South African Rugby Players Association (SAPRA) and Others v SA Rugby (Pty) Limited and Others; SA Rugby Pty Limited v South African Rugby Players Union and Another (CA 10/2005) [2008] ZALAC 3; [2008] 9 BLLR 845 (LAC); (2008) 29 ILJ 2218 (LAC) (12 May 2008)

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[2008] ZALAC 3
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South African Rugby Players Association (SAPRA) and Others v SA Rugby (Pty) Limited and Others; SA Rugby Pty Limited v South African Rugby Players Union and Another (CA 10/2005) [2008] ZALAC 3; [2008] 9 BLLR 845 (LAC); (2008) 29 ILJ 2218 (LAC) (12 May 2008)

30
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
HELD
IN JOHANNESBURG
Case
no: CA 10/2005
IN
THE MATTER BETWEEN
South
African Rugby Players’ First Appellant
Association
(SAPRA)
Richard
Bands 2
nd
Appellant
Christo
Bezuidenhout 3
rd
Appellant
and
SA
Rugby (PTY) Limited
First
Respondent
Commission
for Conciliation,
Mediation
and Arbitration (CCMA) Second Respondent
Pather
A V N.O
Third
Respondent
IN
THE CROSS-APPEAL
SA
Rugby Pty Limited Appellant
and
South
African Rugby
Players
Union First Respondent
Victor
Matfield Second Respondent
Judgment
TLALETSI
AJA
Introduction
[1] This
is an appeal against a judgment of the Labour Court given by
Gerring
AJ
in
a review application that was brought to that Court by the first
respondent to have a certain arbitration award reviewed and set
aside. The first appellant is the South African Rugby Players
Association (“SARPA”) a trade union duly registered as such in
terms of the Act. SARPA is the first respondent in the cross-appeal.
Second and third appellants are members of the first respondent
as
well as Matfield who is the second respondent in the cross-appeal.
The first respondent is SA Rugby (Pty) Limited. It is also
the
appellant in the cross-appeal. The arbitration award related to an
unfair dismissal dispute between the appellants and the first
respondent. The arbitration award had been issued by the third
respondent under the auspices of the second respondent. The second
respondent is the Commission for Conciliation, Mediation and
Arbitration (“CCMA”). The third respondent is a commissioner of
the CCMA. The third respondent conducted the arbitration which
resulted in the arbitration award which was the subject of the review
application.
[2]
The dismissal involved in this case was not the normal dismissal but
constructive dismissal as provided for in sec 186(1)(b) of
the Labour
Relations Act 66 of 1995 (“ the Act”). I shall quote the
provisions of sec 186(1)(b) later in this judgment. The full
text of
the arbitration award referred to above is reported as:
SA
Rugby Players Association on behalf of Bands & others v SA Rugby
(Pty) Ltd
(2005) 26 ILJ 176 (CCMA). The judgment of the Labour Court is
reported as
SA
Rugby (Pty) Ltd v Commission, for Conciliation, Mediation &
Arbitration & Others
(2006) 27 ILJ 1041 (LC).
[3]
The second and further appellants had been employed by the first
respondent as rugby players in terms of fixed term contracts
of
employment. When such contracts of employment were not renewed on the
same terms and conditions or were not renewed at all, the
appellants
claimed that they had reasonable expectation that such contracts were
going to have been renewed on the same terms and
conditions and that
the first respondent’s failure to renew them on such terms
constituted constructive dismissal as provided for
in sec 186(1)(b)
of the Act and they sought compensation. The first respondent
disputed this and the dispute ended up in an arbitration
under the
auspices of the CCMA in terms of the Act which resulted in the
arbitration award referred to earlier. That award was in
favour of
the appellants. Hence the review application brought by the first
respondent in the Labour Court.
Factual
Background
[4] The
first respondent (“SA Rugby”) is a private company duly
registered as such in terms of the company laws of the Republic
of
South Africa. It is the professional and commercial arm of the South
African Rugby Union (“SARU”), its sole shareholder. SA
Rugby is
the employer of rugby players selected to play for the national team
(“the Springboks”). Other commercial activities
include marketing
the Springboks’ brand, attracting sponsorships and other related
commercial activities.
[5] The
selection of players to play for the Springboks is made by a
Selection Committee established by SARU. SA Rugby in consultation
with the national coach decides who are the players who should be
contracted to play for the Springboks. SARPA has since 1998 been
engaged in negotiating the content of the national contracts on
behalf of its members. It however had no say in the actual award
of
the contracts.
[6] A
prerequisite to be offered a player’s contract by SA Rugby is for
one to be selected by the Selection Committee to play for
the
Springboks. However, being selected is no guarantee of a contract.
