DB Contracting North CC v National Union of Mineworkers and Others (JA 113/13) [2015] ZALAC 30; [2015] 10 BLLR 973 (LAC); (2015) 36 ILJ 2773 (LAC) (2 July 2015)

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[2015] ZALAC 30
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DB Contracting North CC v National Union of Mineworkers and Others (JA 113/13) [2015] ZALAC 30; [2015] 10 BLLR 973 (LAC); (2015) 36 ILJ 2773 (LAC) (2 July 2015)

IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA,
JOHANNESBURG
Case
no. JA 113/13
DATE:
02 JULY 2015
Reportable
In
the matter between:
DB CONTRACTING
NORTH
CC
..........................................................................................
Appellant
And
NATIONAL UNION OF
MINEWORKERS
..............................................................
First
Respondent
SIPHO NKABINDE &
105 OTHERS
.............................................
Second
and Further Respondents
Heard:
19 February 2015
Delivered:
2 July 2015
Summary:
Dismissal for operational requirements – sectoral determination
for industry published in the government gazette
increasing hourly
rate of employees – employer unable to afford increased rate –
employer consulting with union and
offering to maintain old rate or
effect an retrenchment – common cause between parties that such
offer was reasonable - Union
representative undertaking to obtain an
mandate as to whether or not to accept such offer to avoid
retrenchment – agreement
between Employer and union that if
offer not accepted retrenchment would be effected on a stipulated
date – no acceptance
of the offer communicated to employer–
employer issuing notice of dismissal – Union contending that
the employees had
accepted the offer but acceptance not communicated
at any time –  on the facts the version of the union that
offer was
accepted rejected – Labour Court’s judgment
finding dismissal unfair and reinstating employees set aside-
appeal
upheld with costs.
Minority:
Onus
on employer to prove fairness of dismissal and not on employees to
prove otherwise – employer alleging its attorney received
phone
call from union representative with message that employees rejecting
employer’s offer – attorney not testifying
and not filing
confirmatory affidavit or letter – attorney’s alleged
message inadmissible hearsay - however employer
issuing letters of
dismissals on strength of the said message and prior to final
consultation meeting – employees disputing
they rejected the
offer but alleging they accepted it - Disputes of fact – Appeal
Court not to lightly interfere with trial
court’s credibility
finding unless there is misdirection or finding clearly wrong -
Retrenchment was premature and, on the
facts, probably inspired by
employer’s desire to re-employ employees through labour broker
– Dismissals were therefore
unfair – Reinstatement
ordered.
Coram:
Ndlovu, Landman
et
Sutherland JJJA
JUDGMENT
NDLOVU JA
Introduction
[1]
This appeal is against the judgment of the Labour Court (Lallie J)
handed down on 3 August 2012, in terms of which the Court
a quo
held that the second to further respondents, comprising a total of
106 employees listed in Table A annexed to the statement of
claim
(the employees), were unfairly dismissed by the appellant; and
ordered that the employees be reinstated to the appellant’s

employ. Leave to appeal was refused by the Court
a quo
on 13
September 2013 and only granted by this Court on 19 February 2014,
upon petition.
[2]
The appellant, DB Contracting North CC carried on the business of
digging trenches on the ground, laying cables and restoring
the
affected areas with backfill. The employees were members of the first
respondent, the National Union of Mineworkers (the union)
which, on
their behalf, instituted an unfair dismissal claim in the Court
a
quo
against the appellant.
[1]
They
were formerly employed by the appellant as general workers until
their dismissals on 4 December 2009, on the ground of the
appellant’s
operational requirements.
The issue
[3] The issue for
determination by the Court
a quo
was two-fold, namely:
3.1
Whether the dismissals of the employees were substantively and/or
procedurally fair.
3.2
Whether the employees refused an alternative reasonable offer put
forth by the appellant to avoid retrenchment and that, by
doing so,
the employees rendered their dismissals fair.
[4]
However, as agreed between the parties, the issue was crystallized
into the terms as formulated in paragraph 2 of the respondents’

