About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Labour Appeal Court
SAFLII
>>
Databases
>>
South Africa: Labour Appeal Court
>>
2012
>>
[2012] ZALAC 12
|
|
Public Servants Association obo PSA members v National Prosecuting Authority and Another (JA 32/09) [2012] ZALAC 12; [2012] 8 BLLR 765 (LAC); (2012) 33 ILJ 1831 (LAC) (20 April 2012)
17
REPUBLIC OF
SOUTH AFRICA
IN THE LABOUR APPEAL COURT OF SOUTH
AFRICA, JOHANNESBURG
JUDGMENT
Reportable
Case No: JA 32/09
The Public Servants’
Association
On behalf of PSA members
…......................................................................
Appellants
and
National Prosecuting Authority
…....................................................
First
Respondent
Department of Justice and
Constitutional Development
…....................................................
Second
Respondent
Heard: 25 August 2010
Delivered: 20 April 2012
Summary
:
Labour Law –
Review of Bargaining Council award –– powers of
arbitrator vis a vis public service regulations –
applicability
of Section 74 of the LRA – arbitrator’s powers to make an
award not ousted by the regulations - award
one which reasonable
decision-maker would have made
JUDGMENT
MLAMBO JP
[1] The issue in this appeal is
whether an arbitration award made in terms of the Labour Relations
Act
1
(LRA) is one that a reasonable
decision-maker would have made.
[2] The award, in favour of the
appellants, was made by former Zimbabwe High Court Judge N J McNally
(the arbitrator). The respondents
however succeeded in having it
reviewed and set aside by the Labour Court (Molahlehi J), on the
basis that the arbitrator took
into account irrelevant considerations
and also exceeded his powers, thus rendering the award one that a
reasonable decision-maker
would not have made. This appeal is
directed at that order and is before us with the leave of the Labour
Court. Central to the
resolution of the appeal is the effect of
certain Public Service Regulations, to which I shall return shortly,
on the arbitration
in general but more specifically on the
arbitrator’s powers. I must at the outset sketch in some
details the factual background
of the matter.
[3] In 1998, the government of this
country commenced a job evaluation exercise intended for the whole of
the public service. The
modus
operandi
adopted was
consultative and embraced all key role players and departments
including National Treasury (Treasury). Consultation
with Treasury
was necessary in view of the need for additional budgetary
allocations which were required to implement the job evaluation
process recommendations, in cases where there were posts that
required upgrading. This was because no government department would
be able to upgrade any posts and increase the salary levels of those
posts, if there were no funds available for that purpose.
[4] It was for this reason that the
government sought to ensure that there be tight control regarding the
fiscal consequences of
the exercise. In keeping with this objective,
in 1999 and 2001, Public Service Regulations were promulgated, which
dealt with the
method of controlling and managing the fiscal
implications of the job evaluation exercise. Essentially these
regulations decreed
that no post upgrades were to be implemented
unless the necessary funding was available. In this regard Regulation
V.C.5 of 2001
(regulation 5) provides:
‘
An
executing authority may increase the salary of a post to a higher
salary range in order to accord with the job weight, if
(a)The
job weight as measured by the job evaluation system indicates that
the post was graded incorrectly: and
(b)
The department budget and medium-term expenditure framework provide
sufficient funds.’
[5] This regulation in particular, has
been pivotal in the litigation that has culminated in this appeal.
The arbitrator and the
Labour Court grappled with it, not so much
with its meaning, but rather with its effect on the arbitration
process in general and
the arbitrator’s powers specifically. It
is common cause that reference in the regulations to ‘executing
authority’
means the Cabinet Minister in charge of the relevant
state department.
2
[6] At the conclusion of the job
evaluation process, it was found that a large number of posts in the
establishment of the First
Respondent (NPA) required upgrading. The
financial implications of this finding was that an additional
budgetary amount of approximately
R140 million was required to effect
all the post upgrades in the NPA over a three - year budgetary cycle.
In the first year of the budgetary
cycle, the NPA required an amount of R54 million of the R140 million
to implement the recommended
job upgrades. There was no provision in
the NPA’s budget for these funds nor in that of the Second
Respondent (the DOJ &
CD) under which the NPA resorts. For this
reason, the NPA, through the DOJ & CD, approached Treasury for
additional funding
in the amount of R27 million for that year of
implementation.