Criteria to be offered a contract include,
inter
alia,
selection, transformation, the needs of the team, the needs of the
national coach and the value of the player to the team. The number
of
contracts offered is limited. The Springboks players are full-time
provincial players contracted to their respective constituent
unions.
They play in the local Currie Cup competition as well as in the Super
12 competition. Some of the players play for overseas
teams.
[7] It
is common cause that Matfield, Bands and Bezuidenhout were at all
relevant times professional rugby players who were employed
by SA
Rugby to play for the Springboks during 2003. Matfield had entered
into a contract with SA Rugby which was to expire by mutual
agreement
on 31 December 2003. Unlike Matfield, both Bands and Bezuidenhout had
not entered into a standard player’s contract with
SA Rugby.
However, Bands played for the Springboks for most of 2003. He only
received match fees for his services in this regard.
[8]
The three players concluded separate player’s agreements with SA
Rugby for the sole purpose of participating in the Rugby World
Cup
(“RWC”) 2003. These contracts were of short duration. They
commenced on 1 September 2003 and were to expire on 30 November
2003
by mutual agreement. The contracts for all the players provided,
inter
alia
,
as follows:
“3.2
As this is a fixed term contract, it shall automatically terminate
on the date set out in paragraph 1.2 of schedule 11 hereof
(30
November 2003) and the player acknowledges that he has no expectation
that this contract will be renewed on the terms herein
contained, or
on any other terms.”
The
agreements stipulated further that the duration clause shall be
subject to clause 8 of the agreements. The latter clause provided
that should the player sustain an injury during the currency of the
contract whilst performing his services in terms of the contract,
SA
Rugby would continue to pay his monthly remuneration from the date of
the injury until the termination of the contract.
[9] The
other terms of the contracts relevant to this matter provided:
9.1 that
any variation of the terms of the agreement shall be of no force or
effect unless reduced to writing and signed by the parties;
9.2 that
the agreement, constituted the entire agreement
between the parties;
9.3 that
no agreements, representations or warranties between the parties
regarding the subject matter other than those set out in
the
agreement would be binding on the parties;
9.4 that
any prior agreements between the parties relating to the subject
matter are hereby cancelled;
9.5 for
the remuneration package for the players which included bonuses for
the various stages of the competition in which the Springboks
would
participate;
9.6 a
letter of intent which, as incentive for winning the RWC 2003,
provided for the payment of a sum of R410 000-00 as well as a
guaranteed one year Springboks contract for 2004, with a minimum
value of R400 000-00.
[10]
Matfield had also concluded a standard player’s contract with SA
Rugby starting from 1 January 2003 to 31 December 2003. The
contract
contained provisions similar to those of the RWC 2003 agreement
except those terms that specifically related to the RWC
2003 such as
the remuneration structure and the incentives.
[11]
It is common cause that the Springboks did not do well at the RWC
2003. The team was knocked out of the competition early. As
a result
the team had to return to the country together with the then national
coach, Mr Rudolph Straueli (“Straueli”). As expected,
their early
exit in the RWC 2003 attracted much criticism from the public and the
local media. On 23 November 2003, Piet Heymans
(“Heymans”), the
Chief Executive Officer for SARPA, addressed an e-mail to Straueli
which he copied to other executive committee
members of SARU as well
as its then President. The body of the letter reads:
“SARPA has been approached by
a number of Springboks expressing concern that neither you nor
anybody from SA Rugby has communicated
with them regarding possible
contracts for 2004.
As you are
aware most of the current contracted Bok player’s contracts with SA
Rugby will expire at the end of November 2003.
This
excludes the short term contracted Bok players that was contracted
for the RWC 2003 only
.
In terms of fair employment
practices an employer should at least one month before a fixed term
contract expires, notify the employee
that the contract will not be
renewed or alternatively that the employer does not want to renew the
contract.
Due to the
fact that this has not been done we propose that the current
contracted Bok players remain on their current contracts
until such
time as SA Rugby has been able to communicate with these players
regarding their contracts.
Our
members need to know what their future prospects are in relation to
their national contracts
.
As professional rugby players
they need to make important decisions based on their provincial and
national contracts.
We trust that
this important issue will be addressed as a matter of urgency.”
(My
emphasis)
[12] On
24 November 2003 Straueli forwarded personal letters to the players
who had participated in the RWC 2003. In the letters he
mentioned,
inter
alia
,
that the 2003 as a year was interesting and exciting for the players
and that, though they could not achieve all their goals, they
had
managed to build friendship
“on
and off the field of play
”,
especially after their game against Samoa. He mentioned further that
it would be very important that they built on what they
had started
and that correct decisions would have to be taken to ensure that the
team stayed together. He recorded, that as the players
knew that
their contracts with SA Rugby Union were coming to an end on 30
November 2003, they would be reviewed as soon as Rian Oberholzer
(“Oberholzer”) had returned from his RWC 2003 commitments in
Australia. Oberholzer was the Managing Director of SARU at the time.
