Pretorius v Rustenburg Local Municipality and Others (JA20/05) [2007] ZALAC 15; (2008) 29 ILJ 1113 (LAC) (21 December 2007)

About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Labour Appeal Court
SAFLII
>>
Databases
>>
South Africa: Labour Appeal Court
>>
2007
>>
[2007] ZALAC 15
|

|

Pretorius v Rustenburg Local Municipality and Others (JA20/05) [2007] ZALAC 15; (2008) 29 ILJ 1113 (LAC) (21 December 2007)

56
IN THE LABOUR
APPEAL COURT OF SOUTH AFRICA
HELD
IN JOHANNESBURG
Case no: JA20/05
In the matter between
Nicholas Pretorius
Appellant
And
Rustenburg Local Municipality 1st respondent
Munimed 2
nd
respondent
Municipal Gratuity Fund 3
rd
respondent
JUDGMENT
ZONDO JP
[1] I have had the benefit of reading the judgment
prepared by Comrie AJA in the matter. Regrettably I am unable to
agree with his
conclusion that the appellant has made out a case that
he is entitled to the order that he seeks. My approach to the matter
is rather
different from the approach adopted by Comrie AJA. In my
view the appellant is not entitled to any relief and the appeal
should
be dismissed with costs.
[2] In order to determine whether or not the appellant
is entitled to the relief that he seeks, it is necessary to set out
the material
facts as well as the history of the dispute. In the
course of doing so it will be necessary to also refer to the
legislative measures
that were taken during that history which will
have a bearing on whether the appellant is entitled to the relief he
seeks. I start
off with the facts.
The facts
[3] Since
the advent of democracy in this country in 1994 many changes have
occurred and, yet, still more changes need to occur. Local
government
and how it operates have been no exception in this regard. In 1998
the first democratically elected government enacted
the Local
Government: Municipal Demarcation Act, 1998 (Act 27 of 1998) which
created the Demarcation Board. The Demarcation Board’s
main
function was to demarcate territorial boundaries of various local
government authorities throughout the Republic. Once established,
the
Demarcation Board went ahead and did this. After this had been done,
it was necessary to establish local government authorities
in
accordance with the demarcations made by the Board. This meant that
some of the local government authorities which had been established
under apartheid would have to be disestablished. Furthermore, the
territorial jurisdiction of the new local government authorities
would not necessarily be the same as those which had existed in the
respective areas under apartheid. Accordingly, in some cases
a new
local government authority could have under its jurisdiction areas
that previously fell under different local government authorities.
[4] Another piece of legislation that was enacted in
1998 was the Local Government: Municipal Structures Act 118 of 1998
(“
the MSA
”). In
terms of sec 12(1) of the MSA a Member of the Executive Council for
local government in a province was required to establish
by notice in
the Provincial Gazette, “
a municipality in
each municipal area which the Demarcation Board demarcates in the
province in terms of the Demarcation Act
”.
In terms of sec 12(2)(a) and (b) of the MSA the establishment of a
municipality was required to be “
consistent
with the provisions
” of the MSA and would
“
take effect at the commencement of the
first election of the council of that municipality
.”
[5] In terms of sec 14(1)(a) of the MSA
“(a)
municipality established in terms of section 12 in a particular area,
supersedes the existing municipality or municipalities
to the extent
that the existing municipality or municipalities fall within the
area
.” In terms of sec 14(1)(b)
“(t)he
superseding municipality becomes the successor in law of the existing
municipality subject to paragraph (c).”
Sec
14(2), in so far as it is relevant herein, provides:
“(2)
(a)
If subsection (1) is
applicable, the section 12 notice or any amendment of the section 12
notice, must –
provide for the disestablishment of the existing
municipality or, if only part of the existing municipality’s area
is affected,
the disestablishment of the existing municipality in
the affected area; and
regulate the legal, practical and other consequences
of the total or partial disestablishment of the existing
municipality, including
–
the vacation of office by councillors of the
exiting municipality;
the transfer of staff from the existing
municipality to the superseding municipality, or, if there is more
than one superseding
municipality, to any of the
superseding municipalities
;
the transfer of assets, liabilities, rights and
obligations, and administrative and other records, from the
existing municipality
to the superseding municipality or if there
is more than one superseding municipalities, taking into account
the interests of
creditors of the existing municipality;
……………
..
Provided that if the superseding municipality is a
district or local municipality a transfer referred to in subparagraph
(ii) or (iii)
must be effected in a way that would enable the
superseding municipality to perform the functions or exercise the
powers assigned
to it in terms of section 84(1) or (2).
[6] Sec 12(3) of the MSA provides:
“(a)
The transfer of a staff member in terms of a
section 12 notice must be –
on conditions of service not less favourable than
those under which that staff member served in the existing
municipality; and
in accordance with the Labour Relations Act, 1995
(Act 66 of 1995)
(b)
A section 12 notice
transferring staff of an existing municipality to a superseding
municipality may determine that -
(i) the staff transferred from the existing
municipality to the superseding municipality form an administrative
unit that functions
as such unit until the superseding municipality
has established a staff structure and has appointed staff to
positions on the staff
structure; and
(ii) such
administrative unit functions under the control of the municipal
manager or acting municipal manager of the superseding
municipality
.”
[7] The appellant was at some stage employed by the
Rustenburg City Council. That City Council later became or later
formed part of
the Rustenburg Local Transitional Council. That
Council was later disestablished in terms of sec 12 of the MSA. The
Rustenburg Local
Municipality, the first respondent, was established
by way of a notice issued by the Member of the Executive Council
responsible
for local government in the North -West Province. The
notice was notice NO 316 of 2000 which was published in the
Provincial Government
Gazette No 5574 of 29 September 2000. Such
notice will be referred to herein as “
the
sec 12 notice
”. The Rustenburg Transitional
Local Council was only one of three municipalities which were
disestablished and replaced by the
Rustenburg Local Municipality.
This means that the personnel that had been employed by the
municipalities or local councils concerned
were all to be transferred
to the new Rustenburg Local Municipality, the first respondent.
[8] In the sec 12 notice the relevant MEC stated:
“Under
sec 12(1) and (3) and 14(1) and (2) of the Local Government:
Municipal Structures Act, 1998 (Act NO 117 of 1998), I hereby
establish the Rustenburg Local Municipality as set out in the
Schedule hereto
” That was on the 26
th
September 2000. However, as would have been noted earlier in this
judgment, in terms of sec 12 of the MSA the establishment of the
Rustenburg Local Municipality was only going to take effect at the
commencement of the local government election that was to follow.
It
is also at that time that the Rustenburg Transitional Local Council
was going to cease to exist.
[9] The local government election that was held after
the issuing of the sec 12 notice was held on the 6
th
December 2000. That is also the date on which the Rustenburg
Transitional Local Council ceased to exist and the date on which the
first respondent was established. The question which arises is: on
the 6
th
December
2000 what happened to the personnel and all employees previously
employed by the Rustenburg Transitional Local Council and
the other
local municipalities which were disestablished on that date?
[10] In terms of sec 14(2)(b)(ii) of the MSA, if sec
14(1) of the MSA applied to a particular situation, the sec 12 notice
or any
amendment of a sec 12 notice was required to regulate the
legal, practical and other consequences of the total or partial
disestablishment
of an existing municipality, including “
the
transfer of staff from the existing municipality to the superseding
municipality, or if there is more than one superseding municipality,
to any of the superseding municipalities”
.
For the sake of completeness it can also be mentioned that what a sec
12 notice was required by sec 14(2)(b)(ii) to do in regard
to staff
was also required by sec 14(2)(b)(iii) of the MSA in respect of
“
assets, liabilities, rights, obligations
and administrative and other records
.” In
other words just as an MEC for local government could under sec
14(2)(b)(ii) transfer an employee from a disestablished municipality
to any one of a number of superseding municipalities - where there
was one or more superseding municipalities – which seems to
suggest
to me that the MEC could do this even against the employee’s will –
the MEC could also transfer an asset or liability
of a disestablished
municipality to any one of the superseding municipalities even
against the wishes of either the councillors or
the personnel. One
assumes that this would be permissible where to do so was in the
public interest.
