About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Labour Appeal Court
SAFLII
>>
Databases
>>
South Africa: Labour Appeal Court
>>
2008
>>
[2008] ZALAC 25
|
|
SAPPI Forests (Pty) Ltd v Commission for Conciliation Mediation and Arbitration and Others (DA 12/08) [2008] ZALAC 25 (1 January 2008)
IN THE LABOUR APPEAL
COURT OF SOUTH AFRICA
(HELD AT
JOHANNESBURG)
CASE
NO: DA 12/08
In the matter
between:
SAPPI FORESTS
(PTY) LTD
APPELLANT
and
CCMA
FIRST RESPONDENT
ANASHRIN PILLAY
N.O SECOND RESPONDENT
DOUGLA ALEXANDER
BOYD THIRD RESPONDENT
JUDGMENT
WAGLAY DJP
[1] The Second
respondent issued an award in favour of the third respondent in terms
of which he held that the appellant’s
decision to change the
terms of the third respondent’s suspension, from suspension
with pay to suspension without pay, was
both substantively and
procedurally unfair. He ordered the appellant to reinstate the
original terms of the suspension and to back
pay the third respondent
his salary during the period of suspension without pay. At the time
of the arbitration the third respondent
was still on suspension.
[2] The appellant
launched an application to the Labour Court to review and set aside
the arbitration award. The Labour Court (Pillay
J) dismissed the
review application but granted the appellant leave to appeal to this
court. The Labour Court found that the appellant
had no contractual
right to suspend the third respondent without pay and, therefore, the
suspension without pay was unfair and
that the arbitrator committed
no reviewable irregularity.
[3] The facts in
this matter are mostly common cause. The third respondent was
employed in the capacity of management forester.
He concluded a
written contract of employment with the appellant on 25 October 2001.
Clause 11 of the contract provided as follows
“... it is
mutually understood that you shall be bound by and comply with the
rules and policies of the company
in force from time to
time
, including its grievance and disciplinary
procedures.
” (emphasis added)
[4] There was no
evidence led by either party as to what the applicable policy
(hereafter the “disciplinary code”) said
about suspension
at the time the contract was concluded. In fact the third respondent
testified that at the time he concluded his
employment contract he
had neither access to nor was he shown a copy of the applicable
disciplinary code.
[5] The third
respondent had no reason to consider the disciplinary code prior to
his suspension, following his release on bail
on charges of
corruption and/or fraud on 28 October 2005. The criminal charges were
initiated by the appellant on the basis of
allegations that the third
respondent had fraudulently and dishonestly received monies from its
clients.
[6] The
third respondent’s
suspension on 28 October 2005 was with pay p
ending
the outcome of a disciplinary investigation
.
On 31 October 2005 the third respondent was handed a
Notice
of a Disciplinary Hearing
.
The disciplinary hearing was scheduled for 2 November 2005.
[7] A recording was
made of what was said at the hearing on 2 November 2005. A transcript
thereof was submitted as part of the record
at the arbitration. Both
parties confirm that the transcript properly records what transpired
at the Hearing.
[8] Prior to the
hearing the third respondent’s wife requested a copy of the
applicable disciplinary code from the appellant’s
Human
Resources department. Someone in appellant’s employ provided
her with a disciplinary code described as
revision 2.1
dated
21 November 2003. This disciplinary code contained an unusual clause
which reads as follows: “
Where an employee is criminally
charged no hearing will be conducted save and except for suspending
him with pay until such time
as the criminal case is finalised.”
[9] Also prior to
the scheduled disciplinary hearing the third respondent’s
attorney, relying upon the provisions of the
disciplinary code,
wrote a letter to the appellant informing it that in terms of its
disciplinary code it was not entitled to hold
a disciplinary hearing
until such time as the criminal trial had been finalised. The letter
also stated that the third respondent
was not given sufficient time
to prepare for the hearing; that he needed the hearing to be
postponed for at least ten days to prepare
for it; that the
disciplinary notice was vague; and, that the third respondent be
allowed to be legally represented at the disciplinary
hearing.