[13] On
26 November 2003 one Mandy, who was an employee of SA Rugby forwarded
an e-mail to Heymans advising him that Oberholzer was
at the time on
his way back to South Africa and that he would respond to his e-mail
once he had an opportunity to go through all
his e-mail messages.
[14] It
is common cause that on the 4
th
December 2003 Straueli resigned from his position of national coach
following a settlement agreement reached with SA Rugby. He was
replaced by Jake White. Oberholzer also resigned and was replaced by
Mr Songezo Nayo (“Nayo”) in an acting capacity. The president
of
SARU, who was an elected official, was also replaced. These changes
resulted in a new administration coming into office. Before
his
departure, Straueli had meetings with some of the players
individually on 26 November 2006. The discussions of these meetings
will be dealt with later when dealing with the evidence of each
player.
[15] It
is common cause that no national contracts were offered to the
players during or at the end of 2003. During the period from
January
to May 2004 Heymans made several attempts to communicate with SA
Rugby in order to renegotiate national players’ contracts.
The
attempts were not successful. The new regime in SA Rugby had decided
that they (SA Rugby) would do away with annual contracts
and
retainers for its players. It was in favour of replacing the retainer
system with a “match fee only” structure. This would
mean that
the players would be paid match fees only and would not be paid if
they got injured when participating in their provincial
teams. The
other disadvantage would be that players would no longer have fixed
monthly income. The effect of this system on the players
was that
insurance companies would not be prepared to insure players who did
not have fixed income.
[16] It
is common cause that after 30 November 2003 Bands and Bezuidenhout
had no contracts with SA Rugby. As Matfield had a standard
players’
contract, he continued to be contracted to SA Rugby until December
2003.The negotiations between SARPA and SA Rugby regarding
new
contracts had not been finalised during this period. In February 2004
the first appellant referred to the CCMA on behalf of the
players a
dismissal dispute concerning the first respondent’s failure to
renew the second and further appellant’s contracts,
for
conciliation. A conciliation meeting was held on 4 March 2004 and the
dispute could not be resolved. On 17 June 2004 the appellants
requested that the dispute be referred to arbitration. They
described the issue in dispute as
“failure
by employer to renew contract-reasonable expectation; alternatively
(2) Failure to re-employ in accordance with an agreement”
.
The
“decision”
that they required the commissioner to make was “that the employer
recognise and implement undertakings made to contract with the
individual players and/or compensation”. The arbitration
proceedings in respect of the dispute took place on the 28
th
and 29
th
October 2004. The arbitration award was issued on 30 November 2004.
[17] At
the arbitration, the appellants tendered the evidence of the three
players as well as that of Heymans. The first respondent
tendered no
oral evidence. What follows is the summary of the relevant evidence
of the witnesses.
[18] Matfield
testified that he was selected to play for the Springboks since 2001.
Mr Harry Viljoen was the national coach at the
time. When Straueli
took over after the departure of Viljoen, Matfield was offered
another contract for the year 2002. In terms
of the new contract, he
earned half of what he was earning the previous year. His agent, Mr
Jason Smith, tried to negotiate more
money for him but was
unsuccessful. He testified that he played well in the year 2001. In
2002 his play was interrupted by an injury.
In July 2003 the team’s
then General Manager (Butch Watson Smith) resigned and the players
started to deal directly with Straueli
in respect of their contracts.
[19]
Matfield testified that he had a successful 2003. He was chosen to
play in all the matches at the RWC 2003 and was complimented
by the
media. Matfield testified that the compliment by the media also
contributed in him believing that he would get a contract
for the
year 2004. I doubt whether being complemented by the media can be a
legal ground for a player to harbour a reasonable expectation
to be
given a Springbok contract. He testified that he expected to
negotiate to be paid higher retainers and less match fees for
2004.
He confirmed receipt of the letter dated 24 November 2003 from
Straueli. He was convinced that the coach had faith in him and
that
he would be part of the team that would be retained.
[20]
On 26 November 2003 Matfield had a meeting with Straueli. During this
meeting Straueli told him that he was one of the more senior
players
and that he would want to use his experience. Matfield testified that
he raised with Straueli the matter of his fee structure
in the
contract. The latter told him that they could look at other options
and that he (Matfield) was definitely part of his plans
for 2004.
