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[2007] ZALCCT 2
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Tiger Food Brands Limited t/a Albany Bakeries v Levy NO and Others (C104/07) [2007] ZALCCT 2 (10 April 2007)
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
IN CAPE TOWN
CASE
NO: C104/07
In
the matter between:
Tiger
Food Brands Limited t/a
Albany
Bakeries
Applicant
And
L.
Levy N.O.
1
st
Respondent
Commission
for Conciliation,
Mediation
and Arbitration
2
nd
Respondent
Food
and Allied Worker’s Union
3
rd
Respondent
The
Employees Listed in Annexure
“A” 4
th
Respondent
JUDGMENT
Ngcamu
AJ
[1]
This is an application to review and to set aside the ruling of the
first respondent made on 28 February 2007 in which he found
that the
CCMA did not have jurisdiction to facilitate the referral under
section 189 A of the Labour Relations Act. The written
reasons were
furnished on 8 March 2007. The third to further respondents oppose
the application.
[2]
The applicant operates two bakeries in the Western Cape, one at
Maitland and one at Bellville, where it produces bread for
distribution throughout the region. The applicant’s Western
Cape operations suffered a loss of R12 million in the financial
year
that ended in September 2006. A new bakery Manager Mr. Erasmus was
appointed with the responsibility of addressing the situation.
The
applicant further decided that Mr. Marais, the manufacturing
Executive responsible for its bakeries nationally would spend
more
time in Cape Town to assist Mr. Erasmus. The two even identified a
number of issues that needed to be addressed in order not
restore the
efficiency at the bakeries.
[3]
At all the applicant’s bakeries, the employees were
contractually obliged to work on public holidays, when needed. The
practice in the Western Cape was that only employees who had
volunteered would work on public holidays. The applicant had to
depend
on temporary replacement labour. The result was that the
through put and quality targets were not met on public holidays.
[4]
The applicant needed the provisions of the recognition agreement to
be adhered to. The access had to be improved. A finger print
access
control system needed to be implemented. Employees refused to
complete the baking process on days where it continued after
the end
of their normal time. This led to the bread which was in the process
of being baked at the time being damaged and wasted.
Invocoms that
had been instituted in order to improve communication between
management and the workforce were not being attended
by employees.
The employees resisted the attempts by management to improve
production and access control. The resistance took a
violent nature
at the Maitland Bakery.
[5]
In November 2006, the shop steward told Mr. Marais that he would not
tell them what to do. Another shop steward Mr. Ncinitwa
threatened
Mr. Marais and Erasmus that the bakery would be shaken as never
before in the event Mr. C. Tyhali being dismissed. Mr.
Tyhali was the
chief shop steward at Maitland who was dismissed for sexual
harassment on female employee.
[6]
The applicant’s attempts to regularise the public holiday
problem led to the strike on 24 December 2006. The applicant
responded by locking out the employees. An application to interdict
the lock out was dismissed on 11 January 2007. Following the
CCMA
facilitation on 12 January 2007, an agreement was reached that
employees in the bargaining unit would work on public holidays.
[7]
During the strike action and in particular on 28 December 2006 about
30 striking employees attacked the replacement labourers
with
knobkerries. On 2 January 2007 Mr. Stengile, a production supervisor
simulated shooting Mr. Marais with a plank while picketing.
On 24
January 2007 two shop stewards told Mr. Marais that they would not
attend the shop steward meeting requested for 26 January
2007 where
Mr. Marais wanted to discuss the implementation of the fingerprint
access control system. On 25 January 2007 an attempt
was made to
assassinate Mr. Marais while he was with Mr. Stengile. This happened
few minutes after 06h00 while Marais was assisting
Stengile to
prepare for an invocom. The shooting took place where the invocom was
scheduled to take place.
[8]
On 25 January about 21h45 the factory manager Mr. Windwaai received a
message on his cell phone threatening him that he was
the next. On 27
January 2007, a white bakkie followed the factory manager Mr. Gerhard
Kleyn from the factory to his brother’s
residence and then to
his house. On 2 February the controller-dispatch, Mr. Trevor Scholtz
received a call. The caller told him
to watch out. On 3 February, two
shots were fired in the street in from of Mr. Kleyn’s house.
[9]
It was not possible for the applicant to identify the persons
involved in the assassination attempt and the threats. This made
it
impossible to take disciplinary action. The applicant formed an
opinion that it was no longer possible to manage the Maitland
Bakery
due to these incidents. The applicant feared for the safety of the
managerial staff. Accordingly the applicant formed the
view that its
operational requirements required that the employment relationship
between it and the group of employees who may
have been involved or
have known of the assassinations attempt or threats be terminated.
