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[2018] ZALAC 46
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SAMWU and Another v Ethekwini Municipality and Others (DA18/2016) [2018] ZALAC 46; [2019] 1 BLLR 46 (LAC) (15 August 2018)
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA, DURBAN
Not reportable
Case no: DA18/2016
In the matter between:
SAMWU
First
Appellant
A A
DAWOOD
Second
Appellant
and
ETHEKWINI
MUNICIPALITY
First
Respondent
the South african
local government
bargaining
council
Second
Respondent
COMMISSIONER NDABA
N.O.
Third
Respondent
Delivered: 15 August
2018
Summary:
Employee dismissed
for refusing to
comply with lawful and reasonable instruction of employer and failing
to perform job responsibilities to the best
of his ability. At
arbitration dismissal found procedurally fair but substantively
unfair for reason of inconsistency in that employer
failed to furnish
records of disciplinary steps taken against other employees.
Continued employment found not to be
reasonably
practicable under s 193(2)(c) of the LRA given that other employees,
including union members, had complied with employer’s
instruction and employee had failed to raise a grievance. Employee
awarded 6 months’ compensation.
The
Labour Court dismissed the employee’s review application,
placing reliance on s193(2)(b) to find that continued employment
was
intolerable. On appeal: found that Labour Court erred in considering
s193(2)(b) when the focus of the arbitrator had been on
s193(2)(c).
Award was found reviewable on the basis that the arbitrator had not
taken into account relevant circumstances in finding
reinstatement
reasonably impracticable despite having found the dismissal
substantively unfair. Having regard to all relevant facts
and
circumstances, primary remedy of reinstatement found appropriate.
Appeal upheld with costs. Employee retrospectively reinstated
into
employment with a final written warning valid for 12 months for
insubordination.
Coram: Waglay JP,
Coppin JA and Savage AJA
JUDGMENT
SAVAGE AJA
Introduction
[1]
This appeal, with the leave of the Labour
Court (Whitcher J), is against the judgment of that Court, in which
the application to
review the arbitration award of the third
respondent (the arbitrator) was dismissed with no order as to costs.
[2]
The second appellant, Mr A A Dawood (the
employee), was employed as an electrical faultsman by the first
respondent, the Ethekwini
Municipality (the employer), on 3 January
1990. He had a clean disciplinary record for almost 20 years until
his receipt on 21
October 2009 of a verbal warning, which he refused
to acknowledge, for insubordination, following his failure to comply
with an
instruction to complete new formatted running sheets as part
of the employer’s electrical outage management system.
[3]
On 11 November 2009, the employee was
warned again by a senior manager, Mr Sharach Laban, that his
continued refusal to comply with
the instruction to complete the
running sheets constituted gross insubordination for which he would
be disciplined. The employee’s
response was that since other
employees were not completing the running sheets, he would not comply
with the instruction. Shortly
thereafter, on 17 November 2009, at a
meeting with two further managers, Mr Segran Moodley and Mr Kubendran
Nayager, the employee
was again instructed to complete the running
sheets. He indicated his deliberate refusal to comply with the
instruction, in a manner
which was described as rude, belligerent and
disrespectful, and challenged his managers to “
go
ahead, do whatever you want to do
”.
After persisting with his refusal to complete the running sheets, the
employee was suspended from duty in March 2010. On
16 August 2010,
following a disciplinary hearing, he was dismissed from his
employment for refusing to comply with a lawful and
reasonable
instruction of the employer, and for failing to perform his job
responsibilities to the best of his ability.
[4]
The South African Municipal Workers’
Union (SAMWU) referred an unfair dismissal dispute on behalf of the
employee to the South
African Local Government Bargaining Council
(SALGBC). The evidence at the arbitration hearing was that other
faultsmen had complied
with the instruction to complete the running
sheets, albeit with occasional lapses, such as those of two
employees, Mr Majozi and
Mr Khumalo, who, according to the employer,
had been given verbal warnings for such conduct. Since the employer
was unable to produce
a record of these warnings, the arbitrator
found the employee’s dismissal procedurally fair, but
substantively unfair because
of inconsistency, in that the employer
failed to “
furnish records of the
purported discipline of other faultsmen
”.
[5]
Mr Moodley and Mr Laban testified at the
arbitration hearing, that the employee’s refusal to comply with
the instruction and
complete the running sheets, was deliberate and
persistent; that he would not submit to the authority of his
managers; and that
his conduct had led to a breakdown in the trust
relationship between the parties.
