
[20] The earliest Union Act, the Industrial Conciliation
Act No. 11 of 1924, was amended by the Industrial Conciliation
(Amendment)
Act No. 24 of 1930, a further Amendment Act No. 7 of 1933
and finally repealed by the Industrial Conciliation Act No. 36 of
1937
which was further repealed by the Labour Relations Act No. 28 of
1956. The Industrial Conciliation Act No. 11 of 1924 defined an
“employee” in s 24 to mean ‘any person engaged by an employer
to perform, for hire or reward, manual, clerical or supervision
work
in any undertaking, industry, trade or occupation to which this Act
applies, but shall not include a person whose contract of
service or
labour is regulated by any Native Pass Laws and Regulations, or by
Act No. 15 of 1911 or any amendment thereof or any
regulations made
thereunder, or by Law No. 25 of 1891 of Natal or any amendment
thereof, or any regulations made thereunder, or by
Act No. 40 of 1894
of Natal or any amendment thereof…’.
[21] In Act No. 36 of 1937 “employee” was to defined
to mean ‘any person employed by, or working for any employer, and
receiving,
or being entitled to receive, any remuneration, and any
other person whatsoever who in any manner assists in the carrying on
or conducting
of the business of an employer but does not include a
person, whose contract of service or labour is regulated by Act No.
40 of 1984
of Natal, or, in terms of section two of the Masters and
Servants Law (Transvaal and Natal) Amendment Act, 1926 (Act No. 26 of
1926),
is regarded for the purpose of Act No. 40 of 1984 of Natal as
a contract between master and servant, or is regulated by the Native
Labour Regulation Act, 1911 (Act No. 15 of 1911), or by the Natives
(Urban Areas) Act, 1923(Act No. 21 of 1923), or by any amendment
of,
or any regulation made under, any of those laws; and “employed”
and “employment” have corresponding meanings…’.
[22] A totally new dispensation followed in 1956 in the
Act finally called the Labour Relations Act 28 No. of 1956 (‘the
1956 LRA”)
in which an “employee” was defined to mean ‘any
person (other than a Bantu) employed by, or working for any employer
and receiving,
or being entitled to receive any remuneration, and any
other person whatsoever (other than a Bantu) who in any manner
assists in
the carrying on or conducting of the business of an
employer; …’. The definition was changed during the years after
1956 as the
government of the time came to accept black persons as
employees (See s 1(c) of Act No. 94 of 1979, as amended by section 1
(f) of
Act No. 57 of 1981 and by section 1 (a) of Act No. 2 of 1983).
Section 1 (a) of Act No. 2 of 1983 defines “employee” to mean
‘any person who is employed by or working for an employer and
receiving or entitled to receive any remuneration, and, subject to
subsection (3), any other person whomsoever who in any manner assists
in the carrying on or conducting of the business of an employer…’.
The sensible trend of having a similar definition in the Basic
Conditions of Employment Act 3 No. of 1983, which was replaced by
the
Basic Conditions of Employment Act No. 75 of 1997(“the BCEA”),
was also implemented.
[23] A perusal of the predecessors of the present
definition reveals that in none of them was it contemplated
that a person only became an “employee”
once he commenced his duties. There is no suggestion that Manqele was
to work for or render
services to any one other than the appellant.
He was controlled by the appellant. I might interpolate here that it
seems to me that
Manqele might well have been said to be working when
he was carrying out one of his duties i.e. that of choosing a motor
vehicle.
That was, however, not fully argued and need not be dealt
with further.
[24] When all is said and done the question remains
whether it is possible, after nearly a century of jurisprudence in
which a person
became an “employee” once a contract was concluded
either orally or in writing, that the legislature decided to change
the position
and accord him that status only when he commenced work?
In order to determine this question it is necessary to consider the
principles
of interpretation.
PRINCIPLES OF INTERPRETATION
[25] It is trite law that in interpreting the provisions
of a statute the Court should apply the golden rule of construction.
This
rule is restated by Joubert JA in
Adampol
(Pty) Ltd v Administrator, Transvaal
1989 (3) SA 800(A)
at 804B-C, as follows:
“The
plain meaning of the language in a statute is the safest guide to
follow in construing the statute. According to the golden or general
rule of
construction the words of a statute must be given their ordinary,
literal
and grammatical meaning and if by so doing it is ascertained
that the
words are clear and unambiguous, then effect should be given
to their
ordinary meaning unless it is apparent that such a literal
construction
falls within one of those exceptional cases in which it
would be
permissible for a court of law to depart from such a literal
construction,
eg where it leads to a manifest absurdity, inconsistency,
hardship
or a result contrary to the legislative intent.”.
