National Education Health and Allied Workers' Union and Others v University of Pretoria (JA39/03) [2005] ZALAC 7; [2006] 5 BLLR 437 (LAC); (2006) 27 ILJ 117 (LAC) (26 October 2005)

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[2005] ZALAC 7
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National Education Health and Allied Workers' Union and Others v University of Pretoria (JA39/03) [2005] ZALAC 7; [2006] 5 BLLR 437 (LAC); (2006) 27 ILJ 117 (LAC) (26 October 2005)

38
IN THE LABOUR
APPEAL COURT OF SOUTH AFRICA
HELD AT JOHANNESBURG
CASE NO: JA 39/03
In
the matter between:
NATIONAL EDUCATION, HEALTH 1
st
and further Appellants
AND
ALLIED WORKERS’ UNION
AND OTHERS
and
UNIVERSITY OF PRETORIA Respondent
JUDGMENT
Zondo JP
Introduction
[1] The first appellant is a registered trade union of
which the second and further appellants are members. In this judgment
I shall
refer to the first appellant as “
the
union
”. The second and further appellants
are former employees of the respondent. The respondent is the
University of Pretoria. The second
and further appellants are among a
large group of employees whom the respondent dismissed from its
employ for operational requirements
on the 30
th
June and 31
st
July
1998.
[2] The appellants disputed the fairness of the
dismissals. They contended that the dismissals were unfair both
substantively and
procedurally. The respondent maintained that the
dismissals were fair both procedurally and substantively. In due
course the dispute
was referred to the Labour Court for adjudication.
It was heard by Revelas J. The Labour Court found that the dismissals
were fair
both procedurally and substantively. It, accordingly,
dismissed the appellants’ claim with costs but subsequently granted
them
leave to appeal to this Court. This, then, is an appeal from the
decision of the Labour Court dismissing the appellants’ claim
with
costs.
[3] Before the appeal can be considered, it is necessary
to set out the factual background to the dismissal of the second and
further
appellants. I propose to do so below. However, before I do
so, let me say this. For purposes of this judgment, it is not
necessary
to set out all the facts or events relating to the second
and further appellants’ dismissal, particularly those relevant to
the
substantive fairness of the dismissal. This is because in this
appeal the appellants do not challenge the substantive fairness of
the dismissal. The appellants only challenge the procedural fairness
thereof. Even that challenge to the procedure is a very narrow
one.
It is that, when the respondent initiated the consultation process
required by sec 189(1) of the Labour Relations Act, 1995
(Act 66 of
1995)(“
the Act
”),
the union was faced with a fait accompli. In the light of the fact
that the appellants’ challenge to the fairness of the dismissal
is
a very narrow one, I propose to confine the factual background to
this matter to the facts and events that are relevant to the
determination of whether or not the appellants were faced with a
fait
accompli
.
The facts
[4] In
his speech at the opening of the 1997 academic year on the 28
th
January 1997 Prof Van Zyl, who was the new Rector and Vice-Chancellor
of the respondent at the time, set out, among other things,
his
vision for the respondent and its role in South Africa and, indeed,
internationally. Prof Van Zyl stated, among other things,
that the
respondent had to meet certain challenges facing it. He enumerated
certain matters which he said required particular attention.
The
first of the matters he mentioned was that there would have to be a
thorough reconsideration of the university’s core functions
and the
performance or execution thereof. He also stated that partnerships
with the private sector would have to be investigated
urgently,
particularly through the outsourcing of support services.
[5] By way of a letter dated the 7
th
February 1997 the respondent appointed management consultants called
Strategic Partners to investigate the cost-effectiveness and
efficiency of certain support services within the respondent. This
project was to be known as the Support Services Development Project.
In the letter of appointment the respondent stated that the
consultants’ brief was to undertake a support services development
project at the respondent. The respondent also set out in the letter
the “
parameters
”
of the consultants’ appointment. The letter stated that the main
objective of the support services development project would
be “
to
optimize the cost efficiency and effectiveness of support services of
the university
.” The letter also identified
the service areas that had been prioritized for detailed review
during 1997. These were given as:
- Building
and Terrain Services
- Campus
Security
- Marketing
Services
- Student Services (including the Bureau for Culture and
the Bureau for Sports)
- Technical services.
Under the third paragraph of the letter of appointment
the respondent informed Strategic Partners that the support service
development
project would be carried out according to the following
phases in the case of each support service area mentioned above. The
phases
were:
“
- The establishment and acceptance of the
project’s mandate among all stakeholders in the University’s
support services.
A factual analysis into the current levels of cost
efficiency and effectiveness.
A participative process giving stakeholders an
opportunity
to jointly evaluate the
current costs efficiency and effectiveness of the services
concerned, the opportunities for performance
improvement as well as
the options and guiding criteria towards change.
The preparation of a project plan towards
implementing the preferred change option(s)
Assistance towards successful implementation.”
(Emphasis added)
[6] In the fourth paragraph of the letter the respondent
went on to make it clear to the consultants that “
(t)he
evaluation of future options regarding the functioning of each
support service will be carried out with proper consideration
of:
- the interests and rights of employees, students and
other service users.
- financial
affordability and cost competitiveness of options.
- Sustainability of the options considered
.”
[7] In the fifth paragraph the respondent pointed out
that
“(t)he project for each service area
will be overseen by a project steering committee comprising
representatives from, inter alia,
staff and unions, line management
and students. The chairperson of the project steering committee will
be selected by these representatives.”
