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[2014] ZALAC 44
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Shatterprufe (Pty) Ltd v Sesani NO and Others (PA4/13) [2014] ZALAC 44 (10 September 2014)
IN THE LABOUR APPEAL
COURT OF SOUTH AFRICA, PORT ELIZABETH
Reportable
Case
no: PA4/13
In the matter between:
SHATTERPRUFE (PTY)
LTD
Appellant
and
NTOMBEKHAYA SESANI
N.O.
First Respondent
NATIONAL BARGAINING
COUNCIL
FOR THE CHEMICAL
INDUSTRY
Second Respondent
JOSEPH SONAMZI
Third Respondent
Heard:
26 August 2014
Delivered:
10 September 2014
Summary: Review of
arbitration award- Employer adopting escalation procedure to curb
financial losses resulting from breakdown in
production during night
shift. Procedure enjoining employee to notify Supervisor within 30
minutes of the occurrence of breakdown.
Employee experiencing series
of breakdown during night shift- employee notifying supervisor via
sms minutes later. Arbitrator finding
that sms inappropriate in the
circumstances- Labour Court reviewing arbitration award on factual
basis. Appeal- reasonable test
restated. Evidence showing that
employee failed to follow escalation procedure- Failure to resolve
factual dispute not vitiating
the arbitration award- award falling
within the band of reasonableness- appeal upheld- review application
dismissed.
Coram: Waglay JP,
Murphy et Dlodlo AJJA
JUDGMENT
MURPHY
AJA
[1]
The appellant appeals against the decision
of the Labour Court reviewing and setting aside the award of the
first respondent (“the
arbitrator”) to the effect that
the dismissal of the third respondent (“Sonamzi”) was
fair. None of the respondents
actively opposed the appeal.
[2]
The
Labour Court found that the arbitrator’s failure to resolve two
factual disputes amounted to a gross irregularity within
the meaning
of section 145 of the Labour Relations Act
[1]
(“the LRA”). It set aside the award and ordered the
dispute to be remitted to the bargaining council (the second
respondent)
for hearing by an arbitrator other than the first
respondent.
[3]
Sonamzi was employed as a shift leader and
had worked for the appellant for more than 22 years. He was charged
with misconduct as
follows:
‘
Failure
to follow the standard escalation procedure in that you did not call
your manager after having extensive downtime and losses
on nightshift
on 05.11.09.
Totally
unacceptable work performance in that there was no work done on the
Bando
and only 3 pallets of off line during
all the downtime on nightshift of 05.11.09.’
[4]
A disciplinary enquiry found Sonamzi guilty
of the misconduct and recommended his dismissal
.
Sonamzi did not challenge the
procedural fairness of his dismissal. His case was that he was not
guilty of misconduct. He also maintained
that even if he was guilty,
the sanction of dismissal was in the circumstances too severe. His
contention in this latter respect
must be assessed in light of his
rejection after the disciplinary enquiry of an offer by the appellant
to substitute the recommended
sanction of dismissal with one of
demotion.
[5]
As stated, Sonamzi worked for the appellant
for a long time. He rose to the position of team leader and was then
promoted to the
position of shift leader, a post which carried with
it significant responsibility, particularly since it made him the
highest ranking
employee at the plant during the evening shift.
[6]
In the years leading up to the incident,
the appellant had suffered significant financial losses, which were
to a large extent attributable
to mechanical breakdowns and
associated down time and lost production. In an effort to curtail
these losses, the appellant took
steps to ensure that the so-called
“escalation procedure” was rigidly applied and adhered
to.
[7]
The escalation procedure required the shift
leader to notify his superior of any breakdown in the production
process during his
shift so that remedial steps could be immediately
implemented with a view to limiting production losses. Responsible
employees
are obliged to report and escalate breakdowns to the next
highest level of authority, with a view to ensuring a timely and
effective
intervention. The shift leader was thus expected to notify
both the production manager and the plant engineer within 30 minutes
of the occurrence of a breakdown. The rationale underlying the
escalation procedure was two-fold. Firstly, it served to apprise
senior management of production related difficulties. This would
enable them to determine precisely what resources ought to be
invested in addressing the problem. Secondly, the act of notifying
more senior management allowed those managers to determine how
best
to utilise the existing manpower resources. The procedure allowed
senior management to take the important decision of determining
production priorities and, if necessary, switching products etc.
[8]
The applicable rule is recorded at the
bottom of the Short Interval Control Chart, an internal production
document. It specifies
as follows:
‘
After
thirty minutes of continuous down time, notify the Production Manager
Plant Engineer and the Shift Leader.’