Matfield testified that, after this discussion, he felt optimistic
that he was going to receive a contract for 2004. Matfield
testified
that he continued to play for the Springboks during 2004 after the
expiration of his contract. He said that he was no longer
being paid
a retainer fee but only match fees and win bonuses.
[21] Matfield
testified that the players continued to be concerned about their 2004
contracts. He said that on the eve of one of the
Super Twelve
competition matches, Nayo and the new coach-that is Jake White-met
with the players. At this meeting the players enquired
from Nayo
whether they would get contracts for the season. Nayo responded that
the issue of the contracts had not been finalised
as yet and that, as
such he could not give them an answer. Matfield could not recall the
date of this meeting. He testified that
a day after they had met with
Nayo, Jake White had come to see them and told them that it was
difficult for him to offer any contracts
as he was at that stage not
sure who was on his plans and that he would probably look at that
after he had assembled his team. Matfield
testified that Jake White
told them that he would not give any guarantee.
[22]
Under cross-examination Matfield testified that he did not take
specific notice of the clause stipulating that his contract will
end
on 31 December 2003 and that he acknowledged that he had no
expectation of the contract being renewed on its terms or any other
terms. He testified that it had to be understood that national
contracts were not negotiable and one had to either accept one as
it
was or reject it. He mentioned that he had no option but to sign the
contract as it was in order for him to play for the Springboks.
He
accepted that clause 3.2 provided for termination and that it meant
that no expectation for the renewal of the contract would
be
entertained. However, he expected, as it had happened before, that
during December there would be negotiations for a new contract.
[23] On a specific question relating to the basis for his
expectation the following is recorded:
“(Mr
Arendse): Nou Victor (Matfield) laat ek net verstaan, jou eis ten
opsigte van die verwagtinge die reasonable expectation, is
dit
gebaseer op ondernemings of beloftes wat gemaak is deur Rudolph
Straueli of is dit gebaseer op die supplementary aanvullunde
kontrak
wat aangegaan is tussen SA Rugby en die Wereldbeker-spelers.
(Matfield): Nee, ek dink
eerstens dit is as gevolg van my performance vir die Springbokke. Die
aard (onduidelik) speel. Ek was die
heeltyd in die span. Daar was net
een wedstryd waar ek gedrop word. Op die Stadium het ek nog steeds
vir hulle gespeel. So ek het
aanvaar ek sal aanhou betaal word deur
hulle of nog steeds ‘n kontrak kry en dan ook Rudolf het na die
wereldbeker gekom en vir
my gesê, (onduidelik) ons kyk na n’ beter
struktuur of ons die (onduidelik).
(Mr Arendse): So aanvaar dan nou
dat Rudolf dit dan nou vir jou gesê het. Hy het nie vir jou gesê,
hy gaan vir jou aanstel of jy
gaan gekontrakteer word en dit is nou
die terme van die kontrak ne?
(Matfield): Hy het vir my gesê,
hy sal na my kyk die volgende jaar, ons moet net kyk na die struktuur
(ondeuidelik) so hy het gesê
hy sal na my kyk.
(Mr
Arendse): Maar hy het nooit gesê, dit is die – dit gaan die terme
wees?
(Matfield):
Hy het nooit vaste (ondudelik--tussenbeide).”
Matfield
further accepted that there were players who had also played for the
Springboks the previous year who were not contracted
for 2004.
However, he expected that since emphasis was on performance of the
player in the previous year, they should also have had
an expectation
of being given new contracts.
[24] Matfield
was referred to clause 5.1.15 of the agreement between Straueli
and SA Rugby which provided, as one of his responsibilities,
that:
“advise
SA Rugby from time to time of the names of players selected in the
National Squad and/or the National Team (and such other
players that
Straueli may deem appropriate), which requires to be contracted to SA
Rugby. It shall be the obligation of SA Rugby
to enter into contracts
with the players, and in so doing, Straueli shall advise SA Rugby as
to the level at which and duration for
which a particular player
should be contracted on terms which are fair, reasonable and
acceptable to SA Rugby”.
It
was further pointed out to Matfield during cross-examination that
Straueli could only tell the player that he should play for
him and
thereafter only recommend that SA Rugby should enter into an
agreement with the player. Matfield agreed that this is how
it
worked.
[25] The
next player, Bezeuidenhout, testified that he was part of the
Springboks that played in the Tri-Nation’s Test against New
Zealand
in August 2003. On their way back from the match, he testified,
Straueli told him that he wanted him to be part of the world
cup
squad. At the RWC 2003 he played three of the five matches. He
mentioned that, after their match with England, he and Bands were
selected for the World 15 dream rugby team voted by the media. The
reason for their being voted was, according to him, their good
performance. He confirmed receipt of the letter dated 24 November
2003 from Straueli.