heads of argument, cited below, which essentially did not change the
substantive character of the one presented before the Court
a quo
:
‘
If
it is found that indeed the respondents (the employees) refused the
offer, which was reasonable, then the appeal ought to succeed
and
conversely, if it is found that the respondents (the employees) were
amenable to the offer and in fact accepted same however
the appellant
terminated their employment even before their acceptance could be
communicated then it should follow that the retrenchments
were
premature and therefore unfair with the result that the appeal ought
to be dismissed with costs.’
The factual
background
[5]
On 13 March 2009, a collective agreement
[2]
was concluded in the National Bargaining Council for the Electrical
Industry of South Africa (the bargaining council) in terms
of which,
among other things, all electrical assistants’ remuneration had
to be increased from R11-55 per hour to R16-98
per hour. It was
common cause that the collective agreement was binding to all the
parties who operated within the registered scope
of the bargaining
council, including non-members, such as the appellant, presumably in
terms of section 32(1) of the LRA. It may
be noted that a copy of the
said collective agreement was not included in the papers presented to
the Court. However, nothing turned
on this omission since the parties
agreed on the material terms of the collective agreement, relevant
for the present purpose.
[6]
Initially, the appellant sought to resist the collective agreement on
the basis that it was not a party to the agreement. Consequently,
the
union referred a dispute to the CCMA for conciliation.
[3]
The dispute remained unresolved as at 8 June 2009 and a certificate
of non-resolution was issued on the same day. Thereupon, the
union
referred the matter to arbitration.
[4]
However, whilst notification of the date of arbitration was being
awaited, the appellant issued a notice to the union dated 30
July
2009, purportedly in terms of section 189 of the LRA (the
retrenchment notice), which read thus:
1.
This notice is intended to advise the
National Union of Mineworkers, being the trade union which represents
the majority of the
our (sic)  employees of the need to commence
with retrenchment consultations due to the Close Corporation’s
financial
problems.
2.
This notice is issued in accordance with
the provisions of section 189 (2) and (3) of the Labour Relations
(Act No 66 of 1995) wherein
the purpose of our consultation will be
to discuss all relevant information and to engage (the employees and
the Union) in a
meaningful joint consensus seeking process to
attempt to reach consensus on appropriate measures which are:
2.1. To avoid the
dismissals;
2.2. To minimise the
number of dismissals;
2.3. To change the
timing of the dismissals; and
2.4. To mitigate the
adverse effects of the dismissals.
3.
We will further attempt to reach consensus
on the method for selecting the employees to be dismissed and the
severance pay applicable
to dismissed employees.
THE CAUSE OF THE
FINANCIAL CONSTRAINTS
4.
The reasons for the expected retrenchments
are due to the fact that the Close Corporation is experiencing severe
financial constraints.
The Close Corporation is well aware that the
salary increments were due 01 February 2009 in terms of the existing
collective agreement.
4.1. The Close
Corporation had a contract with J & J Cable Jointing which lost
its Eskom contract in November 2008.
4.2. The Close
Corporation is relying on subcontractors from municipalities. DB
Contracting have no active contracts presently.
ALTERNATIVES
5.
The Close Corporation intends to find, in
consultation with the union and employees, suitable alternatives to
the termination of
the employment (retrenchment) of the employees.
The Close Corporation considered the following alternatives:
5.1
It proposes that employees will work
at J & J Cable Joining through labour brokers.
5.2
After retrenchment, the Close
Corporation intends to employ [the employees] through labour broker
services
.
(Emphasis added)
THE PROVISIONS
OF SECTION 189 (3)(i) AND (j)
6.
The Close Corporation has employed 128 (One
Hundred and twenty eight) employees and there has been no dismissals
for reasons based
on operational requirements in the preceding 12
months.
THE AFFECTED
EMPLOYEES
7.
The positions likely to be affected by the
retrenchment are:
7.1
General
Workers which (sic) consists of 82 (eighty two)
[5]
employees.
THE SELECTION
CRITERIA
8.
In the selection criteria the Close
Corporation intends to make use of a fair and objective criteria of
selecting the affected employees,
and it proposes to use last in
first out criteria. The proposed criteria will be discussed on our
first consultation meeting, which
will be arranged.
TIME PERIOD
9.
The period of consultation process will be
arranged between the Union, employees and the Close Corporation
(employer). Notice of
termination in terms of the Basic Conditions of
employment will only be given after consultation process is complete
and only where
all issues relevant to such terminations are
exhausted.
SEVERENCE
PACKAGES
10.
The employees who rendered services to the
Close Corporation for a completed year or longer will be entitled to
a severance package
of (1) one week of each completed year of
service. The packages will be discussed during our consultation
process.
DB Contracting North
CC
Per: Peter Mueller’
[7]
It was not in dispute that prior to 30 November 2008,
[6]
the appellant generated most of its profit from its sub-contract with
a corporate entity known as J & J Cable Joining CC (J
& J
Cable), which in turn had a substantial contract with Eskom (the
Eskom contract). J & J Cable was accredited with a
Black Economic
Empowerment (BEE) status, which the appellant did not have. According
to the appellant, due to its lack of the BEE
status, it did not
qualify to conclude a business contract directly with Eskom hence it
got the Eskom work through its contractual
association with J & J
Cable. However, it was also conceded by the appellant, through the
evidence of Mr Magagula (under cross-examination),
that both the
appellant and J & J Cable were co-owned by one and the same
person, namely, Mr Peter Mueller,
[7]
the author of the retrenchment notice.
[8]
There was also no dispute that on 30 November 2008, the Eskom
contract was terminated by Eskom and that this development had
a huge
negative financial impact and implications, not only on J & J
Cable but, naturally, also on the appellant. A subsequent
contract
which the appellant concluded with Ekurhuleni Municipality (the
Ekurhuleni contract) was worth far less in comparison
to the Eskom
contract. According to the appellant, it was as a result of the
economic downturn in its business operation, occasioned
by the
termination of the Eskom contract, that it was not economically
feasible for the appellant to afford paying the employees
at the
increased remuneration rate in terms of the collective agreement.
Hence, according to the appellant, there was a need for
section 189
consultations to be embarked upon. It is to be noted at this point
that the appellant opted not to follow the procedure
of applying to
the bargaining council for exemption from the operation of the
collective agreement on the ground of the appellant’s
alleged
financial incapacity or distress. If, in that event, the application
for exemption was declined by the bargaining council,
the appellant
would have been entitled to lodge an appeal in terms of section
32(3)(e)(i) of the LRA. I will return to this issue
in due course.
[9]
Consultative meetings were held between the union’s and the
appellant’s representatives on 13 August, 24 August,
13
November and 4 December 2009. At all these meetings, the appellant’s
team was led by its Human Resources Manager, Mr Jonas
Magagula and
the union’s team was led by its legal officer, Mr Melusi
Bengequla.
[8]
It was common
cause that at the meeting of 24 August, the parties discussed only
about the applicability of the collective agreement
on the appellant
and the monies owed to the employees by the appellant in terms of the
collective agreement. In other words, at
that meeting nothing was
discussed pertaining to finding ways of avoiding the imminent
retrenchment of the employees.
[10]
At the meeting of 13 November 2009, the appellant presented to the
union an offer to the effect that all the affected employees
would be
retained in the appellant’s employ and not retrenched, provided
they would accept to be remunerated at the unchanged
pay rate of
R11.55 per hour, instead of the new increased rate of R16.98 per
hour. It would appear (from the handwritten minutes
or notes taken at
this meeting of 13 November) that the parties had initially agreed to
have that meeting as their final consultative
meeting. In other
words, the understanding was that, unless some agreement was reached
by 4 December, the implementation of retrenchment
would commence on
that day. It was not in dispute between the appellant and the union
that the appellant’s offer was reasonable
in the circumstances.
[11]
However, it was then agreed that the union would take the appellant’s
offer to the employees for their necessary mandate,
i.e. whether they
accepted or rejected the offer. The last entry in the minutes of the
meeting of 13 November read: “
Parties
agreed to change the termination date of 13 October 2009 to be 4
th
December 2009.”
I must hasten to point out: It was common cause between the parties
that the date 13 October 2009 was a typographical error, which
was
intended for 13 November 2009. So, the 4
th
of December was to be the deadline for the consultation process to be
concluded. On that day the employees would either be retained
at
R11.55 per hour or be retrenched
forthwith,
depending on their response to the appellant’s offer. The
employees would be retrenched only if they rejected the
offer and
this position was agreed to by both parties
[9]
and further confirmed by the appellant’s counsel during
argument.
[12]
The handwritten notes taken at the meeting of 4 December 2009 are so
patchy and scanty that they hardly offer any helpful and
reliable
forensic information, in relation to what really took place at that
meeting, save some blurred indication of a few topics
which were
purportedly discussed, including something about the appellant’s
“financial statement”; the complaint
by the appellant’s
representative that the matter had been dragging for too long; the
remuneration rate at which the retrenched
employees would be paid
retrenchment packages. Otherwise, one would virtually have to guess
in order to figure out what actually
happened at the meeting.
[13]
It was common cause between the parties that at the meeting of 4
December 2009 nothing was discussed in connection with the
issue of
whether the appellant’s offer was accepted or rejected by the
employees. Neither the union nor the appellant raised
the issue. Of
significance that day was the fact that final payslips were issued to
the employees, confirming their dismissals
with effect from the same
day, that is, 4 December 2009. The significance of the timing of
issuance of the final payslips is discussed
in more detail later in
this judgment.
[14]
On 7 December 2009, Mr Bengequla addressed a letter to the appellant
in which he said the following:
‘
I
refer to the above matter and our third consultative meeting of the
4
th
of
December 2009 herein.
We have received
information from our members that employer gave them notices of their
dismissal on the 4
th
December after the third consultative
meeting. Kindly be informed that, as you know, this process has not
being (sic) finalized
yet, as we are still awaiting employer’s
offer of retrenchment which stipulates all calculations to be made
regarding severance
pay and the payment of the outstanding amounts
owed to our members in terms of the collective agreement.
Take notice further
that, should employer continue with giving our members premature
notices of their dismissal, we will have no
option but to approach
the court for an appropriate remedy.’
[15]
Consequently, the union referred an unfair dismissal dispute for
operational requirements to the bargaining council for conciliation.

The dispute remained unresolved as at 23 March 2010 and a certificate
to that effect was issued on the same day. Hence, the union
referred
the matter for adjudication by the Labour Court.
Proceedings
in the Labour Court
[16]
In its statement of case, the union summed up the events that
culminated in the alleged unfair dismissal of the employees as

follows:
‘
2.26
The next meeting was on the 13
th
November 2009. In these meetings the [appellant] issued the [union]
with its counter proposal regarding the proposed frame work
agreement
of retrenchment.
2.27
The [appellant] did not organise a facilitator as agreed. The 13
th
November 2009 was supposed to be the termination date of all the
affected employees’ contracts of employment according to
the
[appellant] but the [union] persuaded the [appellant] to change this
date as there was no progress made regarding consultation
process.
2.28
The [appellant] reluctantly changed the [termination] date to the 4
th
December 2009.
2.29
The next meeting was on the 4
th
December 2009 and the
[appellant] indicated that the consultation meetings have been
dragging on for too long and terminated the
services of all affected
employees, on the same day.
2.30
The [employees] were accordingly dismissed on the 4
th
December 2009. After the retrenchment of the [employees], the [union]
on behalf of its members declared a dispute of unfair dismissal
to
the [bargaining council].’
[17]
Mr Magagula testified that prior to 4 December 2009, the appellant’s
attorney received a telephone message from the union
representative
to the effect that the employees had rejected the appellant’s
offer. As a result, the appellant had then embarked
on the process of
preparing final payslips for the employees, which the appellant did
prior to 4 December – albeit the payslips
aforesaid reflected
the same date. According to Mr Magagula, the appellant felt that it
was no longer necessary to raise the issue
of the appellant’s
offer again when the parties met on 4 December, but only to discuss
about payment of severance packages.
Indeed, on 4 December the
employees’ final payslips and severance packages were ready for
delivery to the employees, which
was done. Mr Magagula was the only
witness for the appellant.
[18]
To the contrary, Mr Bengequla told the Court that whilst on his way
to the meeting on 4 December 2009 he received a telephone
call from
the leadership of the employees to the effect that the appellant had
already started dismissing the employees. He further
said that the
employees accused him of being a sell-out. Consequently, when he
arrived at the meeting he raised the query with
Ms Nkadisha, who was
part of the appellant’s team, about the appellant having
prematurely implemented the retrenchments.
However, he said he did
not expressly indicate to Ms Nkadisha that the employees had actually
accepted the appellant’s offer,
which he testified that the
employees had actually done. Ms Nkadisha was presumably the
appellant’s attorney who it was alleged
had received a call
from Mr Bengequla. I say so in the light of Mr Bengequla’s
further evidence when he denied the allegation
that he ever phoned
the attorney concerned. He said
[10]
:
“
No,
that is not true, My Ladyship, I never telephoned Nkadisha. The
results of the consultation with the [union] members were to
be
discussed on 4 December
.
I
was supposed to tell them [the appellant’s representatives]
whether that has been accepted or not.”
Mr Bengequla further testified that, in the circumstances, he felt it
was then pointless to raise the issue of the appellant’s
offer
again at the meeting, but rather to focus on the calculation formula
of the severance packages.
[19]
In any event, it was submitted by Ms Nkutha, counsel for the
employees, that any claim of the appellant’s attorney having

