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[2014] ZALAC 6
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Solidarity obo Wehncke v Surf4Cars (Pty) Ltd (JA63/11) [2014] ZALAC 6; [2014] 7 BLLR 702 (LAC); (2014) 35 ILJ 1982 (LAC) (20 February 2014)
REPUBLIC OF SOUTH
AFRICA
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA
HELD
AT JOHANNESBURG
REPORTABLE
CASE NO: JA63/11
In the matter between:-
SOLIDARITY
obo JA
WEHNCKE
Appellant
and
SURF4CARS
(PTY) LTD
Respondent
Delivered:
20 February 2014
Flynote
:
Automatically unfair dismissal – Dismissal to compel employee
to accept
demand (section 187 (1) (c) of LRA 1995) –Difference
between such dismissal and dismissal defined in section 186 –
Test whether dismissal conditional or irreversible – Dismissal
based on Employee’s refusal to accept a contract of employment
embodying a term which is necessary for employer’s operational
requirements not automatically unfair.
JUDGMENT
ZONDI,
AJA
Introduction
[1] This appeal, which is
with leave of the Court
a quo
, is against the whole of the
judgment and order handed down on 13 July 2011 by Lagrange J
dismissing the appellant’s automatically
unfair dismissal claim
as contemplated by section 187 (1) (c) of the Labour Relations Act 66
of 1995 (the LRA) and the learned
judge’s failure to consider
the appellant’s alternative claim of unfair dismissal. The
basis of the Court
a quo’s
decision was that the
appellant had failed to satisfy it on a balance of probabilities that
the purpose of his dismissal was to
compel him to sign a contract
incorporating a term which the appellant alleged sought to amend the
terms of his employment.
[2]
The crisp questions for determination are whether the allegations
contained in the appellant’s statement of case read
with the
averments in the affidavit in support of a default judgment are
sufficient to found the appellant’s claim of automatically
unfair dismissal as contemplated by section 187 (1) (c) or for that
matter, an alternative claim for unfair dismissal and whether
the
Court
a
quo
had jurisdiction to consider the alternative claim for unfair
dismissal falling within the ambit of section 188 (1) of the LRA
[1]
.
Facts
[3] It is common cause
that the appellant was employed by the respondent as a Data
Capturer/Photographer in terms of a verbal agreement
he concluded
with the respondent in or about October 2007. Part of his duties
included marketing the respondent’s brand which
involved
travelling to the respondent’s clients and for that purpose the
respondent provided the appellant with a company
vehicle branded with
its logo. According to the appellant when the motor vehicle was made
available to him for his use the respondent
did not impose any
restrictions on its use and in particular that he would be required
to pay the excess amount should the vehicle
be involved in a
collision.
[4] On or about 3 March
2008 the respondent presented to the appellant a written agreement
embodying the terms which the respondent
proposed were to govern
their employment relationship and by which the respondent sought to
regulate the use of its vehicle by
the appellant.
[5] One of the terms of
the contract required of the appellant to undertake that he would be
responsible for the payment of the
excess amount should the
respondent’s vehicle be involved in a collision. The appellant
strongly objected to the inclusion
of this term in the contract of
employment on the basis that it was “
too vague
”.
The appellant requested the respondent to remove the relevant
offending term from the contract but the latter refused.
The
appellant refused to sign the contract unless the offending term was
removed. The respondent responded by giving him an ultimatum
to sign
the contract on or before 28 April 2008 or else face dismissal. The
appellant ignored the ultimatum and refused to sign
the contract. His
refusal to comply with the ultimatum prompted the respondent to
terminate the appellant’s service by giving
him one month’s
notice in a letter dated 2 June 2008.
[6] The letter reads
thus:
EMPLOYMENT
CONTRACT: USE OF COMPANY MOTOR VEHICLE
1.
Your letter dated 29 April 2008
refers.
2.