[26] Bezuidenhout
testified further that he also had a meeting with Straueli on 26
November 2003. At this meeting, he testified, Straueli
told him that
he was not well known to him but that the chance that he gave to him
in the RWC 2003 was well used to prove himself
and that he was in his
plans for 2004. Bezuidenhout testified that he informed Straueli that
his remuneration was not as ‘big’
as other players because he was
playing in the small rugby union, playing for the Pumas team.
Straueli then told him that he would
see if he could not design his
contract in such a way that he would in total earn in line with other
players. This meant that he
would earn more than other players on his
Springboks’ contract to make up the deficiency at Union level. He
testified that Straueli
did not specify what that amount would be. He
was to revert back to him about the final contract for the 2004
season.
[27] Bezeuidenhout
testified that nobody thereafter communicated with him to inform him
that he would not be receiving a contract
for 2004. He only learnt
from the media that they were not going to receive contracts. He
confirmed that at the beginning of 2004
he participated in the
training camp for the Springboks which had been assembled by the new
coach, Jake White. He played for the
South African A team against
Nambia but was later sent home. At the time Jake White told him that
he might recall him for the next
test. Bezuidenhout testified that he
believed that he was initially part of Jake White’s plans. However,
he testified that he realised
later that he was not. Under
cross-examination he testified that Jake White told him that, if he
and the other players became part
of his group, he would back-date
their contracts to January 2004, but he first had to see which
players he was going to use in the
tests against Ireland, Wales as
well as in the Tri-Nations at the end of February 2004. It is not
disputed that Bezuidenhout did
not play in any of these tests.
[28]
On a specific question as to what the basis of his expectation for
the renewal of his RWC 2003 contract was, Bezuidenhout testified
that:
(a)
Straueli told him that at that time he was part of his plans;
(b)
he had played well in 2003, the Super 12 and the RWC 2003, and
(c)
he had been chosen above players whose standard players’ contracts
ran up to the end of 2004.
He
conceded that it happens in rugby as in other sporting codes that one
may play very well but not necessarily be given a contract.
He also
conceded that at the end it was SA Rugby that decided who should get
a contract. He added, though, that it was the coach
who should still
train the player.
[29] Bands
testified that he played for the Springboks for the first time in
2003. He played in 11 of the 12 ‘tests’ that were
scheduled for
2003. During the RWC 2003 he played very well and was chosen by the
media as part of the World 15 dream team. He also
received the letter
dated 24 November 2003 from Straueli. He believed that he was one of
the players referred to in the letter who
were said to be talented
and needed to build on. He also met Straueli on 26 November 2003 at
Loftus Versveld Stadium. The latter
told him that he wanted to keep
the same players in the team for the sake of continuity. He had
enquired from Straueli if he was
going to be contracted by SA Rugby
for 2004 as he had already received an offer from Northhampton Saints
for R 1.5M. He testified
that Straueli told him that he was part of
his plans and that he would give him a contract. He testified that he
expected to be paid
a retainer of R300 000-00 for the 2004 season.
[30] Bands
testified further that he also had a telephonic discussion with
Straueli after the expiry of his contract. He mentioned
that Straueli
assured him that he would get a Springboks contract and that he
(Straueli) intended to stay on as coach until his contract
expired in
2005. He only discovered via the media that he was not going to
receive a contract from SA Rugby.
[31] Unfortunately
the entire cross-examination of Bands is not part of the record. What
is available is only some handwritten short-hand
notes by the
commissioner. It was not the parties’ contention before the court a
quo and before us that the information on record
is not sufficient
for the determination of the matter. Most of the evidence tendered
was in any case not disputed. This appeal will
therefore be
considered on the material available on record.
The
arbitration
[32] In
the award the arbitrator recorded the issue to be determined as
whether or not the applicants were dismissed in terms of section
186(1)(b) of the LRA and whether such dismissal was fair. She held
that the players impressed her as witnesses and that their evidence
was consistent under cross-examination. She accepted the players’
evidence that they based their expectation for renewal of their
contracts on the promises made by Straueli both orally and in writing
and their consistent performance in the RWC 2003. She found
Straueli’s conduct to amount to an express offer of the Springbok
contracts to the players. She further reasoned that Straueli
was not
called by the SA Rugby to challenge the player’s evidence and as
such their evidence remained uncontroverted. She concluded
that:
“
In
the light of the abovementioned evidence I am of the view that
personally, all the applicants’ had an expectation that their
contracts would be renewed and that in the light of the factors on
which their expectations were based, their expectations were
reasonable”.
