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[2018] ZALAC 52
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Workerslife Direct (PTY) LTD v Maloka (JA148/2017) [2018] ZALAC 52; (2019) 40 ILJ 841 (LAC) (12 December 2018)
IN
THE LABOUR APPEAL COURT OF SOUTH AFRICA, JOHANNESBURG
Reportable
Case
no: JA148/2017
In
the matter between:
WORKERSLIFE
DIRECT (PTY) LTD
Appellant
and
E
MALOKA
Respondent
Heard:
22 November 2018
Delivered:
12 December 2018
Summary:
Specific performance – employee claiming payment of
post-employment commissions in terms of a Group Scheme Broker
(
GBS)
contract after resigning – employee contending that he had
concluded both an admin contract and a GSB contract with employer
and
that was entitled both to the benefits of an administrative employee
and to the post-termination commission – employer
contending
that only GSB employees entitled to post-termination and targets
commission and disputed the authenticity of the GSB
contract - court
finding that employee was paid on terms identical to those provided
for in the GSB contract and that employee
GBS contract probably
authentic – Labour Court’s judgment upheld and appeal
dismissed with costs.
Coram:
Sutherland and Jappie JJA and Murphy AJA
__________________________________________________________________
JUDGMENT
__________________________________________________________________
MURPHY
AJA
[1]
This is an appeal against the judgment of the Labour Court (Barnes
AJ) of 25 August
2017 in which it ordered the appellant to pay the
respondent various commissions he had earned on policies he sold
during his employment
as well as post-employment commissions for the
period stipulated in clause 5.5.1 of his alleged “GSB”
contract.
[2]
The appellant sells insurance and related products. The respondent
commenced working
for the appellant’s predecessor in 1997. The
predecessor went through various name changes and converted to a
private company.
The respondent’s contractual rights were
ultimately transferred to the appellant in terms of section 197 of
the Labour Relations
Act
[1]
(the
LRA”).
[3]
The respondent started work in the business as an administrative
clerk for which he
received a salary; however, he was also entitled
to sell insurance products for which he received a commission. His
initial contract
of employment (concluded on 2 September 1997) made
provision for both his salary and for the payment of commission for
products
sold.
[4]
The respondent alleges that a few years later, on 20 November 2000,
during the restructuring
of the business, he signed two contracts.
The first contract (referred to by the court
a quo
as “the
admin contract”) made provision for the payment of a salary in
respect of the respondent’s employment
as an administrative
clerk. This contract, unlike the initial contract, made no provision
for commission for the sale of insurance
products. The alleged second
contract however appointed the respondent as a sales broker and
provided for the payment of commission
– this contract was a
Group Scheme Broker contract (“the GSB contract”). The
appellant disputes the existence
of this latter contract.
[5]
Clause 5.5.1 of the GSB contract provides:
‘
Should
the GSB leave the service of the COMPANY after five years from the
date of signing this agreement or should the GSB die or
retire as a
result of ill health (the condition to be certified by two medical
practitioners that he/she is permanently unable
to continue with
employment as GSB), payment of the Provida commission will continue
for a period equal to his term of service.’
[6]
The respondent resigned from his employment with the appellant on 13
March 2013. He
did so because he was unhappy with changes to the
commission arrangement proposed by the appellant. After the
respondent left employment,
the appellant refused to honour the
obligation in Clause 5.5.1 to pay him post-employment commission.
[7]
The respondent then brought an application in terms of section 77(3)
of the Basic
Conditions of Employment Act
[2]
(“the BCEA”) to compel specific performance. The GSB
contract was annexed to the founding papers as “Annexure
EM1”.