[8] It would seem that already on the 6
th
May 1997 the consultants held a meeting with the union in which they
briefed the union on their mandate. The minutes of that meeting
reflect that, among other things, Mr Marais, who was the leader o the
consultants, informed the union that his team had requested
the
meeting “
in order to brief Nehawu on the
envisaged Support Services Development Project and to request their
comment and advice on the structuring
of the project
.”
The minutes also reflect that, among the things, Mr Marais told the
union that the consultants had no pre-conceived ideas on
the type of
changes that the support services would be required to undergo in
order to improve their cost-effectiveness. He also
informed it that
the consultants had not been asked to merely justify any
stakeholder’s foregone conclusion on the direction that
support
services would go in the future.
[9] The minutes of the meeting of the 6
th
May also reflect that Mr Sehone of the union asked whether the
inevitable outcome of restructuring would not be a reduction of
personnel
through retrenchments. Mr Marais’ answer was an
explanation that it was too early to think in terms of what kinds of
changes would
be necessary to improve the cost-effectiveness and
efficiency of support services. He said that the extent of the
problem and the
alternatives for change had to be identified first.
He likened the situation rather to that of a doctor and said that,
before a doctor
examined a patient, he would not be able to tell the
nature of the patient’s illness nor would he know what medicine to
suggest.
He said that the Support Services Development Project had to
first investigate the current problems before deciding whether
restructuring
would be the right solution. He pointed out that in
certain organisations better management processes or even an increase
in staff
had been implemented in support services.
[10] In that meeting Mr Marais also outlined the process
that the consultants intended to follow in going about executing
their mandate.
The minutes reflect that he said:
“
-
The
first stage of the project (of which this meeting forms a part)
involves discussion with the various stakeholders involved in
support
services in order to explain the envisaged objectives and process and
to obtain input from the stakeholders. This stage is
to result in the
formation of a steering committee in each of the service areas
concerned.
These steering committees should
represent
all stakeholders such as workers – labour unions, line management
and students.
The role of the
steering committees would be to consider the work of the consultancy
and to participate in project workshops.
The second stage of the project is envisaged to
consist of an independent review of the current cost-effectiveness
and efficiency
of the services concerned by the consultancy. In the
course of this review they will consider aspects such as service
user satisfaction,
the future need for the service concerned, the
current cost of service delivery as well as management practices.
The review will
also consider how the nature and costs of the
services at the University compare with that of other universities
and other public
and private sector organisations. The consultancy
will present the results of their review to a workshop. The workshop
will develop
conclusions on the opportunity for improving the cost
effectiveness and/or efficiency of the service concerned and will
list potential
improvement alternatives. During the next stage the
consultancy will provisionally evaluate the improvement options
according to
criteria developed during the first workshop. The
results of this evaluation will be presented to a second workshop
where the stakeholders
will consider the best improvement option and
its implementation implications.
Once an implementation decision has been made, the
consultancy will assist with implementation planning and with
project management
during implementation. Naturally, no
implementation could proceed without proper consultation with all
role players concerned.”
[11] Mr Marais emphasised that the best interests of the
respondent and, therefore, of all stakeholders, would be served by
the participation
of all stakeholders concerned including the union
in the project. He then asked what the union’s suggestions were
regarding participation
of workers and union representatives in the
process of the project. At the meeting the union representatives
indicated that they
would need to consult their shopsteward
colleagues before they could react to the invitation to participate
in the project.
[12] On the 28
th
May 1997 another meeting was held between the consultancy and the
union. The aim of the meeting was for the consultancy to brief
the
union further on the Support Services Development Project and to give
the union an opportunity to ask whatever questions or raise
whatever
concerns they may have had about participation in the project. The
minutes of the meeting reveal that the union delegation
asked
numerous questions. Indeed, there were even debates on certain
issues. Ultimately the union delegation indicated that the union
would participate in the project. It is important to highlight that
in that meeting the union was informed that the aim of the meeting
was to give it the opportunity to:
“
-
comment
on the proposed process and suggest possible alternatives
raise any preliminary concerns and or issues
regarding the project
comment on the consultative approach and indicate
possible alternatives and [to] know each other and develop a working
relationship.”
[13] The union confirmed its agreement to participate in
the project by way of a letter from a Mr Robinson Mosebi. The letter
appears
to have been approved by Mrs Molefe who was the chief
shopsteward of the union at the respondent. In addition to advising
in that
letter of its agreement to participate in the project, the
union also made a proposal as to the composition of “
the
structure of the Steering Committee
.” The
union suggested that each steering committee should be composed of:
(a) one
representative from the consultancy;
(b) two representatives from supervisors/managers
(c) three representatives of unions or employee
organisations.
Mr Marais subsequently wrote to the union to welcome
its decision to participate in the process or the project. He also
informed
the union that he was accepting its proposal of how the
steering committees should be composed. He said that in fact the
union’s
proposal on the composition of such committees was the same
as his own earlier proposal. The union then participated in the
project
and in the steering committees. In participating in the
project and being part of the steering committees, the union was free
to
raise whatever concerns it had, was free to make any proposals it
wished to make and was free to express any views it had. It was
not
hampered in any way.
[14] In a letter dated 21 August 1997 the union, through
Mr Robinson Mosebi, advised Mr Marais that the union was withdrawing
from
further participation in the project because the minutes of the
various meetings that its representatives had attended did not
reflect
the contributions made by the union representatives’ in
such meetings. However, later on the union rejoined the process and
continued
to participate until the end of the process.