For
the balance of the funds required for the first year, the NPA was
confident it would raise these through savings from its existing
budget.
[7] The approach to
Treasury was unsuccessful as the requested budgetary allocation was
not approved. There is no reason in the
record before us why this
request was turned down. The need to call a Treasury official to
testify during the arbitration proceedings
was dispensed with by the
respondents. Their reasons appear to have been based on respect for
what Treasury officials do and to
avoid subjecting them to
cross-examination on matters involving their decisions regarding
fiscal priorities. Hence to this day
we remain in the dark about
Treasury's reasons for refusing to approve the NPA's request for an
additional budgetary allocation
in the amount of R27 million at that
time.
[8] As
a consequence of this setback, the NPA
decided that it would
be feasible to adopt a phased implementation of the job evaluation
recommendations.
In this regard, the NPA decided
that certain identified posts were to be upgraded first as it
regarded these as most in need for
upgrading. The idea appears to
have been that further posts would be upgraded as and when further
funds become available through
other means but most likely through
forced savings.
[9]
The NPA went ahead and raised funds from its existing budgetary
allocation to commence the phased implementation of the job
evaluation recommendations regarding those posts it had identified
for prioritised implementation. This phased approach was however
rejected by the appellants who insisted that the upgrading be
implemented for all posts at the same time; this despite the
respondents
stated position that the required funds for total
implementation were not available. It is this
impasse
that gave rise to the litigation that
has ensued. I pause here to highlight the fact that, at that point,
the parties were in agreement
that the recommended job upgrades were
justified. The issue was the failure and/or inability of the NPA to
effect the job upgrades
as recommended.
[10] The appellants declared a dispute
characterising it as a dispute of mutual interest and referred it to
the General Public Service
Sectoral Bargaining Council (the Council)
for resolution through the latter’s dispute resolution
processes. The Council has
jurisdiction over the parties in this
matter regarding the determination of conditions of employment as
well as the resolution
of disputes between them regarding terms and
conditions of employment. The Council was however unsuccessful in its
efforts to resolve
the dispute through conciliation.
[11] The appellants
pressed ahead and referred the dispute for resolution through
arbitration by the council. The parties however
agreed that, instead
of the council initiating arbitration under its auspices, the dispute
be resolved by private arbitration in
terms of the Arbitration Act
3
.
To this end, the parties concluded an arbitration agreement in terms
of which they,
inter
alia
,
appointed the arbitrator and agreed that he would have the same
powers as if he had been appointed by the Council to arbitrate
the
dispute in terms of the LRA even though his appointment was in terms
of the Arbitration Act.
[12] The parties characterised the
dispute in that agreement, as follows: ‘3.The dispute arises
out of the failure by the
National Prosecuting Authority (NPA) to pay
certain categories of departmental employees (principally prosecutors
and special investigators)
the extra remuneration to which they were
entitled as incumbents of the re-graded posts with effect from 1
April 2005.’
[13] In the normal
course of mutual interest disputes such as this one was alleged to
be, upon the failure of conciliation, industrial
action in the form
of a strike or lockout would have ensued. However no strike action
was initiated as the employees of the NPA
involved in this matter are
precluded from engaging in strike action as they have been designated
in terms of section 71 of the
LRA to be engaged in an essential
service
4
.
Compulsory arbitration in terms of section 74
5
is the option
available to such employees instead of strike action. It is for this
reason that this dispute went that route.
[14] At the
commencement of the arbitration proceedings, the arbitrator
considered two
in
limine
objections
raised by the respondents. Although a total of nine objections had
initially been raised in the pleadings but these were
eventually
whittled down to the two main objections referred to which were
originally numbers four and five. The first objection
was based on
regulation 5, it being contended essentially that the regulation
permitted an executing authority to increase salaries
provided that
the relevant budget and departmental Medium Term Expenditure
Framework (MTEF) allocation made provision for sufficient
funds to
accommodate the increase. It was argued that this was a statutory
requirement which barred implementation of the recommended
job
upgrades if the funds required for that purpose were not available.