allegedly received a telephone message from the union - purportedly
rejecting the appellant’s offer on behalf of the employees
-
was inadmissible hearsay, given the fact that the attorney in
question was not called as a witness. Hence, Mr Bengequla accused
the
appellant of having acted prematurely in its retrenchment of the
employees, thus rendering the retrenchments to be substantively
and
procedurally unfair.
[20]
The second witness for the employees was Mr Nkosiyabo Gumede (company
clock number 463), one of the further respondents who
testified on
behalf of himself and all other retrenched employees. He confirmed
that all retrenched employees received their final
payments on 4
December 2009 which were calculated on the basis of the unchanged pay
rate of R11.55 per hour and that any suggestion
that they were paid
at the new increased rate of R16.98 per hour would be untrue. He
further confirmed that all employees were
seeking reinstatement in
the event of their dismissals being found to be unfair. This witness
was not cross-examined at all by
counsel for the appellant, Mr
Hutchinson.
[21]
After considering the evidence adduced and submissions made on behalf
of both parties, the Court
a quo
accepted the version of the
union and rejected that of the appellant. Pertinently, the following
appears in the judgment of the
Court
a quo
:
‘
[9]
The cause of the respondent’s financial difficulties and the
alternatives to retrenchment proposed by the respondent paint
a
different picture for the real reasons for retrenchment from the one
the respondent (sic) attempted to paint. When the evidence
of the
reasons for retrenchment is considered in its totality it proves that
when the respondent could not pay the increment prescribed
in the
collective agreement, instead of engaging the first applicant [the
union] in finding a solution which could keep the respondent
in
business and protect the jobs of the employees, it opted for
dismissing [the] employees. Under cross-examination, Magagula
testified that had the [first] applicant not insisted on its members
being remunerated at the rate prescribed in the collective
agreement,
the respondent would have afforded to keep them in employment. …
I have accepted that there was an agreement
between the respondent
and the first applicant that Bengequla would inform the respondent at
a meeting scheduled for 4 December
2009 whether the second to further
applicants [the employees] would accept the hourly rate of R11.55 and
forfeit the increment
as an alternative to retrenchment. The
respondent dismissed the second to further applicants before the
scheduled meeting could
be held and denied Bengequla the opportunity
to convey the second to further applicants’ acceptance of the
hourly rate of
R11.55 which the respondent could afford.
[10] …The
real reason for the second to further applicants’ retrenchment
was that the respondent wanted to get rid
of them as employees and
use employees of labour brokers.
[11] …No
evidence was led by the respondent to prove that the second to
further applicants were dismissed for the respondent’s

operational requirements. Dismissing employees solely to use those
same employees as employees of a labour broker falls outside
the
realm of operational requirements. …
[17] The applicants’
version and the concession made on behalf of the respondent reflect
that the respondent failed in its
duty to engage with the first
applicant in a meaningful joint consensus-seeking process, because
although the parties reached consensus
that Bengequla would
communicate the second to further applicants’ response to the
respondent on 4 December 2009, the respondent
reneged on that
agreement and dismissed the second to further applicants before
giving Bengequla an opportunity to convey their
response. The
respondent’s premature and unfair conduct rendered the second
to further applicants’ dismissal for operational
reasons both
substantive[ly] and procedurally unfair.’
[22]
Thereupon the Court
a quo
ordered that the employees be
reinstated into the appellant’s employ and further that the
appellant must pay the costs of
the application. It is against this
judgment of the Court
a quo
that the appellant has now
appealed to this Court.
The
appeal
[23]
As stated earlier, the issue in this appeal was crystallised and
agreed between the parties to be the one as formulated in
paragraph 2
of the respondents’ heads of argument, which I repeat
hereunder:
‘
If
it is found that indeed the respondents (the employees)
refused
the offer
,
which was reasonable, then the appeal ought to succeed and
conversely,
if it is found that the
respondents (the employees) were amenable to the offer and in fact
accepted same
however the appellant terminated their employment even before their
acceptance could be communicated then it should follow that
the
retrenchments were premature and therefore unfair with the result
that the appeal ought to be dismissed with costs.’
(Emphasis added)
[24]
In my view, it is clear that the first part of the crystallised issue
seeks this Court to determine first and foremost whether
the
employees did in fact refuse the offer. The appellant made this
allegation and the appellant was obliged to prove it. This
was
besides the overall
onus
borne by the appellant, as the employer, to prove that the
retrenchments of the employees were fair.
[11]
[25]
Obviously, the issue here necessitated a factual finding on
credibility which had to be determined on inherent probabilities
and
civil inferential reasoning. Based on the evidence of the witnesses
for both parties and the other evidentiary material presented
at the
trial, the Court
a quo
had to determine which of the
conflicting versions was more probably true. Having done so, the
Court
a quo
accepted the evidence on behalf of the employees
and rejected that of the appellant.
[26]
Indeed, the fact of the appellant having prepared the employees’
final payslips already by 4 December 2009, called for
a plausible
explanation from the appellant, which would confirm its
bona fides
and quell the union’s claim that the final decision on the
implementation of retrenchments was a
fait accompli
.
[27]
Strangely though, in its argument, the appellant pretended as if it
never made the allegation about Mr Bengequla having phoned
its
attorney relaying the employees’ rejection of the offer.
Instead, the appellant sought to rely on the conduct allegedly

exhibited by the union, which the appellant submitted created
sufficient ground from which to draw an inference that the employees

did not accept the offer. Pertinently, the following aspects were
referred to, on behalf of the appellant, in substantiation of
its
contention in this regard, namely:
1.
That at the meeting of 4 December 2009, the
issue of acceptance or non-acceptance of the appellant’s offer
was never raised
by the union representative but, instead, the issues
deliberated upon were mainly about the calculation formula of the
employees’
severance packages.
2.
In
the union’s letter of 7 December 2009, referred to above, the
union again appeared only concerned about the calculation
formula of
the employees’ severance pay, as well as reminding the
appellant about “
the
outstanding amounts
[totalling
R632 310.30]
owed
to our members in terms of the collective agreement”,
as duly confirmed in the arbitration award dated 8 November
2009.
[12]
3.
In the union’s statement of claim (in
the Court
a quo
),
the issue of the employees having accepted the appellant’s
offer was not pleaded, despite it being the employees’
apparent
main ground on which they sought to rely.
4.
In
the parties’ original pre-trial minute dated 7 December
2010
[13]
the issue of
acceptance or rejection of the appellant’s offer was never
raised by the union. It appeared only for the first
time in the
supplementary pre-trial minute dated 10 August 2011
[14]
– some 20 months later, since the meeting of 4 December 2009.
[28]
On the basis of these points, the appellant sought to depart from the
premise that the employees did not accept the appellant’s
offer
and thus refuting Mr Bengequla’s claim that the employees
accepted the offer. However, it seems to me that this approach
is
misguided. I say so for the simple reason that the approach tends to
shift unduly the
onus
onto the employees to prove that they
accepted the offer and that, therefore, their dismissals were unfair.
As I see it, the approach
conveniently disregards completely the
appellant’s failure to prove its allegation that the employees
rejected its offer,
thus rendering their dismissals to be fair. This
was the first part of the parties’ crystallised issue for
determination
by this Court. In my view, the appellant dismally
failed to prove this allegation. As for the employees, it seems to me
that only
if the appellant had presented credible and reliable
evidence establishing that the employees indeed rejected its offer,
would
the employees then bear the evidential burden of proving that
they accepted the offer.
[29]
It does not appear to me that by their denial of the appellant’s
allegation and, instead, alleging that they had accepted
the offer,
the employees thereby attracted the
onus
of proving such
acceptance by them, regardless whether the primary and material
allegation by the appellant (that they rejected
the offer) was proved
by the appellant. In my view, that would be tantamount to burdening
the employees with a duty to prove that
their dismissals were unfair.
Indeed, generally-speaking, any denial of an allegation (by the party
against whom the allegation
is made) does not necessarily relieve the
party alleging from its duty to prove the allegation.
[30]
In its attempt to proving its case, the appellant denied that it
issued the employees’ final payslips (which also served
as
notices of their dismissals) prematurely. It was submitted on the
appellant’s behalf that the following reasons served
as the
basis for the appellant’s conclusion that the employees indeed
rejected its offer:
1.
As far as the appellant was concerned, the
union was supposed to transmit the employees’ response on the
issue of acceptance
or non-acceptance of the appellant’s offer
any time prior to 4 December 2009, in order for the employees’
position
to be clearly known when the consultative meeting resumed on
4 December. In other words, if the response was not communicated to

the appellant, at the latest by 3 December, then the retrenchments
would be implemented on the following day (i.e. 4 December 2009).
2.
The appellant further relied on the
telephonic report that was allegedly received by its attorney from Mr
Bengequla to the effect
that the employees had rejected the offer. In
this regard, the appellant’s case was not merely to allege that
the employees
did not accept its offer, but that they in fact
expressly rejected it.
[31]
As stated, the appellant bore the
onus
to prove its aforesaid
allegations.
Having considered the
matter, I am not persuaded that the appellant discharged its
onus
in this regard, for the reasons that follow.
1.
Mr
Magagula conceded, under cross-examination, that there was no
evidence on record to support his claim that the agreement between

the parties (at the meeting of 13 November) was that the employees’
response to the appellant’s offer had to be communicated
to the
appellant strictly prior to 4 December. Actually, he conceded that
the 4
th
of December was the deadline on which the employees’ reaction
to the offer was to be communicated to the appellant, not necessarily

