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[2017] ZALAC 81
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Edcon Ltd v Steenkamp and Others (JA125/2017) [2017] ZALAC 81; [2018] 3 BLLR 230 (LAC); (2018) 39 ILJ 531 (LAC) (18 December 2017)
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA, JOHANNESBURG
Reportable
Case
no: JA 125/2017
In
the matter between:
EDCON
LTD
Appellant
and
STEENKAMP,
KARIN AND 1817
OTHERS
Respondents
Heard:
23 November 2017
Delivered:
18 December 2017
Summary:
Section 189A(13) of LRA– proper function – an
intrinsically urgent set of remedies to address alleged unfair
procedure in a retrenchment – four remedies in section
189A(13)(a) - (d) must be read together, not disjunctively -
compensation
order in terms of section 189A(13)(d) is not available
as primary relief – any condonation application must take
account
of that intrinsic character of the application whose function
is to supervise a retrenchment process
Condonation
of a late filing of a section 189A(13) application years out of time
– explanation offered was that the
respondents relied on
a particular view of the law, based on case law that was reversed
later to justify a delay, is in principle
unacceptable; ie the
respondents had pleaded a case based on the invalidity of a dismissal
where a breach of section 189A had been
alleged, the appellant had
successfully challenged that view leaving respondents with no
cognisable causa having been pleaded-
moreover, on the facts, the
litigant had abandoned a case based on procedural unfairness and had
delayed seeking condonation unduly,
changing tack only when the
Constitutional Court had held against their appeal of the LAC
reversing the view of the law
Parkinson
v Edcon (LC)
and
Ramiyal
v Clinix Selby Hospital (LC
)
applied
Decision
of the Labour Court granting condonation set aside.
Coram:
Musi, Coppin and Sutherland JJJA
JUDGMENT
SUTHERLAND
JA
Introduction
[1]
The
appeal is against an order of the Labour Court given on 13 June 2017,
which echoed the relief sought by the respondents (applicants
a
quo)
in
their notice of motion. The order reads:
‘
(48.1) The referrals to the
Court under cases numbers in annexure NOM 1
[1]
hereto are consolidated into a single trial.
(48.2) The late filing of this
application, insofar as it pertains to the application for
condonation for the late filing of the
application for compensation
in terms of section 189A(13)(d) of the Labour Relations Act 66 of
1995 (LRA) is condoned.
(48.3) The application for
compensation referred to under paragraph 48.2 above in respect of
procedural fairness under section 189A
is referred to trial and
consolidated with the main action.’
[2]
The
principal controversy in the appeal is whether the granting of
condonation to the respondents to bring an application in terms
of
section 189A(13) of the Labour Relations Act 66 of 1995 (LRA) after
the expiry of the prescribed 30 day- period was an incorrect
exercise
of judicial discretion. Upon the fate of that issue, hangs the
propriety of consolidating the several other cases.
[2]
[3]
This
case is the latest chapter in the course of protracted litigation
arising from retrenchments effected by the appellant between
April
2013 and October 2015. The Litigation has reached a point that is
characterised by forensic untidiness which, insofar necessary
for the
purposes of this judgment, an attempt is made to unravel the critical
threads and provide a measure of coherence.
The
geography of this matter
[4]
It
is common cause that over a period of some two and half years, the
appellant, a major retailer in South Africa, terminated the
employment of at least 1817 employees. Of these employees, the
appellant claims that only 23 employees have actually referred a
dispute to conciliation. The Respondents do not deny this allegation,
which must therefore stand.
[3]
The appellant categorised the respondents into five categories as
follows:
4.1.
Category 1:
801 employees who were not “dismissed” but elected to
enter into agreements to terminate their employment
and take
voluntary retrenchment packages, of which 121 also took early
retirement.
[4]
4.2.
Category 2:
1236 employees who were retrenched in a process that was indeed
conducted pursuant to section 189A.
[5]
4.3.
Category 3:
Steenkamp and others who were retrenched and referred a case for
conciliation, alleging that section 189A had not been
complied
with.
[6]
4.4.
Category 4:
Miscellaneous employees.
[7]
4.5.
Category 5:
Employees who were retrenched and were reemployed.
[8]
[5]
The
validity of such characterisation is faintly disputed by the
respondents, save as to category 4, “miscellaneous”,
in
respect of which it is properly conceded there is no case to advance
for its inclusion in these proceedings. Thus, of category
4 no more
need to be said. Of category 1, the respondents’ attorney says
that the agreements are invalid for want of proper
consent. Of
Category 5, the respondents’ attorney says that these factual
confusions can be sorted out in the trial contemplated
by the order
a
quo.