(See also Bader Bop (Pty) Ltd v NUMSA & Another
(2002) 23 ILJ 104 (LAC) at para 16; University of the North &
Others v Ralebipi
& Others (2003)24 ILJ2132 (LAC)). I agree with
this as a starting point.
[26] The Court is also justified in considering the
definition in context. Of relevance to the determination of the issue
at hand
are the provisions of s 186 (1) (a), 3 and 200A (1) of the
LRA and s 23(1), read with sections 2 and 39 of the Constitution of
the
Republic of South Africa No. 108 of 1996 (“the Constitution”).
Section 186 (1) (a) defines ‘dismissal’ as meaning
that-
“an employer has terminated
a contract of employment
with or
without notice.”
(my
emphasis)
The LRA contains an interpretative instruction in s 3
which provides that –
“Any person applying this Act must interpret
its provisions –
to give effect to its primary objects ;
in compliance with the Constitution; and
in compliance with the public international law obligations of the
Republic.”.
Section 200A (1) of the LRA which was inserted by s 51
of Act 12 of 2002 provides for a presumption as to who an employee
is. Factors
that brought the presumption into existences, eg, the
employer’s right of supervision and control, might as well be taken
into
account in deciding whether a person is an employee or not (see
P Benjamin ‘ An Accident of History: Who is (and Who Should Be)
and
Employee under South African Labour Law’ (2004) ILJ Vol. 25 787 at
802 and 804).
[27] Section 23 of the Constitution provides that
‘[e]veryone has the right to fair labour practice’ and s 2
provides that the
Constitution is the Supreme Law. Section 39 enjoins
the Court, when interpreting the bill of rights and any legislation
and when
developing the common law or customary law, to promote the
values that underlie an open democratic society based on human
dignity,
equality and freedom, to consider international and foreign
law and promote the spirit, purport and object of the Bill of Rights,
respectively.
[28] Zondo AJP, as
he then was, in
Xaba v Portnet Ltd (2000) 21
ILJ 1739
at para 3.22 remarked that ‘[t]here
is a limit to which the wording of a statute or rule may be
disregarded in the process of an
application of purposive
interpretation’. He considered that ‘such limit is necessary if
we are to heed, as I think we should,
the unanimous warning of the
Constitutional Court given in
S v Zuma and
Others
[1995] ZACC 1
;
1995 (2) SA 642
(CC)
.’. In the
latter case the Constitutional Court,
per
Kentridge AJ, as he then was, was commenting
at 652H-653A on the remarks by Froneman J in
Qozeleni
v Minister of Law and Order and Another
1994 (3) SA 625(E)
at 635B-C.
The remarks were that ‘the previous
constitutional system of this country was the fundamental ‘mischief’
to be remedied by the
new Constitution’. Agreeing specifically
that the Constitution must be interpreted so as to give clear
expression to the values
it seeks to nurture for a future South
Africa, Kentridge AJ remarked, at 653H-653A,
that-
“
While
we must always be conscious of the values underlying
the
Constitution, it is nonetheless our task to interpret a
written instrument. I am well aware of the fallacy of supposing that
general
language must have a single ‘objective’ meaning. Nor is it
easy to
avoid the influence of one’s personal intellectual and moral
preconceptions.
But it cannot be too strongly stressed that
the
Constitution does not mean whatever we might wish it to mean.
…We must heed Lord Wilberforce’s reminder that even a
constitution is a legal instrument, the language of which must be
respected.
If the language used by the lawgiver is ignored in favour
of a general resort to ‘values’ the result is not interpretation
but
deviation. If I may again quote
S v Moagi … I
would say
that a constitution
‘
embodying
fundamental rights should as far as its language permits be given a
broad construction.”.
[29] In
Ceramic Industries Ltd
t/a Beta Sanitary Ware v NCBAWU (2
)
(1997)18 ILJ 671 (LAC)
at 675G-H this Court,
per Froneman DJP remarked,
inter alia,
that
‘[w]here constitutional validity is not an issue it seems that an
interpretation that accords best with the general purpose
of the Act
( as set out in s 1) and the more specific purpose of a particular
section, should be followed.’.