[33] On
the question as to whether there was an objective basis for the
expectations, the commissioner remarked that the evidence
presented
by “both” parties indicated that professional rugby environment
was
“insecure,
uncertain and characterised by a frequent change in management”
.
She said that each coach had a different approach as to how the
contracts should be awarded and structured. She remarked that there
were no clear policies or guidelines on how contracts should be
awarded or structured. She held that such an environment could result
in unfair treatment and that employees needed protection. She
mentioned that despite the change in management the
“legal
entity”
remained
the same and as such players were therefore entitled to rely on the
word of a coach who had
“implied
authority
”
and created an expectation that contracts would be given. She also
found that despite the fact that the team did not perform well
in the
World Cup the performance of the three players during the world cup
was
“outstanding
”
and that it was evident that the coach wanted to keep and develop the
“talent of the tight five after the World Cup”. The
“tight
five” was the position in which Bands and Bezuidenhout played with
three other players.
[34] On
the argument that in terms of the contract between Straueli and SA
Rugby it was clear that Straueli had no express or implied
authority
to give undertakings or make promises to players, the commissioner
held that on the evidence presented Straueli had the
implied
authority to promise Springboks contracts. She based her conclusion
on what she referred to as the “significant” role
played by
Straueli in the team with regard to selecting players and awarding
contracts.
[35] In
conclusion, on the submission that the players were bound by the
express terms of their contracts, the commissioner held that
their
claims were statutory ones in terms of the Act, which was based on
fairness and equity as opposed to contractual claims. She
held that
SA Rugby could not rely on the terms of the contract alone and that
in the interests of fairness and equity, the surrounding
circumstances of the case had to be considered and that SA Rugby had
to justify the “dismissal”. She thereafter found that SA
Rugby
had not proved that there was a fair reason for not renewing the
contracts of the players or that their “dismissal” was
effected
in accordance with a fair reason.
[36] The
commissioner thereafter ordered that Matfield be paid an amount of
R400 000-00 and Bands and Bezuidenhout be paid an amount
of R300
000-00 each, all payable by the 31
st
January 2005. She made no award as to costs. SA Rugby, aggrieved by
the award of the commissioner, instituted review proceedings
in the
Labour Court to have the award reviewed and set aside.
Proceedings
in the Labour Court
[37] The
Labour Court ruled that the commissioner’s reasoning and conclusion
in relation to Matfield’s contract was justified
and dismissed the
review application. In respect of Bezuidenhout and Bands the Labour
Court concluded that it had not been shown
that the two players had a
reasonable expectation that their fixed term contracts would be
renewed by the employer on the same or
similar terms as required by
section 186 (1) (b) and that the commissioner’s finding to the
contrary was not supported on an objective
and rational basis.
The
Appeal
[38] SARPA’s
appeal is against that part of the judgment of the Labour Court which
upheld the first respondent’s review application
in respect of
Bezuidenhout and Bands. There is also a cross-appeal by the first
respondent against that part of the judgment in which
the Labour
Court dismissed the review application in respect of Matfield.
[39] The
issue that was before the commissioner was whether there had been a
dismissal or not. It is an issue that goes to the jurisdiction
of the
CCMA. The significance of establishing whether there was a dismissal
or not is to determine whether the CCMA had jurisdiction
to entertain
the dispute. It follows that if there was no dismissal, then the CCMA
had no jurisdiction to entertain the dispute in
terms of section 191
of the Act.
[40
]
The CCMA is a creature of statute and is not a court of law. As a
general rule, it cannot decide its own jurisdiction. It can only
make
a ruling for convenience. Whether it has jurisdiction or not in a
particular matter is a matter to be decided by the Labour
Court. In
Benicon Earthworks & Mining Services (EDMS) BPK v Jacobs No &
Others
(1994) 15 ILJ 801 (LAC) at 804 C-D, the old Labour Appeal Court
considered the position in relation to the Industrial Court
established
in terms of the predecessor to the current Act. The Court
held that the validity of the proceedings before the Industrial Court
is
not dependent upon any finding which the Industrial Court may make
with regard to jurisdictional facts but upon their objective
existence.
The Court further held that any conclusion to which the
industrial court arrived at on the issue, has no legal significance.
This
means that, in the context of this case, the CCMA may not grant
itself jurisdiction which it does not have. Nor may it deprive itself
of jurisdiction by making a wrong finding that it lacks jurisdiction
which it actually has jurisdiction. There is, however, nothing
wrong
with the CCMA enquiring whether it has jurisdiction in a particular
matter provided it is understood that it does so for purposes
of
convenience and not because its decision on such an issue is binding
in law on the parties. In Benicon’s case the Court said:
“In
practice, however, an Industrial Court would be short-sighted if it
made no such enquiry before embarking upon its task. Just
as it would
be foolhardy to embark upon proceedings which are bound to be
fruitless, so too would it be fainthearted to abort the
proceedings
because of a jurisdictional challenge which is clearly without
merit.”