[6]
Neither
the founding affidavit nor the replying affidavit is deposed to by a
respondent but, rather, by their attorney.
6.1.
Only
Steenkamp, herself, deposed to a confirmatory affidavit. It has been
argued that the attorney’s say-so is hearsay and
upon that
ground, the application should have been dismissed.
6.2.
In
rebuttal, it is said that the management of the litigation was in the
attorney’s hands and much of what is necessary to
say,
especially about condonation, he has first-hand knowledge. That an
attorney has a contribution to make in condonation applications
is
true of many cases including this one, but misses the point in this
particular case. The replying affidavit is replete with
confessions
of ignorance about important aspects of the retrenchment process and
albeit that the riposte is offered that the appellant
chose not to
reveal such facts until the answering affidavit, it is blatantly
obvious that the attorney cannot depose to the several
individuals’
causes of action, nor purport to refute important facts alleged by
the appellant, even in reply, leaving open
the suspicion that the
attorney has not been in contact which very many of the respondents
on whose behalf he has been expected
to advance a case.
6.3.
This hole
in the respondents’ case is huge and is fatal to the case in
several respects.
6.4.
However,
because of the view we have taken about the legal intricacies and the
primary controversy, which it is appropriate to resolve
because more
litigation is likely in one form or another, we have not decided this
matter on the basis of the absence of properly
adduced evidence.
[9]
History
of the litigation
[7]
To
make sense of the controversies that rage at present, it is necessary
to succinctly summarise the critical history. The finer
details of
the clashes are already fully captured in the judgments which precede
this judgment, and do not warrant regurgitation.
[8]
In
2013, the first of a series of retrenchment began. Ms Steenkamp,
whose name is given to the saga, and a few other co-employees,
referred a dispute to conciliation. The conciliation failed. In due
course she and her co-applicants, pleaded a case before the
Labour
Court. That case was formulated on the basis that the failure to
adhere to section 189A rendered her subsequent dismissal
invalid;
alternatively, procedurally unfair.
[9]
In
response, the appellant pleaded that no cause of action existed in
our law to justify a claim of invalidity for want of compliance
with
section 189A. Two judgments in this Court had, prior thereto, held
unequivocally that dismissals in contravention of section
189A were
invalid.
[10]
This view became
known as the
De
Beers Principle
.
The appellant dealt with that hurdle to its defence by seeking an
order that these judgments were clearly wrong and resulted in
an
unconstitutional outcome.
[10]
Because
of that controversy and its wider implications for Labour litigation,
the matter was especially set down before this Court
sitting as a
court of first instance. Steenkamp and her co-applicants then amended
their claims to abandon the alternative cause
of action relying on
unfairness. This was reiterated in the minute of the pre-hearing
conference. The minute, of 6 February 2014,
records:
‘
5.2: The issues have been
narrowed as a result of the amendment. The applicant abandons all
allegations that the dismissal was substantively
and procedurally
unfair under section 189.
5.3: the applicant’s claim is
that the dismissal was
void ab intio
the respondents
disagrees.’
[11]
This
Court thereupon heard the matter and found the two earlier decisions
of this Court and the
De
Beers Principle
to be in error. The result was that dismissals in contravention of
section 189A were indeed valid.
[11]
Whether or not the respondents’ dismissals were unfair was not
an issue put to this Court in those proceedings, nor in the
light of
the pleadings and the pre-trial conference minute, could such an
issue arise.
[12]
That judgment
of this Court was delivered on 3 March 2015, and was confirmed in the
Constitutional Court which delivered its judgment
on 22 January
2016.
[13]
[12]
Within
30 days of the Constitutional Court’s judgment being delivered,
the respondents initiated the present proceedings.
[13]
The
complications that this present application envisages resolving arise
from the fact that the sole issue upon which the respondents’
grievances have hitherto been advanced have been the alleged
invalidity of their dismissals, having expressly abandoned claims
for
procedural and substantive unfairness claims under the circumstances
described. Because the viability of the “invalidity”
premise, as a cause of action, dashed by this Court and by the
Constitutional Court, what the respondents want now is a chance
to
get a compensation order for procedural unfairness using section
189A(13)(d) as a hook. The foundation of the present claim
rests on
two legs; (1) first, that it can pursue a trial about unfair
procedure to obtain relief in terms of section 189A(13)(d),
and (2)
second, they can obtain condonation of the late referral of a section
189A(13) application, years out of time, on the basis
of the alleged
reasonableness of pursuing an invalidity claim until the
Constitutional Court scotched that hope, and thus the delay
is
satisfactorily explained. In this latter regard they draw inspiration
from a
dictum
of Zondo J in the Constitutional Court at [193]:
‘
[193]
The appeal must fail. Does this mean that this is the end of the road
for the employees in this case? Not necessarily. Until
the decision
of this court, the employees acted on the strength of decisions of
the Labour Court and Labour Appeal Court whose
effect was that in
this type of case it was open to them not to use the
dispute-resolution mechanisms of the LRA and not to seek
remedies
provided for in s 189A but instead to simply seek orders
declaring their dismissals invalid. It is arguably open
to them to
seek condonation and pursue remedies under the LRA. Obviously, Edcon
would be entitled to oppose that.’