[11] The question which arises is whether the MEC for
Local Government in the North-West Province did transfer the
personnel previously
employed by the Rustenburg Transitional Local
Council, which included the appellant, to the superseding Rustenburg
Local Municipality
by way of a sec 12 notice as contemplated in sec
14(1)(b)(ii) of the MSA. Item 8 of the sec 12 notice dealt with the
transitional
provisions relating to personnel. I think that the
transition contemplated therein was to be the period from the entry
of the personnel
of a disestablished municipality in the employ of
the superseding municipality pending the rationalisation or
restructuring of the
superseding municipality to the end of such
rationalisation. The end of the transitional period would, as far as
personnel were concerned,
end when all the positions that had to be
filled pursuant to the rationalisation were filled.
[12] In paragraph 3 of his founding affidavit the
appellant stated that “
all assets and
liabilities as well as all personnel of the erst- while Rustenburg
Transitional Local Council (hereinafter referred
to as the TLC were
transferred to the First Respondent
.” In
the same paragraph he said that
“(t)his had
been done (i)n terms of section 3 contained in the schedule to notice
NO 428 of 2000 as published in the North West
Extraordinary
Government Gazette NO 5634 dated 21 December 2000 as well as in terms
of sections 7(1) and 7(2) contained in the schedule
to Notice No 316
of 2000, as published in the North West Extraordinary Government
Gazette, No 55 74 dated 29 September 2000 proclaimed
in terms of
Section 14(2)(b)(iii) of the mentioned Act on Local Government:
Municipal Structures …”.
In par 18 of its
answering affidavit the first respondent stated that these
allegations are not in dispute. This means that it is
common cause
between the parties that all the personnel who were employed by the
Rustenburg Transitional Local Council – which
included the
appellant – were transferred into the first respondent’s employ.
That is a transfer of personnel that the MSA and
the sec 12 notice
referred to. Accordingly, this matter must be approached on the basis
that upon the disestablishment of the Rustenburg
Transitional Local
Council and the coming into existence and operation of the first
respondent, the appellant was transferred into
the employ of the
first respondent.
[13] Item 8(1) of the sec 12 notice reads:
“
Any person in the employ of the disestablished
municipalities referred to in section 2(2) shall, in accordance with
a determination
by the responsible member made after consultation
with the affected municipalities and with effect from a date
mentioned in such
determination, be transferred and placed in the
service of the local municipality within the district area, on such
terms and conditions
of service as are
not
less
favourable under
which such person previously served; Provided that –
……
……
.
……
.
Such person shall not, as a consequence of such
transfer, acquire a right to retire or to be offered a severance or
retrenchment
package;
…
..
…
..
…
..
Any person who refuses or withholds his or her
consent to be transferred as contemplated by this section, shall not
be entitled
to any severance benefit or benefits.
Provided, further, that the provisions of this
subsection shall not prevent the municipality concerned from
implementing a scheme
to re-organise its personnel subject to the
Labour Relations Act, 1995 (Act No 66 of 1995).”
Item 8(2) of the sec 12 notice reads:
“(2)
The employment of personnel referred to in
subsection (1)-
must be regularised in accordance with any
collective agreement reached between the municipality concerned and
the trade unions
representing those employees; and
is subject to section 197 of the Labour Relations
Act, 1995 (Act No 66 of 1995).
Item 8(3)(a) provides that a determination contemplated
in subsection (1) shall be published in the Provincial Gazette for
information.
Item 8(3)(b) and (c) read thus:
“
(b) The effective date of a determination referred
to in paragraph (a) may be a date prior to the date of publication of
a notice
for information as contemplated in this subsection.
The responsible Member may amend a determination
contemplated in subsection (1)”
Item 8(4) reads thus:
“(4)
The local municipality referred to in section
2(1) may, by agreement with the relevant district municipality or any
other local municipality
within the district municipal area and with
effect from a date determined by such agreement, after due
consultation with the relevant
trade union and with the consent of
the employee concerned, transfer or second any of its employees to or
place the services of any
such employee at the disposal of the
district or local municipality concerned: Provided that in the event
of a transfer such employee
shall be employed on such rights and
privileges as are not less favourable than those applicable to him or
her at the time of such
transfer.”
[14] Subsequent to the establishment of the first
respondent, the first respondent embarked upon a re-organisation or
rationalisation
or restructuring to create posts which would be
filled by employees. The employees who would fill such posts would
include the former
employees of the Rustenburg Transitional Local
Council. One does not need much imagination to understand that, as
there were two
other municipalities which had been disestablished and
were replaced by the first respondent, this was a situation where for
any
post there could be two or three people who had previously
occupied similar or corresponding posts in the disestablished
municipalities
each of whom may have hoped to get either the
corresponding post in the first respondent or a post as close as
possible to the one
they had occupied in the disestablished
municipalities. Obviously, the first respondent had to deal with the
challenge of how to
accommodate all the employees from all the three
disestablished municipalities. In most cases it would be impossible
to give each
employee exactly the same post or position that he or
she had occupied in the relevant disestablished municipality. All
that the
first respondent could realistically be expected to do was
to make employees reasonable offers of employment in certain
positions.
It would never succeed if it sought to satisfy every
employee in respect of every issue. It is now necessary to consider
the events
which occurred subsequent to the disestablishment of the
three municipalities and the establishment of the first respondent in
so
far as they are relevant to this matter.
[15] In 1973 the appellant was employed by the
Rustenburg Town Council. Later the Rustenburg Town Council was
disestablished and replaced
by the Rustenburg Transitional Local
Council. This was in the post – 1994 period. The capacity in which
the appellant had been
employed by the Rustenburg Town Council was
that of Assistant Town Engineer (Water and Sewerage Section) until
1974 when he was promoted
to the position of Deputy Town Engineer. In
1989 he was promoted to the position of City Engineer: Civil
Services. That was the position
that the appellant occupied on the
5
th
or 6
th
December 2000 at the time of the disestablishment of the Rustenburg
Transitional Local Council and the establishment of the first
respondent.
[16] In his founding affidavit the appellant referred to
an agreement that was concluded on the 31
st
October 2000 between, on the one hand, the North-West Government
Association (“
NORWELOGA”
),
of which the first respondent was, at all material times, a member,
and, on the other, the South African Municipal Workers Union
(“
SAMWU
”) and the
Independent Municipal Association of Trade Unions (“
IMATU
”).
The appellant was at all material times a member of IMATU. A copy of
that agreement was annexed as “
NP1
”
to the appellant’s founding affidavit.
[17] In the record there is an advisory arbitration
award that was issued by an arbitrator who had been asked by either
all or at
least some of the parties who had signed the “
NP1
”
agreement to give an advisory arbitration award on a number of
issues. The fact that the award is an advisory one means that it
is
not binding on any of the parties thereto. One of the issues on which
the arbitrator had been asked to give an opinion was whether
or not
the “
NP1
”
agreement is a collective agreement. The arbitrator concluded that
the “
NP1
”
agreement is not a collective agreement. Obviously, no court is bound
by that conclusion. Indeed, as I have said, that conclusion
is not
binding even on the parties to that advisory award.
[18] The arbitrator who issued the advisory award based
his conclusion in this regard on the provisions of the constitution
of the
South African Local Government Bargaining Council,
particularly clause 3.2 thereof read with clause 3.1. In terms of
clause 3.2 collective
agreements in the bargaining council must be
concluded at a certain level. The arbitrator stated that this had not
been complied
with in the case of the “
NP1
”
agreement. For this reason he concluded that the “
NP1
” agreement
was not a collective agreement.
[19] I am not certain whether the terms of reference of
the arbitrator required him to give his opinion on whether the “
NP1
”
agreement is a collective agreement on the basis of the constitution
of the bargaining council or whether no restriction was placed
with
regard to what could form the basis of his opinion. What is
conspicuous by its absence from the matters that the arbitrator
took
into account in arriving at his conclusion that the “
NP1
”
agreement is not a collective agreement is a consideration of
whether the “
NP1
”
agreement falls within the definition of a collective agreement
contained in sec 213 of the Labour Relations Act, 1995 (Act 66
of
1995) (“
the Act
”).
That definition reads as follows:
“Collective agreement’
means a written agreement
concerning terms and conditions of employment or any other matter of
mutual interest concluded by one or
more registered trade unions, on
the one hand and, on the other hand –
(a) one or more employers
(b) one or more registered employers’
organisations; or
(c) one
or more employers and one or more registered employers’
organisations.”
