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[2013] ZALAC 4
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South African Municipal Workers Union and Others v City of Johannesburg Metropolitan Municipality (JA 48/10) [2013] ZALAC 4; (2013) 34 ILJ 1944 (LAC) (21 February 2013)
REPUBLIC OF SOUTH
AFRICA
THE LABOUR APPEAL
COURT OF SOUTH AFRICA, JOHANNESBURG
Reportable
Case no: JA 48/10
In the matter between:
SOUTH AFRICAN
MUNICIPAL WORKERS’ UNION
..................................
First
Appellant
TE CHAANE & 31
OTHERS
............................................
Second
and further Appellants
and
CITY OF JOHANNESBURG
METROPOLITAN
MUNICIPALITY
..................................................................
Respondent
Heard: 10 May 2012
Delivered: 21February
2013
Summary: Rectification
of a settlement agreement- whether it was the intention of the
parties to continue with the payment of the
“loco allowance”
in addition to the new salary package.
-
onus
on
appellants to adduce evidence supporting their entitlement to
rectification- appellant failing to present such evidence- Appeal
dismissed.
JUDGMENT
WAGLAY AJP.
Introduction
[1] The issue in this
appeal is whether the appellants are entitled to rectify the
agreement concluded between the first appellant
and the respondent so
as to reflect that the second to further appellants (hereafter “the
employees”) would continue
to receive as part of their
remuneration an allowance referred to as a “locomotion
allowance”.
Background
[2] The employees were
promoted from the positions of superintendents to the positions of
chief superintendents in the respondent’s
Metropolitan Police
Department. The new positions carried with them an all-inclusive
remuneration package and a motor vehicle was
no longer required to
carry out the duties attached to the new position. The employees were
therefore required to return the motor
vehicle supplied to each of
them by virtue of their past positions.
[3] After taking up their
new positions with the all-inclusive remuneration package, the
employees formed the view that their promotion
placed them in a worse
financial position. They thus made proposals to the respondent to be
paid a “special locomotion allowance”.
This allowance
would ostensibly fund the purchase of a motor vehicle by each of the
employees.
[4] The respondent
investigated the employee’s complaint and sought advice from
Human Resources Consultants. The recommendation
it received was that
the employees be paid a locomotion allowance (“loco allowance”)
of R6000.00 per month to compensate
for the loss of their “company
motor vehicle”. The recommendation was placed before the
respondent’s city manager,
Mr. Moloi. Mr. Moloi was of the view
that the proposal was reasonable and decided that it be implemented.
He sent a letter to this
effect to Mr. Ngcobo who was the chief of
the Metropolitan Police Department and the employees’ immediate
superior. Mr. Ngcobo
was unhappy with this proposal and met with Mr.
Moloi to explain that on a consideration of all the facts and
circumstances relating
to the employees promotion a car allowance
should not be paid to the employees. According to Mr Ngcobo, there
were principally
two reasons why the respondent should avoid paying
the employees a car allowance: (i) because the employees did not
require a motor
vehicle to discharge their duties as chief
superintendents; and, (ii) because the employees were aware at the
time of their promotional
appointment that they would only receive an
all inclusive package and no car allowance or a car to carry out
their duties. Mr Ngcobo
did however suggest that the employee rather
be given an increase in their salary of about R11 500.00 per annum.
Mr. Moloi accepted
Mr Ngcobo’s reasons and suggestions and
rescinded his decision to pay the employees a car allowance, and
recommended an increase
of R11 750.00 per annum for each of the
employees.
[5] The appellants were
of the view that because Mr. Moloi had initially agreed to pay them a
car allowance of R6000.00 per month,
his withdrawal thereof
constituted an unfair labour practice. They thus raised a grievance
against the respondent. The parties
failed to resolve the dispute
which was then referred to the relevant Bargaining Council first for
conciliation and thereafter
for arbitration.
[6] The award issued by
the arbitrator was to the effect that the respondent should pay to
each of the employees the sum of R6 000.00
per month as a car
allowance. The respondent, dissatisfied with the award, applied to
have it reviewed and set aside in the Labour
Court. The Labour Court
set aside the award for various reasons and referred the dispute back
to the Bargaining Council to be arbitrated
afresh. A new arbitration
was held and an award similar to one previously made was handed down.