(at
804 c-d)
In my view the same approach is
applicable to the CCMA.
[41]
The question before the
Court
a quo
was
whether on the facts of the case a dismissal had taken place. The
question was not whether the finding of the commissioner that
there
had been a dismissal of the three players was justifiable, rational
or reasonable. The issue was simply whether objectively
speaking, the
facts which would give the CCMA jurisdiction to entertain the dispute
existed. If such facts did not exist the CCMA
had no jurisdiction
irrespective of its finding to the contrary.
[42] Section
186 (1) (b) provides that:
“(
1)
Dismissal means that-
(a) …
(b) an
employee reasonably expected the employer to renew a fixed term
contract of employment on the same or similar terms but the
employer
offered to renew it on less favourable terms, or did not renew it,”
[43] What
s 186(1)(b) provides for is that there would be a dismissal in
circumstances where an employee reasonably expected the employer
to
renew a fixed term contract of employment on the same or similar
terms but the employer only offered to renew it on less favourable
terms or did not renew it. The operative terms in s 186(1)(b) are in
my view, that the employee should have a reasonable expectation,
and
the employer fails to renew a fixed term contract or renew it on less
favourable terms. The fixed term contract should also be
capable of
renewal.
[44] The
appellants carried the onus to establish that they had a ‘reasonable
expectation’ that their contracts were to be renewed.
They had to
place facts which, objectively considered established a reasonable
expectation. Because the test is objective, the enquiry
is whether
would a reasonable employee in the circumstances prevailing at the
time have expected the employer to renew his or her
fixed term
contract on the same or similar terms. As soon as the other
requirements of s186(1)(b) have been satisfied it would then
be found
that the players had been dismissed, and the respondent (SA Rugby)
would have to establish that the dismissal was both procedurally
and
substantively fair.
[45] It
was contended on behalf of the appellants that the evidence presented
by the players proved a reasonable expectation on their
part. The
evidence referred to relate to the “outstanding” performance of
the players at the RWC 2003 as well as the remarks
made by Straueli.
In the case of Matfield, he relied on the meeting of 26 November 2003
in which Straueli told him that, as he was
one of the senior players,
he (Straueli) wanted to use his experience and was part of his plans
for 2004. In the case of Bands and
Bezuidenhout they also relied on
the remarks by Straueli that they were part of his plans for 2004 and
that he would like to keep
the same team together.
[46]
Clause 3.2 stating that the contracts automatically terminated on the
dates set out and that the players acknowledged that they
had no
expectation that their contracts would be renewed on the terms
contained therein or any other terms is to me of critical importance.
This clause and other exclusionary clauses referred to above were
deliberately included in the contracts in order for them to be
part
of the contracts and to mean what they were intended for. It would
therefore, be expected of the appellants to place more credible
facts
to make their expectation reasonable in the face of clause 3.2. A
mere
ipse
dixit
that there is an expectation, based on flimsy grounds, would not
suffice.
[47] It
should be borne in mind that the RWC 2003 contracts were for a
specific event that came and went. The terms of the contract
related
to what was to happen at the RWC event. It follows, as was contended
on behalf of the respondent, that such a contract could
not be
renewed after the event, whether on the same or similar terms.
Furthermore, in the letter of intent sent by Straueli to those
players who had participated in RWC 2003, the players were reminded
that Rugby World Cup comes once every four years. The letter
also
explained to the players that they were guaranteed a one year
contract for 2004 and an incentive of R600 000-00 only in the
event
of them winning the tournament which did not happen. It is also
evident in the letter from Heymans dated 23 November 2003 that
RWC
2003 contracts were excluded from negotiations for renewal.
[48] I
am unable to find on the evidence before us that Bezuidenhout and
Bands could justifiably form any reasonable expectation that
their
RWC 2003 contract would be renewed. Their “outstanding”
performance at the RWC 2003 could only place them in a better
position
to be considered for a new standard contract on negotiated
terms different from the RWC 2003 contracts. Even the former coach on
whose remarks they relied did inform them that their contracts would
be reviewed when Oberholzer, the managing director at the time,
returned from overseas. Furthermore, their expectation was, on their
evidence, that they would be given standard players’ contracts
for
a period of one year and not to participate in RWC 2004. Such
contracts would differ materially from the RWC 2003 contracts as
they
would be for a different purpose. In addition the promise made by
Straulie seems to have been to give them contracts on terms
more
favourable than the ones they had.