[15] In the September 1997 issue of the University’s
bulletin it was explained that, after the establishment of a steering
committee
in each one of the support services that had been
prioritised, the project team (i.e. the consultants) had undertaken
an independent
investigation into each of the various services. It
was said that such investigation had focused on the effectiveness,
client satisfaction,
cost, efficiency, the opinions of staff,
management practices as well as comparisons with the practices at
other organisations.
[16] It was also stated in the bulletin that at that
time the consultancy was presenting two workshops in respect of each
service.
At such workshops, continued the bulletin, the consultancy’s
analysis of the service, the need for change as well as the possible
alternatives for the future were considered in consultation with the
steering committee concerned. It was stated that, once those
workshops had been concluded, the consultancy would make a
recommendation to the Executive of the respondent. It was then
written:
“
These recommendations may coincide
with or differ from those of the steering committee
.”
It was stated that that was where the work of the steering committee
would end.
[17] There was a section in the September 1997 UP
Bulletin which dealt with the “
road ahead
.”
In this section it was stated that in October 1997 the consultancy
aimed to complete the report-back to the steering committees.
The
following also appeared in the bulletin:
“
The analyses of the project team will by then have
been open to inspection by all interest groups and these groups will
have been
able to participate in the process for the consideration of
alternatives for the future. After the steering committee process in
respect of each department has been concluded, the project team will
make their recommendations, together with views expressed by
the
steering committee concerned to the Executive
of UP. This means that the Executive may start
to take principle decisions regarding the future of the various
services during September
and October 1997. Where personnel
implications arise, management will have to consult with the parties
concerned before a final decision
can be made.”
During October 1997 the consultants submitted their
reports in respect of some of the support services to the Executive
of the respondent.
In such reports the consultants inter alia
identified the problems in the relevant support service areas and
made recommendations
on what should be done to address them. The
recommendations included that the support services affected in this
matter be outsourced.
[18] The Executive of the respondent furnished copies of
the consultants’ reports to all stakeholders including the union
and asked
them to give their reactions thereto. In a letter dated 29
October 1997 Mrs Molefe undertook to Prof Pottas of the respondent
that
the union would submit its response to the reports of the
consultants on the 5
th
November 1997. This was agreed to by the respondent. In the UP
Bulletin of the 7
th
November 1997 it was announced that on the 1
st
November a support centre had been installed in the Marketing
Services Building “
to answer questions from
staff about the renewal process at UP
.” The
investigation undertaken by the consultants was part of the renewal
process at the respondent. It was further stated that
the centre
would also be “
part of general employees’
aid programme managed by the Labour Relations Division
.”
It was stated that a team of professionals including ministers of
religion, social workers, psychologists and staff of the Labour
Relations Division would be available to assist staff. It was also
written:
“
The centre will assist staff who may be affected
by rationalisation to compile a CV, find other work and will also
give advice on
financial matters etc. Staff members will still be
able to use this one stop service for a limited time after they have
left the
university’s service.”
[19] The union failed to submit its response to the
reports by the 5
th
November 1997. By a letter dated 10 November 1997 the union asked
that it be given an opportunity to give a verbal reaction to the
consultancy’s reports and that this be done on either 12 or 13
November 1997. By a letter of the same date Prof de Beer, who was
a
vice-principal of the respondent and who was the respondent’s main
contact person or representative both in the Support Services
Development Project and in the subsequent sec 189 consultation
process that started in November or December 1997, agreed to the
union’s
suggestion.
[20] On the 13
th
November 1997 a meeting was held between the respondent and the
union. Although the union had requested the meeting for the purpose
of giving a verbal reaction to the consultants’ reports, once at
the meeting, the union’s Mr Jaftha indicated that there were
a
number of questions on which the union sought to have clarification.
One such question was whether the process that had taken place
was a
substitute for the consultation process required by the Act in the
case of a contemplation of a dismissal of employees for
operational
requirements. Prof de Beer explained that, once the Executive of the
respondent had received all comments on the reports
and all parties
had had a chance to discuss them with a view to trying to reach a
consensus, the Executive would “
take a
position in terms of which the provisions of
section 189
of the
Labour Relations Act might
come into play and will be followed to the
letter
.”
[21] After asking another question which was answered,
the union’s Mr Jaftha submitted a proposal for redeployment to Prof
de Beer.
The document containing the proposal was marked: “
NEHAWU’s
Redeployment Proposal”
. Mr Jaftha commented
that such proposal had been used as a model for restructuring at
other institutions focusing on a training strategy
for staff with the
use of government funding earmarked for such purpose. Mr Jaftha
stated that the proposal did not constitute the
union’s reaction to
the reports and reserved the “
right
”
to comment later. Prof de Beer undertook to submit the proposal to
the Executive for consideration after which a follow-up meeting
would
be held to discuss the merits of the submission as part of the
comment on the reports. The meeting ended with the union not
having
given the verbal reaction to the consultants’ reports as it had
undertaken to. It also did not ask for an extension of time
to do so.
[22] On the 18
th
November 1997 the respondent gave notice of consultation in terms of
sec 189 of the Act and invited various unions including the
union to
a meeting scheduled for the 24
th
November 1997. There was an annexure to the notice. The annexure to
the notice stated, among other things, that “
the
crux of the [consultants’] recommendations, comments and proposals
”
revealed that “
the respondent will have to
provide for the discontinuation of service in various ways of some of
its employees on the basis of the
University’s operational
requirements, should attempts to avoid such staff reduction by the
consultation as set out in
Section 189
of the
Labour Relations Act
not succeed
.”