before then.
[15]
2.
There seemed to be ample evidence on record
to support the conclusion that the appellant relied mainly, if not
entirely, on the
alleged telephonic information from its attorney
about the employees having rejected the offer. The following extracts
from the
record illustrate how Mr Magagula responded to questions
under cross-examination:
‘…
Okay,
now it is common cause that the employment of the second to further
respondents (sic) was terminated on 4 December. Is that
correct? …
That is correct.
And yet the date at
(sic) which the offer had to be accepted, was the very same date, 4
December. Is that correct? That is correct.
Now exactly when …
were the applicants [employees] supposed to communicate [their
response to the] offer, … if as
you have already agreed, if 4
December was the date at (sic) which they ought to have accepted or
rejected the offer? …
As I have said actually … the
union, they dragged their feet … to engage themselves …
in this retrenchment
…, to engage themselves in consulting
with the employee (sic). On 4 December, it was agreed between the NUM
and the company,
then all of a sudden after that, we discussed with
Mr [Bengequla] the offer, so that we can maybe not carry on with
dismissal,
retrenchment. … the date was something like 13
October [November?], then we had to extend it to 4 December.
Then by 4 December,
before 4 December we got the response from Mr [Bengequla].
We know
(sic) before 4 December that these guys, they do not want the offer,
right,
before the 4
th
.
Right.
Mr [Bengequla] said, I mean he communicated to
you before the 4
th
that the guys, the workers rejected the offer?  …
Telephonically. I cannot prove it, telephonically he did talk
to …
(intervenes) …
Well that is very
convenient. That is very convenient, Mr Magagula. I mean you cannot
prove, because let me tell you why you cannot
prove it, is because it
does not exist, is because it never happened. It is because Mr
[Bengequla] would come here and state that
having received your offer
on 13 November when he was in the meeting and said that he was going
to consult [the] workers and revert
to you on the 4
th
and
actually advise whether the workers accept or not, he went to the
workers, he put the offer and the workers actually said,
“As
much as we are not happy with the offer that the respondent is
putting on the table, but in order to avoid the retrenchment
so that
we can save our jobs, we accept the offer of R11.55 per hour”.
… That is not true.
…
You
cannot say that is not true, because that was the communication
between him and the workers. You have got no way of knowing
whether
it is true or not. …. …
As
I said actually, we got the report back from Mr [Bengequla] before 4
December.
By
telephone, you say? … Yes, that is right.
He telephoned. Did
he telephone you or somebody else in your company? … No, [he]
did telephone the lawyer, Ms (inaudible).
He
telephoned the lawyer?  … Yes, from Mogaswa Attorneys.
Okay, and
do we
have anything in this bundle that points to that effect?
Because
that is so important. I mean
if an employer puts an offer [about]
the measure of avoiding dismissal and the employee rejects it, that
is being unreasonable.
Now that is a very important document. Can you
locate it in the bundle of documents … No, I cannot.
And
is the lawyer by the way, here to testify to that effect?  …
No, she is not.”
[16]
“
COURT:
I need to understand your response to the question. The question that
Mr Zondo has put to you, is that you agreed with Mr
[Bengequla] that
on the 4
th
,
Mr [Bengequla] would approach the employer,… and say, “This
is what the workers say. They either say they accept
your offer or
they reject it”.
Why then issue on
the same date, on the same 4
th
, the letters of dismissal before hearing from Mr [Bengequla]
…
Because
we already got the respond (sic) from Mr [Bengequla] telephonically.
…
MR
ZONDO: A response which unfortunately you cannot prove, correct?
… That is correct
.
[17]
“…
Had
the company waited for the acceptance of the offer of R11.55 to be
communicated to it on the 4
th
and know that the employees accept R11.55, we would not be here
today. Is that correct?   …   Well I
will
say that is not correct, because
actually
we did get a respond (sic) before 4 December
.’
[18]
(Emphasis added)
[32]
However, it was common cause that the appellant’s attorney, who
allegedly reported to the appellant that she received
a telephonic
report from the union advising her that the employees had rejected
the appellant’s offer, was not called as
a witness. There was
not even an affidavit deposed to by the attorney concerned verifying
and confirming the appellant’s
allegation attributed to her. As
a matter of fact, there was not even written correspondence (produced
by the appellant) from the
said attorney to the appellant,
purportedly informing the appellant of the alleged telephone
conversation and the contents thereof;
and then advising the
appellant to proceed with the retrenchments. To make things worse,
the appellant did not even attempt to
explain why it elected not to
substantiate its allegation in this regard. In this situation, I am
left with no option but to infer
negatively against Mr Magagula’s
credibility and honesty as a witness.
[33]
Indeed, notwithstanding Mr Magagula’s concession that he could
not prove the existence of the alleged telephone conversation,
there
was still no attempt on the part of the appellant to cure this
material evidential defect. Nor was there any attempt by the

appellant, which was legally represented, by the way, to have sought
to have the hearsay evidence admitted, for whatever other
permissible
reason, in terms of any of the statutory exceptions to the hearsay
rule, as laid down in the Law of Evidence Amendment
Act.
[19]
In my view, the reason is clear: There was no valid ground for any of
the exceptions to apply. Therefore, it stood to reason that
any
reference, in Mr Magagula’s evidence, to the alleged attorney’s
telephonic report, was inadmissible hearsay and
fell to be treated as
pro
non scripto,
which
the Court
a
quo
correctly did.
[34]
Consequently, with the exclusion of the appellant’s two grounds
aforesaid, there was nothing else left for the appellant
to rely on
as basis for its assertion that the employees rejected its offer,
which was evidently the basis for the appellant to
have prepared the
employees’ final payslips prior to 4 December, as to be ready
for delivery on the same day.
[35]
In any event, I have no reason to fault the Court
a quo
in its
factual findings on credibility. In my view, Mr Bengequla (on behalf
of the employees) appears to have performed far much
better in the
witness stand than Mr Magagula (on behalf of the appellant). Mr
Magagula’s evidence was littered with several
material
discrepancies, including contradictions and inconsistencies; and at
times he even made some serious concessions. The following
examples,
which include extracts from the record, illustrate some of these
discrepancies:
1.
Mr
Magagula was initially adamant that Mr Bengequla said he would phone
the appellant
before
4 December
and advise of the employees’ response to the appellant’s
offer. This is what he said: “…
He
[Mr Bengequla] said he is going to phone us. That means before 4
December …”
[20]
However, when Mr Magagula was presented with evidence pointing to the
contrary, he conceded that in fact the 4
th
of December was the deadline, in the sense that the employees’
response was to be communicated to the appellant on that day:
“
So
it would seem that the deadline for either rejection or acceptance of
that offer would have been 4 December. Is that correct?
…
That is correct.”
[21]
2.
Further,
on his own volition, Mr Magagula conceded that his claim that the
appellant’s attorney allegedly received a telephonic
message
from Mr Bengequla, saying that the employees had rejected the
appellant’s offer, was something that he (Mr Magagula)
could
not prove.
[22]
As already
discussed above, no other admissible evidence was tendered to prove
this allegation, which was seemingly the main basis
for the appellant
to implement the retrenchments.
3.
Hence, on the basis of Mr Magagula’s
concessions there was, in my view, simply no plausible explanation
why the appellant
decided to go ahead and issue the final payslips to
the employees, even before the meeting of 4 December. Obviously,
whatever might
have happened either at the meeting of 4 December or
post 4 December could not possibly have been the cause for the
appellant to
have issued the final payslips before that date. It
follows without doubt that, in this regard, the appellant mainly, if
not solely,
relied on the alleged telephonic report from its
attorney, Ms Nkadisha, which constituted inadmissible hearsay.
[36]
Mr Magagula also appeared to concede that the dismissals of the
employees were indeed a
fait
accompli,
after
all. The following passage from his evidence (under
cross-examination) is pertinent:
[23]
‘…
Can
you agree with me that even before you could hear what the…Applicants
had to say, you decided to terminate because these
meetings had been
dragging for far too long? I can refer you to, I mean to where
actually, I mean in the minutes of the 4
th
where the respondent actually said that the meetings have been
dragging for far too long. I think you have alluded to that as
well…Yes.
So
that was the reason why you terminated. You said no, it has been
dragging for far too long. Whether they accept or not, we are

terminating now because we had said that is the 4
th
.
Is that correct?  …
That is correct, because we agreed that the 4
th
was the termination date
.’
(Emphasis added)
[37]
It is significant to note that even the appellant’s accusation
that the union had been dragging the consultation process
for far too
long was factually incorrect. If anyone was to blame for any delay in
the process, it was the appellant itself. There
were only three
meetings scheduled by the parties to discuss the retrenchment issue,
namely, on 13 August, 13 November and 4 December
2009 – it
having been agreed that the meeting on 24 August 2009 was only for
discussing the issue of the collective agreement
and the moneys owed
to the employees by the appellant in terms of that collective
agreement. At all these three meetings, the union
was represented,
even the one of 13 November when most of its representatives were
attending a training course; and on that day
Mr Bengequla attended
the meeting alone. It transpired that the only single long delay was
the 60 day period – from 13 August
to 13 October – during
which the appellant had proposed to request the CCMA to appoint a
facilitator to try and assist the
parties in the consultation
process.
[24]
However, the
appellant apparently failed to have such facilitator appointed,
[25]
thus considerably contributing to the delay. Mr Magagula’s
responses to further questions under cross-examination:
‘
So
if then the respondent fails to appoint a facilitator and the matter
drags as a result of the respondent’s failure to appoint
a
facilitator, whose fault is it? Speak up, I cannot hear you. …
The company’s fault
[26]
….
…
Okay,
and do you perhaps have any minutes that indicate that for instance
there were meetings that were meant to be attended by
the applicants
which were never attended, which then resulted in these meetings
dragging? Have you got any minutes … No.’
[27]
[38]
The fact of the union having failed, a couple of times, to
communicate the employees’ acceptance of the appellant’s

offer much earlier than it did, was the basis on which the Court was
implored to draw an inference that the employees never accepted
the
offer. However, the same could be said of the appellant. No
explanation was proffered as to why the story - about the attorney