[6]
Although the employee sought retrospective
reinstatement, the arbitrator found, in terms of s193(2)(c) of the
Labour Relations Act
66 of 1995 (the LRA), that:
‘
210.
taking into consideration that applicant
consistently refused to comply with a lawful and reasonable
instruction despite the fact
that other employees were complying who
belonged to his union, the fact that he failed to use the machinery
of the act or a grievance
procedure to challenge the change of the
old practice renders reasonably impracticable for respondent to
reinstate or re-employ
the applicant.
211.
In the
circumstances it is my finding that it is not reasonably practicable
for the employer to reinstate or re-employ the employee
.’
[7]
The employee was consequently awarded “
just
and equitable
” compensation of
R115 866,88, being six months; remuneration, for his unfair
dismissal.
[8]
Dissatisfied with the arbitration award,
and their failure to secure the employee’s reinstatement, the
appellants sought to
review the award in the Labour Court on the
basis that it was unreasonable because, in finding that the employer
had acted inconsistently,
the arbitrator had not considered the
application of the provisions of s193 of the LRA in the appropriate
manner, and had failed
to award the primary remedy of reinstatement.
Judgment of Labour
Court
[9]
On review, the Labour Court found that the
employee’s conduct demonstrated “
a
wilful and serious refusal by an employee to obey a lawful
instruction and a direct challenge to the employer’s
authority
”. This, according to
the court
a quo
,
amounted to gross insubordination in that he had no intention of
complying with such instruction, making “
nonsense
of his contention that he should have been issued with a series of
written warnings prior to dismissal
”.
[10]
The court
a
quo
had regard to the testimony of Mr
Moodley and Mr Laban to the effect that they could not work with the
employee and that the “
manner in
which he had articulated his refusal to comply and his continuous
refusal to submit to their authority had resulted in
a breakdown in
the trust relationship
”. The
court
a quo
held that, having regard to the “
factors
justifying exception to reinstatement as listed in section 193(2) of
the LRA; in this case, whether the circumstances surrounding
the
dismissal were such that continued relationship would be
intolerable
”, reinstatement would
be inappropriate, in that it would not be fair to the employer, in
light of the evidence led at arbitration.
[11]
As a consequence, the Labour Court
concluded that the arbitration award not so unreasonable that no
reasonable commissioner could
have come to the same decision. The
review application was consequently dismissed with no order as to
costs.
Submissions on appeal
[12]
The
appeal turns on whether the court
a
quo
erred in accepting that the employee was guilty of gross
insubordination and that his conduct was distinguishable from that of
other employees. The appellants contend that the arbitrator’s
finding that reinstatement was not reasonably practicable was
unreasonable, given the finding of inconsistency and the lack of
evidence that the trust relationship had been destroyed. Relying
on
Xstrata
SA (Pty) Ltd (Lydenburg Alloy Works) v NUM obo Masha and Others
(
Xstrata
),
[1]
it
was argued that
the
arbitrator could only refuse to reinstate if the evidence established
that the circumstances surrounding the dismissal were
such as to
render continued employment intolerable (section 193(2)(b)), or if
reinstatement was not reasonably practicable (section
193(2)(c)). But
since t
here
was no evidence before the arbitrator that reinstatement was not
reasonably practicable, and no objective evidence that the
trust
relationship had broken down, there was no reason why the primary
remedy of reinstatement, sought by the employee, was not
granted.
[13]
The
employer did not cross-appeal against the finding of substantive
unfairness. It persisted with the contention that the arbitrator’s
finding that the employee had committed misconduct was reasonable.
Regarding the remedy, it was argued that the appellants had
conflated
considerations relevant to the finding of substantive unfairness with
those relevant to the determination of an appropriate
remedy, as
contemplated in s193(2). With reference to
Billiton
Aluminium SA t/a Hillside Aluminium v Khanyile and Others
[2]
and the decision of
Equity
Aviation
v
CCMA and Others
,
[3]
it was submitted emphatically that the approach to the application of
the remedies in terms of s193 must be based on underlying
fairness to
both parties, without introducing “
unwanted
and unnecessary rigidity to saddle an enquiry into fairness with
notions of a legal onus
”.
The arbitrator had applied his mind to whether reinstatement was
justified on the evidentiary material available, including
the
“
non-reinstatable
conditions
”
mentioned in s193(2).
[4]
It was
submitted that the employee’s combativeness and persistent
refusal to comply with the instruction to complete the
sheets,
distinguished his case from that of the other employees, such as Mr
Majozi and Mr Khumalo, who, according to the evidence,
would only on
occasion not complete the sheets, and that a continued employment
relationship with the employee was unsustainable
and impracticable.
For those reasons, the employer sought that the appeal be dismissed
with costs.
Evaluation
[14]
Where
a dismissal is found to be unfair, the mutually exclusive remedies of
reinstatement, re-employment or compensation in s193(1)
are to be
considered, having regard to
s193(2).