[23] In the second last paragraph of the annexure to the
notice it was stated that as a point of departure the management of
the respondent
would attempt to enter into discussions with all
parties involved regarding, among others, measures to try and avoid
dismissals,
to minimise the number of persons who might be considered
for dismissal and to mitigate the adverse effects arising from
dismissal
as well as information that may be required.
[24] On the 24
th
November 1997 the respondent held a meeting with various unions and
employee organisations as well as staff who were not members
of any
unions. The union had observers at that meeting but arranged to have
a separate official meeting with the respondent on the
25
th
November 1997. The respondent and the union did, indeed, hold a
meeting on the 25
th
November 1997. The management stated at the meeting that since
receiving responses to the consultants’ reports from a number of
stakeholders, it had become evident to it that it would have to face
realities and contemplate the dismissal of members of staff
on
account of operational requirements. The management stated that at
that stage there was no indication of the number of employees,
departments or units that could be affected by such a process. It was
stated that the purpose of the meeting was to inform the union
of the
situation. The management set out certain measures that it thought
could help to avoid dismissals or minimise the number of
dismissals.
[25] The union’s Mr Jaftha expressed the hope that the
management would bear the interests of the staff at heart and not
treat the
consultation in terms of sec 189 of the Act as a mere
formality. According to the minutes he further stated that there were
indications
that “
this was a mere formality
or so-called smoke screen for decisions that had already been made
.”
The minutes of the meeting reflect that Mr Jaftha “
referred
to a UP Bulletin of the 7
th
November 1997 in which it was indicated that a support centre was
established prior to the commencement of the process
.”
Mr Jaftha said that from this it appeared that the decision to
dismiss staff had already been made by the management. He also
queried why, if the first phase of the Support Services Development
Project had not yet been completed and all comments received,
notice
was given of staff reduction in terms of section 189. The minutes
indicate that Mr Jaftha pointed out the distinction between
restructuring and a decision to retrench and that the parties
involved had agreed to a process of restructuring.
[26] Mr Jaftha also stated that the union doubted “
the
sincerity, honesty and commitment of Management
”
and was not confident that the ideas and proposals it would make
would be meaningfully addressed. He said that for this reason
the
union’s intention was to “
tie the matter
up by all possible means in terms of the relevant legislation.”
The union said that it had been caught off-guard as it had thought
that the meeting was still to deal with the first phase of the
project. Mr Jaftha stated that the union had thought that the notice
of consultation in terms of sec 189 of the Act would only be
given
after the completion of the first phase. Mr Jaftha proposed on behalf
of the union the addition of another item on the agenda
of the
meeting. The item is reflected in the minutes as “
mitigating
the timing of dismissals.”
Mr Jaftha said
that the union would argue that that was not the time to dismiss
employees in the light of the approaching festive
season.
[27] Mr Jaftha also requested that “
section
197
of the
Labour Relations Act, regarding
the transfer of contracts,
also be included in the legal framework.
”
The management said it was agreeable to this as it considered
section
197
as part of the law of the country to which the respondent was
subject. The union reserved its comment regarding vacancies and
fixed-term
contracts of employment as potential measures that could
be used to avoid dismissals. The union expressed approval of
voluntary retirement
across the board. The parties then agreed to
discuss voluntary retirement and the structure of voluntary
retirement packages.
[28] Mr Jaftha also proposed the addition of another
item on the agenda, namely, voluntary retrenchment. Prof de Beer
requested the
union to provide a detailed proposal in this regard. Mr
Jaftha undertook to supply such a proposal. The parties agreed to
hold another
meeting on the on the 8
th
December 1997. It was stated that such a meeting would focus on the
union’s proposal on voluntary retrenchments, severance packages
for
voluntary retrenchments and management’s proposals regarding
voluntary retirement, taking into account basic conditions of
employment. Mr Jaftha expressed the hope that the parties would reach
an agreement. Towards the end of the meeting Mr Jaftha expressed
the
view that the management’s announcement of the commencement of
consultation in terms of sec 189 of the Act could be considered
premature.
[29] On the 8
th
December 1997 the union and the respondent held another meeting. They
discussed voluntary retirement and voluntary retrenchment.
They
agreed on some aspects but did not on others. The respondent
requested the union to submit any further proposals or alternatives
with regard to the restructuring of voluntary retrenchment and
retrenchment packages.
[30] By a letter dated 7 January 1998 the respondent
advised the union that the latter had not as yet submitted its
reaction to the
various reports submitted to the management by the
consultants. It gave the union a further opportunity until 9 January
1998 to submit
its reaction to the reports if it wished to. In the
second last paragraph of that letter the respondent informed the
union that,
once all interest groups had submitted their reactions to
the reports and these had been studied, a meeting would be held with
all
parties involved in the project for discussion of the
recommendations, reactions and “
various
management perspectives”.
It was stated
that such a meeting was scheduled for the 21
st
January 1998 but that such meeting would not replace
“the statutory process which the University is obliged to follow”.
[31] The union was invited by the respondent to the
meeting of the 21
st
January 1998 to discuss the various reports, reactions and comments
received. This was to be a day-long meeting scheduled to start
at
08H00 and to go on until 16H00. It was to be attended by various
stakeholders. The meeting was to provide an opportunity for
discussions
aimed at conducting an open debate on campus on such
important matters which it was hoped would contribute to informed
decision-making.