(presumably Ms Nkadisha) having received a telephone call from Mr
Bengequla - was kept secret until disclosed at the trial. For

instance, at the meeting of 4 December, none of the appellant’s
representatives disclosed that the employees had actually
rejected
the appellant’s offer. According to Mr Bengequla’s
evidence, Ms Nkadisha (who was part of the appellant’s
team)
was present at the meeting of 4 December and he even spoke to her.
Yet neither Mr Magagula nor Ms Nkadisha ever mentioned
anything about
the alleged telephone call from Mr Bengequla to Ms Nkadisha. Indeed,
the handwritten minutes of the 4 December meeting
bore testimony that
such matter was never raised by any of the appellant’s
representatives. In confirmation hereof, I propose
to refer to some
of the exchanges during the evidence-in-chief of Mr Bengequla:
[28]
‘
All
right. What happened?….On the 4
th
,
the day of the meeting, while I was walking towards the meeting as it
was held at our head office conference room, I received
a call from
the branch leadership, one of the branch (sic), asking me why are we
selling the employees out. I wanted to know why
is he saying that. He
said, “But the employer has already issued the employees with
their payslips, where he has paid them
amounts of money”,
whereas I told them that we are meeting again on the 4
th
.
I said to them, “I am on my way to the meeting” and when
we got to the meeting on 4 December,
I
raised this issue with Nkadisha. [She] was representing the
respondent. My Ladyship, and she just said to me this whole process

has been dragging. I said to him (sic), “But we have not even
discussed, this was the issue we were to discuss, whether the

applicants will accept the 11.55 instead of the, …. 16.98, and
already they had taken a decision. We could not say anything
on 4
December, because the letters [of dismissal] were given to the
employees already.
’ …
.
And
further:
[29]
‘
Okay,
all right. I interrupted you. You carried (sic) on, you were taking
us through as to what happened
when you
were to communicate their acceptance? …  And remember I
raised it with Nkadisha
and said, “I
have just received a call that the respondent is already paying out
the applicants”…(intervenes)
COURT
:
“Who is Nkadisha?….
Nkadisha
was the representative of the respondent from Mogwase Attorneys
.’
Mr
Bengequla proceeded in his evidence
[30]
:
‘
Right.
Now it was the respondent’s evidence that you actually
telephoned their attorney to the effect that, or let me put
it this
way, that after they had put an offer to you on 13 November and you
have said that you were going to go to your members
and communicate
with them and get the mandate and then revert to the employer, that
you then telephoned the lawyer and said that
no, the workers were
rejecting that offer. So I want you to take us through it.  ….
No, that is not true,
My Ladyship,
I
never telephoned Nkadisha. The results of the consultation with the
members were to be discussed on 4 December. I was supposed
to tell
them whether that has been accepted or not.
’
(Emphasis added)
[39]
Whilst the union, in its letter of complaint (about the dismissals)
dated 7 December 2009, failed to mention that the employees
were
dismissed despite having accepted the offer, the same could be said
of the appellant, in that it also failed, in its reply
of 8 December,
to state that employees were dismissed because they had in fact
rejected the appellant’s offer.
[40]
The appellant had another opportunity in its statement of defence to
have pleaded the fact that it implemented the retrenchments
on the
strength of the employees having, through their union representative,
expressly rejected the appellant’s offer. Nor
was this aspect
mentioned by the appellant in both the original and supplementary
pre-trial minutes. In response to the union’s
allegation (as
reflected in the supplementary pre-trial minute) that “
[t]he
applicant requested adjournment to take instruction from the members
and ultimately accepted the offer but still [they were]
dismissed
anyway”
, the appellant only stated, in reply: “
An
offer was put forward by the respondent but was never accepted by the
applicants”
. In other words, the appellant sought to focus
its response only to the alleged acceptance of the offer by the
employees and avoided
completely – and conveniently so –
to disclose that the employees had actually rejected the offer. It
begs the question
why.
[41]
As indicated elsewhere in this judgment, logically-speaking, the
appellant could not possibly have issued the employees’
final
payslips prior to 4 December and claim to have done so on the basis
of the events of 4 December and/or subsequent to that
date. As we
know, Mr Magagula ultimately conceded that there was indeed no
agreement between the parties to the effect that the
employees’
acceptance or rejection of the offer was bound to be communicated to
the appellant prior to 4 December. It followed,
therefore, that the
only reason left with the appellant to have issued the payslips prior
to 4 December was the alleged telephone
message from Mr Bengequla to
the appellant’s attorney. Admittedly, this was precisely the
reason why the appellant issued
the payslips prior to 4 December. It
was also the moment when the appellant made its final decision to
dismiss the employees. In
my view, therefore, the alleged incident of
the telephone call from Mr Bengequla to the appellant’s
attorney was materially
and crucially important for the appellant’s
case. The appellant was obliged to lead evidence on the issue to
prove this allegation,
which the appellant failed to do.
[42]
I think it would also be fair to take regard of the fact that
throughout the consultation process between the parties, the

appellant was always represented by an attorney, whereas the union
was represented by its officials who were presumably not legally

trained. Hence, their performance during the consultation process
should also be viewed and assessed in that context.
[43]
It is trite that, due to the fact of a trial court having the
advantage of observing the performance and demeanour of witnesses
in
the witness stand, the factual findings on credibility made by that
court are presumed to be correct and the court of appeal
will not
lightly interfere with such findings, unless it is satisfied that,
ex
facie
the appeal record, the trial court materially misdirected itself or
was clearly wrong.
[31]
On this basis, there seems to be no justifiable ground, in the
present instance, to fault the Court
a
quo
for having accepted the evidence of Mr Bengequla over that of Mr
Magagula. In this regard, the learned Judge
a
quo
observed:
[32]
‘
The
respondent did not call the attorney who conveyed Bengequla’s
purported response on the [proposed] remuneration rate and
provided
no explanation for such omission. Bengequla led clear evidence on the
issue which was not challenged under cross examination.
The same
cannot be said about Magagula who contradicted himself. For these
reasons I accepted Bengequla’s version that he
did not tell the
respondent, either directly or through its attorneys, that its offer
had been declined by the second to further
applicants …
Magagula conceded
under cross-examination that had the respondent received the
information that the second to further applicants
had accepted its
offer to keep the remuneration rate unchanged, the reason for the
retrenchment would have fallen away and the
second to further
applicants would not have been retrenched. He further conceded that
the respondent did not apply LIFO in selecting
employees for
retrenchment, but retained [only] those employees who accepted the
respondent’s offer to keep the rate of remuneration
unchanged.’
[44]
Clearly, the collective agreement essentially changed the terms and
conditions of the employees’ employment to the extent
that
their remuneration rate was increased from the hourly rate of R11.55
to R16.98. Therefore, the appellant’s proposal
of reversing the
implementation of the provisions of the collective agreement amounted
to a change to the employees’ terms
and conditions of their
employment. However, what the appellant sought to do was neither
unilateral nor impermissible, given the
fact that it wanted to do so
with the employees’ consent. In
Mazista
Tiles (Pty) Ltd v National Union of Mineworkers and Others,
[33]
this Court stated that:
‘
An
employer who is desirous of effecting changes to terms and conditions
applicable to his employees is obliged to negotiate with
the
employees and obtain their consent. A unilateral change by the
employer of the terms and conditions of employment is not
permissible.
It may so happen, as it was the position in [this] case
that the employees refuse to enter into any agreement relating to the
alteration
of their terms and conditions because the new terms are
less attractive or beneficial to them. While it is impermissible for
such
[an] employer to dismiss his employees in order to compel them
to accept his demand relating to the new terms and conditions, it

does not mean that the employer can never effect the desired changes.
If the employees reject the proposed changes and the employer
wants
to pursue their implementation, he has the right to invoke the
provisions of section 189 and dismiss the employees provided
the
necessary requirements of that section are met.
[34]
’
[45]
Due to its professed inability to afford the increased remuneration
rate, the appellant would ordinarily have been expected
to apply to
the bargaining council for exemption from the collective agreement.
If the exemption was refused it would have been
entitled to lodge an
appeal against the refusal.
[35]
However, the appellant did not lodge such application with the
bargaining council. Instead, it opted to embark on the section 189