It was contended that, in view of this requirement, the
application
fell to be dismissed. The other
in
limine
objection
was to the effect that the relief sought by the appellants in the
arbitration was aimed at reversing a decision by Parliament
and/or
Treasury, a legal impossibility, so it was contended. For this
reason, it was argued that no arbitrator had jurisdiction
to make
such an order and therefore the application similarly fell to be
dismissed.
[15] The arbitrator
ruled with regard to the first objection that regulation 5 indeed
limited the discretionary power of the Minister
acting on his own to
increase salaries where no funds were available in the departmental
budget. He acknowledged that in terms
of the regulation the Minister
could only increase the salary of a post if the departmental budget
provided sufficient funds for
this. His view was, however, that
despite this being the statutory framework, if faced with strike
action or compulsory arbitration
under section 74, the Minister could
approach Parliament or Treasury to augment his budget to enable him
to increase salaries.
He stated in this regard that : ‘There
must be many situations where a strike is settled on terms which go
beyond the provisions
in a departmental budget for salaries and
wages. The solution may then have to be reached at a level higher
than that of the Minister
or the executing authority. Parliament, the
ultimate source of funding, may have to become involved. That is
exactly what section
74 of the LRA envisages.’ On that basis,
the arbitrator rejected the first
in
limine
objection.
[16] He also
rejected the second objection and stated that his jurisdiction to
make an award was not ousted. To him, if an award
was to be made in
favour of the salary increase in circumstances where the required
funding was not available, it would have to
be presented by the
Minister to Parliament for consideration. In his view, section 74
provided for a parliamentary overview of
the award should one be
made. He stated that it was because of section 74 that he believed he
had the authority and jurisdiction
to make an award, if persuaded to
do so, regarding any unbudgeted amount, which, in his view, could be
reversed by Parliament,
if it was so minded. He articulated his
reasoning in this regard as follows: ‘It is precisely because
the extra funds sought
are unbudgeted that s 74 provides for a
parliamentary overview of the award, if one is made by me. I find
nothing in the legislation,
which prevents the applicants
[appellants] from in effect taking the Treasury’s decision to
arbitration. And it is precisely
because of the terms of s 74 that I
believe I have the authority and jurisdiction to make an award (if so
persuaded) in an unbudgeted
amount, which award may be reversed by
Parliament if it is so minded. Far from me reversing a decision of
Parliament, it is parliament
which is, empowered by the statute to
reverse an arbitration award made by me.’ The arbitrator
elaborated this view further
in his final award as follows : ‘A
strike by members of the public service
not
in an essential
service is the equivalent of arbitration under section 74(4) of the
LRA in the case of public servants who are in
an essential service.
The result of the strike, or the award of the arbitrator, cannot be
fettered by regulations about the availability
of funding.’ He
reasoned that this view did not mean that as an arbitrator, he had no
limitations in terms of his decisions
or that he could ‘usurp
the function of government in regard to the allocation of resources.’
This, he stated, was
obviated by the provisions of section 74(5).
[17] Section 74(5) provides:
‘
Any
arbitration award in terms of subsection 4 made in respect of the
state and that has financial implications for the state becomes
binding-
(a)
14 days after the date of the award, unless a Minister has tabled the
award in Parliament within that period; or
(b)
14 days after the date of tabling the award, unless Parliament has
passed a resolution that the award is not binding.'
Section 74 (6) provides that ‘If
Parliament passes a resolution that the award is not binding, the
dispute must be referred
back to the commission [or Council] for
further conciliation between the parties to the dispute and if that
fails, any party to
the dispute can request the Commission [Council]
to arbitrate.’
[18] In that final
award, in which was incorporated the
in
limine
rulings,
the arbitrator also dealt with the question whether the dispute
before him involved rights or was one of mutual interest.
The NPA’s
stance was that the dispute concerned the alleged infringement,
application or interpretation of existing rights
and as such, was a
dispute about rights and therefore had to be referred to the Labour
Court for adjudication in terms of Section
158(1) (h)
6
.
This argument, which was persisted in before us, was based on a view
that the recommended salary increases linked to the job upgrades
had
crystallised into rights. The appellants’ argument on the other
hand was that no enforceable rights had come into being,
hence the
insistence of taking the dispute to arbitration. The appellants’
argument was based on a view that the beneficiaries
of the
recommended salary increases may have become morally entitled to the
salary increases but these were not legally enforceable
until an
arbitration award sanctioned them.