During February 2008 we issued the
Companies Employment Contract containing the Terms and Conditions of
Employment and the use of
a company car for your acceptance and
signature.
3.
Notwithstanding (sic) several
requests on numerous occasions, as noted on meeting agendas, that you
acknowledge the terms and conditions
and return the contract, you
purposely delayed accepting and returning the contract to Surf4Car.
To date we have not received the
signed contract from you.
4.
It is company policy that company
motor vehicles can not be used by employees whether on probation or
not without acceptance of
the terms and conditions for the use
thereof.
5.
Surf4Car can not allow the further
use of its motor vehicle by you and Head Office instructed that you
return the Company Ford KA
registration number (……..)
with immediate effect (02 June 2008) before 12h00 to Surf4Car,
Wingate Glen, Rubenstein
Road 701, Moreleta Park, Pretoria.
6.
You are aware, that due to the
marketing aspect of the work, it is imperative that duties are
performed with a Surf4Car branded
car and that you will not be able
to execute your duties as expected.
7.
Hereby, Surf4Cars gives you a one
month’s written notice, whereby you can use your own vehicle to
conclude your duties. Your
last day at Surf4Cars will then be Monday
30 June 2008.”
Proceedings in the
Court
a quo
[7] The appellant
referred the dispute to the Court a quo alleging that the
respondent’s decision to terminate his services
constituted an
automatically unfair dismissal as envisaged by section 187 (1) (c) of
the LRA in that the purpose of the dismissal
was to compel him to
accept the contract of employment incorporating the term to which he
objected. As relief the appellant sought
an order declaring that his
dismissal constituted an automatically unfair dismissal as envisaged
by section 187 (1) (c) and ordering
the respondent to pay him the
maximum amount of compensation provided for by the LRA. In the
alternative he sought an order declaring
that his dismissal was
substantively and procedurally unfair. The allegations
underlying the appellant’s alternative
claim were, however, not
pleaded in the appellant’s statement of claim.
[8] The respondent did
not oppose the matter and upon the expiry of the time provided for
the filing of a statement of defence the
appellant, as he was
entitled, set the matter down for default judgment.
[9] In the affidavit
which he filed in support of the request for default judgment the
appellant sought
inter alia
an order in the following terms:
“
5.1
ORDER
that
the Applicant’s dismissal amounted to an automatically unfair
dismissal as envisaged by section 187 (1) (c), ordering
the
Respondent to pay the maximum amount of compensation provided for by
the Act, alternatively that should the Honourable Court
find that the
dismissal was not automatically unfair find the dismissal to be
substantially and procedurally unfair and award compensation
.”
[10] The Court
a quo
in determining the issues before it followed the approach as set out
by this Court and the Supreme Court of Appeal (the SCA) in
National
Union of Metalworkers of SA and Others v Fry’s Metals (Pty) Ltd
(2005) 26 ILJ 689 (SCA) and
Fry’s Metals (Pty) Ltd v
National Union of Metalworkers of SA
(2003) 24 ILJ 133 (LAC) in
which cases the meaning of automatically unfair dismissal was
considered. It held that in order to succeed
in his claim based on
section 187 (1) (c) the appellant had to demonstrate on a balance of
probabilities that the respondent was
threatening him with dismissal
in order to get him to accept a new term of employment (the condition
attached to the use of the
respondent’s vehicle).
[11] The Court
a quo
found that the appellant’s own initial written response to the
request to sign the contract of employment did not suggest
that his
problem was that the respondent was imposing a new term which had not
previously been agreed upon. It further found that
the appellant’s
description of the conditions of the company car usage tended to
support the interpretation that it was already
part of existing
company policy and not an amendment of it. And finally it found that
even if the conditions attaching to company
car usage had amounted to
an alteration of the appellant’s orally agreed terms of
employment, his dismissal was not conditional
in the narrow sense
meant by the SCA in
Fry’s Metals supra
. It reasoned that
there was nothing in the appellant’s statement of case, as
confirmed on affidavit, which demonstrated that
the respondent made
it clear that the appellant would be reinstated if he signed the
contract.