[10]
On 20 February 2007, the applicant directed to the third respondent a
Notice in terms of section 189 (3) of the LRA and made
application in
terms of section 189A (3) for the appointment of a facilitator. The
facilitator was duly appointed . The employees
were suspended pending
the outcome of the facilitation process.
[11]
At the commencement of the facilitation the third respondent objected
to the jurisdiction of the CCMA to facilitate the dispute
on the
basis that the reason for the proposed dismissals did not fall within
the definition of “operational requirements
“as set out
in the LRA. This objection was upheld by the commissioner. This is
the ruling the applicant seeks to review and
set aside.
[12]
It was submitted that the first respondent failed to apply the Act in
a manner which promotes orderly collective bargaining
and employee
participation in decision making in the workplace. The applicant’s
case is that the fact that it feared for
the safety of its managerial
staff, is both a economic and structural requirement and therefore
fall within the definition of the
term operational requirements.
[13]
What the court is in fact required to do is to decide whether in the
circumstances set out by the applicant, the CCMA has jurisdiction
to
facilitate in terms of Section 189 A (3).
[14]
Section 213 of the LRA defines the operational requirements as
meaning requirements based on the economic, technological, structural
or similar needs of an employer. The Code of Good Practice attempts
to clear the meaning of economic, technological or structural
needs
of the employer. The Code acknowledges that it is difficult to define
all the circumstances that might legitimately form
the basis of a
dismissal for that reason. The Code defines the economic reasons as
those that relate to the financial management
of the enterprise. The
technological reasons are defined as those that refer to the
introduction of a new technology which affects
work relationships
either by making jobs redundant or by requiring employees to adapt to
the new technology or a consequential
restructuring of the workplace.
The structural reasons are those that relate to the redundancy of the
posts consequent to a restructuring
of the employer’s
enterprise. What the Code does not attempt to define is the all
encompassing term being “similar
needs of an employer.”
[15]
The applicant took a giant step to have the facilitation process
based on the fact that it could no longer run its business
as a
result of the threats to the management and the resistance to change.
The question that arises is whether this is an operational
reason.
The commissioner found that the request for facilitation fell outside
the parameters envisaged by section 189 A of the
Act and that, the
CCMA for that reason had no jurisdiction. In coming to this
conclusion, the commissioner reasoned that:
“
Indeed
the guiding principle inherent in this type of job loss contemplated
in the Act is that it is a ‘no fault dismissal.”
How then
can the definition of rationale be stretched to suit a situation in
which 49 employees are named and already suspended
for reasons
relating to misconduct? Surely, the specific circumstances, which the
legislators identified, were intended to clearly
prevent the use of
section 189A of the Act in cases such as this one? Would not the use
of section 189 A (19) (b) in the circumstances
of this case entirely
negate the attempt to specifically identify the rationale laid down
for a genuine dismissal for reasons of
operational requirement.”
[16]
The third respondent in its Answering Affidavit stated that it also
requires a final ruling on how the matter has to be dealt
with. The
respondent’s case is that the applicant sought to deal with the
misconduct and incapacity by recourse to measures
designed for
retrenchment. There is no question of incapacity in this matter. The
case of misconduct may well be argued in the
present case.
[17]
Mr. Whyte for the respondent submitted that the applicant is free to
proceed in terms of section 189 of the LRA. His argument
is in line
with the third respondent’s Answering Affidavit. In paragraph
11.2, the third respondent stated the following:
“
11.2.
The refusal by the first and second respondents to facilitate the
dispute does not in any event prevent the applicant from
consulting
or otherwise adopting a fair procedure. In this regard, the applicant
could attempt to proceed by way of section 189
rather than section
189 A. The third respondent would then need to make an election as to
whether it chose to participate in those
proceedings.”
[18]
The respondent’s contentions are contradictory. It is not open
to the respondent to submit that the retrenchment facilitation
is not
the legitimate process and then submit that the applicant could
attempt to proceed by way of section 189. Section 189 can
only kick
in where there is an operational reason. To suggest that the
applicant can proceed with section 189 but state that section
189A
does not apply in this case has no merit. The applicant plans to
dismiss 49 employees. The applicant is obliged in the present
matter
to request facilitation due to the number of employees it wants to
retrench. If section 189 applies, section 189A would
automatically
apply if the employer is the employer falling under section 189A. The
applicant does fall under section 189A of the
LRA.