[19] The arbitrator concluded that the
dispute was one of mutual interest and that it had been correctly
referred to arbitration.
He reasoned that the dispute concerned the
creation of fresh rights such as for higher salaries. For this
reason, higher salaries
could only be attained generally through
strike action but, in this case, through compulsory arbitration in
terms of section 74,
should the relief sought be granted at
arbitration.
[20] Turning to the
substantive matter, the arbitrator concluded that the appellants had
made out a good case for the relief they
sought. He reasoned in this
regard that all parties were
ad
idem
that
posts had to be upgraded as the conditions then were unsatisfactory.
He referred in this regard to correspondence exchanged
between the
parties that care should be taken to effect the job evaluation
upgrades to avoid industrial action by dissatisfied
members of the
prosecution service. He also stated that by not implementing the job
upgrades, the NPA, DOJ & CD or Treasury
had failed to appreciate
the seriousness of the situation. His award was that the appellants’
members be paid in line with
the job evaluation recommendations and
that they be compensated for the failure of the NPA to implement the
job evaluation recommendations
with effect from the same date that it
was implemented for the other employees who were identified for
prioritised implementation.
This is the award that was taken to the
Labour Court for review.
[21] In the Labour
Court
,
the respondents
primarily sought to assail the award on the basis that the arbitrator
had failed to take into account the provisions
of the regulations, in
particular regulation 5 which, in their view, regulated the financial
implications of the job evaluation
exercise and that by so doing he
had exceeded his powers. This, they argued, rendered his award one
that a reasonable decision-maker
would not have made.
[22] The Labour court proceeded from
the premise that the arbitrator was alive to the statutory
requirement that job upgrades could
only be effected if funds were
available for that purpose. The court then pointed out that the
arbitrator did not base his conclusion
on this important fact but on
two findings: (i) that the funds required ought to have been made
available and that the regulations
were not to stand in the way of
the outcome of the job evaluation exercise and, (ii) on
considerations of fairness and equity.
[23 The Labour court accepted the
respondents’ contentions, finding that the arbitrator had
indeed based his award on considerations
of equity and fairness
which, it stated, did not take account of the regulatory and
statutory framework within which the public
service operated,
including how the job evaluation exercise had come into being as well
as the context within which the regulations
were promulgated. The
Court found that central to the implementation of the job evaluation
recommendations was the availability
of funds. Essentially, the
court’s reasoning was that the arbitrator’s hands were
tied by the regulations and that
he could not make any award
regarding unbudgeted funds.
[24] The court further disagreed with
the arbitrator’s conclusion that the dispute was one of
interest. In the court’s
view, despite the presence of some
interest element in it, the dispute was essentially a rights dispute.
In this regard, the court
found that regulation 5 clearly pointed
towards the dispute being rights based, in that an executing
authority was legally obliged
by the regulations to ensure the
availability of funds to effect the salary adjustments arising from
the job evaluation exercise.
This the court found introduced a rights
element into the matter which placed an impediment upon the relief
sought by the appellant
at arbitration. In this regard, the court
stated: ‘Until set aside the regulation forms part of the law
and the executing
authorities were once the job evaluation was
completed obliged as a matter of law to ensure that funds were
available before effecting
salary adjustment arising from the finding
of the job evaluation.’ The Labour Court concluded in the final
analysis that
the award failed to measure up to one which a
reasonable decision-maker would have made and set it aside.
[25] The appellants contended on
appeal that the Labour Court erred in rejecting the findings made by
the arbitrator, that he could
issue an award regarding unbudgeted
funds. They also contended that the Labour Court failed to appreciate
the arbitrator’s
reasoning regarding the applicability of
section 74. It was submitted in this regard that the court had failed
to appreciate that
an arbitrator, acting in terms of section 74,
exercises a different power to that of an executing authority in
observing budgetary
constraints.
[26] On the other
hand, the respondents, supporting the Labour Court’s reasoning,
argued that the arbitrator did indeed misconceive
his powers in the
context of section 74. Their further submissions went along the
following lines: the regulations, the validity
of which was never
challenged, properly understood disempowered the arbitrator from
undoing the fiscal control mechanism found
in the promulgated
requirement contained in regulation 5 in particular; that Treasury,
having rejected a request for an additional
allocation, effectively
ended the appellants’ options of having the upgrades effected
simultaneously; that it was not open
to the arbitrator to
second-guess Treasury’s decision as to how the national revenue
was to be spent and that the arbitrator
had been misdirected in
regarding the regulation as not binding on him, seeing that these had
been put in the place as a deliberate
‘control mechanism and
defined pertinent rights’
7
.