[30] The Constitutional Court in
National
Education Health and Allied Workers Union v University of Cape Town &
Others
2003 (3) SA 1(CC)
at para [41]
remarked,
per
Ngcobo
J, that-
“The
declared purpose of the LRA ‘is to advance economic
development, social justice, labour peace and the democratization
of the
workplace’. This is to be achieved by fulfilling its primary
objects,
which include giving effect to s 23 of the Constitution. It
lays down
the parameters of its interpretation by enjoining those
responsible
for its application to interpret it in compliance with the
Constitution
and South Africa’s international obligations. The LRA
must
therefore be purposively construed in order to give effect to the
Constitution.
…”
.
In
NUMSA & others v Bader Bop
(Pty) Ltd & another (2003) 24 ILJ 305 (CC)
O’ Regan J
remarked
at para [37] that if the Act-
“…is capable of a broader interpretation
that does not limit
fundamental rights, that interpretation should be preferred. This is
not
to say
that where the Legislature intends legislation to limit rights, and
where that
legislation does so clearly but justifiably, such an
interpretation
may not be preferred in order to give effect to the clear
intention of the democratic will of parliament. If that were to be
done, however, we would have to be persuaded by careful and thorough
argument that such an interpretation was indeed the proper
interpretation and that any limitation caused was justifiable as
contemplated
by s 36 of the Constitution.”.
FOREIGN JURISPRUDENCE
[31] It is necessary, for the purpose of this judgment
and in line with the constitutional imperatives, to have regard to
comparable
statutory enactments and case law in other countries as
the jurisprudence in such countries may be an important resource in
developing
the South African Labour law with regard to issues under
consideration. Section 153 (1) of the English Employment Protection
(Consolidation)
Act 1978 (as amended) (“EEPA”) defines an
‘employee’ as –
“an individual who has entered into or works under (or where the
employment has ceased) worked under a contract of employment.”.
‘
Dismissal’
is defined in s 55 of that Act. Attention in that section is focused
on the ‘termination of the contract of employment’.
[32] It must be borne in mind that the definition in s
153 (1) of the EEPA,
supra,
does include ‘an individual who has entered into… a contract of
employment’. The situations are, therefore, not truly
in
pari materia.
The importance , however,
resides in the fact that the English Courts are anxious to keep such
cases in their labour court structures
and not leave it to some
other common law jurisdiction to determine the issue.
[33] A case that is instructive is
Sarker
v South Tees Acute Hospitals NHS Trust
[1997] IRLR 328
,
which shares common features with the instant case. Ms Sarker applied
for and was offered a post by the respondent employer (the
Trust).
Subsequent to the offer which she accepted, the Trust sent her a
formal letter of appointment to which was attached a document
setting
out the particulars of employment referring to a commencement date of
1 October 1995. Before she started work the Trust sought
a commitment
from her that she would work in the post for a minimum of six months.
The particulars of employment in her contract
provided that she was
required to give two months’ notice of termination of employment. A
few days thereafter she was told that
the Trust was withdrawing the
offer of employment. She instituted an action in the Industrial
Tribunal alleging breach of contract
and wrongful or unfair dismissal
on the assertion of her statutory right to notice. She claimed that
she was entitled to pursue a
claim for damages for breach of contract
under the Industrial Tribunal which, in terms of s 131 (2) (a), has
jurisdiction in respect
of a ‘claim for damages for breach of a
contract of employment or any other contract connected with
employment’.
The
Industrial Court found that she had concluded a contract of
employment with the Trust but that her claim was not one which arose
or was outstanding on the termination of the employee’s employment
because as at the date of the alleged breach, there had been
no
termination of her employment as employment had never begun. She
appealed against that decision. The Trust cross-appealed against
the
finding that the correspondence between the parties, as distinct from
an agreement to enter into a contract of employment on
1 October,
amounted to a contract of employment.
[34] On appeal the Employment Appeal Tribunal (“EAT”)
dismissed the cross appeal, allowed the appeal and remitted the case
to
the Industrial Tribunal to deal with the unfair dismissal claim.
The EAT held that-
“The Industrial Tribunal had erred in holding that it did not have
jurisdiction to consider the appellant’s claim for damages
for
breach of contract in circumstances in which she had contracted to
work for the respondent employers but the contract was terminated
before she had commenced work under it.”.