[19]
The third respondent’s stance is maintained in paragraph 12 of
the Answering Affidavit where the respondent states that:
“
I
deny that the refusal by the first and second respondents to
facilitate the dispute increases the risk of a procedurally unfair
dismissal. As noted above, the applicant is quite capable of
conducting a fair process under section 189, assuming that it is
ultimately able to convince a court that dismissals are justified on
the basis of operational requirements in any event.”
[20]
The third respondent denies any resistance to finger print control at
the bakery and stated that it was always prepared to
negotiate. With
regard to the work left unfinished, it suggested negotiation on
overtime. On the question of Invocom, it was submitted
that the
management used it as a form of dictating to the employees and have
ceased to be an information sharing forum.
[21]
The third respondent further admitted that the shop stewards refused
to attend the meeting because it had not been called in
accordance
with the normal procedure. There is no suggestion what the normal
procedure is except that Mr. Moselane indicated that
he would have
invited to attend the meeting.
[22]
The third respondent has not suggested what led to the attack on Mr.
Marais and the threats to other managers. The third respondent
conceded that the shooting at Mr. Marais appears to be that of an
assassination attempt. The third respondent contends that this
cannot
lead to the retrenchment exercise.
[23]
It was the respondent’s case that the problem could have been
dealt with by way of disciplinary or criminal proceedings.
The
applicant submitted that it is unable to proceed with individual
disciplinary proceedings as it is unable to identify the culprits.
The matter was however reported to the police.
[24]
At paragraph 43 and 44 of the Answering Affidavit, the third
respondent stated:
“
43
Furthermore the third respondent wishes to make it abundantly clear
that it vigorously opposes such unlawful conduct and will
assist the
applicant in identifying the perpetrator if requested to do so.
44. I
must again stress that the event cannot be attribute to the employees
as a group, and cannot be used as a means of jeopardising
their
ongoing employment.”
[25]
The third respondent has not suggested how they could help in
identifying the perpetrator. There is no suggestion that he is
known
to the third respondent. In the event that such perpetrator for the
attempted assassination and the threats to other managers
is known
and can be disclosed for possible disciplinary and criminal
proceedings, that can be dealt with and can assist in avoiding
any
possible retrenchment.
[26]
In paragraph 49, the respondent stated:
“
49.
Having canvassed these matters with the employees, I am of the view
that the route (sic) cause of the problem is the management
style
being adopted by the applicant’s managers. Whilst I am in no
way condone misconduct or unlawful activities, common
sense requires
that the parties meet in order to resolve their differences.”
[27]
The respondent admits that there is a problem but blames the
management. The respondent’s submission is that a meeting
would
resolve the differences. The meeting the third respondent has in mind
is outside the provisions of section 189 A of the LRA.
[28]
The applicant needs to be able to manage its business in order to be
able to turn it around. It has to deal with the safety
of the
managers and be able to control access to the bakery. It is not able
to do this if the managers are being assassinated and
direct threats
are made to them. How does the employer protect its own management
team and also be in control of the business faced
with violent
resistance? The management needs the workforce, which will be able to
work on public holiday, and be able to finish
unfinished work before
knocking off. With all these problems in mind, does the CCMA have
jurisdiction to facilitate the dispute?
The answer lies in the
answering whether the problems the applicant is facing constitute the
employer’s operational requirements.
[29]
On the information presented, the problems do not relate to
technological reasons. This is so because no new technology has
been
introduced. This can safely be excluded. The Act requires that anyone
interpreting the provisions of the Act should give effect
to the
primary objects. This being
inter alia,
the promotion of orderly Collective
Bargaining, employee participation in decision-making in the
workplace, and the effective resolution
of labour disputes. As the
Act does not give a definition of economic, technological and
structural needs of the employer, a narrow
approach to the definition
cannot be appropriate.
[30]
The inability of the employer to manage the business affects the
economic viability of the enterprise. The threat to the management
also affects its viability as the conditions under which the
manager’s work is unsafe. These scenarios can be regarded as
the employer’s economic requirements.
[31]
It was submitted on behalf of the applicant that if circumstances
have drastically impaired the ability of management to effectively
manage a particular business due to fear for their own safety, and
this needs to be addressed by restructuring of that workplace,
then
this would constitute a structural requirement. I have no problem
with this submission. However, the problem of the applicant
is not
with the structure of the business or the management team. The
applicant does not want to shed jobs because of the redundancy
of
positions caused by the restructuring. In my view, the applicant’s
problem is not structural.