[10] The above
letter was handed to the chairperson at the commencement of the
disciplinary hearing. It is evident that Jonker,
the company’s
representative, was surprised at this development. He immediately
requested for and was granted an adjournment
to study the letter and
the disciplinary code referred to. On his return he did not dispute
that the disciplinary code relied upon
by the third respondent was
not the company’s disciplinary code but argued that the
provisions of the disciplinary code served
only as guidelines. Jonker
then requested the chairperson to suspend the third respondent
without pay stating that the disciplinary
hearing was in the hands of
the third respondent. The chairperson agreed to this request.
[11] The transcript
of the disciplinary hearing also reveals that the third respondent
did not understand the import of the decision.
A discussion then took
place between Jonker and the third respondent. It is instructive to
note the discussion, all of which was
recorded:
Mr Jonker: Mr
Chairman, maybe I didn’t make myself clear. If that’s the
case, my humble apologies, but what I want to
put forward is, in very
simplistic terms, Mr Boyd, and I’ll try and make the decision
easy for yourself, is to go and glean
legal advice, that’s your
constitutional right. What I’m saying is that the decision to
ask for a postponement was
yours, via your legal advisor…
(inaudible). That is fine. What I’m saying to you is that we
will oblige to your request
for a postponement, but you will be
suspended without pay, because according to my interpretation of it,
it’s on your request.
Now, if you come back to me now and you
say, “Okay, I hear what you say, I understand what you’re
saying”, you
are asking for ten days, I’m saying to you,
being fair, although I don’t agree that it’s necessary, I
will grant
you a five day grace in terms of the disciplinary code and
procedure and in terms of the charges as you requested to prepare
yourself,
okay. I pointed out to you that we will not allow legal
representation. You need to deal with that issue with your attorney.
So,
the decision you have to make and come back to me with in order
for me to make a judgement call on that is, I’m saying I’m
happy to postpone for five days, then your suspension stays as is. We
set a new date. When you come back we agree on a new date
and you set
out everything. You come and appear before a disciplinary inquiry,
you bring witnesses if you’ve got any. I will
lead my evidence,
I’ll bring my witnesses and we put everything on the table for
the Chairman to decide and make a ruling
on it. So, that is entirely
up to you. So, if I didn’t make myself clear, Mr Chairman, if
Mr Boyd does not agree on a five
day postponement and he does not
agree on that we set a date today here for the next hearing, then I
stay with my request that
he be suspended without pay.
Mr Boyd: Sorry,
I’m not trying to awkward.
Mr Jonker: No,
No, I understand that.
Mr Boyd
(Inaudible). So, all that you are saying is, it doesn’t matter
when the hearing takes place, I’m suspended without
pay. So, in
six months time, it’s really doesn’t matter that’s
the conditions.
Mr Jonker: Let
me just clarify this for you. I’m happy to grant you the
postponement for five days under your now suspended
….
(inaudible) in order for you to prepare, in order for you to do
whatever you want to. If you want to get a fairly senior
Sappi
employee to represent you, that’s your right in terms of the
company’s policy, in terms of the Constitution.
What I will not
allow in an internal company inquiry, legal representation. So, you
need to deal with that with your attorney.
If you’ve dealt with
your attorney and come back then you need to give me an answer. We’ll
postpone for five days and
we have the disciplinary hearing with your
consent on an agreed date, and you go away and have five days to
prepare yourself etcetera.
Alternatively you come back and you say,
“Look, I’ve gleaned legal advice. My legal advice tells
me that I will not
attend the disciplinary hearing until the criminal
charges have been dealt with.” Then I will accede to that
demand, but
then your suspension is without pay.
Mr Boyd: Sorry
that’s perfectly clear now.
Mr Jonker: Are
you happy, maybe I didn’t make myself clear, but that’s
my decision.
Mr Boyd: No, I
understand.
Mr Jonker: Okay,
so, Mr Chairman, what I would like to propose is for Mr Boyd to be
given the opportunity to speak to his attorney.
You can use a
telephone, I’ll direct to and an office you can use the phone,
you can close the door and then come back to
us within a reasonable
period, say 20/25 minutes and give us an answer. Then we can decide
which way to go.
Mr Boyd: No, I’ve
made the decision myself. I remain suspended in the meantime. I don’t
need to consult.
Mr Chairman: You
don’t want to consult … (inaudible). What you’re
requesting is you be suspended without pay?
Mr Boyd: To go
with the clause in company disciplinary procedure.