[20] Once an agreement is a collective agreement as
defined in sec 213 of the Act, such agreement is binding on the
employers’ employers’
organisations and their members and the
trade unions which signed the agreement as well as their members.
This is so by virtue of
the provisions of sec 31 of the Act. In my
view the fact that such an agreement may not have complied with any
domestic or internal
requirements of a particular organisation does
not affect the question whether or not, for purposes of the Act, it
is a collective
agreement. I am unable to agree with the conclusion
that the “
NP1
”
agreement is not a collective agreement as defined in sec 213 of the
Act. IMATU, the union of which the appellant is a member,
is a
registered trade union and it is party to the “
NP1
”
agreement. SAMWU is a registered trade union and it was a party to
that agreement. NORWELGA is an employers’ organisation. The
provisions of the “
NP1
”
agreement clearly relate to terms and conditions of employment and
other matters of mutual interest between employer and employee.
In my
view the “
NP1
”
agreement meets the requirements of the definition of a collective
agreement in sec 213 of the Act and is, indeed, a collective
agreement for purposes of the Act.
[21] Annexure “
NP1
”
was one of the first steps, if not the first step, taken by the
parties to that agreement to put in place structures and processes
that would be necessary for, among others, the first respondent, once
established, to manage and regulate the restructuring and
reorganisation
that had to be undertaken after the disestablishment
of some of the old local authorities and the establishment of certain
new municipalities.
[22] It is not necessary to refer to all the provisions
of the “
NP1
”
agreement. It will suffice to note some of its provisions. The
preamble to the “
NP1
”
agreement reads:
“
Whereas the Structures Act and demarcation results
necessitate the incorporation of personnel into one structure for
each demarcated
area.
Now therefore it is agreed as follows:”
This preamble makes it clear that the “
NP1
”
agreement recognised that certain challenges lay ahead in the
incorporation of personnel from different disestablished local
authorities
into municipalities created as part of the restructuring
of local government. Furthermore, through the “
NP1
”
agreement the parties thereto sought to lay down principles that
would govern the challenges that lay ahead and the processes
that
would have to be followed and the structures or bodies that would
play different roles to deal with the challenges.
[23] Clause 1 of the “
NP1
”
agreement contained what it referred to as the “
STAFF
PLACEMENT POLICY AND PROCESS
”. Clause 1.1.
provides that the parties to the “
NP1
”
agreement accepted that as a result of “
the
need to restructure local government and functions within the
applicable demarcated areas, the reorganisation of existing staffing
structures (including geographic redeployment) [could] be necessary
to meet operational objectives of service delivery
.”
From clause 1.1 two observations can be made. The one is that the
parties to the NP1 agreement – which included the appellant’s
trade union - accepted that there was a “
need
to restructure local government and functions
”
within the newly demarcated areas. The second is that they also
accepted that it could be necessary to have a reorganisation of
existing staffing structures including geographic redeployment to
meet operational objectives of service delivery. By the term
“
geographic redeployment
”
I understand that an employee could have to move from one
geographical area to another geographical area in order to meet the
operational objectives of service delivery.
[24] Clause 1.2 of the “
NP1
”
agreement provided that municipal councils had to “
prepare
the envisaged final organograms of departments wherever there is
reasonable certainty as to the requirements and it [was]
unlikely
that any substantial changes to these structures [would] be required
in the foreseeable future.”
This clause
envisaged the preparation of final organograms of departments. Clause
1.3 provided that, where it was not possible at
that stage “
to
prepare final organograms, temporary deployment of staff [would] take
place in terms of structures prepared on a cut-and-paste
basis
”.
[25] In terms of clause 1.4. all organograms, whether on
a final or “
cut-and-paste
”
basis, would be referred, in the first instance, to a Local Labour
Forum and, finally, to the Municipal Facilitation
Committee/Municipality
for final approval. In terms of clause 1.5
each municipality or Municipal Facilitation Committee was required to
create a “
Placement Committee
”
“
consisting of equal numbers of employer and
employee representatives
.” The terms of
reference of these committees were going to be “
to
consider and make recommendations to the new municipality on the
placement of existing employees into the new structures.
”
In terms of clause 1.6
“(s)taff [were] to be
placed in these structures on a permanent basis.”
[26] Clause 1.6 went on to say in the next sentence:
“
Every attempt will be made to place all
existing staff within these new structures. New or major changed
posts [would] only be advertised
where no ‘close-match’ placement
[was] possible
” This suggests that it was
within the contemplation of the parties to the “
NP1
”
agreement that there would be new posts and that there would be
“
major changed posts
.”
The parties could not but also have contemplated that some of the
posts that some employees may have occupied before could no
longer
exist. Clause 1.7 is very important. It reads as follows:
“
The parties are committed to ensure (sic)
continuity of employment and every attempt will be made to
ensure
that no retrenchment/ redundancy will occur provided that the
affected employees are
willing to
accept alternative positions that are offered. Every effort will be
made to
ensure that such alternative
offers are reasonable
”
(underlining supplied).
[27] In clause 1.7 the parties to the “
NP1
”
agreement committed themselves to ensuring that in effect there would
be no retrenchment or redundancy arising out of the contemplated
restructuring and reorganisation provided reasonable offers of
alternative positions were made to employees. The employees to whom
clause 1.7 applied included the appellant. What this meant is that,
if an employee was offered a reasonable alternative position
to fill,
he could not demand to be retrenched and, if he did, he would not be
entitled to severance benefits. The clause cannot conceivably
be
construed to mean that, irrespective of an employee being offered a
reasonable offer of an alternative position which he rejects,
he
would be entitled to demand that he be retrenched and be paid a
severance package despite the parties having committed themselves
to
avoiding retrenchments and redundancies. Such a construction would
wholly defeat the idea of clause 1.7 that every effort be made
to
make reasonable offers of alternative positions.
[28] In clause 1.7.1 and 1.7.2 of the “
NP1
”
agreement the parties set out in express terms situations which would
not constitute grounds for retrenchment or redundancy. These
situations were given as:
(a) “
a reasonable geographical
deployment”
(clause 1.7.1), In my view this
refers to a case where an employee was offered a position in a
geographical area other than where
he was based prior to December
2000 and that re-deployment was reasonable. I pause here to make the
observation
that, if
an employee who is offered a position, for example, 30 km away and
the offer is a reasonable one in the circumstances, had
no right to
be retrenched by virtue of such geographical re-deployment, it stands
to reason that an employee who is made a reasonable
offer without a
geographical redeployment would a fortiori also not be entitled to
demand to be retrenched. A construction of the
agreement that would
say that, if an employee was made an offer of alternative employment
which was reasonable but which required
him to relocate will not be
entitled to be retrenched and to receive severance pay if he rejected
the offer but he would be entitled
in the same circumstance to
severance pay if there was no relocation would make a complete
nonsense of clause 1.7 and 1.7.1
(b) “
the
transfer from one employer to another employer without any material
changes to functions and/or conditions of employment”.
(clause 1.7.2).
Clause 1.7.3 provides that, notwithstanding clause 1.7.1
and 1.7.2, employees who felt aggrieved by decisions made “
in
terms of the said clauses”
would retain the
right to lodge grievances. This would have to be dealt with in terms
of the grievance procedure provided for in clause
8 of the “
NP1
”
agreement. That procedure leads to arbitration.
Clause 1.8 provides as follows:
“
Prior to the Placement Committee forwarding their
recommendations to the Municipal Facilitation Committee/Municipality,
each member
of staff concerned must receive a letter and copy of the
section of the relevant organogram indicating their proposed post and
the
classification thereof, Department, service unit, where
applicable, and Council in which they will be placed. Where changes
to duty
schedules and/or geographical relocation are envisaged,
adequate consultation with affected staff will take place. In such
instances
a meeting of the affected employees concerned should be
convened with trade union representation at their discretion.”