[7] The respondent again
applied to the Labour Court to review and set aside the new award.
[8] While the dispute was
going through its various stages, to appease the dissatisfaction
within the respondent’s metropolitan
police service, the
respondent made all kinds of attempts to address the issue. The one
constant was that the respondent was not
prepared to pay a car
allowance to the employees. One of the reasons for adopting this view
was respondent’s fear of opening
the “flood gates”,
as every employee who did not need a vehicle to discharge his/her
duties would then claim or demand
a car allowance. The respondent
attempted to accommodate the employees’ demand/grievance
initially (as recorded above) by
increasing their annual salary by
R11 750.00 (about R1000.00 per month) thereafter by increasing their
salary yet again by a further
R4 800.00 per month. Also in order to
make the salary package more “tax-efficient”, the
respondent agreed to allow
a portion of their salary to be labelled a
car allowance. This meant that although the employees did not receive
a car allowance
their payslip reflected a basic salary and a car
allowance (referred in their payslip as a “loco allowance”).
The car
allowance attracts a lower tax rate than the normal salary
hence the employee received a benefit in the form of getting extra
cash
by paying less tax on their salary.
[9] The result was that
in attempting to accommodate the employees’ complaint about
being financially worse off after accepting
their promotions, the
respondent gave them certain increases to address their complaint
(this amounted to about R5 800 per month)
and allowed them to
structure their remuneration package in a way that would give the
employees an additional benefit.
[10] By June 2007, the
salaries of the affected employees were structured as follows:
29 employees: salary
component R17886.44 loco allowance R6835.00
1 employee: salary
component R16488.01 loco allowance R7303.22
1 employee: salary
component R21190.16 loco allowance R5673.00
1 employee: salary
component R24958.37 loco allowance R6000.00
[11] The total
remuneration package of the 32 employees thus varied from R23 791.23
to R30 958.37 per month or R285 494.76 to R371
500.44 per annum.
[12] By June 2006, it had
been five years since the dispute was raised and the end through the
legal process still seemed nowhere
in sight. The respondent’s
application to review and set aside the second arbitration award had
also hit a serious obstacle.
The record of the arbitration
proceedings could not be found and the parties had to get together to
reconstruct the record. By
this time the respondent’s city
manager, Mr. Moloi, was replaced by one Mr. Mavela Dlamini and
everyone was now desirous
of resolving this long outstanding dispute.
[13] Negotiations were
held between the parties but not a single piece of paper evincing a
minute of a meeting between them was
presented to the Court.
[14] A settlement
agreement was eventually concluded. This agreement once and for all,
settled the dispute relating to the locomotion/loco/car
allowance for
the employees. The relevant parts of the agreement record the
following:
‘
MEMORANDUM
OF AGREEMENT AND SETTLEMENT
Entered into between:
City of Johannesburg Metropolitan
Municipality
And
South African Municipal Workers
Union
(Jointly referred to as the
Parties)
Whereas the South Africa Municipal
Workers Union, (SAMWU) has on behalf of their members made demands on
the City of Johannesburg
per a petition of demands of the 23 May
2006; and
Whereas there are material issues that
have been referred to the Labour Court relating to the payment of
allowances to 32 employees.
Mainly Chief Superintendents, in the
service of the City at Johannesburg Metropolitan Police Department
have been in dispute with
the city for a long time.
Now therefore
The parties herein confirm that they
have each been legally and appropriately mandated to enter into the
said settlement agreement.
The parties therefore wish to settle
the disputed matters, being the intended review by the Labour Court
and other demands petitioned
to the city, as follows:-
1.to 6.
7.
The parties herein resolve and agree
to settle the dispute regarding the demand for review of remuneration
of Chief Superintendents
as follows:
8.
