About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Johannesburg Labour Court, Johannesburg
SAFLII
>>
Databases
>>
South Africa: Johannesburg Labour Court, Johannesburg
>>
2007
>>
[2007] ZALCJHB 35
|
|
Gauteng Enterprise Propeller v Mbatha and Others (JR627/06) [2007] ZALCJHB 35 (5 February 2007)
In
the Labour Court of South Africa
Held
At Johannesburg
CASE
NO: JR627/06
In
the matter between
:
Gauteng
Enterprise
Propeller
Applicant
And
Senior
Jabulani Mbatha
1
st
Respondent
The
Commissioner for Conciliation
Mediation
and Arbitration
2
nd
Respondent
Ntombekhaya
S. Mancotywa
N.O. 3
rd
Respondent
JUDGMENT
1.
This is an application to review and set aside the arbitration award
issued by the third respondent in which she found the dismissal
of
the first respondent procedurally and substantively unfair and
ordered his reinstatement.
2. The
applicant is a company duly incorporated in terms of Section 21 of
the Company Law of the Republic of South Africa. The first
respondent, Mr. Mbatha was employed by the applicant as an industrial
advisor. The contract under which Mr. Mbatha was employed
was signed
on 20 June 2001. His employment commenced on 1 August 2001.
3. Mr.
Mbatha’s main duties as set out in the contract of employment
were to:
(a)
To design and cost effectively manage a wide variety of
multi-discipline engineering/ manufacturing projects from conception
to completion.
(b)
To assist clients (SMME’s) with the required managerial,
technical, financial advice to stimulate the development
of suitable
enterprise.
(c)
To help entrepreneurs’ to help themselves by solving business
problems with them.
(d)
To function as back-up resources for the cadet officers, actually
involving themselves in problem related to management
and operation
of the client’s company.
(e)
Responsible for ensuring those personnel working in projects comply
with relevant legislation and safe working practices.
(f)
Interface with and register / develop service providers.
(g)
Inputs for the continual update of SMME and service provider
database.
(h)
Set-up / arrange business linkages seminars to promote networking and
co-operation amongst SMME’s.
4. He
was charged with three counts of misconduct being dishonesty and or
fraud and or forgery. A disciplinary hearing presided
over by an
outside chairperson was held. Mr. Mbatha was found guilty and
dismissed on 8 December 2004. Mr. Mbatha referred a dispute
to the
second respondent. The third respondent presides over the arbitration
hearing and issued an award dated 9 February 2006
which the applicant
is challenging.
5. The
applicant has challenged the award on four grounds namely that :
5.1
The commissioner exceeded her powers by ordering 13 months
compensation;
5.2
The commissioner committed a gross irregularity in the proceedings in
the manner in which she dealt with the agreement
reached by the
parties on 2 December 2005 regarding the evidence of Mr. Martin.
5.3
The commissioner’s finding that the dismissal was procedurally
unfair is not rationally connected to the evidentiary
material
properly before her. Her finding that the applicant disregarded their
disciplinary code by appointing outsiders to chair
the disciplinary
hearing ignored the evidence that the code served merely as a guide
and did not contain peremptory provisions.
5.4
The commissioner’s finding that the dismissal was substantively
unfair is not rationally connected to her own reasons
or to the
evidentiary material properly before her. She failed to properly
consider the seriousness of the misconduct perpetrated
by the first
respondent.
6.
During the arbitration hearing, the evidence of the applicant was led
by its chief executive officer Mr. Phore. Mr. Martin who
was
instrumental in the charges did not give evidence. The parties agreed
that his statement would go in as evidence. Mr. Phore’s
evidence was that the applicant was set up to assist Small Medium
Micro Enterprises in establishing their business. Industrial
advisors
are employed to assist and examine the status of SMME’s in
ascertaining constraints that would impede the full participation
of
the SMME’s. The assistance is through service providers who are
on the applicant’s data base. These service providers
are then
contracted to the applicant to assist the SMME’s in return for
a management fee. The industrial advisors recommend
which service
provider would do the work.
7. Mr.
Phore further testified that in 2003, Mr. Martin made a complaint to
the repondent’s chairperson alleging that he paid
a management
fee to Mr. Mbatha for services he had rendered to him. Mr. Martin
stated that he was not aware that he had to pay
the management fee.
Mr. Phore testified that Mr. Mbatha invoiced Mr. Martin for services
that were paid for by the applicant. The
services that Mr. Mbatha
rendered to Mr. Martin were within the scope of the applicant and for
this reason, there was conflict
of interest. The actions of Mr.
Mbatha were in direct conflict with his contract of employment.
8. Mr.
Dan Mogami also testified and corroborated Mr. Phore. Another witness
was Mr. P.S. Morolo who testified that some of the
applicant’s
services included the designing, setting up, as well as the
implementation of websites.