[29] The picture that emerges from clause 1.1 to 1.8 of
the “
NP1
”
agreement is that all concerned accepted that:
(a) there was a need for a restructuring or
reorganisation in the different municipalities;
(b) that
positions/posts would be created some of which would be the same as
positions previously held by some of the employees but
that there
would also be positions or posts which would be slightly different,
some drastically changed and others completely abolished;
(c) staff
who had previously been employed by a municipality or local authority
in one geographical area could be offered positions
in different
geographical areas;
(d) as
far as possible the municipalities should avoid retrenchment and
redundancies;
(e) to
try and avoid retrenchments and redundancies, the municipalities were
required, as far as possible, to make reasonable offers
of
alternative positions to employees;
(f) reasonable
geographical redeployments would be no ground for retrenchment;
(g) the
transfer from one employer to another employer was no ground for
retrenchments if there were no material changes to functions
and/or
conditions of employment;
(h) structures were established which would make
recommendations or take the necessary decisions about positions to be
created and
offered but employees who felt aggrieved had recourse to
an agreed grievance procedure.
[30] In terms of clause 2.1.1 the Placement Committee
would consider and make recommendations to the new municipality on
the placement
of existing personnel within the new structure. The
establishment of the Placement Committee was provided for in clause
1.5 of the
NP1 agreement. It was made up of an equal of number of
representatives of employers and employees. In fact clause 1.5 states
quite
clearly that
“(t)he terms of reference
of [the Placement Committee]
will
be to consider and make recommendations to the new municipality on
the placement of existing employees into posts in the new
structures
”.
[31] Clause 2.2.1 to 2.4 contained the processes that
were to be “
followed in the placement of
staff within the new structures.
” There
were three processes that were available for the placement of staff
in new structures. The first was that the council would
list certain
posts and submit them to the Placement Committee for consideration
and approval by the municipality. The posts which
would be dealt in
this way were “
unchanged posts
”,
“
minor changed posts
”
and “
redeployed posts
.”
The unchanged posts were posts involving no change to their schedule
of duties or geographical location. Minor changed posts
were posts
involving minor changes to the duty schedule e.g change of title with
no change to duties or minor changes to the duty
schedule which has
no material effect on the level of responsibility. The re-deployed
posts were posts involving no change or minor
change to the duty
schedule, but where a change in geographical location would occur.
[32] Another process was one where posts and the names
of proposed parties were to be submitted to the Placement Committee
for the
placement of such staff members on a “
close
match
” basis but, after these posts had
been filled, they would be submitted for evaluation. The third
process entailed that the posts,
with their detailed duty schedules,
would be submitted to the Placement Committee or the Municipality for
consideration of the placement
of existing staff on a “
close-match
”
basis and, thereafter, sent to the Job Evaluation Committee for
evaluation. If no suitable candidate was found within the council’s
service, the post would be advertised. This process applied to new
posts. New posts were posts which carried duties and responsibilities
that did not exist in any form in the structures before the new
municipality. The last process involved placing posts to the
Placement
Committee with appropriate proposals, followed by
evaluation where necessary. This last process applied in the case of
posts other
than the categories of posts referred to above.
[33] Clause 2.3 provided that every employee had to be
informed in writing by the employer of the decision of the Municipal
Facilitation
Committee or Municipality. Clause 2.4 dealt with the
decision-making process with regard to the filling of posts. It
provides that
the Placement Committee “
shall
strive
” to reach consensus on the staff
placement submissions under consideration. In other words this
Committee – which was composed
of an equal number of
representatives of the employer and those of employees – would seek
to make decisions about who would fill
which posts on the basis of a
consensus. Its recommendation would in terms of clause 2.4 “
be
referred to the Municipal Facilitation Committee / Municipality for a
final decision
.” Clause 2.4 further
provided that an employee or his trade union retained the right to
lodge a grievance against any published
decision and such a grievance
would be dealt with in terms of the grievance procedure provided for
in the “
NP1
”
agreement – which leads ultimately to arbitration.
[34] Clause 4.4 provides:
“
Employees shall retain their remuneration and all
benefits as applicable before the amalgamation subject to clause 4.5
below:”
Clause 4.5 reads as follows:
“
Within 1 year of the commencement date of this
agreement, the Job Evaluation Committee of the Bargaining Council
shall evaluate all
the posts of the newly formed local
authority. The relevant posts will be
evaluated by the Job Evaluation Committee with due observance of the
additional implications
.”
Clause 5 deals with conditions of service. Clause
5.1(a) guaranteed employees the retention of their pre-new
municipality years of
service subject to (b) and (c) of clause 5.1.
Clause 5.1(b) dealt with “
cases of
resignation prior to
amalgamation
”
Clause 5.1 (c) provided that, notwithstanding the provisions of (a)
and (b) therein, “
staff in all Councils
would retain all other current conditions of employment following
placement in the new structures until rationalisation
of such
conditions of employment has (sic) been completed
.”
[35] Clause 7 deals with geographical relocation. Clause
7.1 provides that
“(a)ll submissions in
terms of the abovementioned classification are to indicate whether
geographical relocation of staff will be
required
.”
Clauses
7.2, 7.3, 7.4 and 7.5 read:
“7.2
Geographical re-deployment of staff will only
take place for sound operating and/or economic reasons;
The functions of the post/s are to be delivered in
another geographical area.
The functions of the post/s may be reduced and/or
combined resulting in a necessity to rationalise resources.
The functions of the post/s may be abolished in
that particular geographical area
.”
Clause 8 deals with the “
grievance-handling
process
.” Clause 8.1 provides that
“(s)hould a grievance be lodged arising out
of the placement (including geographical re-deployment) of any
employee/s a meeting
shall be convened within 5 working days between
the employee/s, management and trade union concerned
.
All relevant information requested will be
made available
.”
[36] Clause 8.2 provides in effect that, if the parties
reached agreement, the proposed placement/s would be implemented.
Clauses
8.3, 8.4, 8.5 and 8.6 read thus:
“8.3
Should the parties disagree and should the
matter not be resolved within a period of 10 working days as to
whether the proposed placement
is reasonable, then the matter will be
referred for conciliation by the North - West Division of the SALGBC
and should no agreement
be reached at this level, the matter shall be
referred to Arbitration within 30 working days from the date of
conciliation.
The arbitrator shall, after taking into account all
relevant legislation and submissions by the parties give the final
and binding
ruling within 14 working days of hearing the
submissions.
Section 138
of the
Labour Relations Act shall
apply
during the proceedings.
Should the matter be referred to private
arbitration, the costs of arbitrator shall be shared equally
between the parties.”
[37] Sec 138 of the Labour Relations Act, 1995 (Act 66
of 1995) (“
the Act
”)
deals inter alia with how a CCMA commissioner is required to conduct
arbitration proceedings. In paragraph 10 of his founding
affidavit
the appellant stated that the “
NP1
”
agreement was “
the first step in an attempt
by the parties involved thereto (sic) to regulate any restructuring
processes that had to take place
regarding
inter
alia
the staff of the First Respondent
and the reorganization of existing staffing structures at the time in
terms of the Municipal Structures
Act and the Municipal Systems Act
and related legislation, including the
Labour Relations Act (Act
66
of 1995).”
It is also to be observed that
in paragraph 11 of his founding affidavit the appellant says that “
it
was always envisaged that negotiations by the First respondent with
the affected staff members of the first respondent would take
place
between the relevant employer and trade union representatives.
”
[38] A “
staff communique
,”
which was annexed as Annexure NP2 to the appellant’s founding
affidavit, was issued on the 2nd June 2002 by the first respondent.
It included a portion on the second page thereof which read as
follows:
“
The RLM (i.e Rustenburg Local Municipality) has
already embarked on conciliations and negotiations with trade unions
represented in
the Local Labour Forum on the restructuring of the
municipality. Parties to the Local Labour Forum have reached
consensus on the
strategic direction, high-level organisational
design as well as the unit level organisational design.”
The next paragraph in the “
communiqué
”
bore the heading: “
Placement of Employees
into the New Organisational structure
.”
Thereunder came a paragraph that included the following passage:-
“
Placement means the process of placing employees
from one post or position to another in the new organisational
structure. The restructuring
of the municipality will affect
employees in some or other way. For many employees, these changes may
be negligible, a change in
reporting line, for example, may not
affect the nature of the work done by the employee, the hours worked
by that employee, or any
other change to a term or condition of
employment for that employee
.”
[39] Annexure NP2 included an organisational structure
with new positions that needed to be filled. One of the sections of
the new
organisational structure was the Directorate: Infrastructure
Development and Management. There were four other directorates.
Directorates
were just below the level on which the municipal manager
was employed.