[5]
[15]
S193(2) provides that the employer –
‘…
must
… re-instate or re-employ the employee unless—
(a) the employee does
not wish to be re-instated or re-employed;
(b) the circumstances
surrounding the dismissal are such that a continued
employment relationship would be intolerable;
(c) it is not
reasonably practicable for the employer to re-instate or re-employ
the employee; or
(d) the dismissal is
unfair only because the employer did not follow a fair procedure.’
[16]
The
use of the peremptory “
must
”
in s193(2)
requires
that reinstatement, or re-employment, must follow upon a finding of
unfair dismissal, as the primary remedies under the
LRA,
[6]
unless it is not sought by the employee, or where either, or both, of
the “
non-reinstatable
conditions
”,
referred to s193(2)(b) and s193(2)(c), exist, making an order of
reinstatement, or reemployment, inappropriate.
[7]
[17]
There
is no
onus
on the employer to prove the existence of these “
non-reinstatable
conditions
”.
The approach is one of fairness to both employer and employee even
when “…
no
specific evidence was canvassed or submissions made during the trial
on the issue of the non-reinstatable conditions”.
[8]
The court or arbitrator is “
obliged
to take into account any factor which in the opinion of the court or
the arbitrator is relevant
”.
The determination involves the exercise of a discretion, which is “
in
part a value judgment and, in part, a factual finding
”
.
[9]
If
none of the non-reinstatable conditions exists, the arbitrator has a
discretion only as to the extent to which reinstatement
should be
made retrospective.
[10]
[18]
In
Xstrata,
it was held that
the
term “
not
reasonably practicable
”
in s193(2)(c) of the LRA, did not equate with “practical”,
but with the concept of feasibility:
‘
Something
is not feasible if it is beyond possibility. The employer must show
that the possibilities of its situation make reinstatement
inappropriate. Reinstatement must be shown not to be reasonably
possible in the sense that it may be potentially futile
’.
[11]
[19]
In
Republican
Press (Pty) Ltd v CEPPWAWU and Others,
[12]
whether
reinstatement was not reasonably practicable, was found to “
depend
on the particular circumstances
”.
In
Potgieter
v Tubatse Ferrochrome,
[13]
“
operational
or similar grounds
”
were held to make reinstatement not reasonably practicable. While in
Maepe
v CCMA and Another
[14]
reinstatement was found not to be reasonably practicable because the
senior employee was no longer capable of performing his duties
effectively after he had given false evidence under oath at an
arbitration.
[20]
Since the
finding that the dismissal of the employee had been substantively
unfair for reason of inconsistency had not been challenged
by the
employer, it was only a review of the sanction that was before the
Labour Court. The particular factors relied upon by the
arbitrator to
find that reinstatement was not reasonably impracticable under
s193(2)(c) were that other employees, including union
members, had
complied with the instruction and that the employee had not lodged a
grievance to challenge the instruction. Yet,
the Labour Court relied
on s193(2)(b) in its consideration of the matter, to find that a
continued employment relationship was
not tolerable. This occurred in
circumstances where the Labour Court was tasked with reviewing the
arbitrator’s
exercise of his
discretion. It was not open to the court
a
quo
to simply exercise its discretion
afresh
on
the issue of remedy, without finding that the decision of the
arbitrator, in light of all the relevant facts and circumstances,
was
unreasonable. This was so since the court
a
quo
was not dealing with an appeal. It follows, therefore, that in its
approach to the matter, the Labour Court erred.
[21]
Having
found the dismissal substantively unfair for reason of inconsistency,
the arbitrator was to consider whether the peremptory
reinstatement
should not be awarded in light of the particular circumstances of the
matter
.
This
required the arbitrator to have regard to s193(1) and (2), and in
doing so, also take into account all the relevant circumstances
before him. These included, that the employee sought reinstatement as
the primary statutory remedy available to him in his unfair
dismissal
dispute;
[15]
the
employee’s long service and previously clean disciplinary
record; the short period left before his retirement; the nature
and
extent of the misconduct; whether the principle of progressive
discipline could reasonably be applied; the fact that the dismissal
had been found to have been substantively unfair due to
inconsistency; the operational and other circumstances of the
employer;
the extent to which the evidence supported a conclusion
that the trust relationship have been severed.