[12] The Court
a quo
concluded that the appellant had failed to demonstrate that the
reason for his dismissal was to compel him to comply with a demand
to
amend his term of employment. It held accordingly that the reason for
the appellant’s dismissal was not automatically
unfair in terms
of section 187 (1) (c) and dismissed the appellant’s claim with
no order as to costs.
The appellant’s
case
[13] The findings and
conclusions of the Court
a quo
were challenged by the
appellant on various grounds. There are, however, two main bases upon
which the appellant’s attack
on the Court
a quo
’s
judgment is based. First, he contends that the Court
a quo
erred in finding that the appellant’s evidence in support of
his claim under section 187 (1) (c) was insufficient. His second
leg
of attack relates to the Court
a quo’s
failure to
consider his alternative claim.
[14]
In relation to the second ground the Court
a
quo
in granting leave to appeal conceded that it had in error, not
considered the appellant’s alternative claim in the judgment.
It, however, pointed out that the Labour Court does not have
automatic right to determine a dispute over a substantively and
procedurally
unfair dismissal, and may only do so with the agreement
of the parties in terms of section 158 (2) (b)
[2]
which procedure was not available to it in view of the fact that the
matter was before it for the purposes of granting a default
judgment
and that had it considered the appellant’s alternative claim an
appropriate course available to it would have been
to remit the
matter to an appropriate forum for arbitration in terms of section
158 (2) of the LRA.
Applicable Law
[15] The appellant’s
main claim is founded on section 187 (1) (c) of the LRA which deals
with automatically unfair dismissals.
The section provides as
follows:
“
(1)
A dismissal is automatically unfair if the employer, in dismissing
the employee, acts contrary to section 5 or, if the reason
for the
dismissal is-
(a) ...
(c) to
compel the employee to accept a demand in respect of any matter
of mutual interest between
the employer and employee...”
[16]
It is common cause that what led to the termination of the
appellant’s employment was his refusal to sign a contract
of
employment which contained a term to which he objected. The term of
the contract to which the appellant objected is the following:
“
I
must advise you that should you have any accident in the vehicle, you
will be responsible for the excess amount
.”
[17] The appellant made
it clear to the respondent that he was not prepared to sign the
contract unless the clause which he considered
offensive was removed.
The parties deadlocked on the exclusion from the contract of the term
to which the appellant objected and
in consequence the respondent on
2 June 2008 terminated the appellant’s services by giving him a
month’s notice.
[18] The first question
posed in para 2 hereof should be determined within the prism of the
broader jurisprudence of this Court.
As indicated earlier in this
judgment in
Fry’s Metals supra
this Court and the SCA
considered the meaning of dismissal which is contemplated by section
187 (1) (c). The SCA held that a dismissal
would be automatically
unfair when such dismissal is effected for the purposes of compelling
the employee to agree to the employer’s
demand and such
dismissal is temporary, pending the acceptance of the changes to the
terms and conditions of employment.
[19] In the
Fry’s
Metals
case
supra
Zondo JP observed that there is a
difference between a dismissal as defined in section 186 (a) and a
dismissal as contemplated
by section 187 (1) (c) and that these two
categories do not overlap. In this regard he had this to say at para
31 of the judgment:
“
[31]
A dismissal for operational requirements fits
comfortably within the definition of 'dismissal' in s 186(a)
of the
Act. There may be an argument that a dismissal contemplated by s
187(1)(c) - especially if it is understood not to be final
- does not
fit comfortably within the definition of 'dismissal' in s 186(a).