Mr Jonker: That
is until the criminal charges be dealt with. In that case Mr
Chairman, I stay with my proposal. My request is that
the suspension
is without pay.
Chairman: I
agree to that.
[12] It is clear
from the above extract that Jonker,
inter alia
gave the third
respondent a choice: he could either chose to be suspended without
pay till his criminal matter is finalised or he
could take a five day
postponement and continue to be suspended with pay. Jonker also
informed the third respondent that the appellant
would not agree to
him being legally represented at the disciplinary hearing and that
ultimately it was he (the third respondent)
who was in control of the
process by which he meant that the third respondent could determine
when he was prepared to have his
disciplinary hearing.
[13] I must also add
that after Jonker asked the chairperson to postpone the disciplinary
hearing pending the finalisation of the
criminal trial and for the
third respondent to remain suspended but without pay, the
chairperson, called upon the third respondent
to comment thereon but
the third respondent said that he had no comment to make.
[14] The third
respondent was then suspended without pay pending the day of the
disciplinary hearing which hearing would not commence
until the
finalisation of the third respondent’s criminal trial. On 2
November 2005, after the hearing, the appellant wrote
to the third
respondent’s attorney stating the following:
“
We would
like to bring the following to your attention:
1. We heard Mr
Boyd’s representations this morning.
2. We agreed to
his request to postpone the Disciplinary Hearing until the criminal
charges against him have been dealt with in
a Court of Law.
3. His suspension
effective 2 November 2005 will be without pay.”
[15] The
third respondent’s attorney responded by letter dated 3
November 2005. In this letter the only complaint raised was
that the
appellant was not entitled, in terms of its disciplinary code, to
suspend the third respondent without pay. The appellant’s
reply
to that was that if the third respondent is aggrieved by the
suspension without pay he should avail himself to attend a
disciplinary hearing without delay. The third respondent’s
attorney only replied
t
wo
months later re-stating the contents of its previous letter of 3
November 2005. In addition, this time the attorney threatened
to
refer the matter to the CCMA unless the appellant agreed to comply
with its disciplinary code. Once again the appellant’s
response
was the same as in its previous correspondence, which was that the
third respondent should agree to an immediate disciplinary
hearing
and the whole matter will be resolved.
[16] The third
respondent’s actions signalled that he had no desire to
participate in the disciplinary hearing at that stage
and referred an
unfair labour practice dispute to the CCMA. The referral to the CCMA
was couched as follows:
(a) The issues in
dispute:
“I was suspended without pay contrary to company’s
(SAPPI) disciplinary code and the Labour Relations Act”.
(b) What decision
would you like the commissioner to make:
“I would like
SAPPI to comply with its own disciplinary code and pay me whilst on
suspension together with all benefits.”
[17] During the
hearing at the CCMA the appellant firstly argued that the CCMA lacked
jurisdiction to determine the dispute because
it was only entitled to
arbitrate alleged unfair suspension disputes if the suspension is
meted out as part of a disciplinary sanction
short of dismissal. The
CCMA dismissed this argument.
[18] On the merits
of the dispute, at the arbitration, the appellant produced a
different disciplinary code (hereafter referred
to as the “new
disciplinary code”) which it said was the disciplinary code
applicable at the time of the third respondent’s
suspension.
Jonker testified that he only discovered the error about the
applicable disciplinary code when preparing for the conciliation
meeting. This new disciplinary code, he said, originated on 1 June
1995 and was revised on 1 July 2002 and again on 1 January 2004;
it
was placed on the intranet and authorised by the Human Resources
department. Unlike the disciplinary code that the third respondent
relied upon at the disciplinary hearing, this code had a numerical
code and was in fact attached to a recognition agreement which
the
appellant had concluded with the trade union SATAWU. It was, he said,
the applicable disciplinary code.
[19] The
new disciplinary code did not have a clause like the one in the
disciplinary code produced by the third respondent at the
disciplinary hearing
1
.
Instead, it had a clause reading: “
The
Company shall not wait for the result of a criminal prosecution
before taking disciplinary action
.”
[20] The evidence
before the arbitrator was therefore that the parties had both been
under a common mistake at the disciplinary
hearing and were operating
from an incorrect disciplinary code and therefore from an incorrect
premise. The appellant’s HR
department must take the blame for
this but the third respondent is not totally blameless. The correct
code was available on the
intranet and was at the respondent’s
disposal.