[14]
Premised
upon that foundation, it is advanced on behalf of the respondents
that there ought to be a consolidation of the several
cases claiming
invalidity as a
causa,
already
before the Labour Court, with section 189A (13) applications, their
late filing duly condoned.
Section
189A (13) – what is it for and how does it work?
[15]
In
our view, the application by the respondents is fatally flawed and
the judgment
a
quo
in
error. Upon these grounds the appeal has to succeed. The principal
reason for this outcome is the misconception about the purpose
and
functioning of section 189A(13).
[16]
Section
189A was enacted by an amendment to the LRA in terms of section 45 of
Act 12 of 2002. There were further amendments in 2014
to section 189A
in terms of Section 33 of Act 6 of 2014, but those amendments are
irrelevant to this controversy.
[17]
Section
191 of the LRA regulates, generally, how disputes about unfair
dismissals are dealt with. In particular, in relation to
dismissals
as a result of retrenchments, section 191(5)(b)(ii) provides that a
dispute unresolved by conciliation, may be referred:
‘…
to the Labour Court for
adjudication, if the employee has alleged that the reason for
dismissal is …based on the employer’s
operational
requirements’.
[18]
An
employer who dismisses an employee must justify the decision to do.
Section 189 regulates that obligation. Furthermore, in large
scale
retrenchments, like that in this case, additional obligations are
imposed on the employer by section 189A. Central to the
present
controversy is section 189A(18) which provides that:
‘
The Labour Court may not
adjudicate a dispute about procedural fairness of a dismissal based
on the employer’s operational
requirements referred to it in
terms of section 191(5)(b)(ii)’.
[19]
There
could be no clearer indication that after a dismissal had taken place
under the stipulated circumstances of operational requirements
of an
employer, the Labour Court is bereft of jurisdiction, save in respect
of substantive fairness. That express exclusion of
jurisdiction to
evaluate procedural unfairness
ex
post facto
is in stark contrast to the jurisdictional competence of the Labour
Court in other kinds of dismissal disputes.
[20]
This
policy choice in the LRA goes hand in hand with what can be described
as a partial claw - back of jurisdiction. This claw -
back is the
burden of section 189A (13):
‘
(13) If
an employer
does
not comply with a fair procedure
,
a consulting party may approach the Labour Court by way of an
application for an order-
(a)
compelling
the employer to comply with a fair procedure;
(b)
interdicting
or restraining the employer from dismissing an
employee
prior
to complying with a fair procedure;
(c)
directing
the employer to reinstate an
employee
until
it has complied with a fair procedure;
(d)
make an
award of compensation, if an order in terms of
paragraphs
(a)
to
(c)
is
not appropriate.’
[21]
This
jurisdictional competence cannot be read disjunctively from Section
191(5)(b)(ii) and section 189(18). Plainly, this power
is an
exception to the primary prescription that no adjudication can occur
about unfair procedure. A reading of section 189A as
a whole reveals
that it is envisaged that the dynamics of large scale retrenchments
are beneficially managed in many cases by third
party intervention in
the form of facilitation. Either the employer or, in certain
prescribed circumstances, the affected employees,
may request
facilitation, whereupon the CCMA must intervene. If, for whatever
reason, no facilitation occurs, a 30- day moratorium,
calculated from
the date of the notice contemplated by section 189(3) notifying
employees that they are at risk of retrenchment,
is imposed on all
parties from referring a dispute to the CCMA. After that 30-day
period, a dismissal notice may not be given until
a further 30 days,
as contemplated in section 189(8)(b)(i) have elapsed. Section
189A(2)(a) makes it plain that a dismissal “….must
give
notice of termination of employment in accordance with the provisions
of this section”.
[22]
The
effect of these provisions, in short, is that an employer must wait
at least 60 days from the date upon which an employee is
notified of
being at risk of retrenchment before giving notice of dismissal in a
large-scale retrenchment exercise.
[14]
[23]
There
are time limits placed on the bringing of such an application.