9. Mr.
Mbatha’s evidence was mainly that in March 2003 he received a
message from the receptionist to call Mrs. Martin. He
called her and
she told him that she was referred to him by a person from the
department of labour. Her family wanted to recruit
field workers for
their internet business. He offered to assist the Martins in getting
premises and advising them on how to go
about setting up their
business. He testified that this service did not fall under the scope
and mandate of the applicant because
Mr. Martin did not at the time
have a business and was not a manufacturing company. The Martins did
not have employees at the time.
He received money from the Martins
some of which were for personal use and had nothing to do with the
applicant. He further testified
that the Martins became service
providers for the applicant after he had severed all business ties
with him. He further stated
that the applicant did not comply with
its own disciplinary code pertaining to who should preside over the
disciplinary hearings.
10. I
now turn to the grounds of review. I have mentions in paragraph 3 of
this judgment what Mr. Mbatha’s duties were. I
however wish to
firstly deal with the first ground of review relating to the order
for payment of the loss of salary equal to thirteen
months. Mr. Van
Der Riet for the applicant submitted that the commissioner exceeded
his powers in ordering compensation of 13 months.
Mr. Mbatha
submitted that the amount awarded was a back pay and not
compensation. For this reason as Mr. Mbatha submitted that
the limit
of 12 months does not apply.
11. I
agree with the applicant’s submission that the commissioner
exceeded his powers. In CWIU and others v Latex Surgical
Products
(Pty) Ltd
(2006) 2 BLLR 142
(LAC) at Para 116 Zondo JP stated:
“
In
the light of all the above , I conclude that it is not competent to
order a retrospective operation of a reinstatement order
(even if
limited) which is in excess of twelve months in an ordinarily unfair
dismissal case.”
12. I
should point out that the commissioner ordered reinstatement in this
matter without loss of benefit and income and also ordered
payment of
R373750-00 which is the amount equal to 13 months. The Latex judgment
has since confirmed that even the back pay has
to be limited to 12
months. It would be unreasonable to limit the period of retrospective
reinstatement to 12 months but allow
the back pay to exceed the 12
months limit. This ground of review should therefore succeed. The
commissioner should have limited
the back pay to 12 months. This
ground alone, is not sufficient to have the award reviewed in toto as
I am entitled to correct
it.
13.
Mr. Van der Riet further submitted that the commissioner
committed gross irregularity in dealing with Mr. Martin’s
statement. It is common cause that Mr. Martin failed to attend the
arbitration hearing. It is further common cause that the parties
agreed that Mr. Martin’s statement would go in as evidence. The
commissioner questioned Mr. Mbatha if he was aware of the
implications for the admission of the statement of Mr Martin. At page
45 of the transcript lines 1-7 the commissioner stated:
“…
because
I make the ruling that we are going to proceed. We are going to
proceed without Mr. Martin and the parties agree. Mr. Mbatha
you have
been cautioned and advised accordingly as to the implications of what
you want me to do and you understood that perfectly.
I am proceeding
with Mr. Martin and the evidence that shall be led pertaining to Mr.
Martin shall only be confined on the statements
made by Mr. Martin
before the disciplinary hearing and after the disciplinary hearing…”
14. In
dealing with the statement of Mr. Martin the commissioner reasoned
that:
“
Mr
Phore’s testimony was based on Mr. Martin’s statement.
Considering the fact that Mr. Martin failed to attend this
arbitration, I shall thereby attach to such evidence the weight it
deserve.”
15.
The commissioner completely ignored Mr. Martin’s statement. The
basis for this appears to be that Mr. Martin did not testify.
The
applicant should have been advised that Mr. Martin’s statement
would not be taken into account if he did not testify.
The
commissioner’s reasoning does not tally with the warnings he
gave to Mr. Mbatha regarding the implications of admitting
Mr.
Martin’s statement. In my judgment the commissioner committed a
gross irregularity when ignoring Mr. Martin’s statement
where
the parties had agreed to have it used as evidence in circumstances
where a clear warning had been given to the parties of
the
implications of admitting it. That left the applicant with the belief
that the statement would be given effect to. What is
also strange is
that the commissioner stated that she would attach to the statement
the weight it deserved. It is not clear what
the commissioner meant.
This is so because she failed to go further and indicate what weight
she had attached to it in coming to
her conclusion. Mr Mbatha
submitted that Mr. Martin’s statement was rejected because of
contradictions. This does not appear
as the reason for rejecting it.
The commissioner did not rely on contradictions. I therefore reject
this submission made by Mr.
Mbatha. It is my view that the applicant
was not given a fair hearing. I find the commissioner’s conduct
unfair and grossly
irregular when dealing with Mr. Martin’s
statement. The award stands to be reviewed and set aside on this
ground.
16.
Another issue I need to deal with is the finding of procedural
unfairness of the dismissal. In this regard, the commissioner
reasoned that:
“
The
Respondent’s disciplinary procedure clearly states the
procedure to be followed when disciplinary action is taken against
an
employee as well as the persons authorised to take such disciplinary
action… No explanation or justifying reasons were
afforded by
Mr. Phore on why the respondent decided to disregard its own
disciplinary procedure. It had been put in place for a
reason. I am
having difficulty in understanding the respondent’s actions on
this aspect. I am compelled to believe that in
this instance the
respondent deliberately disregarded its disciplinary procedure to
suit its own interests. It is therefore my
opinion that respondent’s
failure to observe its own disciplinary procedural constituted
procedural unfairness.”