[40] In paragraph 13 of his founding affidavit the
appellant states that it is clear from annexure NP 2 that “
virtually
the whole of the contents of my job description as City Engineering :
Civil Services, would be transferred to a new directorate
of the
First Respondent, namely the Directorate: Infrastructure Development
and Management which directorate was basically anticipated
to take
over all my responsibilities as city Engineer: Civil Services as well
as the responsibilities of the City Engineer : Electrical
Services,
whose position was vacant at the time.”
An
inspection of Annexure “
NP2”
does not reveal any duties for the position of Director:
Infrastructure Development and Management. The best that can be said
is
that the directorate relates to Infrastructure Development and
Management.
[41] The appellant goes on to say in paragraph 14 of his
founding affidavit that, due to the similarities which, he alleged,
existed
between the duties and or responsibilities of the Director:
Infrastructure Development and Management and those of the City
Engineer:
Civil Services, he was almost sure that he would be
appointed to the position of Director: Infrastructure Development and
Management.
He goes on to say in effect that the policy of the first
respondent that “(
i)f the positions in the
new structure are the same or similar to those in the old structure,
then the incumbents will be placed in
the new positions or compete
with each other if there is more than one incumbent
”
was applicable to his case and that “
(i)n
view of the vacancy at the time in the position of the City Engineer:
Electrical Services
”, he would have been
“
the only incumbent (sic) to fill the
position of the Director: Infrastructure Development and Management
in the circumstances, which
expectation I submit was reasonable in
the circumstances.
”
[42] In paragraph 15 of the founding affidavit the
appellant contends that the first respondent “
acted
…. in a fashion that is directly in contest with the declared
acceptance of the First Respondent and it is my contention that
the
actions of the first respondent mentioned below were executed with a
positive intent to abolish my erstwhile post as City Engineer:
Civil
Services and to prejudice my person
:”
Thereafter he sets out in paragraphs 15.1 to 15.21 various matters
which he contends support this. A reading of paragraph 15.1
to 15.21
does not, in my view, support the contention that the first
respondent acted as alleged simply because it wanted to prejudice
the
appellant. Indeed, the first respondent denied the appellant’s
allegations in this regard. The first respondent emphasised
that the
process of restructuring that it undertook was part of the broad
process of municipal restructuring that took place across
the
country. It admits that the new structure did not provide for the
post of a City Engineer nor did any of the new posts, in particular,
the Director: Infrastructure Development and Management, equate with
the responsibilities of the post of City Engineer. Referring
to the
position of Head: Technical Services which was offered to the
appellant, the first respondent stated in par 29.7 of the answering
affidavit that the appellant “
has not
suffered any reduction in remuneration or any other benefits nor has
he suffered any other prejudice
.”
[43] In paragraph 16 of the founding affidavit the
appellant submitted that he was more than suitably qualified to have
been appointed
as Director: Infrastructure Development and
Management. In paragraph 19 the appellant submitted that, in the
process of establishing
the new structure, the first respondent had
effectively abolished his post of City Engineer: Civil Services.
[44] The appellant also refers to the fact that the
first respondent offered him the position of Head: Technical
Services. He points
out that, when this offer was made to him –
which he says was at a meeting attended by himself, his lawyer and a
Mr Andries Boshoff
who represented the first respondent – his
lawyer pointed out that it would not be possible for the appellant to
make an informed
decision on the offer before such position was
evaluated. He says that at the meeting it was agreed that the first
respondent would
send details of that post “
for
evaluation and that such valuation would be available not later than
8 (eight) weeks from the date of the said meeting which would
have
meant that this matter had to be held further in abeyance until at
least 6 August 2003.
” In par 31 of the
founding affidavit the appellant says that on the 29
th
July 2003 the first respondent resolved, “
apparently
without having obtained an evaluation of the said post as agreed, to
offer the post of Head: Technical Services to me,
…
”.
[45] With regard to the offer referred to in the
preceding paragraph, reference can be made to annexure NP33 to the
founding affidavit.
That was a letter addressed to the appellant by
the first respondent’s director: corporate support services dated 4
August 2003.
The heading of that letter reads: “
Organisational
Restructuring: Displaced Employees in the Corporate Pool
.”
The letter contained an offer by the first respondent to the
appellant of the position of Head: Technical Services. The body
of
the letter reads as follows:
“
You are herewith informed that the Council has
resolved on 29/07/2003 per item 400 to offer you the following final
offer of employment:
Head: Technical Services,
on
the same employment conditions that you currently have on an open
ended contract
.
We
trust that you will be happy in your new position and want to express
our gratitude for the positive spirit and patient manner
in which you
have dealt with this difficult transitional time in your career.”
(
underlining supplied).
Annexure NP34 to the founding affidavit was the
Council’s relevant resolution relating to the offer to the
appellant.
[46] In a letter written by the appellant’s Counsel,
who also appeared for him before us, Mr Van der Walt, to the first
respondent
on the 11
th
August 2003 and marked as annexure NP 35 to the founding affidavit
the appellant’s Counsel
inter alia
stated that the appellant would not accept the offer of the position
because it had not yet been evaluated. I must take this opportunity
to say that it was unacceptable conduct for Mr Van der Walt as
Counsel to engage in writing letters to the first respondent as that
was the instructing attorney’s work. It should not have happened.
[47] The Acting Municipal Manager of the first
respondent responded to annexure NP 35 by a letter dated 12 August
2003 marked annexure
NP 36. It was addressed to the appellant’s
Counsel, Mr Van der Walt. In that letter the Acting Municipal Manager
indicated that:-
- the first respondent had
“the
interests of all its employees at heart.”
-
the
first respondent had categorically stated that
“all attempts would be directed to place all employees in a
position which is not detrimental or less favourable than the
position
they occupied prior [to] placement.”
-
the
first respondent
“values the technical
expertise of [the appellant] and is convinced that his contributions
in a technical capacity would enhance
service delivery.”
- “
in
order to retain these (sic) expertise, [the first respondent]
resolved per item 406 on 29 July 2003 to create the position of Head:
Technical Services. The details of the role description must be
completed in the TASK format
.”
-
“[the
appellant] must sign the role description together with his trade
union. The completed role description will then be submitted
to Mr
Slade Pillay, the Technical Co-ordinator of job evaluation in the
offices of SALGA
.”
[48] On the 23
rd
September 2003 the Director: Corporate Support Services of the first
respondent addressed a letter to the appellant’s Counsel reminding
him that the role description that had been sent to him for signature
by the appellant had not yet been returned to the first respondent.
In his founding affidavit the appellant sought to justify his failure
to sign the role description on the basis that he was not yet
the
incumbent of the position concerned and that the contents thereof
were new to him and had not been discussed with him.
[49] Annexure 37 included duties and responsibilities
attached to the position of Head: Technical Services. A perusal of
those duties
and responsibilities leaves one with no doubt that the
position carried with it huge responsibilities. Section D of annexure
37 bore
the heading: approval of job description. Thereunder appears
the following writing: “
We the undersigned
confirm that we have consulted on the content contained in the job
description and hereby confirm that we consider
that the information
contained is a correct reflection of the context of the post and its
content
.” Thereunder spaces were provided
for various persons to sign. One space was for the signature of a
representative of IMATU, the
appellant’s union. The other was that
of the “
incumbent
.”
A Mr Stols signed in the space provided for a union representative.
He did this on the 19
th
August 2003. The effect of anyone signing therein was that he or she
was confirming that he or she had consulted on the content of
the job
description and that he considered the information to be correct. The
appellant did not sign. The union subsequently wrote
a letter seeking
to extricate itself from the natural effects and consequences of its
representative having signed section D in Annexure
37.
[50] In a letter dated 2 October 2003 addressed to the
Director of Corporate Support Services, the appellant’s Counsel,
inter alia,
said that the appellant was not prepared to sign the role
description. He also accused the first respondent of having appointed
certain
people to certain positions for which they were not qualified
and who would not be able to cope with the work “
without
the assistance of a person of [the appellant’s] calibre (sic)
.”
One of the reasons given as to why the appellant was not prepared to
sign the role description was that the first respondent
had not sent
the post for evaluation. By a letter dated 3 October 2003 the Acting
Municipal Manager informed the appellant’s Counsel
that he had
submitted the job description to the Job Evaluation Committee “
in
its current format
” for evaluation without
the appellant’s signature. He hoped that the Job Evaluation
Committee would make its decision not later
than 10 October 2003.