The City pays in full and final
settlement of the dispute an amount of R5.8m (five million eight
hundred thousand Rand) including
previous payments and the Chief
Superintendents will be placed at a salary package of R290.000 per
annum effective from the 1 March
2006 (which translates to R24
166.66); and further that no additional allowance in respect of the
disputed locomotion allowance
shall be considered or paid to the said
category of employees.
(my emphasis)
That on receipt of the aforementioned
payment both the City and the Union agrees that this will constitute
a full and final settlement
between the parties.
The parties agree that the original
award will be superceded and nullified by this signed settlement
(and that neither of the
parties will not use the award or this
agreement as a precedent for other cases that may arise).
It is further agreed that, this
settlement agreement may be made an order of court in terms of
section 158 of the LRA No. 66 of
1995 as amended.
No representation other than what is
contained herein will be binding unless reduced to writing and
signed by the two parties.
No variation, amendment or deletion
will be binding on either party unless reduced to writing and signed
by the two parties.
9.
That notwithstanding anything to the
contrary, the parties agree that the employees affected shall waive
and have no further recourse
for any differentiated salaries,
benefits or allowances on the basis such as experience,
qualifications length of service etc given
the single benchmark
envisaged and agreed to herein, unless expressly agreed to as part of
the natural progression of staff in
future years.
10. to 13.
[Signed by both parties
]
’
[15] According to the
respondent, in terms of the agreement the employees would be paid a
lump sum amount in respect of car allowance,
and would receive a new
monthly all-inclusive salary of R24 166.66 with no car allowance. The
employees aver that, other than the
lump sum, the agreement in fact
provides for a monthly salary of R24 166.66 plus the monthly “loco
allowance” in the
amount as reflected on their payslips prior
to the conclusion of the agreement.
[16] The respondent
refused to pay the employees the monthly loco allowance and the
appellants thus instituted an action against
the respondent for
payment thereof. The appellants claimed that the respondent was in
breach of the agreement by failing to pay
the employees their monthly
loco allowance. The appellants further contended, that in the event
it is found that the agreement
does not provide for the continued
monthly payment of their loco allowance, then the appellants seek
rectification of the agreement
to reflect the respondent’s
obligation to pay the monthly loco allowance as this was the common
intention of the parties
at the time the agreement was concluded.
The Labour Court
[17] The Labour Court
(Van Niekerk J) dismissed the action on the grounds that the
respondent had not breached the agreement and
had, in fact acted in
accordance with the terms thereof. On the alternative claim for
rectification, the Labour Court held that
the appellants had failed
to establish that the agreement did not reflect the common intention
between the parties and refused
rectification of the agreement.
[18] The appellants’
application for leave to appeal was refused, as was its petition to
the Judge President of this Court.
The appellants’ leave to
appeal to the Supreme Court Appeal (SCA) was partially successful in
that the SCA granted the appellants
leave to appeal to this Court
only in respect of the appellants’ alternative claim, that of
rectification of clause 8 of
the agreement.
The Appeal
[19] What this Court is
required to determine is whether the parties had in fact intended, or
put differently, had the common intention
to pay and receive, in
addition to the new agreed salary, the loco allowance which the
employees were being paid at the time. In
other words, the
appellants’ seek to rectify the agreement to reflect a change
in the words “salary package of R290
000.00 per annum” to
read “a basic salary package of R290 000.00 per annum”.
[20] An agreement more
often is a product of compromise between two or more parties. In most
cases, it is embodied in a written
document which records the
compromise made and is held up as an enforceable deal. The written
agreement is therefore conclusive
as to the rights and obligations of
the parties. Where the rights and obligations set out in the
agreement are clear and unambiguous,
the rule is that no external
factors can play any role in interpreting the terms of the agreement,
nor will any evidence be entertained
to impose additional or
different rights and obligations different to what is clearly
understood by a plain reading of the agreement.
1
A written agreement that
is clear and unambiguous stands as an agreement cast in stone which
can neither be moved nor can any inroads
made into it. Likewise the
fluidity of changing conditions and evidence cannot dilute the rights
and obligations embodied in a
written agreement.