[49] The
Labour Court seems to have relied on the failure by SA Rugby to
respond to the letter dated 23 November 2003 from Heymans
to find
that Matfield had a reasonable expectation that his contract would be
renewed. The Labour Court reasoned thus:
“In
the absence of an answer or an explanation it was in my judgment
reasonable in the circumstances for Matfield to expect his
employer
to renew his fixed term contract for calendar year 2003 on the same
or similar terms and the commissioner was justified
in finding that
in respect of Matfield there was an objective basis for his
expectations, and that his expectations were reasonable”.
[50] In
my view, this aspect alone is not sufficient to establish a
reasonable expectation. In the first place Heymans’ letter
recognised
that the contracts were coming to an end and that the
players had not been contacted regarding “possible” contracts for
2004.
Failure to communicate an intention not to renew, cannot, in my
view, mean that the contract would be renewed when the contract
itself
does not make room for renewal. Although Matfield played for
the Springboks since 2001 and was given a contract for 2002 and 2003,
it has to be understood that these contracts were not on the same or
similar terms. They were negotiated contracts for each year
and given
to the players who were selected by the coach who was in charge of
training the team at the time. Not all the players who
played for the
Springboks during the years preceding 2002 and 2003 were selected by
the coach and given contracts.
[51] Furthermore,
Heymans acknowledged that the contracts would be coming to an end by
mutual agreement and proposed that the players
should remain on those
contracts until such time that SA Rugby had communicated with the
players. This proposal was in my view a
request for an extension of
the contracts that would expire and cannot be a basis for a
reasonable expectation of renewal. Lastly,
on this aspect, Heymans
expressed the view that players needed to know their future prospects
in relation to their national contracts.
This was, as contended on
behalf of respondent, evidence of uncertainty and not of an
expectation of renewal.
[52] In
my view, a statement by the then national coach-Straueli- that the
players were part of his plans for 2004 is not sufficient
to form a
basis for a reasonable expectation. Matfield conceded in his
evidence that it was not the coach that decided on the substance
of
the contract but negotiations that would take place between the
collective bargaining agents, i.e SA Rugby and SARPA. Even if
one
could find that Straueli could have raised an expectation on the
players about the renewal of their contracts such expectation
should
have diminished when Straueli’s contract was terminated on 04
December 2003. It should have been clear to the players, as
professional rugby players, that each coach had his own preferences
and only the players he required would feature in his plans.
The
players should therefore have known that they were not guaranteed a
place in the Springboks when a new coach was appointed. Selection
of
players to be in the team depended on the encumbent coach. This could
be a reason why contracts were for a limited period. It
would be
absurd to allow an outgoing coach to decide on the players his
successor should include in his team. The criticism by the
commissioner that the professional rugby environment is insecure,
uncertain and characterised by frequent changes in managers is
not
entirely valid because, among others, SA Rugby must be responsive to
changing conditions. The criteria adopted for selecting
Springbok
players had to be satisfied first. Performance in the RWC 2003 could
be one of the considerations but not the only one.
[53] Since
the claims of the players are based mainly on the promises made by
Straueli, they should perhaps have pursued other contractual
remedies
and not rely on the provisions of S 186 (1) (b). This view is
fortified by the fact that Heymans testified that they engaged
SA
Rugby in a process of negotiating contracts for the 2004 season. I
did not understand his evidence to mean that negotiations
centred
around renewing the existing contracts of all the players contracted
for 2003 season. Indeed, some of the players did not
play for the
Springboks for the 2004 season. It is common cause that Matfield
played for the Springboks during 2004 on different
but agreed terms
with SA Rugby. Furthermore, his 2003 contract was less favourable
than that of 2002 in that he earned less than
he previously did.
This is indicative of the fact that there was no automatic renewal
but re-engagement on negotiated terms.
[54] In
conclusion I am of the view that the appellants have not shown that
there had been a dismissal in terms of s186 (1) (b) and
as a result
the CCMA had no jurisdiction to entertain the dispute. In the result
the appeal must fail and the cross-appeal should
suceed. It is in my
view in accordance with the requirements of the law and fairness that
there be no order as to costs.
In
the result I make the following order:
1
.
The appeal is dismissed.
2.
The cross-appeal is upheld.
3.
There is to be no order as to costs.
__________________
TLALETSI
AJA
I agree
_________________
ZONDO
JP
I agree
___________________
WAGLAY
JA
Appearances
For
the Appellant: Mr Robert Stelzner
Instructed
by: Adams & Adams
For
the Respondent: Mr Norman Arendse SC
Instructed
by: Sonnenberg Hoffmann & Galombik
Date
of Judgment: 12 May 2008