[9]
The duty to contact both the production
manager and plant engineer is not discretionary. It arises
immediately on the expiry of
the 30 minute period of continuous down
time. In the event of more than four hours continuous down time, the
production manager
is required to notify the general manager. The
production manager, Mr Africa, testified that he had discussed the
policy with Sonamzi
a few weeks before the incident and had informed
him that the rule required that he be contacted, that a short message
service
(sms) would be insufficient compliance with the requirements
of the rule and that he should actually phone and speak to him.
Sonamzi
denied this.
[10]
The existing disciplinary code recommends
dismissal for a first offence of failing to comply with standard
operating procedures.
The same recommended sanction applies in cases
of gross negligence and unacceptable work performance.
[11]
On 5 November 2009, Sonamzi was the shift
leader of the so-called “6/6 shift”, meaning that he was
the most senior employee
on site. His direct superior – and the
person to whom he would escalate any production related difficulties
– was the
production manager, Africa. At approximately 21h20
that evening Sonamzi experienced the first of a series of mechanical
breakdowns,
which resulted in an interruption of production. Sonamzi
first engaged artisans on site in an attempt to solve the problem but
was unsuccessful in solving the problem. Contrary to the escalation
procedure, Sonamzi did not attempt to contact Africa by 21h50,
being
within the 30 minute cut-off. He waited a further approximately 20
minutes before forwarding an sms to Africa, the production
manager,
and to Smit, the plant engineer. Africa did not respond to the sms.
It is common cause that Africa was asleep at the time.
A further
hour’s production was lost before Sonamzi sent another sms to
Africa. This occurred shortly after 23h00. Once again,
this method of
communication proved ineffective.
[12]
At about midnight, there was a further
major mechanical breakdown. Sonamzi again waited almost a full hour
before sending an sms
at 00h48 to the production manager and plant
engineer. It elicited no reaction from Africa, who was still asleep.
At about this
time – an hour after the second major breakdown –
Sonamzi instructed his team leader to contact Gerrie Oosthuizen, a
process technician, who then attended on the site and attempted
(unsuccessfully) to fix the breakdown
[13]
Africa first became aware of the
significant down time when he received the production figures (per
sms) from Sonamzi shortly after
06h00 on the morning of 6 November
2009. This resulted in him immediately contacting Sonamzi and
enquiring about the inadequate
production figures.
[14]
It was not disputed that had Sonamzi
communicated effectively, Africa would have enlisted the services of
Oosthuizen at a far earlier
stage. Africa testified that had he been
made aware of the magnitude of the problem he would have switched
production to the SAG
process. The appellant could then have run the
SAG process for at least six hours and have usefully deployed the
employees working
the shift in this process. As things turned out,
however, the SAG process only commenced four hours into the next
morning’s
shift.
[15]
Sonamzi initially maintained that he
complied with the standard escalation procedure by notifying Africa
by way of sms of the production
problems which were beyond his
control and claimed that he did his best by utilising the staff at
his disposal as effectively as
possible. He thus suggested that in
the context of the escalation procedure an sms was adequate. During
the course of cross-examination
he was however forced to concede that
the term “notify” meant “bring to the attention of”
for the purpose
of allowing the more senior manager to take a
decision about what remedial steps had to be taken to fix the
problem, and
about how to utilise manpower if the problem could not
be fixed rapidly. He conceded also that the purpose of the escalation
policy,
to allow senior management to take decision regarding
production priorities, could never be achieved in the absence of an
actual
communication between himself and Africa. He thus in effect
recognised that an unanswered sms could never satisfy the objectives
of the policy.
[16]
In relation to the second charge, Sonamzi
maintained that there was no person on duty competent to run the
Bando machine. Africa
disputed this and added that had Sonamzi
actually spoken to him he would have told him who to use to get that
machine operational.
[17]
The arbitrator in her award correctly noted
that the purpose of the escalation procedure is to enable senior
management to determine
what resources ought to be utilised in
addressing the problem, as well as to determine how best to utilise
existing manpower in
order to cut down financial losses caused by
breakdown and down time. She considered the applicable rule and
procedure to be reasonable.
She held that the requirement to notify
senior management necessarily implied bringing the particular issue
to management’s
attention. On the facts that did not occur. She
reasoned:
‘
I
therefore fail to understand the applicant’s logic that he
notified Mr Africa via the sms’s. The fact that Mr Africa
did
not respond to the applicant’s first sms should have raised
some concerns on him. Arguing that he sent Mr Africa
the sms’s
and he chose not to respond is an element of having disregard of the
consequences of his actions. Any reasonable
person would have
made a follow up, probably by means of a telephone call, so as to
ensure that the problem at the workplace is
communicated to the
production manager
.’