DOMESTIC JURISPRUDENCE
[35] Counsel for the appellant, Advocate A Myburgh,
contended that Manqele was not an employee as envisaged in s 213 of
the LRA. Placing
reliance,
inter alia,
on the decision in Whitehead v Woolworths (Pty) Ltd (1999) 20 ILJ
2133 (LC) he submitted that in interpreting the provisions under
consideration the ordinary, literal and grammatical interpretation
should be adopted. Mr Sebola, of RAWU and who appeared on behalf
of
Manqele, argued that this Court should interpret the provisions under
consideration by adopting a purposive approach. He submitted
further
that the interpretation suggested
on
behalf of the appellant would render the long established Human
resources and Business Practices, of formulating and advertising
positions, interviewing, selecting and appointing applicants for such
jobs, nugatory. He argued further that the risk, if such
interpretation
is adopted, will be too high for prospective employees
who would not be considered employed even after having gone through
all the
HR processes, resulting in a conclusion of a contract of
employment, and still not be considered employees until the day and
time
they report to work, render their services or subordinating
their productive capacity to the employer.
[36] The issue under
consideration has been alluded to in a number of cases which include
Whitehead,
supra,
and
Jack v Director- General Department of
Environmental Affairs
[2003]
1 BLLR 28
(LC)
but has not as yet, as far as
I have been able to ascertain, been dealt with as such. In Whitehead,
the court found the definition
to be totally unsatisfactory. In Jack,
it considered the definition ‘irrational and constitutionally
untenable’. I deal hereunder
with the facts of these cases out of
consideration for the common feature between them and the instant
case.
[37] In Whitehead,
supra,
the applicant (“Whitehead”) having been interviewed, was offered
a job of Human Resources Information and Technology Generalist.
She
did not accept the offer because she considered the remuneration
offered inadequate. The job was re-advertised and, among the
applicants, one Dr Y applied. Whitehead displayed some interest in
the position. The employer (Woolworths) indicated to her that
there
were still applicants to be interviewed before a final decision was
made as to who should be offered the position. She was
interviewed
again and two days later the officer who interviewed her left a
message on her voicemail which, according to her, gave
the impression
that she had been selected for the position. In a subsequent
interview that officer indicated to her that Woolworths
was concerned
about the fact that she was pregnant. She was then offered a
fixed-term contract that would have expired on the expected
date of
her confinement. At that stage the said Dr Y had not yet been
interviewed. Whitehead rejected the offer. Dr Y was appointed
to the
position after his interview. Whitehead then claimed that she was
unfairly dismissed, alternatively, that she had been unfairly
discriminated against on the basis of sex.
[38] The Labour Court found that Whitehead could not
claim to have been dismissed as she was not an employee as defined in
s 213 of
the LRA. In dismissing her claim of an unfair dismissal that
court remarked, at 2173A-C,
inter alia,
that a person, in terms of the definition of the employee-
“… is only an employee when such person actually works for
another
person. The employee must therefore have rendered a service to
another which services are not that of an independent contractor.
In
addition to working for another the employee must also “receive”
or “be entitled to receive” remuneration. The remuneration
must
correspondingly mean remuneration for work done or tendered to be
done. In the circumstances where an offer of employment is
made to
another and the offer is accepted, a contract of employment may come
into existence but the parties to that contract do not
enjoy the
protection of the Act until such time as the offeree actually
commences her performance or at least tenders performance
in terms of
the contract.”
[39] On appeal the Labour Appeal Court in
Woolworths
(Pty) Ltd v Whitehead
[2000] 6 BLLR 640
(LAC)
per
Zondo AJP, as he
then was, remarked at para [13], apparently on the basis
inter
alia,
that Whitehead was not offered the
position by Mr Inskip, that the Labour Court correctly dismissed
Whitehead’s claim for unfair
dismissal. That case is
distinguishable from the instant case,
inter
alia,
because in the latter, as I have found,
a contract of employment was indeed concluded.
[40] In Jack,
supra,
the question which arose was whether Jack was an employee at the time
of breach. Jack had applied for the position and had been told
that
his application was successful. Two weeks after being informed of the
success of his application, the Department sent him a
formal letter
of appointment. On the basis of such letter Jack handed a notice to
his erstwhile employer. Two days before he was
due to commence
working the Department notified him that his appointment had been
revoked. When challenging the dismissal and claiming
relief under the
BCEA the Department raised the defence that the Labour Court lacked
jurisdiction because Jack was not an employee.