In effect, the conclusion that was contended for was that the
arbitrator could only come to one conclusion and this was that,
as
there were no funds available to implement the job evaluation
results, regulation 5 had the effect of preventing any further
action
being taken to have the upgrades effected until funds were available.
[27] Before
considering the contrasting contentions raised in the appeal, it is
worthwhile to remind ourselves that the essential
issue before us is
whether the award made by the arbitrator is one that passes muster
when considered in the context of the test
laid down in
Sidumo
and Another v Rustenburg Platinum Mines and Others
8
.
It is therefore to the award that we must focus our attention in
considering if it was correctly set aside by the court
a
quo
.
This Court has stated that in the review of awards issued in terms of
the LRA, and in line with the
Sidumo
standard of
reasonableness, the essential issue is not whether the award is wrong
or whether the judge holds a different view to
that of the
arbitrator
9
,
but whether the award is justifiable in relation to the material
available to the arbitrator. See
Bestel
v Astral Operations and Others
.
10
This approach as
well as an enquiry into the process employed by the arbitrator in
making an award have been sanctioned by this
Court as acceptable and
to be in line with the
Sidumo
test
11
.
With this reminder, it is necessary to consider the conclusions as
well as the reasoning of the Labour Court in setting the award
aside.
[28] The Labour Court’s
conclusion to set aside the award is rooted in its acceptance of the
respondents’ contentions
as well as its reasoning that the
arbitrator based his award on irrelevant considerations. This
ineluctably calls for a proper
consideration and location of section
74, which features prominently in the arbitrator’s reasoning.
The question squarely
before us therefore must be whether there is an
objective rational basis between the arbitrator’s reasons
regarding the effect
of the regulations on the arbitration as well as
his powers specifically and his conclusions.
[29] The arbitrator’s conclusion
that the dispute was one of interest is, in my view, rationally
connected to the material
before him and his analysis of the facts
before him. In this regard, he properly took account of the fact that
if the recommendations
for job upgrades had become legal entitlements
in the form of rights, then the regulations provided no shield to the
respondents
to avoid total implementation until they had found money.
Recommendations are just that and nothing more. They are required to
be effected and/or implemented before crystallising into substantive
rights. It cannot be that the appellants were entitled to the
higher
salaries but could not enjoy them until the NPA found money.
[30]
The regulations could play no role in converting these
recommendations into rights as found by the Labour Court. Had this
been the case, it would not have been open to the NPA to delay
implementation thereof for the other posts in the hope of raising
further funds. Clearly, until an award was issued in their favour,
the appellants could not enforce any entitlement to the higher
salaries embedded in the job evaluation recommendations. The
arbitrator explained this by means of his analogy that, had the
employees
affected not been designated to be performing an essential
service, they would have been perfectly entitled to go on a protected
strike to force the NPA to effect the higher salaries. It must follow
that before implementation no rights accrued; hence the arbitrator’s
finding that the approach to arbitration was the path towards the
creation of fresh rights. In my view, the arbitrator’s
conclusion that the dispute is one of interest is a reasonable one
when considered within the factual matrix of this case read
with the
law. This Court has stated that a
dispute
of interest does indeed concern the creation of new rights or the
diminution of existing rights and that a dispute of right
concerns
existing rights.
Gauteng
Provincial Administrasie v Scheepers
12
.
In general, disputes of right can be defined as being concerned with
the infringement application or interpretation of existing
rights
contained in a contract of employment, a collective agreement or a
statute such as the Labour Relations Act. Disputes of
interest
generally relate to the creation of new rights or the elimination of
existing rights and are resolved, ordinarily by collective
bargaining, failing which the exercise of social power
13
.
[31] The approach to arbitration in
the context of this matter was clearly akin to the initiation of
strike action to garner higher
and better salaries. The arbitrator's
conclusion in similar vein is, in my view, properly countenanced by
section 74 in the context
of this matter. In this regard the argument
that the dispute was not a typical wage dispute, but one that was
concerned with whether
the appellants were entitled to higher
salaries, and therefore not of interest, is clearly misconceived.