This argument would be based on the notion that the
word 'dismissal'
as defined in s 186 does not refer to a dismissal that is not final
and that, wherever it appears in the Act,
it bears the meaning given
to it in s 186. The argument would be that to hold that the dismissal
that is contemplated in s 187(1)(c)
is not a final dismissal is to
give the word 'dismissal' in s 187(1)(c) a meaning that is different
from the meaning given to that
word in s 186(a). In my view the
difference between a dismissal as defined in s 186 and a dismissal
such as is contemplated by
s 187(1)(c) is that the latter dismissal
is required to be effected for the specific purpose given in s
187(1)(c) and that purpose
is absent in an ordinary dismissal such as
is defined in s 186(a). That purpose renders a s 187(1)(c)
dismissal a special
kind of dismissal. In the light of all the
above I conclude that there is a distinction between a dismissal for
a reason based
on operational requirements and a dismissal the
purpose of which is to compel an employee or employees to accept a
demand in respect
of a matter of mutual interest between employer and
employee. The distinction relates to whether the dismissal is
effected in
order to compel the employees to agree to the employer's
demand which would result in the dismissal being withdrawn and the
employees
being retained if they accept the demand or whether it is
effected finally so that, in a case such as this one, the
employer
may replace the employees permanently with employees who
are prepared to work under
the terms and conditions that meet the employer's requirements. An
ordinary retrenchment, where the employees
who are being retrenched
will not be replaced, is, of course, also a dismissal for operational
requirements.”
[20] This approach makes
it clear that only conditional dismissals can fall under section 187
(1) (c) and in the words of the SCA
in
Fry’s Metals
at
para 56 “
it is this that distinguishes them from the broader
category of dismissals where the employer – irreversibly –
has terminated
the employment contract
”.
[21] Turning to the facts
of the instant matter in my view the appellant’s contention
that his dismissal was automatically
unfair should be rejected. The
dismissal was not conditional in the sense that it was reversible on
acceptance of the respondent’s
demand to sign the contract
incorporating the term to which the appellant had objected and which
according to the appellant would
have introduced changes to the terms
of the verbal contract of employment. The respondent’s letter
notifying the appellant
of termination of his services unambiguously
makes it clear that his last day of work was 30 June 2008. That date
was final and
irreversible. In the termination notice the respondent
advises the appellant that during the notice period the appellant
should
use his own motor vehicle to perform his duties. It was
unreasonable for the appellant to refuse to accept the respondent’s
offer of employment on the basis of the terms as set out in the
contract of employment. The term to which the appellant objected
was
in my view necessary for the respondent’s business requirements
and probably formed part of the respondent’s policy
which
applied to all of its employees who used its vehicles in the
performance of their duties.
[22] During argument it
was suggested by Mr
Van Der Bijl
, who appeared for the
appellant, that the respondent in requiring the appellant to sign a
contract embodying the term in terms
of which he could be held liable
for the excess should the vehicle be involved in a collision,
discriminated against him because
his fellow employees who also used
the respondent’s vehicles were not required to sign a contract
with a similar term. This
suggestion must be rejected because the
case which it sought to advance was not pleaded in the appellant’s
statement of case
nor in the affidavit he filed in support of the
request for default judgment. (
Billiton Aluminium SA Ltd t/a
Hillside Aluminium v Khanyile and Others
(2010) 31 ILJ 273 (CC)
at para 35)
[23] The second question
is whether the Court
a quo
erred in not addressing the
appellant’s alternative claim relating to an unfair dismissal
dispute. The allegations forming
the basis of the appellant’s
alternative claim have not been pleaded at all by the appellant. The
alternative claim is introduced
for the first time in the appellant’s
prayers. Notwithstanding the lack of averments underlying the
appellant’s alternative
claim, I will, however, assume in his
favour that it is cognisable in his statement of case and proceed to
deal with the appellant’s
contention on the basis of that
assumption.