[18]
Regarding the crux of Sonamzi’s
defence, namely communication by sms, the arbitrator reasoned as
follows:
‘
The
applicant argued that they previously communicated via sms’s
and that was the reason why he sent Mr Africa sms’s
on the
night in question. In support of this argument he submitted
transcribed sms’s between himself and Mr Africa.
I accept
that there was previous communication via sms’s but one needs
to state that those sms’s came to Mr Africa’s
attention,
he received them and as such notified of the problem, hence the
response. They constituted effective communication.
The sms’s
of the night in question never reached his attention even though they
were sent. He was not notified of the
problem.’
[19]
In relation to the second charge, the
arbitrator held that had there been proper communication, the Bando
machine could have been
brought into operation and that Sonamzi was
accordingly guilty of misconduct on that score too.
[20]
With regard to an appropriate sanction, the
arbitrator held the following:
‘
Having
considered the above evidence and submissions, it is my finding that
the applicant failed to observe the escalation procedure
in place,
thereby causing the respondent substantive financial loss that could
have been minimised. As a shift leader, he was in
a position of
trust, responsible for the staff in his shift and to ensure that
there is a reasonable production. His disregard
of the rules
and procedures in place makes him an untrustworthy employee. It
is further my finding that the applicant’s
dismissal was
reasonable and fair.’
[21]
The Labour Court set aside the award on two
grounds. It was of the view that the arbitrator erred in not
resolving the factual dispute
about whether Africa had told Sonamzi
that communication by sms was insufficient, and erred secondly in not
similarly resolving
the factual dispute regarding the presence of an
employee with skills to operate the Bando machine during the shift.
The failure
of the arbitrator to apply her mind properly to these
issues, which the court
a quo
regarded as material, in its view, denied Sonamzi the right to have
his case fully and fairly determined. These material irregularities,
the court held, meant that the decision was not a decision that a
reasonable decision-maker could reach.
[22]
Thus, the court held that resolving the
dispute of fact about communication by sms was material to
determination of the dispute
about Sonamzi’s guilt on the first
charge. The appellant submitted that the court
a
quo
erred in this respect and did not
properly construe the purpose of the escalation policy, namely to
enable managers at higher levels
of authority to bring their minds to
bear on operational problems that occur at times when they are not at
the workplace. Compliance
or otherwise with the escalation policy had
to be evaluated with reference to that purpose. Notwithstanding any
instruction by
Africa to Sonamzi requiring the latter to phone the
former, a series of unanswered text messages could in any event never
amount
to compliance with the escalation policy – rendering
resolution of the first factual dispute unnecessary. As the
arbitrator
found, a reasonable person would have taken further action
once his first text message went unanswered and further unanswered
text
messages could not cure the inadequacy of the first unanswered
text message. Self-evidently, ineffective communication could not
be
cured by way of additional ineffective communication. It follows that
even if the factual dispute in question had been resolved
in favour
of Sonamzi, the outcome would have been no different, since he would
in any event have been guilty of failure to comply
with the
escalation policy. The arbitrator appears to have appreciated this
when she said in her award:
‘
Whether
this instruction was issued or not is not clear. However, any
reasonable person would have known that the most reasonable
thing to
do when Mr Africa was not answering his phone was to call him.’
[23]
In the premises, the arbitrator did in fact
apply her mind to the issue and concluded that there was no need to
resolve the factual
dispute. She committed no irregularity in that
regard which impacted on the award so as to render its outcome
unreasonable.
[24]
In relation to the second charge, the
Labour Court implicitly proceeded from the premise that Sonamzi could
not be guilty of this
charge unless the appellant showed that the
Bando machine was capable of being operated on the night in question.
It accordingly
considered the resolution of the dispute of fact about
the availability of an employee with the necessary skills to operate
the
Bando machine to be material to determination of Sonamzi’s
guilt on this charge. The appellant argued that this premise
misconceived
the essence of its argument, and ignored the evidence
about the alternatives available to Sonamzi on the night in question.
The
appellant’s argument is that, regardless of the
availability of someone with the skills to operate the Bando machine,
Sonamzi’s
failure to properly escalate the problem to his
superiors deprived those superiors of the opportunity to minimise
production losses
by way of appropriate decisions about redeployment
of available human and other resources. In this regard the arbitrator
stated
in her award:
‘
Mr.
Africa came up with a number of alternatives that would have been
adopted had the applicant observed the escalation procedure.