[21] There are however
circumstances where the written agreement, clear and unambiguous as
it is, does not record and reflect the
true agreement between the
parties. Where this is the case the parties are entitled to
rectification of the agreement. Generally,
where terms that were
agreed upon are omitted or, terms not agreed to are added to the
written agreement, then a party to the agreement
can seek
rectification of the written document so that it records and reflects
the true and proper agreement that was concluded
between the parties.
[22] In this matter, the
appellants seek rectification of the written agreement to reflect
that the employees would, in addition
to the new salary package of
R290 000.00 per annum, continue to receive the amount paid to them as
a “loco allowance”,
as this was, according to the
appellants, the common intention of the parties. The respondent
disagrees. The respondent avers that
there was no intention on its
part to continue making the “loco allowance” payments and
that the new salary package
of R290 000.00 per annum constituted the
all-inclusive package of the employees. According to the respondent,
the document as it
stands properly reflects the agreement between
them.
[23] The duty falls upon
the appellants to satisfy this Court by presenting evidence that can
demonstrate in clear and satisfactory
manner the contentions made by
them to support their entitlement to rectification. In
Bardopoulos
and Macrides v Miltiadous
,
2
it was said:
‘
A party
seeking to obtain rectification must show the facts entitling him to
obtain that relief ‘in the clearest and most
satisfactory
manner’…and as it is pointed out in
Taylor
v Cape Importers
1938
CPD 362
at p368, where the common intention is to be shown not by any
writing but by verbal evidence, the Courts may have great difficulty
in determining whether there was a mistake in the written contract.
These cases do not, I consider, require more than a balance
of
probability in favour of the party seeking rectification but indicate
that such a claim is in fact difficult to prove’
[24] The above
dictum
was confirmed by the SCA
in
Soil
Fumigation Services Lowveld CC v Chemfit Technical Products (Pty)
Ltd
3
when it was said that:
‘
It is a
settled principle that a party who seeks rectification must show
facts entitling him to that relief ‘in the clearest
and most
satisfactory manner’ (per Bristowe J in
Bushby
v Guardian Assurance Co
1915 WLD 65
at 71; see also
Bardopoulos
and Macrides v Miltiadous
1947 (4) SA 860
(W) at 863 and
Levin
v Zoutendijk
1979
(3) SA 1145
(W) at 1147 H-1148A). In essence, a claimant for
rectification must prove that the written agreement does not
correctly express
what the parties had intended to set out therein.
(See e.g
Meyer
v Merchants’ Trust Ltd
1942
AD 244
at 253).’
[25] As I have said
earlier in this judgment, there is not a single minute setting out
the discussions, debates, agreements and
disagreements that took
place at the various meetings that were held between the parties. The
only documents that were presented
to the court
a quo
were:
(i) the proposals made by the appellants to the respondent to settle
the dispute (this document is of little relevance as
it purports to
be an “unmandated” proposal made by the union); and (ii)
the document dated 8 June 2006 headed “
Proposal to settle
dispute: SAMWU obo members vs. City of Johannesburg”
(hereafter
referred to as the “Mayoral Committee document”). The
Mayoral Committee document records the following:
‘
1. STRATEGIC
THRUST
Service Delivery Excellence and Good
Governance
2. OBJECTIVE
The purpose of this report is to
obtain approval from the Mayoral Committee to offer a financial
settlement to SAMWU in an attempt
to resolve a long outstanding
dispute.
3. BACKGROUND
The Chief Superintendents in the
Johannesburg Metropolitan Police Departments (Herein after referred
to as JMPD) are an integral
part of management and carry out the
responsibility of ensuring that the operations of JMPD continue
uninterrupted.
This category of employees raised a
grievance with the City represented by the South African Municipal
Workers Union, (Hereinafter
referred to as SAMWU) relating to payment
of loco allowances, which is dealt with in terms of the City’s
grievance procedure.
Having not resolved this grievance at local
level, it was elevated to the City Manger, Who appointed Messrs,
Mavuso and Lebelo
to deal with this matter in his behalf.