Section 189A (17) provides:
‘
(17)
(a)
An
application in terms of subsection (13)
must
be brought not later than 30 days after the employer has given notice
to terminate the
employee's
services
or, if notice is not given, the date on which the
employees
are
dismissed.
(b)
The
Labour Court may, on good cause shown condone a failure to comply
with the time limit mentioned in paragraph
(a)
.’
[24]
In
context, these time periods speak plainly to the intrinsic urgency of
judicial intervention pursuant to section 189A(13), if
a party wishes
a procedural fairness dispute to be addressed. The relief that a
court might grant in terms of Section 189A(1)(a)
– (d) must be
understood in that context. The remedies are designed to be available
when an aggrieved applicant brings the
application by not later than
30 days after the notification of the possible retrenchment, and
thus, 30 days before a dismissal
notice may be given. The primary
purpose is to get the retrenchment process back onto a track that is
fair. Remedies (a) and (b)
plainly are appropriate before a dismissal
is effected. Remedy (c) is aimed at not only reversing a dismissal,
but obligating the
employer
in
future
to comply with fairness during an implicitly resumed process, which
implies timeous proximity to the dismissals. Remedy (d) is
plainly
contingent on remedies (a) (b) or (c) being inappropriate in given
circumstances; it is thus subordinated to the first
three options,
and cannot be read disjunctively from the rest. Were it appropriate
to separate remedy (d) from the rest, the effect
of the section would
be to totally contradict section 189A(18). Such an interpretation
cannot therefore be sustained, and it is
not open to a party to seek
primary
relief in terms of section 189A(13) (d). The function of section
189A(13)(d) is a residual power, if the given circumstances make
the
first three remedies inappropriate.
[25]
In
summary, Section189A (13) is a procedure designed to enable the
Labour Court to urgently intervene in a large-scale retrenchment
to
ensure that fair procedure is followed. It is not designed to offer a
platform for
ex
post de facto
adjudication of unfair procedure disputes. Although a failure to
comply with the 30-day period can be condoned, the merits of any
condonation application must be understood within the context of an
urgent intervention, that being the critical functional
characteristic
of an application in terms of section 189A(13).
[26]
Moreover,
the intervention contemplated, by its nature does not contemplate a
trial at some future remote time. It exists not to
facilitate a
post
mortem
but, rather, to oversee the process of retrenchment while it is
taking place or shortly thereafter where precipitate dismissals
make
intervention before actual dismissal impossible, and to reverse the
dismissals.
[15]
Remedy (d) is
a last resort back up to cater only for the inappropriateness of
remedies (a) (b) or (c).
[16]
The
flaws in Respondents’ case and in the judgment a quo
The
Nature of Section 189A(13)
[27]
The
case offered by the respondents is wholly at odds with the function
of section 189A(13) and must therefore fail.
The
explanation offered to support condonation of the late referrals
[28]
There
can be no doubt that the decision to initiate litigation on the
premise of the invalidity of the dismissals was taken in the
light of
the
De
Beers Principle.
As much as the decision to rely on a stance founded on judicial
precedent is understandable, recognising that fact in this case
is
where the criticism-free zone ends.
[29]
The
abandonment of the alternative unfairness
causa
in the
face of a direct and open challenge to the correctness of the
invalidity
causa
is not
explained. It was a huge risk, with no apparent forensic advantages
to weigh up.
[30]
When
this Court in March 2015 upheld the appellant’s challenge,
instead of a referral of a section 189A(13) application being
made
then, together with an application for condonation, the respondents
threw their only egg into the Constitutional Court’s
basket,
despite its by now cracked condition. Then only after the
Constitutional Court tossed it out of the basket did the respondents
change tack.
[31]
Plainly,
a litigation strategy had been adopted that rested on a single
premise, and notwithstanding challenges to it, no fall-back
position
was adopted. Indeed, the procedural unfairness
causa
had
been expressly abandoned.
[32]
The
fate of a failed legal strategy is doom. That risk is intrinsic to
our system of litigation. Moreover, a fair litigation system
demands
that the adversaries know what cases they have to meet. It is not
unknown to commence litigation, whether as a claimant
or a defendant,
having designed and formulated a claim or a defence on a given
premise, only to be upended by developments in the
law by the end of
the case. This phenomenon is an occupational hazard in litigation. It
is unthinkable that a party can claim a
right to bite at the cherry,
if the raspberry, initially chosen, is sour. This explanation,
offered by the respondents for the
choice not to pursue a procedural
unfairness case by way of a section 189A(13) application, is
unacceptable in principle. Moreover,
in these particular
circumstances the opportunities spurned by the respondents to remain
in the game, and later to try to get back
in the game, must be
weighed too, and weighed against them. As a result, no proper case
for condonation is made out.