[24]
The question is whether the Court
a
quo
had jurisdiction to adjudicate the dispute which concerns a claim for
unfair dismissal. The appellant’s alternative claim
is a
misconduct-based dismissal which ordinarily falls within the ambit of
section 191 (5) (a) (i) of the LRA. In general the Labour
Court does
not have jurisdiction to adjudicate disputes concerning dismissals
for misconduct, incapacity or other causes falling
within the
jurisdiction of the CCMA unless the CCMA director has, in terms of
section 191 (6) of the LRA, decided upon application
by any party to
the dispute that it would be appropriate for the dispute to be
referred to the Labour Court. And it may not in
the exercise of its
inherent discretion assume jurisdiction which is contrary to any
statutory provision. It also has no jurisdiction
to adjudicate a
dispute which the LRA requires to be arbitrated. Accordingly if the
Labour Court discovers that the dispute which
has been referred to it
for adjudication is the one which the LRA requires to be arbitrated,
it may, however, stay the proceedings
and refer the dispute to
arbitration, or if, in terms of section 158 (2) and (3)
[3]
the parties consent and it is expedient to do so, assume the role of
the arbitrator.
[25] In light of the
above analysis I agree with the appellant that the Court
a quo
erred in failing to consider the appellant’s alternative claim
for ordinary unfair dismissal. It should have dealt with and
finalised it in accordance with the procedure as set out in section
158. In my view a referral of the appellant’s alternative
claim
to the CCMA for arbitration would have been an appropriate course for
the Court
a quo
to have followed bearing in mind that the
jurisdictional facts necessary for the exercise of its powers under
section 158 (2) (b)
were lacking as the proceedings before it were in
the context of a default judgment.
[26] In these
circumstances the appellant’s appeal against the Court
a
quo’s
failure to consider his alternative claim should
succeed and the appellant’s claim relating to the unfair
dismissal dispute
should be referred to the CCMA for arbitration.
[27] In the result the
following order is made:
1.
The appeal relating to the appellant’s claim for automatically
unfair dismissal
is dismissed;
2.
The appellant’s appeal against the Court
a
quo’s
failure to consider the
appellant’s alternative claim relating to the unfair dismissal
dispute succeeds and the appellant’s
alternative
claim
is referred to the CCMA for arbitration.
3.
no order is made as to costs.
_______________
ZONDI,
DH
WAGLAY,
AJP & HLOPHE, AJA concur in the judgment of ZONDI AJA.
APPEARANCES
For
the appellant : Mr A J van der Bijl
Instructed
by : Solidarity
For
the respondent : Adv. J M Bezuidenhout
Instructed
by : Kramer Villion Norris Attorneys
[1]
(1)
A dismissal that is not automatically unfair, is unfair if the
employer fails to prove-
(a) that
the reason for dismissal is a fair reason-
(i) related
to the employee's conduct or capacity; or
(ii) based
on the employer's operational requirements; and
(b) that
the dismissal was effected in accordance with a fair procedure.
[2]
(
2)
If at any stage after a dispute has been referred to the Labour
Court, it becomes apparent that the dispute ought to have been
referred to arbitration, the Court may-
(a) ...
(b)
with
the consent of the parties and if it is expedient to do so, continue
with the proceedings with the Court sitting as an arbitrator,
in
which case the Court may only make any order that a commissioner or
arbitrator would have been entitled to make.”
[3]
(2)
If at any stage after a dispute has been referred to the Labour
Court, it becomes apparent that the dispute ought to have
been
referred to arbitration, the Court may-
(a) stay
the proceedings and refer the dispute to arbitration; or
(b) with
the consent of the parties and if it is expedient to do so, continue
with the proceedings with the Court
sitting as an arbitrator, in
which case the Court may only make any order that a commissioner or
arbitrator would have been entitled
to make.
(3)
The reference to 'arbitration' in subsection (2) must be interpreted
to include arbitration-
(a) under
the auspices of the Commission;
(b) under
the auspices of an accredited council;
(c) under
the auspices of an accredited agency;
(d) in
accordance with a private dispute resolution procedure; or
(e) if
the dispute is about the interpretation or application of a
collective agreement.