In its answering affidavit, the appellant admitted that it had
concluded the GSB contract but that a new payment structure
had been
negotiated and agreed in terms of which post-employment commissions
were no longer payable. The respondent denied this
in his replying
affidavit. The appellant then brought an interlocutory application to
withdraw the admission made in its answering
affidavit. In its
founding affidavit in the interlocutory application, the appellant
denied that it had employed the respondent
as a broker and disputed
the authenticity of the contract. However, in its replying affidavit
in the interlocutory application,
the appellant changed its version
for a second time. There it stated that it did not dispute the
authenticity of the contract,
but contended that the contract had
never been implemented and was therefore null and void. The appellant
asserted that the admin
contract could not co-exist with the GSB
contract as this would be against company policy. It annexed the
admin contract as “Annexure
JJ2” to the founding
affidavit in the interlocutory application.
[8]
The main application was ultimately referred to trial with the
affidavits substituting
as pleadings. Despite the appellant’s
admission on the pleadings that the GSB contract was authentic, the
Labour Court, having
regard to the pre-trial minute and the course of
evidence at the trial, accepted that the authenticity of the GSB
contract (Annexure
EM1) was the principal issue in dispute.
[9]
The respondent testified that he was asked to sign Annexure EM1 and
Annexure JJ2 on
20 November 2000 by Ms Pillay, a secretary in the
employ of the appellant. This was necessary because the original
employer had
converted to a private company and changed its name. The
contracts had not been signed by the employer when presented to him.
Ms
Pillay witnessed his signature on both contracts. He was later
provided with copies signed on behalf of the employer. The respondent
did not know who had signed on behalf of the employer, but the
signatures of the employer on both Annexure EM1 and Annexure JJ2
appear to the naked eye to be identical. The respondent received
substantial commission while employed. In 2013 his net monthly
salary
under the admin contract was R7540, while his total monthly
commission was approximately R38000. He also received a “target
bonus” of R1565. The target bonus was paid to him monthly if he
achieved applicable sales targets. It is common cause that
the target
bonus was provided for in the GSB contract but was not included in
any contractual term in either the initial employment
contract of
1997 or the admin contract.
[10]
The respondent’s version that he worked both as an
administrator and broker was confirmed
by the testimony of his wife
who had worked as a GSB at the appellant until 2010. She confirmed
also that she had been paid post-employment
commission in terms of
Clause 5.5.1 of the standard GSB contract.
[11]
The appellant’s General Manager, Mr. Jan Jooste, testified and
admitted that the respondent
was entitled to commission up to the
date of his resignation. He said that there were two main types of
employees at the appellant
– administrative staff and sales
contractors - GSBs. Some administrative staff members also sold
policies and were entitled
to commission thereon. According to
Jooste, the respondent fell into this hybrid category of
administrative employees. The hybrid
administrative staff earned a
basic salary, medical aid & provident fund benefits, plus
commission, but only while in the appellant’s
employ. In
contrast, GSBs earned commission only but were also entitled to
commission after the termination of their employment,
on certain
conditions. The respondent essentially claims that he was in a
sui
generis
category of employee, as he had concluded both an admin
contract and a GSB contract with appellant and that he was,
therefore, the
only employee entitled both to the benefits of an
administrative employee and to the post-termination commission to
which only
GSBs were otherwise entitled. This, again according to
Jooste, was inconsistent with prevailing practice.
[12]
The difficulty facing Jooste during his evidence was that he could
not convincingly point to
a contractual instrument other than the GSB
contract providing for payment to the respondent of the substantial
commission and
target bonuses he earned during the 13 years from 2000
to 2013. The admin contract made no provision for commission; yet
about
90% of the respondent’s earnings were in the form of
commission. He ventured that the commission was paid in terms of the
initial employment contract concluded in 1997, despite the initial
employment contract on the face of it having been superseded
in all
its other terms and conditions by the admin contract in 2000.
[13]
Although Jooste stopped short of alleging that Annexure EM1 was a
forgery, he persisted with
the contention that it was not authentic.
When pressed in cross-examination by Mr. Kuhn, for the respondent, he
explained that
Annexure EM1 was not a valid contract and did not
appear in the respondent’s personnel file. He was not prepared
to say it
was a forgery because, so he said, he was not an expert on
forgeries. He could also offer no explanation for why the disputed
authenticity
of the document was not raised at an earlier stage, for
instance in response to the respondent’s letter of demand which
expressly
placed specific reliance on Clause 5.5.1 of the GSB
contract.