The
Judgment a quo
[33]
The
Judgment a quo addressed itself to the norm of ‘interests of
justice’ to conclude that condonation ought to be granted.
In
doing so the court
a
quo
declined to follow
Parkinson
v Edcon (Parkinson)
[17]
and, on
appeal, it was argued that despite the court
a
quo
being
referred to
Ramyidal
v Clinix Selby Park Hospital (Pty) Ltd (Clinix),
[18]
the court
a
quo
did
not deal with that decision. Both decisions were binding on the court
a quo,
unless found to be clearly wrong.
[34]
As
regards the very concept of the “interests of justice”
some clarification is warranted. It has been said of the fairness
jurisprudence of the Labour Courts that the prescribed measure of
fairness is not a warm fuzzy feeling you experience in your tummy.
The same caution needs to be expressed about the “interests of
justice”. In real life, losses are experienced and they
have to
fall somewhere. Much of our law is devoted to the development of
norms, principles and rules to decide where such losses
must fall;
this is evidenced most starkly in the law of delict. This, sometimes,
daunting exercise of weighing the interests of
justice aims at
even-handedness among adversaries too. Accordingly, the enquiry into
the “interests of justice” always
occurs within a
fact-specific context. The notion that the respondents have been
denied access to a court to ventilate a grievance
cannot be examined
within a paradigm that ignores the interests of the adversary, nor of
the ordinary dynamics of litigation, more
especially, because the
reality is that litigation is a process in which adversaries make
choices. If the consequences of choices
that are made are that
opportunities to pursue other options are forfeited, it does follow
that there is a failure of justice.
The litigation system affords
litigants a process within which they must navigate their own routes;
it is no failure of justice
if their journey culminates in a dead
end.
[35]
Both
Parkinson
and
Clinix
were decisions in point and against the proposition upheld by the
court
a
quo
.
[36]
The
court
a
quo
held that the way to read
Parkinson
was that Van Niekerk J did not depart from the norm of the interests
of justice. However, if that was correct, and the decision
was
binding, on what proper basis could it be distinguished?
[37]
In
Parkinson,
a contest between Ms Parkinson and Edcon (and thus one episode in the
same saga has this appeal must address) Ms Parkinson brought
a
section 189A(13) application on 6 February 2015, the 30-day period
having expired on 25 August 2014, her dismissal notice being
dated 25
July 2014. What had she done in between these dates? She had referred
a dispute to the CCMA, a certificate was refused,
and a review had
been contemplated but not pursued. Then, she was advised to use the
procedure of section 189A(13). Van Niekerk
J held that:
‘
The
explanation for the delay is curious- it appears to amount to no more
than that when the applicant sought advice in relation
to her legal
options concerning a challenge to the commissioner’s ruling,
she was advised to file the present application
and [her] legal
representative became [aware] of the time constraints and [that
stage]. This is not an acceptable explanation’.
[19]
[38]
Van
Niekerk J then went onto say:
‘
The time
limits applicable to an application in terms of s189A (13) are well
known. The fact that the applicant gave consideration
to a remedy in
terms of s 189A(13) only at a late stage she did, or that she was
advised [at] that stage to pursue that remedy,
cannot be the basis
for an explanation not to have brought the application timeously.
Even
if I were to grant to the applicant the benefit of the doubt in
relation to the explanation for the delay in bringing this
application, she has no prospect of success on the merits
.
This
court has made clear on more than one occasion that the purpose of s
189A(13) is one that enables this court to supervise an
ongoing
retrenchment process or one that has recently been concluded
;
it
is not a remedy that is available well after dismissals have been
effected.
The
section intends to ensure that a fair process is followed; it is not
a means to thwart retrenchment itself
(see
Insurance
and Banking Staff Association v Old Mutual Services and Technology
(2006) 27
ILJ
1026 (LC)). In the present instance, the applicant’s date of
dismissal, as I have indicated, is 25 August 2014, a little
short of
two years ago. The irresistible conclusion to be drawn is that having
abandoned her unfair dismissal claim, the applicant
seeks redress in
terms of s 189A (13), a provision ordinarily reserved for urgent
intervention in a consultation process involving
a significant number
of employees.
There
is no basis, in these circumstances, for the court to intervene in
the present dispute, and the applicant’s prospects
of success
are accordingly minimal, if they exist at all.
’
[20]
[own emphasis]
[39]
The
court
a
quo
said this of the emphasized portion of the judgment of Van Niekerk J:
‘
...Van Niekerk J alluded in
Parkinson
that had the application for condonation had prospects of success,
the lateness of the application would have been favourably considered
despite its lateness.’