[32] On the 21
st
January 1998 a meeting took place between the respondent’s
management and various stakeholders to discuss and debate the various
reports compiled by the consultants and inputs thereon from various
interest groups. The minutes of that meeting suggest that issues
were
discussed very thoroughly and all stakeholders had an opportunity to
say whatever they wished to say.
[33] There were three unions in the university which had
members who were affected by these processes. Apart from the union,
the others
were SAWU and UPWO. These three unions established a
structure which they called the Combined Labour Forum (“
the
CLF
”). In a letter dated 12 February 1998
to the respondent’s Rector and Vice-Chancellor, the Combined Labour
Forum advised the respondent
that the three unions had established
the Combined Labour Forum because the respondent was reluctant to
comply with “
fair labour practice in
relation to the proposed retrenchments”
.
[34] The Combined Labour Forum also pointed out in the
letter that the sec 189 of the Act consultations had only commenced
in December
1997 because, prior to that, the management had insisted
that it had not taken any decisions to embark upon a retrenchment
process
even though the trade unions had already found evidence that
the management and the Board of the respondent had decided on
retrenchments
as a
fait accompli
.
In the letter the CLF accused the respondent of trying to create the
impression that it was consulting “
whereas
it is clear that the University has already accepted retrenchments as
a
fait accompli
”
.
It also alleged that the respondent had failed to reach consensus on
appropriate measures as required by sec 189(2)(a) of the Act
“
since
management has throughout concentrated only on retirement and/or
voluntary retrenchment to the detriment of other alternative
measures
as required in sec 189(2)(a)
.” It further
accused the respondent of failing to comply with sec 189(3) or (4) of
the Act and to justify the need for retrenchments.
[35] The CLF then called upon the respondent “
to
immediately rectify the above by,
Consulting with the Combined Labour Forum in order to
attempt to reach consensus on all aspects required by sec 189(2)(a);
Consulting
with the Combined Labour Forum in an attempt to convince the Forum
that substantively the University has no other alternative
but to
embark on a retrenchment exercise;
Complying in full with sec 189(4) should it after
consultation be found that there are no other alternatives but to
embark on a retrenchment
exercise
.” The CLF
also requested certain information. From this, it seems that the CLF
was saying that, if the respondent did the things
that it was being
called upon to do, it would have rectified the things that the CLF
accused it of having done wrong.
[36] Under cover of a letter dated 16 February 1998 the
Rector and Vice-Chancellor of the respondent sent to the CLF “
the
management’s proposals in respect of the Support Services
Development Project and in respect of voluntary retrenchment
packages
” for its perusal and comment. In
that letter the Rector said that the management’s proposals dealt
with, inter alia,
(a) reasons for contemplated dismissals;
(b) measures
to avoid contemplated dismissals:
(c) measures to minimize the number of contemplated
dismissals;
(d) measures mitigating the adverse effects of
contemplated dismissals;
(e) the timing when voluntary packages were likely to
take effect, and;
(f) the
contents of the proposed packages.
The proposals included comprehensive outsourcing of the
functions of Campus Control, Technical Services, Cleaning Services
(university
residences) and other building and grounds services.
Services such as Student Affairs, Marketing Services, the Sports
Bureau and
Bureau for Cultural Affairs were to be restructured
fundamentally. That message was contained in the UP Bulletin of 25
February 1998.
[37] On the 2
nd
March 1998 another meeting was held between the respondent’s
management and the CLF. Prof de Beer indicated at that meeting that
he would disclose in writing the information that the CLF had
previously requested. However, he emphasised that some of the
information
that the CLF had requested had already been disclosed. He
also indicated that he would like to reach an agreement with the CLF
on
a time frame for the CLF to study the information provided in
accordance with sec 189(3) of the Act, for the opportunity for the
CLF to propose alternatives as part of the consultation process in
terms of sec 189(5) and for the management to consider and respond
to
such proposal made by the CLF in terms of sec 189(6).
[38] On the 20
th
March 1998 another meeting was held between the management and the
CLF as part of the consultation process. Mr Jaftha stated at this
meeting that the sec 189 consultation process had been marred by
distrust but said that the letter from the union to the respondent
of
the 16
th
March
1998 and the respondent’s letter of the 17
th
March 1998 were accepted “
as a renewed
commitment to bona fide consultation.
” A
member of the CLF delegation enquired from Prof de Beer whether the
management would be prepared to retain and fund the support
services
internally if efficiency levels were increased and effectiveness was
upgraded to the required levels. He said that the staff
had the
impression that the management did not want to retain the non-core
business. Prof de Beer replied by saying that he would
like to
consult with the Rector before he could give a reply to that
question.
[39] Prof de Beer was also asked to what extent the
respondent would be prepared to develop and promote entrepreneurial
skills within
the affected departments. Prof de Beer’s reply was
that the respondent would provide assistance in this regard wherever
possible
in order for such skills to be deployed on campus at the
required levels of efficiency. He added that the respondent would
closely
consider all proposals. After a caucus, Prof de Beer
indicated that the respondent did not in principle oppose the
rendering of non-core
services by members of staff of the respondent
but that ultimately the multi-dimensional matter of efficiency would
need to be addressed.
However, he made it clear that the management’s
preferred position was to outsource the services. He said that only
if the required
levels of efficiency could be obtained, taking into
account all dimensions in this regard, would the respondent consider
not to opt
for the preferred position.