17.
This reasoning was based on the fact that the applicant used an
external Chairperson of the disciplinary hearing instead of
the
internal one in accordance with the company’s disciplinary
code.
18. It
was submitted that the code is only a guide and that there was no
unfairness in the use of the external presiding officer.
It was
further submitted that there was no prejudice to Mr. Mbatha. Mr.
Mbatha submitted that the disciplinary procedure is part
of the
employment contract and therefore the applicant had to comply with
it. He submitted that the violation of the disciplinary
procedure was
unfair.
19. In
Highveld District Council v CCMA & Others (2003) 23 ILJ 517 (LAC)
at p520 para 15, the Court held that :
“
Where
the parties to a collective agreement or an employment contract agree
to a procedure to be followed in disciplinary proceedings,
the fact
of their agreement will ordinarily go a long way towards proving that
the procedure is fair as contemplated in S188 (1)(b)
. The mere fact
that a procedure is an agreed one does not, however, make it fair. By
the same token, the fact that an agreed procedure
was not followed
does not in itself mean that the procedure actually followed was
unfair.”
20.
Applying this principle, I do not think that the mere fact that the
applicant used the presiding officer who was not in the
management
constituted unfairness. In the Highveld judgment at p521 B-H, Du
Plessis AJA stated :
“…
When
deciding whether a particular procedure was fair, the tribunal
judging the fairness must scrutinize the procedure actually
followed.
It must decide whether in all the circumstances the procedure was
fair… The respondent was nevertheless informed
of all the
allegations against him before the disciplinary hearing commenced…
The respondent was confronted with all the
evidence against him
during the disciplinary hearing and he had ample opportunity to
dispute every piece of evidence that was put
before the disciplinary
committee. It is on that evidence that he was, correctly as it turned
out, found guilty of misconduct.”
21. In
Khula Enterprise Finance Ltd v Madinane & Others
(2004) 4 BLLR
366
(LC), the employer appointed an independent advocate to chair the
disciplinary hearing. In this regard, Kennedy AJ at p369 F-H,
stated
that :
“
The
arbitrator does not appear to have considered at all the reason why
an independent advocate was appointed to chair the enquiry.
There
were several reasons for doing so, in particular that the most senior
level of management were personally involved in the
complaints and
the allegations against Dr Madinane and it was simple unrealistic to
appoint somebody within management…
The code serving merely as
a guideline, the employer was entitled to look outside the
organisation for somebody with appropriate
expertise and objectively
to chair the enquiry. This served the interests of both sides in this
regard. His reliance on the provisions
of the code was misplaced. It
did not provide that an employee had to approve the appointment of
any person to chair the disciplinary
enquiry. It merely provided that
enquires would ordinarily be chaired by a member of management, the
level of which ‘would
be acceptable to both parties.”
22. In
the light of the fact that the present matter is not different from
the Khula matter, I cannot find any reason for the commissioner
to
find that the dismissal was unfair because the procedure set out in
the code was not followed. I can only conclude that the
commissioner
did not apply her mind and failed to have regard to the current
jurisprudence.
23. In
Rand Water Board v CCMA (2005) 26 ILJ 2028 (LC) at 2032
Nkabinde AJ found that it would be highly technical and wrong
to
regard technical procedural defect as constituting procedural
unfairness in the absence of any loss or prejudice suffered as
a
result thereof. Similarly in Dube & Others v Nasionale Sweisware
(Pty) Ltd (1998) 19 ILJ 1033 (SCA) the Court held that the
company’s
disciplinary code and standard disciplinary procedural provisions
contained therein are not obligatory. I agree
with this view and
therefore conclude that the commissioner did not apply his mind in
coming to the conclusion that the dismissal
was procedurally unfair.
In the result, the award can not stand.
24. In
the light of what I have found, there is no need for me to deal with
other grounds of review raised by the applicant. The
record is messy
and it is difficult for me to make a proper assessment of the
evidence on other issues. It is therefore my considered
view to remit
the matter back to the CCMA. I am fully aware that this will cause a
further delay in the matter. It is fair to both
parties that I do not
decide the merits on insufficient evidence. The proper thing to do is
to have the dispute arbitrated afresh.
25. I
have considered the question of costs. In this matter, in the light
of the fact that I was not asked to make a cost order,
I have decided
that there should be no order for costs.
26.
The order I make is the following:
(a)
The award is reviewed and set aside.
(b)
The dispute is remitted to the first
respondent for arbitration by another commissioner.
(c)
There is no order for costs.
_______________
NGCAMU
AJ
Date
of Hearing:
12 December 2006
Date
of Judgment:
05 February 2007
For
the Applicant:
Adv. J.G. Van der Riet SC instructed
by Ruth
Edmonds
Attorneys
For
the 1
st
Respondent: Mr Mbatha (in
person).