[51] On the 5
th
November 2003 the Acting Municipal Manager informed the appellant’s
counsel that the position of Head: Technical Services had been
evaluated “
in the TASK job evaluation system
and the grade of the post [was] a TASK 16
”.
In the last sentence he informed the appellant’s Counsel that the
answer to his offer of employment was still awaited. The
appellant’s
Counsel responded to this letter by a letter dated 25 November 2003
which was annexed as annexure 42 to the founding
affidavit. In that
letter the appellant said through his Counsel that he was rejecting
the offer of the position of Head: Technical
Services because, as his
Counsel put it in the letter, “
the said
position is inferior to the position that was previously held by my
client and would have been held by my client, had his
appointment to
the said position not been made impossible due to ulterior
considerations in the reconstruction process.
”
In that letter it was also stated that the appellant was not prepared
to “
remain in the [corporate pool of
employees] and to leave this matter unresolved for an indefinite
period
.” It was also stated that it had
become abundantly clear that the appellant’s position “
has
become redundant in circumstances and that the Council as employer
has offered my client alternative employment at a lower level
but at
the same rate of pay which was rejected by my client as appears from
the above. The Council should therefore deal with this
matter on the
basis of
section 17.4.7.4.
of ‘The Conditions of Employment
(Transvaal) is concerned.
” In the second
last paragraph of the letter (Annexure 42) the appellant’s Counsel
wrote thus:
“
This letter serves as the final warning that our
client intends to take legal action in this matter unless Council
indicates on or
before 10 December 2003 that it will be prepared to
follow the route as indicated, namely to apply
section 17.4.7.4.
of
the said conditions of employment
.”
[52] By a letter dated 6 February 2004 the Director of
Corporate Support Services informed the appellant’s Counsel that
the first
respondent’s Counsel had noted that it had offered the
appellant a permanent job and he had rejected it. He rejected the
appellant’s
demand that he be treated in terms of clause 17.4.7.4.
However, he asked the restructuring committee to explore the
possibility of
using the appellant’s services on a contract basis
without having to pay retrenchment benefits.
[53] I am prepared to approach this matter on the basis
that the post which the appellant occupied before the coming into
existence
of the first respondent no longer exists. After all it was
within the very nature of the local government restructuring that
occurred
that there would be employees of defunct local authorities
whose previous positions in those local authorities would not be
available
after the restructuring. Indeed, there could be many
employees who would find themselves in such situations. That
notwithstanding,
the restructuring was pursued for the greater good
of the country. Indeed, if it was sought to ensure a restructuring
that would
not have such a result, there would have been no
restructuring at all.
[54] The appellant’s approach, as set out in his
founding affidavit and as argued before us, is that, once his
position had become
redundant, the first respondent became obliged to
declare it redundant and pay him retrenchment benefits in terms of
clause 7.4.7.4
of the collective agreement irrespective of the
reasonableness or otherwise of any offer of employment that the first
respondent
may have made to him which he rejected. If that reasoning
were correct, many employees of the three defunct local authorities
of
which the first respondent is the successor in law could have
demanded to be paid out severance benefits because, I have no doubt,
there would have been many employees who were offered positions that
were lower than those that they had occupied in disestablished
local
authorities and who were not happy with them but, nevertheless,
accepted such positions because they understood that it would
be
impractical for the first respondent to offer everyone exactly the
same position or a position on exactly the same level as the
one that
he held before. As the main objective of the local government
restructuring was to ensure proper service delivery, that
very
objective would have been seriously undermined, if not defeated, if
any employee who was offered a position that was lower than
his
previous one was entitled to get severance pay on demand irrespective
of the reasonableness or otherwise of the offer of an alternative
position made to him which he has rejected. At the same time it can
also not be that an employee who is aggrieved by the fact that
the
position offered to him is lower than the one he had previously
occupied was obliged to take any position that was offered to
him at
the risk of not getting any severance pay if he did not accept such
position and was retrenched. The question, therefore,
is: what, then,
was the test to determine who would be entitled to a severance pay
and who would not be entitled to severance pay
if his position had
become redundant and he had been offered a lower position than the
position that he had previously occupied in
a disestablished local
authority?
[55] It seems to me that the test in terms of the “
NP1
”
agreement is that of the reasonableness or otherwise of the offer
that the first respondent had offered. If it was a reasonable
offer
and the employee rejected it, he was not to be entitled to severance
pay. If it was an unreasonable offer and he rejected it,
then he
would be entitled to severance pay. This accords with clauses 1.7 of
the “
NP1
”
agreement. Clause 1.7 provides that the parties to that agreement,
which included the appellant’s own trade union and the first
respondent’s predecessors, are committed to ensuring “
continuity
of employment and every attempt will be made to ensure that no
retrenchment/ redundancy will occur provided that the effected
employees are willing to accept alternative positions that are
offered. Every effort will be made to ensure that such alternative
offers are reasonable
.” What would be the
point of the commitment to make reasonable offers if an employee
could reject such reasonable offer with impunity
in the sense that he
would still be entitled to be paid his severance pay despite his
rejection of a reasonable offer of employment?
In this regard it must
be remembered that the restructuring of local government was aimed,
among other things, at ensuring service
delivery to the public. The
appellant had skills that the local government needed. It made a
reasonable offer to him. He rejected
it and this deprived the public
falling under the first respondent’s jurisdiction of some of the
technical skills which the first
respondent needed in order to serve
the public properly.
[56] If the appellant’s approach is correct, namely,
that, after the disestablishment of the old local authorities, an
employee
who was previously employed by in a certain position by a
local authority that has been disestablished is entitled, after the
establishment
of new local authorities, to a position that is exactly
on the same level as his previous position or one that is higher than
his
previous position failing which he is entitled to retrenchment
and payment of severance pay on demand irrespective of his rejection
of a reasonable offer of employment by the new local authority, the
result would be that all employees who possessed key technical
skills which the new local authority and the public required could
reject reasonable offers and leave with huge retrenchment packages.
In my view that is not what the legislation that was created to
govern the restructuring of local government and the “
NP1
”
agreement provide for and intended. With regard to the “
NP1
”
agreement I have already referred above to the commitment which the
signatories thereto took upon themselves to avoid retrenchments,
to
pursue continuity of employment and to make reasonable offers to
employees. (see clause 1.7 and clauses 1.7.1 and 1.7.2 of the
“
NP1
”
agreement. I turn to deal with the question of what the relevant
legislation provides for.
[57] I have referred to the relevant legislation earlier
in this judgment. However, it is convenient to repeat the relevant
statutory
provisions. The preamble to the MSA include the following:
“
Whereas past policies have bequeathed a legacy of
massive poverty, gross inequalities in municipal services and
disrupted spatial,
social and economic environments in which our
people continue to live and work
;
Whereas there is fundamental agreement in our country
on a vision of democratic and developmental local government, in
which municipalities
fulfil their constitutional obligations to
ensure sustainable, effective and efficient municipal services,
promote social and economic
development, encourage a safe and healthy
environment by working with communities in creating environments and
human settlements
in which all our people can lead uplifted and
dignified lives;
………
Whereas municipalities now need to embark on the
final phase in the local government transition process to be
transformed in line
with the vision of democratic and developmental
local government
;”
[58] I have also referred above to the fact that
sec
14(2)(b)
of the MSA requires a
sec 12
notice to, among others,
“
regulate the legal, practical and other
consequences of the total or partial disestablishment of the existing
municipality
…”. Such “
legal,
practical and other consequences
” of the
disestablishment of a municipality include, as provided for in
sec
14(2)(b)(ii)
of the MSA “
the transfer of
staff from the existing municipality, or, if there is more than one
superseding municipality, to any of the superseding
municipalities
;”
Sec 14(2)(b)(ii)
is subject to a specific proviso contained at the
end of
sec 14(2).
The proviso is to the effect that the
sec 12
notice
must regulate the legal, practical and other consequences of the
disestablishment of an existing municipality including the
transfer
of staff from a disestablished municipality to a superseding
municipality: “
Provided that if the
superseding municipality is a district or local municipality a
transfer referred to in subparagraph (ii) or (iii)
must be effected
in a way
that would enable the
superseding municipality to perform
those functions or powers assigned to it in terms of
section 84(1)
or
(2),
” (underlining supplied).