[40] At that meeting it was decided that the CLF would
submit its “
informed, constructive counter
proposals
” in writing on 20 April 1998 and
the management would submit its response thereto to the CLF on 23
April 1998. It was also agreed
that the 25
th
April 1998 would be the deadline for the finalisation of voluntary
packages. The second week of May 1998 was given as the deadline
for
applications for voluntary packages. The 30
th
June 1998 was given as the deadline for the termination of services
of the affected employees. It was also agreed that the CLF’s
counter-proposals and the management’s reaction thereto would be
discussed at a meeting scheduled for 23 April 1998. Another meeting
was to be held on 1 April 1998 to have further discussions on the
structuring of voluntary packages.
[41] On the 1
st
April 1998 the management and CLF held a meeting to discuss the
structuring of voluntary packages. As no finality was reached, it
was
agreed to have a further meeting on the 9
th
April 1998. It is not clear whether the meeting scheduled for the 9
th
April did take place. However, a meeting was held on the 23
rd
April 1998 between the management and the CLF. At this meeting Mr
Lehone, representing the union, indicated that the union’s
proposals
on alternatives would be submitted the following day. On
the 24
th
April
1998 the union declared a dispute “
over
privatisation that took place at the Technical Service Fire
Extinguisher Section without proper consultation”
and said that, because of this, its proposal on alternatives would be
delayed until that dispute was settled.
[42] On the 24
th
April 1998 the management and one of the unions, UPWO, concluded an
agreement pursuant to the consultation process in terms of sec
189 of
the Act. In due course the management reached an agreement with the
remaining two members of the CLF, namely the union and
SAWU on
voluntary severance packages. A further meeting was held on the 28th
May 1998 between the management and the CLF. Mr Jaftha
did not attend
that meeting but Mr Mabizela attended it in his stead. There were
other representatives of the union as well. However,
Mr Mabizela said
that, although they would participate fully in the discussions, they
would not commit the union until they had consulted
with Mr Jaftha.
It was agreed at this meeting that all outstanding issues in terms of
sec 189(2) of the Act would be discussed. In
particular, it was
agreed that severance pay, selection criteria, support for affected
staff or measures to mitigate effects on staff
and means to minimise
the number of dismissals would be discussed.
[43] On the 29
th
May 1998 the respondent addressed a letter to the union in which it
responded to all the proposals and requests that had been made
by the
CLF at the meeting of the 28
th
May 1998. The management also indicated the decisions that the
management had taken in regard to such proposals and requests. In
the
UP Bulletin of the 1
st
June 1998 it was written among other things that:
it had been agreed that in cases where services would
be out-sourced, the unions would be given the opportunity to give
input in
regard to the compilation of tender documents; in this
regard trade unions would also take part in the process where
tenders would
be evaluated although the final decision to award or
not to award a tender would rest with the management.
staff would be able to submit tenders for services that
the respondent would be outsourcing; in this regard it was written
that
the respondent had undertaken to play a facilitating role
through the Transitional and Development Centre “
LOOS
”
to support staff in the preparation of tender documents and to this
end a limited budget had been made available.
[44] For all intents and purposes this marked the end of
the consultation process before the letters of dismissal of the
second and
further appellants were issued. Accordingly, as stated
earlier, in due course the respondent issued letters of dismissal in
respect
of some employees with effect from the 30
th
June and in respect of others with effect from the 31
st
July 1998. Some of the second and further appellants fall into the
group dismissed with effect from the 30
th
June whereas others fall into the group dismissed with effect from
the 31
st
July
1998. A dispute then arose about whether such dismissal was fair and,
as stated earlier, the dispute was referred to the Labour
Court for
adjudication.
Proceedings in the Labour
Court
[45] As
already stated above when the Labour Court adjudicated the dispute
about the fairness or otherwise of the dismissal of the
second and
further appellants, it found that the dismissals were fair both in
terms of the reason for the dismissal as well as in
terms of the
procedure that was followed by the respondent. It, accordingly,
dismissed the appellants’ claim.
The appeal
[46] The
appellant’s Counsel contended that the dismissal of the second and
further appellants was procedurally unfair. In support
of this
contention he presented argument at two levels. Both levels were
directed at showing that the union was faced with a fait
accompli by
the time that the consultation in terms of sec 189 of the Act
commenced and that such state of affairs rendered the dismissal
procedurally unfair. Of course, Counsel for the respondent disputed
the correctness of this contention and submitted that the dismissal
of the second and further appellants in this matter was procedurally
fair.
The first level argument.
[47] With
regard to the first level argument, Counsel for the appellants
submitted that the respondent had a predisposition or an
a priori
commitment towards outsourcing and that its attitude was that
outsourcing was the way to go unless the union could convince
it
otherwise. In this regard Counsel for the appellants drew our
attention to a number of areas in the record, including minutes
of
meetings of the senior management and Strategic Partners which he
submitted were indicative of such a predisposition or a priori
commitment. I do not propose to refer to all the areas in the record
that Counsel relied upon. However, I have had due regard to
those
areas of the record that Counsel referred us to in this regard.
[48] I do not think that, when regard is had to all of
the evidence in this matter, it is justified to say that the
respondent had
an a priori commitment to outsourcing. There can be no
doubt that from a certain point in the entire process which began in
February
1997 to the end of May 1998, the respondent can be said to
have shown an inclination towards outsourcing.