retrenchment procedures. This begged the question why that route was
preferred. In my view, the following supplies the probable
answer to
this question:
1.
Applying for exemption from the collective agreement would
necessarily have required of the appellant to submit proof to the

satisfaction of the Minister that it was in such dire financial
straits that it was not in a position to afford to pay the employees

at the increased remuneration rate in terms of the collective
agreement, and its representations in this regard would have had
to
include production of its financial statements for the relevant
periods. Therefore, in the event of the Minister being not satisfied

with its representations, the appellant would then have been obliged
to comply with the dictates of the collective agreement and
to
remunerate the employees in terms of the prescribed increased rate.
2.
The appellant was desperate to having the employees retrenched from
its employ at all costs and, soon thereafter, have them employed
by J
& J Cable via a labour broker service.
[36]
That scenario would in turn benefit the appellant when the same
employees were then to be deployed by J & J Cable (as their

employer) to work for the appellant (being J & J Cable’s
client) at a lower rate than the one prescribed in the collective

agreement. On the facts, I am inclined to conclude that this is what
the appellant wanted to happen. Indeed, there could be very
little
doubt that, for all practical intents and purposes, J & J Cable
and the appellant were virtually one and the same corporate
entity,
given the fact that Mr Peter Mueller co-owned both entities, as
alluded to above.
[46]
In any event, if the appellant claimed (as they did) that all along,
since 4 December 2009, it was prepared to take back the
employees at
the unchanged remuneration rate, which the employees claimed (as they
did) that they were also prepared to accept,
then it begged the
question why this matter is before the Court, in the first place.
Assuming the parties were initially not
ad idem
, as to who
rejected what or who accepted what, but once it became clear to the
appellant that the employees’ position was
that they were
accepting its offer, it was reasonably expected of the appellant to
have taken whatever steps necessary to have
the employees reinstated
without further delay; and thus avoiding this litigation. To that
extent, the appellant was to blame for
the delay.
[47]
For these reasons, the Court
a quo
was, in my view, not wrong
in holding that the dismissals of the employees for operational
requirements were premature and, therefore,
substantively and
procedurally unfair.
[48]
Since the parties elected to crystallise and restrict the issue for
determination by this Court as stated above, it is no longer

necessary to deal in detail with other issues, such as the impact of
termination of the Eskom contract on the appellant’s
financial
standing and capacity and the effect of the subsequent conclusion of
the Ekurhuleni contract in terms of allegedly ameliorating
the
appellant’s financial position after termination of the Eskom
contract.
The
appropriate relief
[49]
This brings me to the question of the appropriate relief. In their
statement of claim, the employees sought an order for their

retrospective reinstatement; alternatively, an order for compensation
in an amount which the Court would deem fair and equitable
in the
circumstances. It is trite that unless the conditions referred to in
section 193(2)(a),(b) or (c) of the LRA are present,
a substantively
unfair dismissal entitles the dismissed employee to reinstatement,
that is, to be placed in the same position that
the employee
concerned would have been, but for the unfair dismissal.
[37]
I
t
was the appellant’s case that all along the appellant was
prepared to retain the employees in its employ on the unchanged

remuneration rate of R11.55 per hour. On this basis, it follows that
trust relationship was never an issue between the parties.
Of further
significance, in his evidence in the Court
a
quo
,
Mr Nkosiyabo Gumede was steadfast that the employees were seeking
reinstatement;
[38]
and not a
single question in cross-examination was put to this witness by
counsel for the appellant.
[50]
Hence, in my view, the Court
a quo
was also not wrong in
ordering the employees’ reinstatement. However, I note that the
Court
a quo
did not specify the extent of retrospectivity of
the reinstatement, particularly the issue of arrear wages, i.e. the
so-called
back-pay. I propose to deal with that aspect hereunder.
[51]
In considering the issue of back-pay, the particular circumstances of
this case should be taken in to account in order to ensure
that, at
the end of the day, fairness is served to both sides. In
National
Union of Metalworkers of SA v Vetsak Co-operative Ltd and Others
,
[39]
the Appellate Division (as the Supreme Court of Appeal was then
known) had this to say:
‘
Fairness
comprehends that regard must be had not only to the position and
interests of the worker, but also those of the employer,
in order to
make a balanced and equitable assessment.  In judging fairness,
a court applies a moral or value judgment to established
facts and
circumstances…  And in doing so it must have due and
proper regard to the objectives sought to be achieved
by the
Act.’
[40]
[52]
Accordingly, I have considered the following factors, in this regard:
1.
The employees were dismissed on 4 December
2009 and the judgment of the Court
a quo
was handed down on 3 August 2012 – almost three years later.
There is no indication that either of the parties was responsible
for
this delay. In particular, the delay cannot be attributed to the
appellant.
2.
Although there was no forensic evidence
presented by the appellant in support of its claim that it was, at
the time, in dire financial
distress, it seems to me that the
employees’ decision to accept the appellant’s proposal to
retain them at the unchanged
remuneration rate, which was clearly to
their detriment, served to show that the union and the employees did
recognise, as a fact,
that the appellant’s unfavourable
financial condition did exist.
[53]
Therefore, it seems to me that an order for payment of arrear wages
with effect from the date of dismissal (i.e. 4 December
2009) in
respect of 106 employees would be unduly financially burdensome on
the appellant.  However, it would not be unfair,
in my view, for
such order to take effect from the date of the judgment of the Court
a
quo.
Indeed,
I consider that it was within the appellant’s right to take the
matter on appeal. Having said so, however, I hasten
to point out that
such right had to be balanced up with the employees’ rights to
protection against any form of unfair labour
practices,
[41]
including unfair dismissals; and to effective and expeditious
resolution of their labour dispute.
[42]
I have no doubt in my mind that some, if not most, of these employees
were sole breadwinners who were left completely impecunious
and
destitute by their untimely unfair dismissals. Therefore, any delay
occasioned by the appellant exercising its right to appeal
should not
prejudice the employees’ right of entitlement to the benefits
of the order of the Court
a
quo,
as
at the time the order was made. On this point, I am mindful of the
remarks by Goldstone JA in
Performing
Arts Council of the Transvaal v Paper Printing Wood and Allied
Workers Union and Others,
[43]
where
the learned Judge of Appeal said the following:
‘
Whether
or not reinstatement is the appropriate relief, in my opinion, must
be judged as at the time the matter came before the
industrial
court.  If at that time it was appropriate, it would be unjust
and illogical to allow delays caused by unsuccessful
appeals to the
Labour Appeal Court and to this Court to render reinstatement
inappropriate.
Where
an order for reinstatement has been granted by the industrial court
[now the labour court], an employer who appeals from such
an order
knowingly runs the risk of any prejudice which may be the consequence
of delaying the implementation of the order.
[44]
’
(Emphasis
added)
[54]
Given the employees’ acceptance of the offer to be retained in
the appellant’s employ at the unchanged remuneration
rate of
R11.55 per hour, it would follow that their reinstatement, as well as
the calculation of their individual arrear wages,
must be based on
the same rate. In accordance with the requirements of law and
fairness, there should not have been a costs order
made in the Court
a quo,
given the need to encourage and promote the harmonious
working relationship between the appellant and the employees.
The order
[55]
In the result, the following order is made:
1.
The appeal is dismissed; save that the
order of the Court
a quo
is amended to read as follows:
(1) The dismissal of
the second to further applicants (the employees) - whose names are
listed in Table A annexed to the statement
of claim - was
substantively and procedurally unfair.
(2) The respondent
is ordered to reinstate the employees retrospectively from the date
of their dismissals and on the same terms
and conditions as they
existed then, save that the employees shall be entitled to back-pay
calculated only from the date of the
order of the Court
a quo
(i.e. 3 August 2012) to the date of this Order; and at the
remuneration rate of R11.55 per hour.
(3) The date of
resumption of duty by the individual employees shall be arranged
between the appellant and the union (or the individual
employees, as
the case may be) but it must not be later than 30 days from the date
of this Order.
(4)
No costs order is made.
2.
There is no order as to costs of the
appeal.
Ndlovu JA
SUTHERLAND JA
[56]
I have read the judgment of my brother
Ndlovu JA, and am unable to agree with the result. In my view, the
appeal should succeed.
[57]
The Labour Court found that the appellant
employer had unfairly retrenched its workers. The appeal seeks to
upset that finding.
[58]
The parties have agreed that the sole
question to decide on appeal is whether the union, on behalf of the
workers, accepted an offer
put to the union on 13 November 2009, that
a retrenchment would be avoided if the workers agreed to a wage rate
at the current
rate of R11.55 per hour and they forwent the
bargaining council stipulated increase at a rate of R16.98 per hour.
Precisely how
an agreement in these terms could be implemented at
less than the bargaining council rate was not disclosed, but it is
not a question
the court is required to decide. This offer is agreed
by the parties as being reasonable; ie a reasonable alternative to
retrenchment.
If the finding of fact is that the workers refused the
offer, the retrenchment is fair; if they accepted the offer, there
would
be no rationale for a retrenchment and accordingly the
retrenchment was unfair. The exact formulation of the question, which
seems
to have some bearing on the difference in the views adopted in
the respective judgments in this case, was articulated thus:
‘
If
it is found that indeed the respondents (the employees) refused the
offer, which was reasonable, then the appeal ought to succeed
and
conversely, if it is found that the respondents (the employees) were
amenable to the offer and in fact accepted same however
the appellant
terminated their employment even before their acceptance could be
communicated then it should follow that the retrenchments
were
premature and therefore unfair with the result that the appeal ought
to be dismissed with costs.’
[59]
Accordingly, in my view, this Court must
address the respective cases which the parties have agreed to
contest; other aspects of
their dispute are irrelevant.
[60]
The relevant factual context is common
cause:
60.1.
The appellant conducted business solely in
terms of civil works sub-contracts to JJ Cables Jointing CC, which
Business in turn concluded
main contracts with the principals. Its
income was a function of the volume of contracts at any time, and how
lucrative they were.
Different contracts were struck at various
rates.
60.2.
A particular contract with Eskom was lost,
and the appellant’s volume of work was reduced to a perilous
level. Although other
work was awarded, that work was less
remunerative. The impact was that the appellant struggled to meet the
overhead expenses and
the wage bill became a strain, exacerbated by
an industry level increase.
60.3.
A retrenchment process was formally engaged
in. Four meetings were ultimately held over a period from 30 July to
December 2009.
Notes of these meetings were recorded by the union
negotiator, Melusi Stephen Bengequla, a union legal officer. (These
notes are
not “proper” minutes, do not purport to be
comprehensive, but are the only contemporaneous record of the events;
the
parties agree they are an accurate reflection of what they
state).
[61]
The parties’ consultations trundled
on in a desultory fashion until the third meeting on 13 November
2009. What passed between
them is noted by Bengequla, albeit
imperfectly. Among the agreements reached and actually noted is this:
‘
Parties
agreed to change the termination date of 13 October to be 4
th
December 2009.’ (It is common cause that the reference to
October should have been November.)
What
was not noted, but is common cause, is that the appellant put to the
union a proposal that the wage rate be kept at R11.55
and if so, the
retrenchment would be abandoned. Bengequla undertook to put this
proposal to the workers. Significantly, the shop
stewards were not at
this meeting, an astonishing circumstance, given the importance of
the topic. Their absence was explained
by their engagement on a union
training course.
[62]
The really controversial question arises
from what the parties expected to happen next. On this, there is a
substantial dispute
of facts. According to the union, Bengequla was
to canvass the workers and report back at the next meeting scheduled
for 4 December
2009. The appellant’s expectation, according to
its main witness, Magagula, the Human Resources Manager, was that an
acceptance
or rejection of the offer would be communicated before 4
December. Which version is more probable?
[63]
The note of the meeting, written by
Bengequla, does not even record that a further meeting is to be held,
merely that the termination
date is agreed as 4 December.
Notwithstanding that, it is common cause that the parties did agree
to meet on 4 December, at the
union offices, as had hitherto been
their practice. However, the primary meaning of the words noted
undoubtedly suggest strongly
that the dismissals would take place on
that day. Equally self-evident, having regard to the offer put up for
acceptance or rejection,
the “termination” must have been
contingent upon a need to retrench; ie the appellant would not
“terminate”
on that date if the offer was accepted.
Presumably, to avoid the deadline on 4 December to trigger the
retrenchment,
at least by 4 December
an answer had to be communicated.
[64]
On 4 December, the appellant dismissed the
workers. Why? The appellant’s case is that the offer was not
accepted. The union’s
case is that Bengequla went to the 4
December meeting to report an acceptance, but to his amazement, the
dismissal process commenced
before his arrival.
[65]
The appellant had wanted to present a case
that on some day prior to the 4 December meeting, it had been told by
Bengequla that
the offer was rejected. Magagula claimed that the
appellant’s attorney had been telephoned by Bengequla to inform
her of
the rejection. She was not called to testify. Magagula’s
evidence was plainly hearsay. Bengequla flatly denied making any
such
communication. Quite correctly, in the face of Bengequla’s
denial, the evidence tendered of his alleged conversation
with the
attorney was excluded and ignored by the court
a
quo
. Accordingly, there was no direct
evidence of a positive rejection of the offer. In my view, the
absence of evidence of an express
rejection ought not to be accorded
undue significance in an assessment of the evidence that was, indeed,
adduced, especially having
regard to the probabilities. It is this
regard that I differ from the approach taken by Ndlovu JA.
[66]
Bengequla’s evidence was that he was
not due to announce the outcome of the workers’ response to the
offer until he
met with the management of the appellant on 4
December. Is this consistent with the probabilities? First, on his
own evidence,
he noted on 13 November, the “termination”
was set for 4 December. Even assuming that for reasons of proper
record
keeping and prudent formalities, the parties would on 4
December meet to conclude an agreement reflecting the agreement by
the
workers to accept the lesser wage rate, if the workers had truly
mandated an acceptance, why wait until the meeting to report that