Sec 14(3)
of the MSA provides that
“(t)he
transfer of a staff member in terms of a
sec 12
notice must be –
(i) on conditions of service not less favourable than
those under which that staff member served in the existing
municipality; and
(ii) in
accordance with the Labour Relations Act, 1995 (Act 66 of 1995).”
[59] From sec 14 of the MSA it can be said that to the
extent that the appellant can be said to have been transferred to the
employ
of the first respondent, such transfer was required to be in
accordance with the Labour Relations Act, 1995 (Act 66 of 1995) (“
the
Act
”). The sec 12 notice provided for in
sec 14 of the MSA is required by sec 14(2) of the MSA to regulate the
transfer of staff from
a disestablished municipality to a superseding
municipality. Item 8(1)(d) of the sec 12 notice in this case, which
has been quoted
above, requires that a person in the position of the
appellant “
shall be transferred and placed
in the service of the local municipality within the district area.”
It provides further that the transfer of such person “
be
on such terms and conditions of service as are not less favourable
under which such person previously served;”
That is the general rule that item 8(1) of the sec 12 notice
prescribes. However, that general rule is not absolute. Indeed, such
general rule is subject to two exceptions or provisos. The first is
to be found in item 8(1)(d), the second in item 8(1)(h) of the
sec 12
notice. The proviso in par (d) is to the effect that a person who has
been transferred from in effect a disestablished municipality
to a
superseding municipality on such terms and conditions as are not less
favourable to those under which he previously served under
the
disestablished municipality:
“
shall not, as a consequence of such transfer,
acquire a right to retire or to be offered a severance or
retrenchment package
.”
[60] Could an employee who has been transferred from a
disestablished local authority to a superseding municipality take the
attitude
after the transfer that he is by virtue of such transfer
entitled to payment of severance pay? Nobody could conceivably make
such
a claim. I can understand that somebody could, before a
transfer, take the attitude that he did not want to be transferred to
the
superseding municipality and seek to be paid severance pay or to
be granted early retirement. That situation is dealt with by item
8(1)(b) of the sec 12 notice and such person will not be entitled to
severance benefits. In such a case that would be an employee
who for
some or other reason does not want to work for the superseding
municipality. But it is difficult to imagine a situation where
an
employee who, having accepted the transfer to the superseding
municipality, would simply turn around and say: by virtue of the
fact
that I have been transferred to this superseding municipality and by
virtue of nothing else I should be retrenched and paid
severance
benefits!
[61] In my view what item 8(1)(d) of the sec 12 notice
deals with is consequences of a transfer of an employee from a
disestablished
local authority to a superseding municipality.
Properly construed, it means that from a consequence of a transfer
such an employee
does not acquire a right to retire early or to be
offered a severance or retrenchment package. In my view that is the
only viable
way of construing the provision of item 8(1)(d) of the
sec 12 notice because it could never have been intended to deal with
an employee
who, having been transferred and not having objected to
the transfer, later sought to be paid severance benefits simply on
the basis
that he or she had been transferred and on no other basis
because such a situation cannot possibly occur. In my view, the
construction
of item 8(1)(d) of the sec 12 notice I have given above
covers a situation such as the one about which the appellant
complains in
this case. That is a case where, after the transfer, the
position that the employee occupied in the disestablished
municipality does
not exist in the superseding municipality and he
cannot be or is not granted a position that is exactly on the same
level as his
previous position. It also applies to a case where there
are more than one employees who previously occupied similar positions
in
the disestablished municipalities but only one of them can be
offered a similar position in the superseding municipality. In such
a
case item 8(1)(d) of the sec 12 notice prevents an employee who is
aggrieved by that from acquiring the right to severance pay
simply on
the basis that he is not being offered exactly the same position or a
position at exactly the same level as the position
he previously
occupied. It seems to me that this was provided for so that an
employee would need to show something more than simply
that his
previous position is redundant and he has not been offered the same
position or a position that is at exactly the same level
as his
previous position before he could be entitled to severance benefits.
It seems to me that that something more is the one contained
in the
further proviso which appears at the end of item 8(1) of the sec 12
notice. That is that “the provisions of this subsection
– that is
item 8(1) of the sec 12 notice – “
shall
not prevent the municipality concerned from implementing a scheme to
reorganise its personnel subject to the Labour Relations
Act, 1995
(Act NO 66 of 1995
).” I discuss what this
proviso means here below. The proviso contained in par (h) is to the
effect that:
“
Any person who refuses or withholds his or her
consent to be transferred as contemplated by this section, shall not
be entitled to
any severance benefit or benefits.
Provided,
further, that the provisions of this subsection shall not prevent the
municipality concerned from implementing a scheme
to reorganise its
personnel subject to the Labour Relations Act, 1995 (Act No 66 of
1995
)”
(underlining supplied).
[62] Paragraph (h) of item 8(1)(2) effectively contains
two provisos. The one deals with an employee who as at the relevant
date of
transfer of staff was employed by a municipality or local
authority that was being disestablished in terms of the MSA. It
provides
that, if such an employee refuses to be transferred or
withholds his consent to be transferred as contemplated by item 8,
such employee
will not be entitled to any severance benefits. I am
prepared to assume, without deciding, that this is not a case to
which the first
proviso in par (h) applies. However, it seems to me
that the second proviso in paragraph (h) does apply. The second
proviso in par
(h) of item 8(1) qualifies, among others, the opening
provision in item 8(1) to the effect that an employee in the position
of the
appellant “
shall … be transferred
and placed in the service of the local municipality within the
district
on such terms and
conditions of service
as
are not less favourable under which such person previously served
;”
(underlining supplied). The proviso or the qualification is
inter
alia
that the provisions “
shall
not prevent the municipality concerned from implementing a scheme to
reorganise its personnel subject to the Labour Relations
Act, 1995
(Act 66 of 1995)
.” From the terms of this
proviso it is clear that it does not only apply to (h) but also to
all the provisions of sub-item (1)
of item 8. It says that “
the
provisions of this subsection shall not prevent …
”.
[63] This proviso was intended to make sure that a
municipality would be able to go ahead and reorganise its personnel
and would not
be prevented from doing so by employees who demanded
severance benefits in circumstances where the actions of the
municipality were
in accordance with the
Labour Relations Act, 1995
or, broadly speaking, with our labour law. In our labour law if, as a
result of restructuring or operational requirements, an employer
can
no longer offer an employee the same position that he occupied before
the restructuring and offers the employee an alternative
position but
the employee unreasonably refuses such offer, the employer is
entitled to dismiss such employee after following the
relevant
procedure and such employee will not be entitled to severance pay. In
this case the first respondent has not dismissed the
appellant
because it needs his technical skills and he has not resigned. The
first respondent is, in my view, entitled to dismiss
the appellant on
proper notice and after following the relevant procedure if he
continues with his stance and he will not be entitled
to severance
pay. He cannot be in a better position simply because be has not been
dismissed.
[64] It seems to me that what the second proviso in par
(h) of item 8(1) of the
sec 12
notice means is that the fact that an
employee such as the appellant was required to be transferred “
on
such terms and conditions of service as are not less favourable under
which [he] previously served”
is subject to
the right of the superseding municipality to implement “
a
scheme to reorganise its personnel
” but
its right to reorganise its personnel must be exercised subject to
the
Labour Relations Act. That
the local municipality’s right to
reorganise its personnel is subject to the
Labour Relations Act, 1995
means, in my view, that the respective rights and obligations of the
employer and employee in such a reorganisation of personnel
as
provided for in the
Labour Relations Act apply
in such a case.
[65] The MSA is an Act that was passed in 1998. At the
time when the MSA was passed, there was a provision in the
Labour
Relations Act which
dealt with the rights and obligations of an
employer and employee with regard when an employer is obliged to pay
severance pay and
when there is no such obligation. The provisions
were subsequently transferred as they were from the LRA to sec 41 of
the Basic Conditions
of Employment Act, 1997 (Act 75 of 1997) (“
the
BCEA
”).
[66] Sec 41(4) of the BCEA contains the relevant
provision. It reads:
“4.
An employee who unreasonably refuses to accept
the employer’s offer of alternative employment with that employer
or any other employer,
is not entitled to severance pay in terms of
subsection (2)”.