[32] In relation to the arbitrator’s
conclusion that the regulations did not bind him, he clearly
considered the effect of
the regulations on his powers in the context
of section 74(5) as has already been pointed out. This section
provides for conciliation
and arbitration of disputes in the public
sector involving essential service designated parties, subject to the
final oversight
of Parliament. It is proper at this juncture to make
the finding that Parliament, as we know it, has not considered the
funding
situation arising from the job evaluation process. It is
Treasury that considered the first respondent’s funding request
and rejected it. Treasury is not Parliament, and the arbitrator was
alive to this fact. It was on this basis that the arbitrator
reasoned
that he exercised a power different to that of the executing
authority in such matters.
[33] Regarding second-guessing
Treasury, the arbitrator, specifically acknowledged that he could not
do that, but that any award
made by him was sanctioned by section
74(5). Acknowledging the importance of the right to strike, to which
the resort to interest
arbitration is akin, the mechanisms set out in
section 74(5) as an alternative to strike action in the form of
compulsory interest
arbitration, cannot be treated as ineffectual or
toothless. In
SANDU v Minister of Defence and others
this was
expressed in the following terms:
‘
Secondly,
proceedings before an arbitrator are remarkably akin to a process of
bargaining...This is a well-known phenomenon in the
civil courts and
other forums, flowing from the fact that each party would rather
negotiate an outcome that is more or less acceptable
to it than be
faced with a less acceptable outcome imposed by an outside
decision-maker...But it is certainly not true to say that
the
arbitration option is so feeble a remedy that it cannot serve as a
substitute for the economic pressure that would ordinarily
set the
bargaining process in motion'
14
.
[34] Indeed, as
argued by the appellants, if spending constraints on the executive
authority, together with the regulations applicable
to a job
evaluation exercise were interpreted in this way (which was equally
applicable to an arbitrator determining a dispute
of interest with
financial implications under section 74) this would substantially
dilute the right to invoke the section 74 arbitration
mechanism. The
consequent effect would be that the outcome of such arbitrations
would be a foregone conclusion in line with departmental
budgetary
constraints. Strike action is universally acknowledged as a powerful
weapon in the hands of employees when bargaining
with their employer
for higher wages and other benefits.
Adopting
the interpretation advanced by the respondents to the section 74
alternative to strike action in the form of interest arbitration
in
essential services designated situations, as we have in this matter,
would indeed be inimical to the proper exercise of this
right.
15
[35] The respondents’ arguments
are to my mind premised on a clear misconception of the regulations
vis a vis the powers of
the arbitrator when viewed in the context of
section 74.
[36] It is clear in this case as
reasoned by the arbitrator that if the executing authority was unable
to comply with the award
he was enjoined by section 74 (5) to table
it before Parliament. It is only then that Parliament could consider
the award and the
job evaluation process as a whole and take a view
whether it authorised the additional funds required to implement the
job evaluation
recommendations or take a decision that the award did
not bind it. A key consideration for Parliament in this regard would
be the
motivation for embarking on the job evaluation process. In the
first place, there was the wide spread threat of industrial action
within the NPA's ranks fuelled by low moral due to low salaries and
benefits. This is well articulated in the memorandum prepared
by the
NPA motivating for the additional funds it requested from Treasury.
This memorandum testifies to the fact that all the parties
involved
in this matter were all at one that the recommendations were
justified.
[37] Considered properly, the
regulations and the unavailability of funds presented no impediment
to the arbitrator making an award
in the terms he made. The
regulations were put as a controlling measure against executing
authorities. The arbitrator’s reasoning
is clear, that rather
than incur unbudgeted expenditure, an executing authority confronted
with an abnormal situation, such as
a strike or an award, as we have
here, had the option of approaching parliament to approve a
supplementary allocation to augment
his budget in order to enable him
to meet the dictates of the award.
[38] Bearing in mind the standard to
which an award of the nature we are dealing with here has to comply,
it is clear from the record
before us that the arbitrator
exhaustively engaged with the regulations in particular, when
considering the matter. No criticism
can be levelled at him on the
basis that he did not bring to bear extensive analysis of the
regulations and the law. A reading
of the award shows that he
considered the regulations and dealt with these extensively. He also
took account of all the material
placed before him and properly
analysed it in a manner that a reasonable decision-maker considering
the matter would have done.