[40]
The
passage was interpreted by the court
a
quo
as
disaggregating the litigant’s prospects of success from the
proper utilisation of a section 189A(13) application. This
reading is
incorrect; the point of the enquiry is not whether some case for
unfair procedure could possibly be made out, rather
the point of the
enquiry is whether a section 189(13) application could be justified
at the time the application was launched.
The cited passage from
Parkinson
is plain that the section 189A(13) application had to have merits and
on the assessment made, there had been an abandonment of
the
opportunity to use that expeditious instrument.
[41]
Moreover,
the Court
a
quo
expressed the view that the remarks of Van Niekerk J that:
‘
[section
189A(13)] is not a remedy that is available well after dismissals
have been effected. The section intends to ensure that
a fair process
is followed; it is not a means to thwart retrenchment itself it is
not a remedy that is available well after dismissals
have been
effected’
must not be:
‘
elevated to
an immutable principle and apply it to circumstances where an
applicant had taken
another
legitimate course
during the ongoing retrenchment process and/or within the permitted
time frames
only
to be disavailed of that cause of action later
and after the lapse of the 30-day period’
[42]
This
observation by the Court
a
quo
is
misdirected. First, it is not open to a court to ignore the function
of the section, and it is no gloss on the section to conclude
that it
is designed for expeditious use only. Second, the description of the
respondents’ choice of the invalidity premise
to run its case
as a “legitimate course” is incorrect. That course was
wrong in law. The law was not “changed”
by statutory
amendment; the invalidity premise was always wrong. Regrettable
though it be that a litigant is upended because the
Courts now
correct an error of interpretation given in earlier decisions, such
mishap does not “legitimise” the view
taken of law.
[43]
In
Clinix
,
the employees were retrenched on 1 June 2015 and the section 189A(13)
application was brought on 22 February 2016, a delay of
nine months.
The explanation offered was identical to that offered in this matter;
ie a reliance on the invalidity premise, and
a change of strategy
after the Constitutional Court had spoken. The case is on all fours
with this matter. Van Niekerk J had this
to say, which we fully
endorse:
‘
[5]
I am not persuaded that the explanation proffered by the applicants
is satisfactory. The
fact that the present application was brought
within 30 days of the Constitutional Court’s judgment is
neither here nor there
– it was always open to the applicants
to invoke the remedies established by s 189A (13). They could have
done so at any
time during the consultation process conducted in
March to May 2015, which they now seek to impugn. Indeed, they could
have done
so at any time during June 2015, the 30-day period that
followed their termination of employment on 31 May 2015. The
applicants
chose to challenge the validity of their dismissals by way
of a referral filed in mid-September. I fail to appreciate how the
decision
by the Constitutional Court issued in January 2016 has any
bearing on a matter such as the present, where for 3 months after
their
dismissals, the applicants did not seek to challenge the
consultation procedure through any of the mechanisms available to
them.
To the extent that the applicants now rely on the dictum by
Zondo J to the effect that it remains open to employees who elected
not to resort to the dispute resolution mechanism established by the
Act and to challenge the validity of their dismissals to seek
condonation and pursue remedies under the LRA. It is not at all clear
that Zondo J was referring to the remedy afforded by s 189A
(13).
That remedy must necessarily be seen in terms of its proper context
and purpose. It is a mechanism that enables this court
to supervise
an ongoing retrenchment process or one that has recently been
concluded; it is not a remedy that is available well
after dismissals
have been effected. In short, the section intends to ensure that a
fair process is followed; it is not a means
to thwart retrenchment
itself (see
Insurance
and Banking Staff Association v Old Mutual Services and Technology
(2006) 27
ILJ
1026 (LC)).
[6]
In any event, the applicants (or their advisers) ought to have been
aware by March
2015, when the Labour Appeal Court overturned
De
Beers
, of any change in the law. The applicants were retrenched
some 2 months later and ought to have anticipated, if they intended
to
limit their strategy to a challenge to the validity of their
dismissals, the attendant risks.
[7]
The failure to furnish a reasonable explanation for an inordinate
delay has the consequence
that any prospects of success in the main
application and the respective prejudice to the parties are not
relevant. I would mention
though given the strict temporal limits
that attach to a s 189A (13) application, I fail to appreciate what
prospects there are
at this late stage that this court will order the
respondent to recommence the consultation process. To the extent that
the applicants
seek an alternative remedy of compensation, it is not
the purpose of s 189A to provide for compensation for any procedural
shortcomings
in the consultation process well after any retrenchments
have been effected. Further, what the applicants primarily seek
is an order of reinstatement with effect from 22 January 2016, the
date of the Constitutional Court’s judgment. That would
impose
a burden on the respondent of the unproductive cost of the
applicants’ salaries for the almost six months between
that
date and the hearing of this application, and the period of any
consultation process. To grant condonation would significantly
prejudice the respondent, who at this point, more than a year after
the applicants were retrenched, is entitled to finality in
proceedings that have been brought about solely by the applicants
having adopted an ill-advised legal strategy’.