[32]
I have mentioned that there is no attempt to define the term “or
similar needs of an employer in the Act or the Code.”
This in
my view relates to the needs of the employer that have some
resemblance of economic, technological or structural. The applicant
seeks solutions to the problems it has.
[33]
The respondent submitted that the applicant could have proceeded with
the disciplinary proceedings either individually or collectively.
The
applicant has conceded that this was one of the options. The
individual disciplinary hearings were not practically possible
because the applicant would need to identify the individuals involved
in the misconduct. The collective disciplinary hearing would
have
been possible. The disadvantage of such process is that employees may
be dismissed with loss of benefits, those in particular
who have been
in the company for a number of years would lose the severance pay.
[34]
The collective disciplinary hearings have been accepted by the
Industrial Court in SACCAWU & Others v Cashbuild Ltd
(1996) 4
BLLR 457(IC).
In that case, the employees were dismissed for failure
to control shrinkage.
[35]
This involves the dismissal of an innocent employee. Although the
dismissal is targeted to the perpetrators of the misconduct
but the
innocent ones come him because of their silence in not disclosing the
perpetrators. The worker in the group is under a
duty to assist
management in bringing the guilty to book (
Chauke
&
Others
v
Lee Service Centre CC t/a Leeson Motors
(1998) 19 ILJ (LAC) at para 31.
[36]
In
SA Chemical Workers Union
v
Afrox Ltd
(1998) 19 ILJ 62 (LC), the court found that there was a good reason
for dismissal where there was a need for the company to reduce
overtime and had decided to restructure in order to combat potential
loss of custom to competitors. The appeal to the Labour Appeal
Court
did not succeed.
[37]
Landman J in
SA Commercial Catering
& Allied Workers Union
& Others
v
Pep Stores
(1998) 19 ILJ 1226 (LC) confirmed the dismissal where the employees
were retrenched because of their failure to control shrinkage.
The
shrinkage resulted in the company deciding to shut down. The closure
as a result of shrinkage was regarded as sufficient reason
to close
the store for operational requirements.
[38]
The need to get the business of the applicant going again on a
permanent basis and in a stable environment is the prime
consideration.
When the managers are being threatened with death, the
applicant cannot operate its business. It has a duty to protect its
managers.
At the same time, the employees have to be fairly treated.
The need for the stability cannot be dismissed as not an operational
reason or economic reason for the retrenchment.
[39]
This does not mean that for any misconduct, the employer may decide
not to have the employee dismissed for operational reasons.
It will
depend on the facts of the case. In the present case, the employer is
faced with problem of having to turn around the business
because of
losses. It is met with violent resistance in which the managers are
at a risk of being killed and the perpetrators cannot
be identified.
[40]
I am satisfied that it was proper and legitimate for the applicant to
request the facilitation. There is an economic reason
or reason
similar to that for the anticipated retrenchment. If there is a
solution or suggestion that can assist in the avoidance
of the
dismissal, that is an issue to be dealt with at the facilitation
hearing. The disclosure of the perpetrators may assist
the applicant
in stopping the retrenchments and commencing the disciplinary
proceedings. The ultimate result required by the employer
is the
protection of its business and its management from the criminal
actions.
[41]
The third respondent loses nothing by their participation in the
facilitation. At stake at present is the trust relationship.
I am of
the view that the commissioner appointed to facilitate gave a narrow
approach to the meaning of operational requirement
of the employer.
He further failed to consider “reasons similar to” the
economic, technological and structural. Had
the commissioner
considered this, he would have realised that even if it was said that
the reasons for the proposed retrenchment
did not fit into the basket
of economic reasons, they had resemblance of economic reasons. That
would therefore give jurisdiction
to the CCMA.
[42]
In the result I find that the reasons advanced by the applicant were
economic or similar reasons. Accordingly, the CCMA had
jurisdiction.
[43]
The order is therefore the following:
(a) The ruling made by
the commissioner is reviewed and set aside. It is substituted with
the order that “the CCMA has jurisdiction
to facilitate the
dispute between the parties.”
(b) The dispute is
referred to the second respondent for facilitation by the first
respondent.
(c) The first and second
respondent are directed to give the facilitation process some
preference.
(d)
There is no order for costs.
____________
NGCAMU
AJ
Date
of Hearing: 22 March 2007
Date
of Judgment: 10 April 2007
For
the applicant: Adv. A.C. Oosthuizen S.C instructed by Deneys Reitz
Inc.
For
the third and fourth respondents: Mr. J. Whyte of Cheadle Thompson
&
Haysom