A recommendation was submitted to the
City manager in October 2002 to grant the said employees an increase
in salary in an attempt
to resolve the grievance. However, they
remained dissatisfied and declared a dispute and referred the matter
for adjudication with
the South African Local Government Bargaining
Council (Hereinafter referred to as SALGBC) on 28 October 2002.
In line with the SALGBC, the matter
was set up for conciliation on 23 February 2003 and remained
unresolved. SAMWU then referred
the dispute to arbitration, and the
matter was arbitrated upon on 30 May 2003 and a default award issued
in favour of SAMWU. The
City, looking at the adverse implications of
the award, applied to the Honourable Labour Court to review the
default award and
succeeded.
Arising from the successful review,
the matter was then arbitrated upon for by another arbitrator, who
awarded that the employees
be paid R6 000 loco allowance although the
nature of their work does not warrant travelling. The City was not
satisfied with this
award and applied to the Honourable Labour Court
to review the arbitration award in anticipation of it settling an
adverse precedent.
The parties are still waiting for a date on which
the review will be heard from the Honourable Labour Court.
In view of the length that his matter
has taken and is still likely to take i.e. since 2002, SAMWU
submitted a written proposal
to the City for consideration in October
2005 which the City acknowledged but was convinced at the time that
interests of the City
will be best served by not settling the dispute
outside the proceedings of the Honourable Labour Court as advised by
the City’s
attorneys.
However, there has been a rethink of
this approach as the dispute has affected the morale of the said
employees negatively and the
longer it takes to resolve this, the
more it affects service delivery in JMPD negatively. In line with the
new thinking, the Chief
of Police, the City manager and Corporate
Services met with SAMWU off the record in order to explore their
flexibility and whether
there is room to settle the dispute without
creating a precedent. The off-the-record discussions were positive;
hence the City
explored various options to propose to SAMWU with a
view to settle the dispute.
SCENARIO 1
This scenario is based on the
assumption of purely implementing the arbitration award
retrospectively, which implies that all the
Applicants be paid a
locomotion allowance of R6 000.00 retrospective to 28 October 2002,
being the date of the dispute referral.
The total cost of implementing the
arbitration award retrospectively is R 6 338 339.32
SCENARIO 2
This scenario is based on the
assumption derived from the SAMWU proposal where the City would pay
the employees a lump sum of R
5,8m once off and then pay them a
salary of R290 000.00pa backdated to 1 November 2002.
The total cost of implementing this
proposal is R 9 727 690.77
SCENARIO 3
This scenario is based on the
assumption that the City pays the Applicants R5.8m as once off only
and adjust their salary to R290
000pa from 1 March 2006. In addition,
the City proposes that the
amount already paid to the employees
during 2002 as recommended to the City manager as well as the R4 800
adjustment paid to them
in July be deducted from the total payable
(my emphasis)
.
The effect of the proposal in that the
City will pay a total of R3 060 991.97 in back pay to the Applicants
and place them on a
new scale of R 290 00pa going forward at an
additional cost of R190 403.39 per month as outlined in Annexure 4.
The settlement
will be based on the conditions outlined in the draft
counter proposal attached hereto as Annexure A; and will be reduced
to a
written agreement to be signed by the parties prior to effecting
any payments.
9. POLICY IMPLICATIONS
The effect of the arbitration award
of implementing a loco allowance for employees who are not required
to travel is problematic.
Hence the City approached the Honourable
Labour Court to preserve this important principle
(my emphasis)
The proposal in scenario 3 addresses
the shortcomings and is viable as it does not create an unsustainable
precedent.
10. LEGAL AND CONSTITUTIUONAL
IMPLICATIONS
None other than those covered in the
settlement agreement.
11. FINANCIAL IMPLICATIONS
The financial implications of the
proposed settlement are R3 060 991.97 and an additional R 190 403 per
month as depicted in this
report in scenario 3. A savings in the
consolidated City budget has been identified to fund the settlement
cost.
12. COMMUNICATION IMPLICATIONS
None
13. ITS IS RECOMMENDED
That the City manager be authorised to
negotiate and finalise the said matter in the context of the
framework detailed in the body
of the report (scenario 3) and with
due regard to stabilising the industrial relations environment in the
City of Johannesburg.’