[44]
At
paragraph [43] of the judgment
a
quo,
the findings are premised on the assumption that a self-standing
remedy in terms of section 189A(13)(d) exists. As addressed above,
that reading is incorrect.
[45]
The
Court
a
quo
therefore misdirected itself in the several respects addressed in
this judgment; ie the proper purpose of section 189A(13) and
its
limitations were not recognised and the explanation in support of
condonation, relying on a failed legal strategy to justify
the delay
is not acceptable, especially, as alluded to above, because earlier
opportunities to seek condonation were spurned, causing
further
delay, to which must be added the express and fatal abandonment of
the alternative cause of action.
Conclusions
[46]
Accordingly,
our findings can be summarised thus:
On
the Law:
46.1.
Section
189A(13) is a procedure to be utilised expeditiously, to address an
ongoing retrenchment process and is not available long
after.
46.2.
Section
189A(13)(d) is not a self-standing remedy that can be disaggregated
from (a) (b) and (c), because it is subordinate and
ancillary to
those provisions.
46.3.
The
explanation that a failed legal choice of strategy is the reason why
a delay occurred to exercise a legal option is not an acceptable
explanation.
On
the facts:
46.4.
The
respondents made out no sound case for condonation.
46.5.
The appeal
must succeed.
Costs
[47]
Both
parties initially sought costs. At the hearing, counsel for appellant
persisted. Counsel for the respondents suggested that
no order be
made.
[48]
In
my view, costs should follow the result having regard to the palpable
lack of merit in the respondents’ stance. Both parties
employed
two counsel which was appropriate to the matter.
The
Order
(1)
The appeal
is upheld.
(2)
The order
of the court
a
quo
is
set aside.
(3)
The order
is substituted with an order that the application be dismissed with
costs.
(4)
The
respondents shall bear the costs of the appeal, including the costs
of two counsel, the one paying the others to be absolved.
___________________
Sutherland
JA
Sutherland
JA (with whom Musi and Coppin JJA concur)
APPEARANCES:
FOR
THE APPELLANT:
Adv A Myburgh SC with
him Adv F Boda SC,
Instructed
by Norton Rose Fulbright Inc
FOR
THE RESPONDENTS: Adv
R Beaton SC with him, Adv M Mtombeni
Instructed
by Jan Kemp Nel Attorneys
[1]
NOM 1 is a schedule of
101 cases before the Labour Court. Some are in respect one
applicant, many have several applicants. All
the applicants were
formerly employees of the appellant and were retrenched. A total of
1817 persons are respondents in this
appeal, but not all respondents
are applicants in these 101 Labour Court cases.
[2]
The
relevant provisions of
Section
189A provide:
Dismissals
based on operational requirements by employers with more than 50
employees
(1)
…..
(2)
In respect of any dismissal covered by this section-
(a)
an
employer must give notice of termination of employment in accordance
with the provisions of this section;
(b)
…
..(d)
(3)
The Commission must appoint a facilitator in terms of any
regulations made under subsection (6) to assist the parties engaged
in consultations if-
(a)
the
employer has in its notice in terms of section 189 (3) requested
facilitation; or
(b)
consulting
parties representing the majority of employees whom the employer
contemplates dismissing have requested facilitation
and have
notified the Commission within 15 days of the notice.
(4)
…..(7)
(8)
If a facilitator is not appointed-
(a)
a
party may not refer a
dispute
to
a
council
or
the Commission unless a period of 30 days has lapsed from the date
on which notice was given in terms of section 189
(3); and
(b)
once
the periods mentioned in section 64 (1)
(a)
have
elapsed-
(i) the
employer may give notice to terminate the contracts of employment in
accordance with section 37 (1) of
the
Basic Conditions of
Employment Act
; and
(ii) a
registered trade union or the
employees
who have
received notice of termination may-
(aa)
give
notice of a
strike
in
terms of section 64 (1)
(b)
or
(d)
;
or
(bb)
refer
a
dispute
concerning
whether there is a fair reason for the
dismissal
to
the Labour Court in terms of section 191 (11).
(9)
Notice of the commencement of a
strike
may be given
if the employer dismisses or gives notice of
dismissal
before
the expiry of the periods referred to in subsections (7)
(a)
or
(8)
(b)
(i).