fact? Self-evidently, if a mandate to accept had been given by the
workers at any time during the three weeks since the offer had
been
made, at least one gathering of the workers must have occurred to
furnish such a mandate to the union. Common sense indicates
that an
immediate report of an acceptance would have followed. Indeed, how
such a mandate could have remained a secret from the
managers of
those workers is, in my view, inconceivable. On Bengequla’s
evidence, the acceptance was given although he does
not say when, and
but his conduct must be understood that it was kept confidential
until the day of the 4 December meeting, when
he intended to reveal
it. No rationale is offered to explain why this was the case.
[67]
A significant morsel of evidence from
Bengequla is that
en route
to the meeting, he says he was phoned by a worker. The worker accused
him of selling them out because they were receiving dismissal

notices; ie
before
the
meeting even started. This remark was understood by Bengequla to
refer to the belief by the workers that if workers were being
given
their dismissal notices, it meant that, contrary to the mandate given
by them to Bengequla to accept the offer to avoid the
retrenchment,
Bengequla had agreed to a retrenchment. This accusation was the very
antithesis of Bengequla efforts. Curiously,
he does not state what
answer he gave to the anonymous caller. If this account of Bengequla
were to be true, then it would imply
two significant circumstances:
first, that he arrived at the meeting in the full knowledge that
despite the report he was about
to deliver it would render the
retrenchment definitively unnecessary, and second, that the
management had not waited to hear from
him and had, as foreshadowed
by the agreement reached on 13 November, implemented the retrenchment
effective on that day, 4 December.
His actions which followed had to
be conditioned by those circumstances.
[68]
What happened at the meeting of 4 December?
Bengequla, once more, made a note. The topics noted allude to back
pay arising from
an arbitration award on the correct rate of pay, and
the drawing up of a list of retrenchees which should reflect the
higher rate
of pay that triggered the retrenchment exercise in the
first place. One notation is made thus: “Instructions are that
this
matter has been dragging” This is an odd way of expressing
a frustration with delays. Bengequla’s evidence is that the

attorney said this to him, and the allusions to “instructions”
on the probabilities bears out that the phraseology
was likely to
have been that of a lawyer advising the appellant, who was herself
present at the meeting.
[69]
However, the most astounding aspect is that
no protest was made by Bengequla that the retrenchment was
unnecessary and no discussion
took place about the acceptance or
rejection of the offer. In my view, if Bengequla really had a mandate
of acceptance to present,
the probability that he would not call for
a reversal of the retrenchment he alleges was already in progress is
so far-fetched
as to be quite unbelievable. He had the ultimate and
complete answer to close down the retrenchment and save the workers’

jobs, but so he says, he did not play that card. Instead, he remained
silent on that score and engaged in discussing other aspects
of the
implementation of the retrenchment decision, moreover, he did so,
despite a fellow union member having inaccurately called
him a
sellout. His efforts to explain away his silence are incredible; ie,
it was too late to do anything about the retrenchment
decision and it
was therefore not even mention-worthy! In the judgment of Ndlovu JA
at paragraph 9 it is suggested that, Bengequla,
by the turn of events
as described by him, was “deprived of an opportunity” to
present or disclose the acceptance.
With this view, I am unable to
agree. In my view, the probabilities are against such a meek, if not
spineless, response. Bengequla
was a union legal officer, accustomed
to negotiating to protect worker’s interests, not a rank and
file worker who might
have been confused or bewildered by the turn of
events. Indeed, the probabilities suggest, in my view, that his
entirely righteous
anger would have been uncontainable in the face of
such duplicity as he claims was perpetrated by the Management.
[70]
However, a credibility finding against
Bengequla need not rest on those circumstances alone. There are
several more
induciae
.
The first is a letter penned by Bengequla on 7 December, three days
later. In it, he accuses the appellant of giving notices to
the
workers
after
the meeting, an allegation, incidently, which contradicts his
evidence that the dismissal notices were distributed before the
meeting took place. In the letter, this act of giving dismissal
notices was improper, he alleges, because financial details were