Such
alternative (sic) shows the importance of the escalation procedure
and its purpose.’
[25]
Moreover, the ambit of the second charge
went beyond the non-operation of the Bando machine. It also included
the fact of an inadequate
quantity of alternative work being
performed on the night in question, despite the availability of work
that could usefully have
been performed during the interruption of
production resulting from the breakdown.
[26]
But also whether someone was available on
the shift could have been determined had there been proper
communication. The arbitrator
recognised that there were factual
disputes, but again, after applying her mind, decided they did not
require definitive resolution.
She quite reasonably reached the
following conclusion:
‘…
one
can only state that had the applicant observed the escalation
procedure in place, he would have known who was capable to operate
the Bando. The evidence before me suggests that the applicant
had no authority to change production. Instead of getting
intervention from other managers he decided out of his own accord to
change the production, an action that again shows disregard
of rules
in place.’
[27]
The arbitrator recognised that there were
factual disputes. Nonetheless, she reached the following conclusion:
‘…
one
can only state that had the applicant observed the escalation
procedure in place, he would have known who was capable to operate
the Bando. The evidence before me suggests that the applicant
had no authority to change production. Instead of getting
intervention from other managers he decided out of his own accord to
change the production, an action that again shows disregard
of rules
in place.’
[28]
Regardless of the outcome of any factual
dispute regarding the use of the Bando machine, the arbitrator
reasonably and correctly
concluded that the losses suffered by the
appellant on the evening in question were the result of Sonamzi’s
failure to properly
escalate the problem to his superiors – and
were therefore attributable to him.
[29]
In the circumstances, it cannot be said
that the arbitrator committed any irregularity which rendered her
ultimate finding unreasonable.
The arbitration award, when considered
with reference to the evidentiary material before the arbitrator,
represented a result that
fell within the range of reasonable
outcomes. A review of a CCMA award is permissible only if the defect
in the proceedings falls
within one of the grounds in section
145(2)(a) of the LRA. For a defect in the conduct of the proceedings
to amount to a gross
irregularity as contemplated by section
145(2)(a)(ii), the arbitrator must have misconceived the nature of
the enquiry or arrived
at an unreasonable result. A result will only
be unreasonable if it is one that a reasonable arbitrator could not
reach on all
the material that was before the arbitrator. Material
errors of fact, as well as the weight and relevance to be attached to
particular
facts, are not in and of themselves sufficient for an
award to be set aside, but are only of any consequence if their
effect is
to render the outcome unreasonable. Thus, even had the
arbitrator committed an irregularity by not resolving the factual
disputes,
it was incumbent on the court to enquire further to
determine if the outcome was unreasonable, which, for the reasons
given, in
this case it was not.
[30]
There are
dicta
in the judgment of the Labour Court appearing to accept that Sonamzi
might in fact have complied with the escalation procedure
by sending
an sms within 15 minutes of the breakdown. The common cause evidence
was to the effect that the first text message was
only sent 50
minutes after the incident, while the escalation policy required the
matter to be escalated within 30 minutes. Consequently,
the evidence
demonstrated that Sonamzi acted in breach of the escalation policy
and was therefore guilty of misconduct even on
his own version.
[31]
The sanction of dismissal does in this
instance appear to be harsh given Sonamzi’s length of service.
A sanction of demotion
would have been more appropriate. The
arbitrator in her award applied her mind to this issue and came to
that conclusion. However,
having regard to the fact that Sonamzi was
subject to a valid, current, final written warning for being under
the influence of
alcohol while on duty, and more importantly had
refused to accept a demotion, the arbitrator concluded that dismissal
was fair
in the circumstances. No consideration appears to have been
given to any argument that it might have been fairer for the employer
simply to have imposed demotion and not to have persisted with a
dismissal. But this Court’s conception of what might have
been
fairer is not decisive. The award of the arbitrator is not one which
a reasonable arbitrator could not reach. However, the
fact that there
was a fair alternative to dismissal, and the lack of opposition,
justify not awarding the appellant the costs of
the appeal.
[32]
In the result,
(a)
The appeal is upheld with no order as to costs.
(b)
The order of the Labour Court is set aside and replaced with the
following order:
“
The
application is dismissed with no order as to costs.”
_________________
JR
Murphy AJA
I agree
__________________
Waglay
JP
I agree
__________________
Dlodlo
AJA
APPEARANCES:
FOR THE APPELLANT:
Adv F le Roux
Instructed by
Rob McWilliams Attorneys Port Elizabeth
FOR
THE RESPONDENT:
No appearance
[1]
Act 66 of 1995.