Pillay J correctly
observed that Whitehead,
supra
,
was distinguishable on the facts and the law with Jack. She remarked
that if the finding in Whitehead were to prevail in the circumstances
of Jack -
“the effect will be that the applicant for employment will be
better secured by legislation than one who has concluded a contract
of employment. Such differentiation is irrational and
constitutionally untenable.”
EVALUATION OF DEFINITION
[41] With the above provisions, principles and case law
in mind I now turn to consider the main issue in this matter, namely:
whether
the definition under consideration includes a person in the
position of Manqele. As apparent from case law
,
supra,
the definition of ‘employee’, as
it stands, creates uncertainty in the practice of labour law. The
adoption of a literal interpretation
of the provisions under
consideration as suggested on behalf of the appellant seems to
exacerbate the problem rather than to resolve
it. A person in the
position of Manqele might have resigned from his former employment on
the basis of him having concluded a contract
of employment. He would
find himself in a worse position than an applicant for a position
advertised.
[42] Manqele’s
rights are clearly protected in terms of the Constitution(s 23).
Section 3(b) of the LRA requires this Court to
interpret the
provisions of the LRA in compliance with the Constitution in order to
give full effect to the legislative purpose to
‘ensure the
protection, promotion and fulfilment of constitutional rights’(See
National Education Health & Allied Workers
Union v UCT 2003 (3)
SA (CC) at para [14]). The constitutional right ‘to fair labour
practice’ in s 23 is not capable of precise
definition as the
complex nature of labour practices does not accommodate any rigid
regulation of what is fair or unfair in any particular
circumstances.
I agree with Mr Sebola that the interpretation suggested on behalf of
the appellant would favour the employer and
would be contrary to the
letter and spirit of s 3 of the LRA and would thus not give effect to
s 23 (1) of the Constitution.
[43] In my view the words in the definition of
‘employee’ in s 213 of the LRA, when given their ordinary and
grammatical meaning,
become ambiguous and inevitably result in
manifest hardship and absurdity when read in conjunction with other
provisions, for example,
the words in the definition of “dismissal”
in s 186,
supra.
The
appellant, in this regard, contends that the contract envisaged in s
186 is a contract in terms of which the employee is working
for the
employer for remuneration. Reliance is placed upon the remarks by
Commissioner Jammy in
Herbst v Elmar Motors
(1999) 20 ILJ 2465 (CCMA)
at 2468J -2469C
,
that-
“When these two definitions are read together, a contract in terms
of ‘employment’ must, in my view, be a contract in terms
of which
any person … works for another person’ and ‘receives, or is
entitled to receive, any remuneration’ or ‘any …
person …
assists in carrying on or conducting the business of an employer.
That concept … must of necessity be interpreted as
requiring that,
before a person can be dismissed, an employment relationship must
have commenced on the basis of the actual rendition
of work or
service or assistance in the conduct of the employer’s business, by
the person alleged to have been employed. Dismissal
cannot … occur
when all that has come into existence is (sic) a contract in
anticipation of the performance of work or the assistance
in carrying
on or conducting business, which the definition of ‘employee’ in
s 213 of the Act contemplates. In other words, the
‘contract of
employment’ referred to in s 186 … is a contract in terms of
which the employment relationship between the parties
has commenced,
that is to say, the employee is working for the employer for
remuneration or is assisting him in the carrying on or
conducting of
his business.”
[44] I do not, with respect, agree with the views
expressed by Jammy C. Section 186 does not provide that the other
party must already
be or have been an employee when dismissal takes
place. Had that been the intention of the lawgiver provision therefor
could have
been made. In any event I do not consider that this Court
is bound by the views expressed in Herbst. It does not appear to me
also,
with respect, that the Learned Commissioner, when expressing
the above views, addressed his mind fully to the constitutional
imperatives
I have alluded to and the remarks by Justices O’Regan
and Ngcobo,
supra.
[45] Given the resultant gross hardship, ambiguity and
absurdity in the adoption of the literal interpretation, I am of the
view that
this Court is thus entitled to depart from such a literal
and ordinary construction and extend the literal construction of the
definition
as including a person who has concluded a contract of
employment which is to commence at a future date. Common sense,
justice and
the values of the Constitution would, in my view, best be
served by extending the literal construction to include such a
person.
That interpretation will be in line with the meaning of
‘dismissal’ in s 186 (1) (a). It will, also in my view, avoid
limiting
the constitutional right to ‘unfair labour practice’ to
a person who works or has rendered services and is entitled to
remuneration.