(10) ….(12)
(13)
If an employer does not comply with a fair procedure, a consulting
party may approach the Labour Court by way of an application
for an
order-
(a)
compelling
the employer to comply with a fair procedure;
(b)
interdicting
or restraining the employer from dismissing an
employee
prior
to complying with a fair procedure;
(c)
directing
the employer to reinstate an
employee
until
it has complied with a fair procedure;
(d)
make
an award of compensation, if an order in terms of
paragraphs
(a)
to
(c)
is
not appropriate.
(14)
Subject to this section, the Labour Court may make any appropriate
order referred to in section 158 (1)
(a)
.
(15)
An award of compensation made to an
employee
in
terms of subsection (14) must comply with section 194.
(16)
….
(17)
(a)
An
application in terms of subsection (13) must be brought not later
than 30 days after the employer has
given
notice to terminate the
employee's
services or, if
notice is not given, the date on which the
employees
are
dismissed.
(b)
The
Labour Court may, on good cause shown condone a failure to comply
with the time limit mentioned in paragraph
(a)
.
(18)
The Labour Court may not adjudicate a
dispute
about
the procedural fairness of a
dismissal
based on the
employer's
operational requirements
in
any
dispute
referred to it in terms of section 191
(5)
(b)
(ii).
(19)
......(20).
[3]
AA: 117/9; RA411/6.
[4]
AA117/10.1; RA 411/7.3.
[5]
AA117/10.2; RA 413/8.
[6]
AA117/10.3: RA 416/9.
[7]
AA118/10.4; RA 417/10.
[8]
AA118/10.5: RA 417/11.
[9]
Examples of the hearsay
problem appear as follows in the record:
RA
117/9.
RA
117/102.
RA
416/8.12.
RA
421/ 19.3.
[10]
De Beers Group
Services (Pty) Ltd v NUM
[2011]
4 BLLR 319
(LAC)
and
Revan Civil Engineering Contractors and Others
[2012]
33 ILJ 1846 (LAC).
[11]
Edcon v Steenkamp and
Related Matters
2015
(4) SA 247
(LAC); (2015) 36 ILJ 1469 (LAC).
[12]
ibid
see
at [28].
[13]
Steenkamp v Edcon Ltd
(NUM intervening)
(2016)
37 ILJ 564 (CC).
[14]
See the LAC decision in
Edcon v
Steenkamp
(supra)
at [8]-[9] concerning section 189A(2).
[15]
See:
CC
in
Steenkamp
v Edcon
(Supra), at [162] – [164]:
[162]
Subsection (13)
(d)
provides that a consulting party may
apply to the Labour Court for an award of compensation 'if an order
in terms of paragraphs
(a)
to
(c)
is
not appropriate'. It seems to me that the phrase 'if an order in
terms of paragraphs
(a)
to
(c)
is
not appropriate' constitutes a condition precedent that must exist
before the court may award compensation. The significance
of this
condition precedent is that its effect is that the Labour Court is
required to regard the orders provided for in subsection
(13)
(a)
to
(c)
as the preferred
remedies in the sense that the Labour Court should only consider the
remedy in subsection (13)
(d)
when it is not appropriate
to make any of the orders in subsection (13)
(a)
to
(c).
[163]
This is a reversal of the legal position that obtains in the case of
dismissals for the employer's operational requirements
governed by
only s 189 where dismissal is only procedurally unfair and not
substantively unfair as well. In these cases, the
Labour Court is
required not to order reinstatement at all. So, in making the remedy
of reinstatement available for a procedurally
unfair dismissal and
also making it one of the preferred remedies in subsection (13), the
legislature has gone out of its way
to give special protection for
the rights of employees and to protect the integrity of the
procedural requirements of dismissals
governed by s 189A.
[164]
The extensive remedies in subsection (13) provide at least
partial compensation for the fact that in respect of disputes
concerning the procedural fairness of dismissals the employees have
been deprived of the right to adjudication that other employees
have. In part the extensive remedies in subsection (13) for
non-compliance with procedural fairness have been provided because
of the importance of the pre-dismissal process.’
[16]
In what factual
circumstances might this back up remedy be appropriate? It is
unnecessary for this court to pronounce on that
question. However,
the obvious candidates are where the business has closed or the
substantive need for dismissal is unchallengeable.
[17]
[2016]
ZALCJHB 540 (28 June 2016).
[18]
[2016]
ZALCJHB 485 (17 June 2016).
[19]
At
para 4.
The
paragraph in the judgment contains typographical errors which I have
edited.
[20]
At para 4.