[14]
Two other witnesses testified on behalf of the appellant. Mr Helmut
Nebur, who was employed by
the appellant between 1996 and 2016,
testified that the signatures on Annexure EM1 and Annexure JJ2
appeared to be his. In 2000,
he was the appellant’s branch
manager in Pretoria where the respondent worked. He testified that he
signed the admin contract
but doubted that he signed the GSB contract
because he was not authorised to sign GSB contracts. This was the
responsibility of
Mr. Derek le Roux, the Sales and Marketing Manager.
While conceding that the signature on Annexure EM1 closely resembled
his, he
was reluctant to accept it as his. He, in effect, alleged
forgery. However, he conceded under cross-examination that his
averment
was based on deductive reasoning and not his recollection of
what in fact had transpired. Le Roux testified that while he had no
personal recollection of the conclusion of the admin contract or the
GSB contract, it was unlikely that Nebur signed the GSB contract
as
such fell within the purview of his authority. He confirmed, most
importantly, that only GSBs were entitled to a target bonus
and could
not explain why the respondent, if not a GSB, had in fact received
target bonuses for 13 years.
[15]
The reasoning of the Labour Court in rejecting the appellant’s
version is sound and unassailable.
It correctly accepted the evidence
of the respondent and his wife as clear, consistent and more
probable. Their testimony was not
damaged in any material respect
under cross-examination. Their version moreover accords with the
probabilities. First and foremost
it was common cause that the
respondent was paid commission and a target bonus for 13 years after
2000. The admin contract made
no provision for either of these kinds
of remuneration. The notion that commission was paid under the
initial contract is highly
implausible in view of the undisputed
evidence that new contracts were concluded in 2000 as part of the
necessary arrangements
following the restructuring of the business.
The admin contract, as appears from its terms, certainly was intended
to supersede
the initial contract of employment.
[16]
The improbability of payment of commission having been made under the
old initial contract is
reinforced by the fact that while that
contract may have made provision for commission, it made no provision
for target bonuses.
Jooste admitted that only GSBs received target
bonuses. Hence, the respondent was paid as a GSB. The conclusion is
therefore inescapable
that the respondent was paid on terms identical
to those provided for in the GSB contract. And thus Annexure EM1 was
probably authentic
and most likely signed by Nebur on 20 November
2000, as evident from the striking resemblance of the signature on
Annexure EM1
to that on Annexure JJ2, which Nebur admitted signing.
[17]
In short, the payments made to the respondent accorded precisely with
the provisions of the GSB
contract. The Labour Court’s
conclusions that the contract was probably concluded on 20 November
2000 and Annexure EM1 was
thus in fact authentic are thus correct.
Moreover, the Labour Court did not err in rejecting the appellant’s
version as implausible
and riddled with contradictions. The
appellant’s failure to take issue with the allegation that the
respondent was a GSB
in the initial correspondence, its admission
that he was a GSB in the answering affidavit in the main application
and its subsequent
changing version all raise doubt about the
credibility and reliability of its account. If the respondent was not
a GSB, the appellant
would have raised that earlier.
[18]
In the premises, the Labour Court did not err in its conclusion that
the respondent proved his
claim and is entitled to the relief he
seeks. The appeal must be dismissed. There is also no reason why
costs should not follow
the result in a case such as this.
[19]
The appeal is accordingly dismissed with costs.
________________
JR
Murphy
Acting
Judge of Appeal
Sutherland
and Jappie JJA concur.
APPEARANCES:
FOR
THE APPELLANT:
Adv P H Kirstein
Instructed
by Grosskopf Attorneys
FOR
THE RESPONDENT:
R Kuhn Attorney
[1]
Act 66 of 1995.
[2]
Act 75 of 1997.