still being worked out; ie the tenor of the letter is that the
principle of retrenchment is implicitly affirmed, but the date of

termination is merely premature, because of details about the package
to be paid. On such grounds, he threatens legal action. Again,

missing from this letter, after three days to reflect and confer with
colleagues, is the killer-point on which to stop the retrenchment

dead in its tracks; ie the improper persistence with a retrenchment
because the workers accept the job-saving offer, rendering

retrenchment unnecessary. In my view, the omission, on two occasions
to protest against the need for a retrenchment because the
offer was
accepted is a material impediment to believing that an acceptance of
the offer existed.
[71]
What the evidence discloses, up to this
stage of the evolution of events, ignoring the belief of the
appellant that the offer was
rejected, is the signal fact that
Bengequla never communicates an acceptance. To the extent that the
agreed termination was contingent
on it being displaced by an
acceptance of the offer, no acceptance is ever given. Accordingly,
the resolutive condition, which
would stop the retrenchment, as noted
by Bengequla on 13 November, it is common cause, is never met.
[72]
The mendacity of Bengequla on the question
of the existence of a mandate to accept the offer is further
manifested by an examination
of the evolution of the pleadings. The
union’s Statement of case is bereft of the slightest hint of
the offer that is central
to the controversy. It alleges that on 4
December, the appellant ended the consultation process merely because
it had dragged on
so long. The Statement of defence in paragraphs
6.2, and 17 set out the case of the offer and the resolutive
condition expiring
on 4 December. The first pre- trial conference
recorded nothing of any use. The parties were then ordered to hold a
fresh meeting.
In paragraph 10.3 of the minute of that conference,
the union alleged that the offer was accepted but the workers were
dismissed
anyway. The appellant responded by denying that an
acceptance was forthcoming.
[73]
From this traverse of the pleadings, it is
plain that the union did not initially seek to rely on a breach of
trust by the appellant
to abandon the retrenchment if the offer was
accepted; only at the very end, was an alleged acceptance raised. The
appropriate
inference to be drawn, from all of these facts and
circumstances is that the claim of an acceptance is opportunistic and
false.
[74]
In the result, Bengequla cannot believe
that he had a mandate to accept the offer. The appropriate factual
finding on this body
of evidence must be that the offer was not
accepted.
[75]
It has been suggested in the judgment of
Ndlovu JA at paragraph 28 that the
onus
to prove a fair dismissal, which rests on the appellant, has not been
met by it because it could not present admissible evidence
of an
express rejection, and no
onus
can rest on the union to prove an acceptance. With this approach, I
cannot agree. The
onus
of proof is not shifted. The real issue is the burden to adduce
evidence of facts upon which the litigants rely. The common cause

facts include an agreed termination date, subject to an acceptance of
an offer to halt the dismissal. The party who alleges an
acceptance
must adduce that evidence, regardless of the incidence of the
onus
.
Paradoxically, the absence of a communication of an acceptance is
common cause. As such, it is merely a semantic question whether
it is
an absence of an acceptance or an absence of a rejection which has
been established by the evidence. Moreover, in my view,
that is not
the determinative consideration.
[76]
The critical issue is
why
Bengequla never communicated an
acceptance when no plausible explanation exists for not doing so. In
my view, his explanation on
this score is incredible, for the reasons
already given. Moreover, the conduct of the appellant is consistent
with a belief that
by 4 December there had been no acceptance, even
disregarding the hearsay evidence of a rejection.
[77]
Accordingly, the question put to the court
must be answered in favour of the appellant. There was no acceptance
of a reasonable
offer to avoid the retrenchment. The retrenchment was
accordingly, not unfair.
[78]
As to costs, once a finding of scheming
untruthfulness is made, the usual factors which incline this Court to
refrain from making
costs orders evaporates. The union should bear
the costs of the matter.
The
order
[79]
The appeal is upheld with costs.
[80]
The order of the Labour Court is set aside
and substituted as follows.
80.1.
The retrenchment of the persons whose names
are listed in table A was fair.
80.2.
The application is dismissed.
80.3.
The Applicant shall pay the respondent’s
costs.
Sutherland
JA
Landman
JA concurs in the judgment of Sutherland JA
FOR
THE APPELLANT: Mr WJ Hutchinson
Instructed
by Fluxman Incorporated,
FOR
THE RESPONDENTS: Ms P Nkutha
Instructed
by Finger Phukubje Inc Attorneys
[1]
In
terms of s
ection
200 of the Labour Relations Act 66 of 1995 (the LRA). See also
National
Union of Mineworkers v Hermic Exploration (Pty) Ltd
(2003)
ILJ 787 (LAC) at paras 37-- 41;
Amalgamated
Engineering Union v Minister of Labour
1949 (4) SA 908
(A) at 910.
[2]
Published
in the Government Gazette No. 31988 of 13 March 2009.
[3]
In
terms of section 24(2) of the LRA.
[4]
In
terms of section 24(5) of the LRA.
[5]
It
later transpired that the employees who were retrenched were 106 in
number and not 82 as appearing in paragraph 7 of the retrenchment

notice. This position became common cause between the parties.
[6]
The
significance of this date will become apparent in the next
paragraph.
[7]
Record,
vol 3, at 253 line 22.
[8]
It
is noted that, in the transcript of the record, the name of Mr
Bengequla was apparently inadvertently misspelt as Mr Bengi
Nxulu.
However, both in the judgment of the Court
a
quo
and the handwritten notes taken at the meetings, the name
“Bengequla” is reflected which, to me, appears to be the

correct spelling.
[9]
Record,
vol 3, at 270 line 3.
[10]
Record,
vol 3, at 273 line 3.
[11]
Section
192(2) of the LRA.
[12]
Arbitration
Award,
at
87-90 of the indexed record.
[13]
Pre-trial
Minutes, at 53 – 58 of the indexed record.
[14]
Supplementary
Pre-Trial Minute, para 10.3,
at
75 of the indexed record.
[15]
Appellant’s
statement of defence para 17.4; See also: Record, v
ol
3 at 218 line 20 et seq
[16]
Record,
vol 3, at 219 line 15 to 222 line 4.
[17]
Record,
vol 3, at 226 lines 12-22.
[18]
Record,
vol 3, at 247 lines 2-7.
[19]
Section
3(1)(c) of
Act
45 of 1988.
[20]
Record,
vol 3, at 218 line 14.
[21]
Record,
vol 3, at 218-219.
[22]
Record,
vol 3, at 220, line17.
[23]
Record,
vol 3, at 225 line 21 to 226 line7.
[24]
Presumably
in terms of section 189A(3) read with section 189A(7) of the LRA.
[25]
Record,
vol 3, at 229 line 2 to 238 line 8.
[26]
Record,
vol 3 at 230 lines 14-17.
[27]
Record,
vol 3 at 231 lines 5-13.
[28]
Record,
vol 3, at 270 lines 7-24.
[29]
Record,
vol 3, at 271 lines 19-25.
[30]
Record,
vol 3 at 272 line 22 to 273 line 6.
[31]
See
Manhattan
Motors Trust v Abdulla
(2002) 23 ILJ 1544 (LAC) at para 7 and
Toyota
SA Motors (Pty) Ltd v Radebe and Others
(2000) 21 ILJ 340 (LAC) at para 39.
[32]
Record,
vol 4, at 344 lines 5-12 and 22-28.
[33]
(
2004)
25 ILJ 2156 (LAC).
[34]
Mazista
Tiles
,
above, at para 48.
See
also:
Motor
Industry Staff Association and Another v Silverton Spraypainters &
Panelbeaters (Pty) Ltd and
Others
(2013)
34 ILJ 1440 (LAC) at para 32.
[35]
In
term of section 32(3)(e)(i) of the LRA.
[36]
Judgment
of the Court
a
quo
,
at para 11.
[37]
Equity
Aviation Services (Pty) Ltd v Commission for Conciliation, Mediation
and Arbitration and Others
(2008)
29 ILJ 2507 (CC); Also reported as
[2008] 12 BLLR 1129
(CC) (
Equity
Aviation Services
)
at para 36.
[38]
Record,
vol 4 at 310 lines 5-8.
[39]
(1996)
17 ILJ 455 (A) (
National
Union of Metalworkers)
,
also reported as 1996 (4) SA 577 (A)
[40]
National
Union of Metalworkers,
above,
at
476 D-E. See also
CWIU
and Others v Algorax
(Pty)
Ltd
(2003)
24 ILJ 1917 (LAC), also reported as
[2003] 11 BLLR 1081
(LAC)
at
para.69. See also
Equity
Aviation
,
above, at para 39;
Billiton
Aluminium
SA
Ltd t/a Hillside Aluminium v Khanyile and Others
2010
(5) BCLR 422
(CC)
at
para 43.
[41]
Section
27(1) of the Constitution of the Republic of South Africa Act 108 of
1996. See also: section 185 of the LRA
[42]
Section
1(d)(iv) of the LRA.
[43]
199
4
(2) SA 204 (A).
[44]
Performing
Arts Council
,
a
t
219H-I.