[21] The arbitrator
decided however, that the question of which disciplinary code was
applicable was not important for a determination
of the matter. He
held that the appellant had no right to suspend the third respondent
without pay under either of the codes or
under the contract of
employment and thus it followed that the suspension without pay was
unfair. The Court
a quo
agreed with the arbitrator and
dismissed with costs the application sought by the appellant to
review, set aside and correct the
arbitration award.
[22] In my view, the
arbitrator was firstly required to decide whether or not the
disciplinary code relied upon by the third respondent
was binding.
This he failed to do. Had he done this and found that it was binding
that would have been the end of the matter because
in terms of that
disciplinary code the appellant could only proceed with the
disciplinary hearing after the criminal trial against
the third
respondent was finalised, and pending that, the third respondent was
entitled to remain on suspension on full pay.
[23] I am however,
of the view that based on the evidence before the arbitrator, the
disciplinary code relied upon by the third
respondent was not in fact
binding. The authenticity of the new disciplinary code produced at
the arbitration hearing by Jonker
was not disputed and the fact that
it was the applicable disciplinary code at the relevant time was
borne out by Jonker’s
evidence. The new disciplinary code was
properly coded; attached to the recognition agreement which the
appellant had concluded
with the trade union; and, it was available
on the appellant’s intranet, thus available to members of its
staff. As opposed
to the new disciplinary code the one upon which the
third respondent relied was not properly coded; it was not on the
intranet;
and, there was no evidence that it was ever approved. The
document in possession of the third respondent was simply a working
draft
which served for purposes of discussion; it was also fraught
with errors both, grammatical and otherwise.
[24] The new
disciplinary code being the relevant document meant that the matter
had to be resolved on the basis that the third
respondent did not
have a right to be on suspension with pay pending the finalisation
of his criminal trial. It also meant that
the fairness of the
appellant’s suspension without pay was to be dependent upon the
new disciplinary code and an analysis
of what took place at and after
the hearing on 2 November 2005.
[25] The fact that
the applicable disciplinary code provided for the holding of a
disciplinary hearing notwithstanding a pending
criminal trial did not
mean that the appellant was compelled to do so, especially, since
third respondent applied for the postponement
of the disciplinary
hearing pending the finalisation of his criminal trial. Hence the
indefinite adjournment of the third respondent’s
disciplinary
hearing did not contravene the disciplinary code in operation at the
time.
[26] Turning to
what transpired at and after the scheduled disciplinary hearing on 2
November 2005:
26.1The appellant
was agreeable to grant the third respondent a postponement of 5 days
(as opposed to 10 days) to prepare for the
disciplinary hearing. He
would remain on suspension for the five days but on full pay. On the
other hand, if the third respondent
wanted a longer postponement or
postponement until the finalisation of his criminal trial then the
appellant would agree to such
postponement however, it would mean
that the third respondent would remain on suspension pending the
disciplinary hearing but without
pay.
26.2 The third
respondent understood the appellant’s proposal but believing
that the disciplinary code in his possession was
the applicable code
accepted the postponement pending the finalisation of his criminal
trial reserving his rights with respect
to payment of his
remuneration while on suspension.
26.3 The third
respondent was then suspended, without pay pending the finalisation
of his criminal trial.
The third
respondent demanded payment in compliance with the disciplinary
code. Appellant’s response was that the third
respondent
should agree to the holding of a disciplinary hearing and the
matter could be finalised, if not, he will remain
suspended without
pay.
[27] Clearly the
third respondent was not prepared to have the disciplinary hearing
take place and as such remained on suspension
– this is a
choice he exercised. He also does not raise any objection against his
suspension
per se
. However, when it came to pay, it was his
belief that he was entitled to be paid while on suspension. His
believe was based on
the disciplinary code which was never
applicable. Once the disciplinary code is found to have no
application he is not entitled
as of right to remain on suspension
pending the finalisation of his criminal trial and be paid. But, he
was not without relief,
he could have accepted the appellant’s
invitation to have his disciplinary hearing and finalise the matter
and end the suspension.
What the third respondent really sought was,
as appellant properly contended, as the saying goes, to have his cake
and eat it.