(the numbering is as appears in the
original document).
[26] There is an annexure
to the above document which sets out the quantification of the
various scenarios. As regards scenario
3 which is the one that
relates to this matter, the annexure is divided into nine columns
marked A to I.
columns A to C set out
the details of the employees;
column D sets out the
settlement amount in respect of each of the employees (This being
the sum of R181 250.00 to each of the
employees amounting to a
total of R5.8million);
column E sets out the
amount that each of the employees had already received up to the
date of settlement. The amount in this
column would be deducted
from the R181 250.00 reflected in column D (The amount here was the
sum of R 85 569.26 made up of
the R 11 750.00 per annum and the
later addition of R 4800.00 per month paid to the employees in lieu
of the car-allowance
– see the highlighted portion of
scenario 3 as appeared on respondent’s settlement proposal);
column F was the amount
which each employee would receive as a lump sum to make up the
amount set out in column D (the amount
here was the sum of R 95
680.74);
column G shows the
“Proposed new basic salary of R290 000.00 per annum”
(this column reflects the sum of R 24 166.66
a month);
column H reflects the
employees current earnings as it appears on their payslips and did
not include the “loco allowance”
that they were
receiving at the time; and lastly,
column I reflects the
increase in salary that each of the employees would be paid in
order to earn a salary of R 24 166.66 a
month or R 290 000.00 per
annum.
finally, at the bottom
of the page there is a table which indicates what the settlement
would cost the appellant , it records:
Amount F R3 060 991.97
Amount I for 4 months
R761 613.56
Grand total 2005/6 R3
822 605.53
[27] The quantification
document that was finally attached to the settlement agreement was
the same as the above document save for
one important change. Column
G in the document attached to the settlement agreement was headed
“Proposed new total salary
of R290 000” and not “Proposed
new basic salary of R290 000” as was the case in the
quantification document attached
to the Mayoral Committee document.
[28] At the trial, Mr
Langa gave evidence on behalf of the appellants. His evidence was to
the effect that he had a number of meetings,
some formal some
informal, to resolve this matter. He said that he never raised the
issue of the car-allowance at these meetings
because when the
car-allowance was mentioned the respondent would not engage them in
discussions. He said that while the agreement
properly recorded the
settlement, in essence, the purport of the settlement was that the
loco-allowance that the employees were
receiving as reflected in
their payslips would continue unaffected. There was therefore in his
view, no need to deal with that
issue in the written agreement. He
added, that the appellants and respondent were in agreement with this
otherwise it would mean
that the appellants had negotiated a
reduction in salary as the “loco-allowance” paid to the
employees (R6835) was
more than the increase (R6280). Furthermore,
and reading the settlement agreement with the Mayoral Committee
document, it is clear
that the respondent envisaged that the new
salary structure would lead to an additional costs R190 403.39 per
month. Therefore
if the “loco-allowance” were to cease it
would not lead to additional costs being incurred by the respondent
but it
would have led to a saving. This he said demonstrated their
view that the “loco-allowance” was not affected by the
agreement and that the appellant would continue making that payment.
[29]
Mr Ngcobo, who testified on behalf of the respondent, denied that the
negotiations and the ultimate settlement were supposed
to leave
unaffected the payment of the “loco-allowance”. He said
that the negotiations were to resolve the issue of
the car-allowance.
The R5.8million lump sum and the new salary must be seen in that
context. From the outset, the respondent did
not want to pay the
employees a car allowance, but it was prepared to make payment in its
stead to minimise the negative impact
the removal of the company car
had on the employees’ salaries. He added that the lump sum
payment of R5.8million was to take
care of the negative impact of the
loss of the car, and the new salary of R290 000 per annum ensured
that the employees were now
at an acceptable level of earning. He
said it was never intended that the respondent would continue paying
the employees the “loco-allowance”
as this would mean
that the employees would receive two car allowances: the lump sum and
an additional monthly amount. The negotiations
would make no sense;
because it would then have been cheaper to simply implement the
arbitration award. Lastly, his evidence was
that the new salary was
effective from 1 April 2006 as that is when salary increases
generally came into effect and because the
agreement was only
concluded in July 2006 the employees were to receive back pay for
four months (between April to July). The back
pay amounted to the sum
of R 761 613.56 as reflected in the quantifying document, being the
monthly increase of R190 403.39 X4
months.