[49] In considering this matter it must be borne in mind
that the appellants did not call any witnesses to testify in support
of their
case. In particular within the context of the narrow
challenge to the procedural fairness of the dismissal in this appeal,
it is
significant to bear in mind that the union officials were not
called to testify about the consultation process and the meetings
between
the parties nor were they called to contradict the evidence
of the witnesses called by the respondent about the procedural
fairness
of the dismissal.
[50] In
my view the respondent’s management’s inclination towards
outsourcing did not begin to exist before the commencement of
the sec
189 consultation process. However, even if it existed before, that
would not render the sec 189 consultation or the resultant
dismissal
procedurally unfair. This is because such an inclination or
pre-disposition is not in conflict with sec 189 of the Act.
I deal
below with the provisions of sec 189 in so far as they relate to this
point.
[51] Section 189 of the Act does envisage that the
employer may come to the first consultation table with a proposal
that can be said
to be not only his preferred proposal but, indeed,
one that he strongly views as the solution to the problem. The
obligation placed
upon the employer to consult only arises in terms
of sec 189(1) of the Act when a situation has been reached where he
“
contemplates dismissing one or more
employees
” for operational requirements. In
other words, before he reaches such stage, he is under no obligation
to consult and is within
his rights to try and deal with the problem
on his own with such assistance and advice as he may in his
discretion feel he needs
which need not be that of the consulting
parties envisaged in sec 189(1). This is because the employer is
entitled to deal with the
problems of his business without consulting
the parties envisaged in sec 189(1) as long as he is not
contemplating the dismissal
of any employees for operational
requirements. It would be natural for him to form a view or even a
strong view about one or other
possible solutions to the problem out
of all those that he might have applied his mind to while trying to
solve the problem before
contemplating the dismissal. Section
189(1)(b),(c),(3)(c) and (g) refer to “
employees
likely to be affected
.” The frequent
reference in those provisions to “
employees
likely to be affected
” is an indication
that it is permissible for the employer to have already grappled with
the problem to the extent that he has in
mind “
employees
likely to be affected by the proposed dismissal
.”
[52] Section 189(3) requires the employer to disclose
the reason for the proposed dismissals, the alternatives that he
considered
before
proposing
the dismissals and the reasons for rejecting each one of those
alternatives, the number of employees likely to be affected
and the
categories in which they are employed, the time when or the period
during which the dismissals are likely to take effect.
The content of
what sec 189(3) requires the employer to disclose suggests quite
clearly that the employer is allowed to initiate
the consultation
process after he has done a lot of work to try and resolve the
problem on his own. He is permitted to have done
so much work that :-
he is in a position to propose dismissal because in
his view there are no other acceptable alternatives that can
address the problem
satisfactorily without dismissals.
he has reasons for proposing dismissals as opposed to
other alternatives.
before proposing the dismissal, he has considered
other alternatives and has rejected them.
he has reasons for rejecting other alternatives and is
ready to articulate them.
Section 189 contemplates that, when the employer
initiates the sec 189 consultation process, he contemplates the
dismissal of one
or more of his employees for operational
requirements; that is why already in paragraph (b), (c) and (d) of
sec 189(1) there are
references to “
proposed
dismissals
”. So what sec 189(1)
contemplates is that the employer is already proposing a dismissal or
dismissals when he initiates the sec
189 consultation process.
[53] The fact that sec 189(3)(b) contemplates that, when
the employer initiates the consultation process in terms of sec
189(1) of
the Act, he has already considered alternatives to
dismissals which he has rejected for certain reasons and requires him
to disclose
the reasons why he rejected such alternatives does not
mean that such alternatives cannot be revisited in the consultation
process.
Of course, they can be because the other consulting party or
parties may view them as potentially viable solutions. Obviously, the
employer may have strong views on such alternatives because he will
have had an opportunity to consider them already and will have
already rejected them before. For the employer to pretend as if he
has no views on such alternatives would be dishonest because he
will
already have formed some or other view on them. However, what will be
required is that the employer should consider honestly
and properly
whatever the other consulting party may have to say on such
alternatives and change its mind or view on them if the
other
consulting party comes up with sufficiently persuasive arguments for
the employer to change. Before considering such alternatives,
the
employer may have found it necessary to launch some or other research
or investigation into the viability of such alternatives
and may,
therefore, seem to have strong views on them because it has
considered them properly and thoroughly.
[54] Where an employer has had an opportunity before the
sec 189 consultation process to consider certain possible
alternatives or
suggestions or ideas and has rejected it or them
prior to such consultation process and one or other consulting party
raises such
proposal or idea or suggestion during the sec 189
consultation process, the employer needs to be alive to the fact that
the other
consulting party has not had or may not have had a similar
opportunity to consider such alternative, idea, suggestion or
proposal.
The employer must not be unduly impatient with the other
party but must listen carefully and consider the arguments or
suggestions
properly and, where necessary, give the other party more
time to also look into the matter in the same way that he has already
done.
[55] In the light of the above I conclude that there is
nothing wrong with an employer coming to the consultation table with
a predisposition
towards a particular method of solving the problem
which has given rise to the contemplation of dismissal of employees
for operational
requirements. What is critical is that the employer
should nevertheless be open to change its mind if persuasive argument
is presented
to it that that method is wrong or is not the best or
that there is or may be another one that can address the problem
either equally
well or even in a better way. He should engage in a
joint problem-solving exercise with the other consulting party or
parties.