[28] The third
respondent’s entitlement to be paid for the period whilst on
suspension pending the criminal trial was dependent
upon the validity
of the disciplinary code upon which he relied. That is how he dealt
with the matter and that’s what his
attorney understood when he
wrote to the appellant on 3 November 2005 and then again on 13
January 2006. That was the issue before
the arbitrator. The
arbitrator however operated from the premise that the third
respondent was entitled to be paid whilst on suspension
simply
because the appellant could not provide a written document stating
that it had a right to suspend him without pay. This
was misdirection
because there is no rule that provides that suspension without pay,
no matter what the circumstances, is unfair.
The misdirection
obviously went to the root of the decision arrived at by the
arbitrator.
[29] The
arbitrator simply failed to appreciate the issues he was called upon
to determine. The referral to arbitration set out
the dispute and the
relief sought and this related to the appellants failure to implement
its disciplinary code, yet the arbitrator
failed to consider this at
all. It was correct to look at the issue of payment of salary during
suspension but this had to be done
in the light of the applicable
disciplinary code and the evidence presented to him. Again he failed
to consider the evidence properly
or at all. In the matter of
CICUSA
v Tao Ying Metal Industries & others
2
the Court said:
“
It is by
now axiomatic that a commissioner is required to apply his or her
mind to the issues properly before him or her. Failure
to do so may
result in the ensuing award being reviewed and set aside. Recently,
in Sidumo, supra, the matter was put thus:“It
is plain from
these constitutional and statutory provisions that CCMA arbitration
proceedings should be conducted in a fair manner.
The parties to a
CCMA arbitration must be afforded a fair trial. Parties to the CCMA
arbitrations have a right to have their cases
fully and fairly
determined. Fairness in the conduct of the proceedings requires a
commissioner to apply his or her mind to the
issues that are material
to the determination of the dispute…”
[30] Furthermore, in
matters such as this, where an employee seeks a postponement of a
disciplinary hearing and the employer, who
is ready to proceed with
the disciplinary hearing, is agreeable to grant that postponement, it
simply cannot be unfair to refuse
to pay that employee, especially,
where the employee is properly on suspension pending a disciplinary
hearing. The employer in
such a case is granting an indulgence, which
it is not obliged to do and cannot be compelled as a consequence of
granting an indulgence
to cause itself prejudice. The situation would
be different if there was an agreement between the parties to the
effect that there
can be no suspension without pay in any
circumstances.
[31] In the
circumstances and for the reasons set out above, the misdirection;
and the arbitrator’s failure to apply his mind
to the issues
and the material before him, his decision is liable to be set aside.
Had he properly considered all the factors the
only conclusion he
could have arrived at was that the third respondent’s
suspension without pay pending the disciplinary
hearing was not
unfair
[32] On procedural
fairness, this issue does not arise in the matter nor did the third
respondent raise it as an issue at the arbitration.
[33] Having regard
to the conclusion I have arrived at in respect of the merits I do not
believe it necessary to deal with the
other issue raised by the
appellant in this appeal.
[34] Finally, the
issue of costs: this is not a matter in which I believe that costs
should follow the results. Had I believed otherwise
I still would not
have ordered the third respondent to pay costs because of the
appellant’s failure to prepare a proper record
in the appeal.
Notwithstanding a muddled record counsel for the appellant had the
temerity to suggest that the record complied
with the rules of this
Court or, at least was in “substantial compliance”
(whatever that means), with the rules of
this Court. I think this
Court should in future visit punitive costs orders against parties
who fail to prepare a proper record
for appeal.
[34] In the result I
make the following order:
The appeal is
upheld.
The arbitration
award of the second respondent is reviewed and set aside and
substituted with the following order
“ the suspension of
the third respondent without pay pending his disciplinary hearing
was substantively and procedurally
fair.”
There is no order
as to costs.
____________________________
Waglay DJP
I agree.
___________________________
Tlaletsi JA
I agree.
____________________________
Musi AJA
Appearances:
For the appellant
: Adv M Pillemer SC
Instructed
by : Millar and Reardon Attorneys
For the
respondent : Adv C Nel
Instructed
by : Austen Smith Attorneys
1
See paragraph [8] above.
2
[2009] 1 BLLR 1
(CC)