[22]
The finding that it was not reasonably
practicable to reinstate the employee was based on two reasons: that
other employees, including
union members, had complied with the
employer’s instruction; and that the employee had not used the
machinery available to
him to lodge a grievance. It is not apparent
that the arbitrator had regard to all relevant factors in arriving at
the conclusion
that the non-reinstatable conditions were extant. The
arbitrator relied on unduly narrow considerations, while
disregarding, or
placing insufficient emphasis on, the other relevant
considerations which had been placed before him. In the result,
without a
careful and thorough consideration of these other relevant
considerations in the exercise of his discretion, the arbitrator
arrived
at a decision which fell outside of the ambit of
reasonableness required. It followed for these reasons that the
decision of the
arbitrator fell to be set aside on review.
[23]
Had the arbitrator considered
appropriately all relevant facts and circumstances, I am satisfied
that a reasonable person in such
position would have arrived at a
different conclusion on sanction. The employee sought reinstatement
as the primary remedy. He
had an extended period of long service,
with a previously clean disciplinary record. A limited period of time
remained before his
retirement
.
The employer was found to have been inconsistent in the application
of discipline and the evidence supported a finding that progressive
discipline could reasonably have been applied. The nature and extent
of the misconduct was such that the trust relationship had
not been
shown to have been severed by the employee’s conduct when the
rude, belligerent and disrespectful behaviour committed
related to a
time when there was general workplace unhappiness with the
operational change proposed. Furthermore, the operational
and other
circumstances of the employer provided no bar to the reinstatement of
the employee. Having regard to all of these relevant
facts and
circumstances, I am satisfied that the employee is entitled to the
primary remedy reinstatement, with a final written
warning valid for
12 months to be imposed in respect for insubordination. This warning
will provide an appropriate caution to the
employee to maintain
appropriate respect for his superiors into the future.
[24]
For these reasons, the appeal succeeds.
Having regard to considerations of law and fairness, it is
appropriate that each party pays
its own costs.
Order
[25]
For these reasons, the following order is
made:
1.
The appeal succeeds with no order as to
costs.
2.
The order of the Labour Court is set aside
and substituted as follows:
“
(1)
The application for review succeeds.
(2) The dismissal of
the employee, Mr A A Dawood, is found to be substantively unfair.
(3) The employee is to
be retrospectively reinstated into his employment with Ethekwini
Municipality by 27 August 2018, with a final
written warning valid
for twelve (12) months for insubordination.
(4) The employee must
be paid the back pay due to him by no later than 31 August 2018”.
___________________
Savage AJA
Waglay JP and Coppin JA
concur in the judgment of Savage AJA.
APPEARANCES:
FOR THE APPELLANT: Mr M M
H Titus
MacGregor Erasmus
Attorneys
FOR THE FIRST RESPONDENT:
Ms L R Naidoo
Instructed by
Hughes-Madondo Attorneys
[1]
(2016)
37 ILJ 2313 (LAC) at paras 6 and 11.
[2]
[2010]
BLLR 465 (CC).
[3]
[2008]
12 BLLR 1129 (CC).
[4]
Mediterranean
Textile Mills (Pty) Ltd v SACTWU
and
Others
[2012]
2 BLLR 142
(LAC) at para 30.
[5]
Toyota
SA Motors
(Pty)
Ltd v Commission for Conciliation,
Mediation
and Arbitration and Others
[2016]
3 BLLR 217
(CC) at para 135;
Equity
Aviation
at
para 42.
[6]
Equity
Aviation Services Ltd v Commission for Conciliation Mediation and
Arbitration and Others
[2008] 29 ILJ 2507; Also reported as
[2008]
12 BLLR 1129
(CC)
at para 36.
[7]
Mediterranean
Textile Mills (Pty) Ltd v SACTWU
(
supra)
at para 28.
Elliot
International (Pty) Ltd v Veloo and Another
(2015)
36 ILJ 422 (LAC) at para 53.
[8]
Mediterranean
Textile Mills (Pty) Ltd v SACTWU and Others
[2012] 2 BLLR 142
(LAC) at para 30.
[9]
DHL
Supply Chain (Pty) Ltd v De Beer NO and Other
[2014]
9 BLLR 860 (LAC); (2014) 35 ILJ 2379 (LAC) at para 21;
Equity
Aviation
Services
Ltd v Commission for Conciliation Mediation and Arbitration and
Others
[2008]
29 ILJ 2507
[2008]
12 BLLR 1129
(CC)
at paras 36
and
48.
[10]
Mediterranean
Textile Mills (Pty) Ltd v SACTWU and Others
(supra)
at
para 8
[11]
At
para 11.
[12]
[2007]
11 BLLR 1001
(SCA) at paras 20-22.
[13]
2014)
35 ILJ 2419 (LAC) at para 37.
[14]
[2008] ZALAC 2
;
[2008]
8 BLLR 723
(LAC) at para 19.
[15]
Equity
Aviation
[2008] ZACC 16
;
2009 (1) SA 390
(CC) at para 36.