[56] The Court a quo gave an extensive exposition of the
appellants’ first level argument from paragraph 3.1 to par 3.33 of
the
judgment. Whereas the appellants complained in their heads of
argument that the Judge in the Court a quo did not accurately record
their second level argument, no such complaint has been expressed in
regard to the first level argument. I do not propose to record
the
details of the argument here. I have considered the reasons given by
the Court a quo for its rejection of the appellants’ first
level
argument and I am unable to fault it. Indeed, I agree with those
reasons. It is not necessary to repeat them herein.
[57] It seems that at some stage the union did propose
various alternatives to the respondent’s management because on the
22
nd
May 1998 Prof
de Beer wrote to Mrs Molefe a lengthy letter which represented the
respondent’s response to such proposals. I do
not propose to deal
with the contents of that letter. It seems sufficient to state that
in the letter the respondent responded to
the argument or proposal
about internal restructuring, the proposal or view that management
positions alone should be outsourced,
the union’s reliance on sec
197 of the Act and the union’s redeployment proposal. The union
cannot complain that its views or
proposals were not considered or
that where they were rejected, no reasons were given for their
rejection.
The appellants’ second
level argument
[58] The
appellants’ argument on the second level is that the investigation
of the problems and possible solutions which was embarked
upon as the
Support Services Development Project prior to the consultation in
terms of sec 189 of the Act was work that should have
been done as
part of the sec 189 consultations between the respondent and the
unions. The appellants submit that that was a very
important process
and that by the time the sec 189 consultation process began in
November 1997, the result was a formality. The appellants
contend
that the respondent must have contemplated the dismissals much
earlier than November 1997 and that, therefore, the sec 189
consultation process should have begun much earlier. Indeed, as early
as February 1997, so runs the argument.
[59] There are at least two answers to the appellants’
second level argument. The first one is that they cannot be heard to
raise
this complaint because the union was invited to take part in
the process that occurred from February to November 1997 and in fact
did take part in that process. The union representatives who took
part in that process were free to raise any issue that they wished
to
raise. In fact at the first two meetings which Mr Marais held with
the union, he told the union that he wanted to get the union’s
views on the process and on how the process should be conducted.
Indeed, the effect of what Mr Marais said at that meeting to the
union was: whatever you wish to raise, please raise and let us talk
about it! It seems to me that this approach was in line with
the
consultants’ mandate from the senior management of the respondent
which was that it was a condition of their appointment that
they had
to ensure that the unions were part of that process. The union has
not suggested that there is any proposal or view that
it advanced or
made which the respondent or the consultants refused to take into
account.
[60] The fact that the union participated in the process
that took place between February and November 1997 and that it was
free to
suggest or to propose whatever it wanted to suggest or
propose means that, since the union did not suggest at the time that
the process
be conducted any differently, it cannot now be heard to
complain that the process should have been dealt with differently.
[61] Secondly, the union cannot be heard to say that the
process which occurred from February to November 1997 was not
consultation.
I say this fully aware that the respondent did say that
the sec 189 consultation process only commenced in November 1997.
However,
the fact of the matter is that, by any standards and
objectively speaking, that process cannot be said to have been
anything less
than consultation. Indeed, nothing can be pointed out
in that process which rendered it less than a consultation. In my
view it was
very much a joint-problem solving exercise in the sense
that all stakeholders took part to investigate what the problem was
and to
look into what possible solutions existed to address the
problem. It is true that to a very large extent it was driven by the
consultants.
But the result of that work was given to the senior
management. And, before the senior management could take a decision
on the recommendations
emanating from that process, they gave all the
steakholders, including the union, copies of the relevant reports and
asked them to
comment thereon. Various steakholders submitted their
comments and the union failed to submit its comments over a long
period even
when it had been granted extensions of time to do so. In
fact during the consultation process that took place after November
1997
the union, through Mr Jaftha, accepted the respondent’s
commitment to a bona fide consultation process. Furthermore, there
was
a full and proper consultation from November 1997 to the end of
May 1998 during which the union accepted the respondent’s
commitment
to bona fide consultations.
[62] In any event, if the union felt that too much work
had been done during the pre-November 1997 process which should have
been
done during the post-November consultation process, it was
always open to it to ask for more time to either carefully examine
such
work or to undertake its own investigation to contradict the
result of the pre-November investigation. It did not do so and cannot
be heard to complain.
[63] In the light of all of the above I am of the view
that the appellants’ second level argument also falls to be
rejected. With
regard to costs, the matter was argued on the basis
that costs should follow the result. I propose to make an order of
costs on that
basis.
[64] Before I conclude this judgment I need to point out
that, after the delivery of the judgment of this Court in
SA
Municipal Workers Union & others Rand Airport Management Co
(Pty)Ltd and others. (2005) 26 ILJ 67 (LAC)
,
the parties in this matter were asked to deliver supplementary heads
of argument on what the effect of that judgment was on this
matter
and whether sec 197 of the Act applied. Both parties indicated that
they did not rely upon sec 197 and requested that this
matter be
decided on the basis on which the trial had been conducted, namely,
as a retrenchment matter. I have, accordingly, dealt
with the matter
on the basis requested by both parties.
[65] In the result the appeal is dismissed with costs.
____________
ZONDO
JP
I
agree.
_____________
Mogoeng
JA
I
agree.
__________
Jafta AJA
Appearances:
For the appellant : Adv K Tip SC, (with Adv K Pillay)
Instructed by : Cheadle Thompson & Haysom Inc
For
the respondent : Adv H Woudstra SC
Instructed
by : Hlatswayo, Du Plessis Van der Merwe
Date
of Judgment : 26 October 2005