In my view the fact that these provisions are no longer
in the LRA but are in the BCEA has no bearing on whether or not they
must
be taken into account. The fact of the matter is that they were
part of the
Labour Relations Act when
the MSA was passed and they
deal with an issue that relates to the reorganisation of personnel.
Even if the
sec 12
notice – of which item 8 is part – was issued
at a time when these provisions had already been transferred from the
LRA into
the BCEA, I would still be of the view that they must be
taken into account because, applying purposive construction, the
reference
to the
Labour Relations Act, 1995
in item 8(1)(h) is
nothing more or less than to say that that part of our labour law
that governs the reorganisation of personnel
should be applied. It
would be highly technical to say that that part of our labour law
applicable to such situations which was previously
part of the LRA
but was transferred to the BCEA should be excluded from the reference
to the LRA simply because it has since been
transferred to the BCEA.
[67] In the light of all of the above I am of the view
that the appellant’s rejection of the first respondent’s offer of
alternative
employment and his insistence that he be offered the same
position or a position at the same or higher level is, in all the
circumstances
of this case, quite unreasonable. Accordingly, he
forfeited whatever right he might otherwise have had to severance
pay. He was
going to suffer no reduction of salary. The position he
was offered was quite a senior position. The first respondent had to
try
and accommodate all the employees. He was to report to the
municipal manager. The first respondent made it clear that it needed
his
technical skills.
[68] I have so far dealt with the matter on the basis of
the relevant legislation and the “
NP1
”
agreement. I have not dealt with it in terms of the collective
agreement on the basis of which the appellant brought his application
in the Labour Court. That collective agreement was annexed to the
appellant’s founding affidavit as annexure “
NP25
”.
For convenience in this judgment I shall call it the “
NP25
”
agreement. The “
NP2
5”
agreement is the “
Conditions of Service
Agreement: Transvaal
” contained in
Government Notice R1828 of 28 October 1994 as published in GG no
16047 in Regulation Gazette No 5416. That agreement
was concluded on
the 28
th
October
1994 and was to operate up to the 31
st
December 1997. It was concluded long before the passing of the MSA
which sought to transform and restructure local government.
[69] When most of the provisions of the Act came into
operation on the 11
th
November 1996, the operation of all collective agreements which were
in operation then, which included the “
NP1
agreement
,” was extended for a period of up
to 18 months after the 11
th
November 1996. By an agreement concluded on the 2
nd
September 1997 – that is within the 18 month period – the parties
to the “NP1” agreement effectively extended the operation
of “
all
collective agreements
” including the “
NP1
”
agreement “
to the extent that they are not
in conflict with the constitution,
until
amended or repealed by the South African Local Government Bargaining
Council.”
I am not sure whether the
“
Constitution
”
referred to is the Constitution of the Republic or the Constitution
of the South African Local Government Bargaining Council.
However,
for purposes of this case, whichever it is does not appear to make
any difference.
[70] A reading of the appellant’s founding affidavit
reveals that for all intents and purposes he has based his claim to
the relief
that he seeks on the “
NP25
”
agreement. The first respondent has stated that the “
NP25
”
agreement does not apply in this case but that, even if it did apply
the appellant is not entitled to the relief that he seeks.
To the
extent that there may be conflict between provisions of the “
NP25
”
agreement, on the one hand, and those of the MSA, the sec 12 notice,
the Act, sec 42 of the BCEA and or the “
NP1
”
agreement, I am of the opinion that the provisions of the “
NP25
”
agreement do not apply or have to yield to those of the legislation
referred to or the “
NP1
”
agreement.
[71] Even if the “
NP25
”
agreement applies in this case, there are a number of provisions of
the “
NP25
”
agreement which, in my view, indicate that the appellant is not
entitled to the relief that he seeks, particularly, the order
that he
be paid severance benefits. I do not propose to quote the provisions
of those clauses. It suffices to simply identify the
relevant clauses
in this regard. The starting point is the definition of “
redundancy
”
in clause 3 thereof as well as the definition of “
retrenchmen
t”.
In this regard I point out that the definition of “
retrenchmen
t”
contemplates a situation where the employee is
“…
loses his job due to factors beyond his control”.
In this case the appellant has not lost his job but, even if he were
to lose his job, he would not have lost it “due to factors
beyond
his control” because he has been offered a good job on the same
salary and it is a senior position in the first respondent
but he has
rejected it. Clause 17 as well as clauses 17.3.1 to 17.3.8 and 17.4.1
to 17.4.8. need to be taken into account. Clause
17.4.3 provides in
part that
“(a)fter the retrenchment
programme has been drafted and all the steps described in clauses
17.3 and 17.4 have been taken, sufficient
notice must be given to the
employee and the trade union”.
Clause
17.4.3 provides that the main purpose of that notice is to “
initiate
consultation with the trade union
”. The
provision further says that, because of that, such notice must
contain certain information specified in clauses 17.4.3.1
to
17.4.3.7. The appellant has not stated that these steps have been
taken. Clause 17.4.3 makes IMATU, his union, an interested party
in
these proceedings because it is entitled to being given the notice
contemplated in clause 17.4.3 before an employee who is its
member
can be dismissed for operational requirements so that it can be party
to the consultations that must ensue after such notice.
In fact this
is in line with sec 189 of the Act which requires an employer who
contemplates dismissing an employee who is a member
of a registered
trade union to give notice of such contemplation to the union of
which the employee concerned is a member and thereafter
to consult
the union on a number of issues aimed at, among others, the avoidance
of the dismissal of the employee. In this case the
trade union of
which the appellant is a member, IMATU, is to not a party to these
proceedings and the appellant has not stated that
the steps required
in the “
NP25
”
agreement in terms of procedure and those required by sec 189 of the
Act have been taken and complied with. He did not file any
affidavit
from the union in the court a quo to the effect that it waives its
right to the notice and to consultation in terms of
clause 17.4.3 of
the “
NP25
”
agreement and to the notice and consultation to which it, as the
appellant’s union, is entitled in terms of sec 189 of the Act.
That
affidavit cannot be filed at this stage of the matter because this
Court, as a Court of Appeal, can only deal with the matter
– in
judging the correctness or otherwise of the judgment of the Labour
Court – on the basis of the papers that were before the
Court a
quo.
[72] In the light of the above the conclusion is
inescapable that the appellant’s application in the Court a quo, if
it had been
granted, would have been granted in breach of not only
the provisions of the “
NP25
”
agreement, particularly the steps that the first respondent is
required to take before any employee can be dismissed for operational
requirements but also such an order would infringe IMATU’s rights
to notice and consultation by the first respondent in terms of
sec
189 of the Act before its member could be dismissed for operational
requirements. A court cannot make such an order. Both the
Labour
Court and this Court cannot be party to a process that would be in
conflict with sec 189 of the Act without the union –
which has
various rights thereunder – having waived such rights.
[73] If provisions of the “
NP25
”
agreement were to be construed to mean that the appellant has a right
to be dismissed in this case and to be paid severance pay,
that
construction would be in conflict with the provisions of the MSA and
the sec 12 notice. In that scenario, the MSA and the sec
12 notice
would prevail because they were specifically passed in order to
govern the specific situation that would arise with regard
to
personnel reorganisation flowing from the restructuring of local
government whereas the “
NP25”
agreement was concluded in 1994 and, in my view, governed normal
situations and not situations in respect of which there is specific
legislation and collective agreements which govern the situation. Put
differently, the “
NP25
”
agreement governs the general whereas the MSA, sec 12 notice, sec 42
and the NP1 agreement govern the specific.
[74] In these circumstances I am of the view that, even
if the “
NP25
”
agreement is applicable, which I think it is not, its own provisions
are such that the appellant is not entitled to any relief.
I have
already said above that on the basis of the MSA, sec 12 notice, sec
42 of the BCEA, the LRA and the “
NP1
”
agreement, the appellant has no right to the relief that he seeks.
[75] With regard to costs I am of the opinion that the
appellant must pay the costs of the appeal.
[76] In
the result the appeal is dismissed with costs.
Zondo JP
I
agree.
Kruger
AJA
Appearances:
For
the Appellant : Adv PG Van der Walt
Instructed
by : F & F Van der Walt Inc
For
the Respondent : Adv. Paul Kennedy SC
Instructed by : Nkaiseng Chenia Baba Pienaar &
Swart
Date
of judgment : 21 December 2007