The focus, in s 186, like its English counterpart, is
on the ‘termination of a contract of employment’. Grogan
‘
Employment Law’ Vol 19 part 3 pp 15-17
opines that ‘had the contract not been repudiated, the-would be
employee would have become an employee.’ Grogan continues to
draw
an analogy between a person in the position of Manqele and unborn
children. He states that -
“… in a sense, a situation is similar to unborn children, to
whom the law is prepared to extend legal rights by way of a fiction.
The only way the courts can now remove the absurdity to which Pillay
J refers in Jack’s case – that unsuccessful applicants for
employment are awarded greater rights under the LRA than those who
have actually been appointed – is to extent the statutory
definition
by means of a similar fiction. They might be assisted by
the fact that the Constitution gives “everyone” – not only
employees
the right to fair labour practices.”
I could not agree more.
[46] The EAT in Sarker,
supra
,
puts it this way -
“… The respondents’ argument that this was an agreement to
enter into a contract of employment on 1 October 1995 is not a
persuasive
one: no further contract between the parties was required.
As and when the appellant turned up for work on 1 October, she would
have
been performing the contract already entered into, not making a
fresh offer which the respondents would then accept by allocating
her
to work and paying her. The mere fact that the duties would only be
performed on a date subsequent to this contract having been
entered
into cannot take it outside the concept of a contract of employment.
If it were otherwise, a very large number of contracts
would not be
contracts of employment, even though they were entered into perhaps
only one day before the individual began actually
performing his or
her duties for the employer.
There is a
single contract, of which there may be an anticipatory breach if one
party gives unequivocal notice that he will not perform
his side of
it. That was exactly the situation which occurred in Hochster v de la
Tour [1853]2 E & B 678.”.
[47] During the course of the argument counsel for the
appellant contended further that Manqele should have brought his
claim to the
Labour Court under the provision of s 77 of the BCEA.
Manqele, in his claim of unfair dismissal in terms of s 191 of the
LRA, sought
reinstatement or compensation.
[48] It must, of
course, be recalled that since service is a prerequisite for
remuneration under the employment contract, it follows
that if the
employer refuses to receive the employee into service he commits a
serious breach of the agreement (See Kinemas Ltd v
Berman
1932 AD
246).
Until the case of
National Union Textile
Workers v Stag Packing (Pty) Ltd and others
1982 (4) SA 151
(T)
it was difficult to secure specific performance in the form of
reinstatement (See Rogers v Durban Corporation
1950 (1) SA 64
(N)).
After that date an employee who was dismissed before commencing his
duties could secure reinstatement either at common law
or in the
Industrial Court in terms of the 1956 LRA.
[49] The effect of holding that the present definition
precludes granting relief to a person in the circumstances of Mangele
would
certainly be startling given the progressive advance of
fairness in labour practice especially under the new dispensation
since 1994.
That he would have to seek solace under section 77 of the
BCEA seems improbable.
[50] The whole tenor of progress in labour law is to
fair labour practices and justice for employees and employers and
away from a
narrow construction of the word “works”. Although
the word is in the present tense, in common parlance we often say of
a person
who has left A to work for B that he now works for B even
though he has not actually commenced his duties.
[51] The narrow construction totally ignores the phrase
‘is entitled to receive any remuneration’ which, in my view,
means that
such a person has not yet commenced actually working but
when he does so he will be entitled to pay. It does also mean
someone who
is never paid but has commenced working but that however
would seem to me to be a rather more
s
trained
construction
.
It
seems to me that the legislature, when defining the word “employee”
was striving for simple language and not drastically changing
the
definition.
[52] The ultimate
conclusion this Court arrives at is that the definition of employee
in s 213 of the LRA can be read to include a
person or persons who
has or have concluded a contract or contracts of employment the
commencement of which is or are deferred to
a future date or dates.
The construction which counsel for the appellant seeks to place on s
213 is, in the circumstances, untenable
as it leads to manifest
ambiguity, absurdity and hardship.
[53] In the view I take of the matter Manqele was
justified in approaching the CCMA.
[54] Accordingly the appeal is dismissed with costs.
_______________
NKABINDE AJA
I
agree
________________
NICHOLSON JA
I
agree
___________
PILLAY AJA
Date of hearing: 17 November 2004
Date of
judgment: 23 March 2005
Appearances:
For the
Appellant : Adv A Myburgh instructed by Sonnenberg Hoffmann Galombik
For the
Respondents : Mr M S Sebola of RAWU