I am therefore of the view that the award
rendered by the arbitrator in this matter is beyond reproach and
eminently one that a
reasonable decision-maker would have arrived at.
In my view the Labour court erred in setting aside the award
[39] In the circumstances, the
following order is granted:
The appeal succeeds;
The order of the Labour Court is set
aside;
In its stead, an order is granted
that:
The application for review is
dismissed.
There is no order as to costs.
There is no order as to costs.
____________________
MLAMBO JP
DAVIS and JAPPIE JJA have concurred in
the judgment of MLAMBO JP.
APPEARANCES:
FOR THE APPELLANTS:
MSM Brassey SC
PA Burski
Instructed by : Bowman & Gilfillan
Inc
FOR
THE RESPONDENTS:
KS Tip SC
GI
Hulley
Instructed
by : The State Attorney
1
Act
66 of 1995 as amended.
2
Regulation
B.2, Part 1 read with Section 1(1) of the Public Service Act, 103 of
1994.
3
Act
42
of 1965.
4
Section
71 (7) and (8) reads as follows:– ‘After having
considered any written and oral representations, the essential
services committee must decide whether or not to designate the whole
or a part of the service that was the subject of the investigation
as an essential service.
(8) if that essential
services committee designates the whole or a part of the service as
an essential service, the community
must publish a notice to that
effect in the government Gazette.’
5
Section
74 in respect of Disputes in Essential Services provides:
any party to a dispute
that is precluded from participating in a strike or lockout because
that party engaged in an essential
service may refer the dispute in
writing to-
a council, if the
parties to the dispute fall within the registered scope of the
Council: or
…
…
The Council…
must attempt to resolve the dispute through conciliation.
If the dispute remains
unresolved, any party to the dispute may request that the dispute
be resolved through arbitration by
the council.
…”
6
Section
158(1) provides that ‘The Labour court may
...
(h) review any decision
taken or any act performed by the state in its capacity as employer,
on any grounds as are permissible
in law:’
7
This
argument is expanded upon in the heads of argument as follows:
‘
Again, that evidence directly reflects the
clear language of the regulation, which in turn gives explicit legal
content to a deliberate
(and consensual) government decision to
manage the substantial fiscal burden of job evaluation by linking
the implementation
of upgrades to the availability of funds. That
decision did not leave it open for the state to be compared by an
arbitrator to
source and assign additional funds. The arbitrator was
not empowered to substitute his decision for that made by the
government
and his flawed reasoning in this regard is not rescued by
the statement that Parliament could be reverse his award.’
8
2008
(2) SA 24
(CC); (2007) 28 ILJ 2405;
[2007] 12 BLLR 1097.
9
Fidelity
Cash Management Service v CCMA and Others
[2008] 3 BLLR 197
(LAC) at para 98.
10
[2011]
2 BLLR 129
(LAC) at para 17 where the court referring to
Carephone
(Pty) Ltd v Marcus
1999 (3) SA 384
(LAC) at para 37, stated:
‘
The
following
dictum
in
the latter judgment is helpful in order to illustrate the nature of
the test: “Is there a rational objective basis justifying
the
conclusion made by the administrative decision-maker between the
material properly available to him and the conclusion he
or she
eventually arrived at”’.
11
Afrox
Healthcare LTD v CCMA and Others
unreported LAC case no JA37/09;
SAMWU and Others v SALGBC and Others
unreported LAC case no
DA6/09.
12
[2000]
BLLR 756
(LAC) at para 8.
13
John
Grogan Collective Labour Law (2010) at 104.
14
2007
(1) SA 402
(SCA) at 416 para 24.
15
In
Re: Certification of the Constitution of the Republic of South
Africa
1996 (10) BCLR 1253
(CC) at
para 66
where this is stated –
‘
Collective bargaining is based on the recognition of
the fact that employers enjoy greater social and economic power than
individual
workers. Workers therefore need to act in concert to
provide them collectively with sufficient power to bargain
effectively with
employers. Workers exercise collective power
primarily through the mechanism of strike action.’