4
[30] Appellants’
argument is that with an arbitration award in their favour there was
no reason for them to negotiate a settlement
of the dispute which
could result in the employees receiving a monthly salary package of a
lesser amount than they were receiving
prior to the settlement. They
had not done so and thus the respondent accepted that the
“loco-allowance” paid to the
employees would continue.
They referred to the Mayoral Committee document and the annexure
setting out quantification of the settlement
which records that
implementing the settlement proposal would add an additional cost of
just over R190 403.39 per month in support
of the argument.
[31]
The above argument would be compelling but for the fact that it
completely ignores the lump sum payment of just over R180 000.00
made
to each of the employees. Furthermore, and having regard to the
Mayoral Committee document and the quantification attachment,
the
increases in salary that the employees received,
in
lieu
of
the car allowance, originally in the sum of R11750.00 per annum (just
under R1000.00 a month) and later a further sum of R4800
per month
amounting to about R5800.00 was to be deducted from the lump sum
payment. This to my mind means that with the payment
of the lump sum,
the employees would no longer receive the R5800.00 they had been
receiving at the time. Hence, it cannot be said
that the settlement
resulted in a reduction of the employees’ monthly salary.
Furthermore, there is merit in the respondent’s
argument that
payment of the lump sum and the continued payment of the
“loco-allowance” that the employees were receiving
would
have meant that the employees would be receiving a double car
allowance. It is not probable that this is what the respondents
intended.
[32] With regard to the
increased costs of R190 403.39 per month, here again, there is no
evidence that this was to be an on-going
monthly increase or whether
the quantification document was to be read to mean that this costs
was to be limited to a period of
four months
5
between the period of the date of implementing the increased salary
and the date of the signing of the settlement agreement. Furthermore,
nothing is said as to why or how it came about that the heading of
Column G of the quantification document attached to the final
settlement document was “total salary” and not “basic
salary” as in the earlier document.
[33] It was further
common cause that the respondent was from the outset against paying
the employees a car allowance. This is in
fact what gave rise to the
grievance. The fact that the respondent maintained this view is
confirmed in the Mayoral Committee document
under the heading “Policy
Implications”, which states that the reason why the respondent
sought to set aside the arbitration
award was because for the
respondent “implementing a loco allowance for employees who are
not required to travel is problematic”
[34] In the
circumstances, the appellants have failed to get off the starting
blocks to satisfy this Court that, on a balance of
probabilities,
both the appellants and the respondent when signing the settlement
agreement were of like minds, holding the view
that the
“loco-allowance” that was being paid to the employees
would continue to be paid. The issue of rectification
therefore does
not arise.
[36] In the result, I
make the following order:
‘
The
appeal is dismissed with costs’.
__________________________
Waglay AJP
I agree
____________________________
Leeuw JA
I agree
____________________________
Murphy AJA
APPEARANCES
FOR THE APPELLANTS: Adv B
Du Plessis SC
Instructed by Cheadle
Thompson & Haysom
FOR THE RESPONDENT: Adv P
Kennedy SC
Instructed by Bowman
Gilfillan Inc
1
Extrinsic
evidence can be brought in to deal with issues that do not
contradict the terms of the agreement for eg. Whether it
is properly
signed. See
SAI Investments v Van Der Schyff NO
1999 (3) SA
340
(N) see also
Telcordia Technologies Inc. v Telkom SA
Ltd
[2006] ZASCA 112
;
2007 (3) SA 266
(SCA) at paragraph 115.
2
1947
(4) SA 860
(W) at 863-4.
3
2004
(6) SA 29
SCA para 2 at 38J to 39B.
4
See
paragraph 26 above.
5
At
the bottom of the quantification document when costing the total
settlement costs the sum of just over R190 000 was calculated
only
over a period of four months.