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[2008] ZALCJHB 2
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BHP Billiton Coal South Africa Limited v Commission For Conciliation Mediation And Arbitration and Others (JR1605/07) [2008] ZALCJHB 2 (29 January 2008)
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
IN JOHANNESBURG
REPORTABLE
CASE
NO: JR 1605/07
In
the matter between:
BHP
BILLITON ENERGY COAL
SOUTH
AFRICA LIMITED
APPLICANT
and
COMMISSION
FOR CONCILIATION
MEDIATION
AND
ARBITRATION 1ST
RESPONDENT
ELIAS
LEKGWATHI
N.O. 2ND
RESPONDENT
ASSOCIATION
OF MINEWORKERS
AND
CONSTRUCTION UNION
3RD
RESPONDENT
NATIONAL
UNION OF
MINEWORKERS 4TH
RESPONDENT
UNITED
ASSOCIATION OF
SOUTH
AFRICA 5TH
RESPONDENT JUDGMENT
MOLAHLEHI
J
Introduction
[1]
1This is an application to review and set
aside the arbitration award issued by the Second Respondent (the
Commissioner) under case
number MP2675-07 and dated 3rd June 2007.
The application includes the review and setting aside of the
variation ruling purportedly
issued by the Commissioner under the
same case number MP2675-07 and dated 4th July 2007.
[2]
The third respondent opposed the
application on a qualified basis.
Factual background
[3]
The applicant is a coal mining company
which was prior to 2003 known as Ingwe Colliers Ltd. It owns and
manages various coal mines.
Before 2003, the industrial relations
structures and processes at the applicant’s mining operations
and other facilities
were primarily regulated, and took place, at
mine level in terms of collective agreements entered into at each
mine or facility.
This applied also to the mines and facilities
managed by the applicant.
[4]
The third respondent (AMCU) had, for some
time, the majority of its members employed in the B-level job grades
at the applicant’s
Douglas Colliery. Consequently a recognition
agreement in terms of which AMCU was recognized for the purposes of
collective bargaining
in respect of its members in the B-level job
grades at the Douglas Colliery was concluded. This agreement also
granted AMCU various
organizational rights.
The Ingwe Forum
[5]
The respondents, AMCU, NUM and UASA, agreed
with the applicant during 2003, to establish a centralised bargaining
forum, known as
the “Ingwe Forum.”, whose sole purpose
was to facilitate collective bargaining including at the Douglas
Colliery.
[6]
The structure and functioning of the Ingwe
Forum was to be formalized in the document known as the “Industrial
Relations Policy’
(“IR Policy”). The IR Policy was
also supposed to regulate the granting of organisational rights and
collective bargaining
rights within the Ingwe operations. However,
the document was not yet formally adopted at the commencement of the
2003 wage negotiations.
It would appear that the parties nevertheless
informally proceeded with their negotiations within the frame work of
the document
in respect of the operations, mines and facilities
covered by the Ingwe Forum. The agreement concluded arising from
these negotiations
was applicable for the period 1st July 2003 to
30th June 2005.
The Threshold
Agreement
[7]
One of the issues which the parties had
apparently envisaged would have been addressed by the IR Policy
concerned the degree of
representivity that would be required of a
union, before it could be allowed to participate in the forum.
Because of failure to
reach an agreement on the threshold, the NUM
referred a dispute to the first respondent (the CCMA) concerning this
issue. The conciliation
having failed the matter was referred to
arbitration.
[8]
The parties reached an agreement prior to
the conclusion of the arbitration proceedings. In terms of this
agreement, a union would
be entitled to participate in collective
bargaining at the Ingwe operations covered by the Ingwe Forum, if it
represented at least
30 per cent of all employees employed by the
Ingwe operations within the A, B and C levels. It was further agreed
that a union
would be entitled to bargain collectively at an
operation in respect of issues of specific relevance to that
operation provided
that it enjoyed the 30 percent representivity.
This agreement was made an award of the CCMA.
[9]
On 11th March 2005, the applicant concluded
a threshold agreement with the NUM in terms of which the
representivity requirements
were regulated.
[10]
The implementation of the IR Policy
effective from 1st July 2005, entailed the determination of which
unions would be entitled to
organisational rights and/or collective
bargaining rights, as envisaged in the IR Policy. The NUM was the
only union that had the
required degree of representivity to
participate in the Forum. However, both AMCU and UASA were entitled
to certain organisational
and other rights within various operations.
[11]
A further agreement was concluded between
the applicant and the NUM in terms of which it was agreed that the
applicant would formally
inform the various unions that were
recognised previously, of the termination of their rights arising
from the previous recognition
agreements, as these agreements had
been superseded and supplanted by the provisions of the IR Policy and
the threshold agreement.
In this respect AMCU was duly informed that
it would no longer enjoy the rights that it may have acquired under
mine-level recognition
agreements and that it would not be entitled
to collective bargaining rights at the Ingwe Forum as its union
membership did not
meet with requisite representivity. AMCU was
nevertheless entitled to organisational rights at Douglas Colliery
and Middelburg
Mines.
[12]
In terms of clause 4 of the Threshold
Agreement, two unions could form a coalition with the view to
achieving the threshold through
their joint membership. It was for
this reason that AMCU and UASA formed a coalition and it was also on
the basis of this agseement
that the two unions applied formanl9 for
membership of the Ingwe Forum!fnr purposes of the 3005-00 wage
negotiations. They were$formerly
recognized by(the!Forum on 14th July
2005.$And during!thiw round of negotiations tje applicant rEached an
agreement with the unio.s
including AMCQ a/d UASA acting4Vowether as
an as an “elliancg”.
The period 2006 and
2107
[13]
The`IR Policy was`amEnded during the course
oF`2006.`The amendientó ingluded the change of the name Ingwe
Forum 4o4the BHP
Billiton Energy Coal SA Limited Forum (BECSA). The
amendments also abolished collective bargaining at operational level.
At the
time of the amendment AMCU was not a party to BECSA which
consisted of the applicant and the NUM. However UASA was, invited and
joined BECSA pursuant the proposal to do so by NUM.
[14]
At a meeting held during February 2007,
AMCU queried why they were not permitted to join BECSA. Having failed
to resolve this issue
with the applicant, AMCU referred a dispute to
the CCMA which was then scheduled for a hearing on 14th May 2007. The
outcome of
the arbitration hearing was that the applicant was ordered
to include AMCU in the negotiations process.
Grounds of review
[15]
The applicant’s challenge to the
arbitration proceedings and the award is based on several grounds
which can be categorized
under the following heading, (a)
gross-irregularity in the conduct of the proceedings, (b) non-joinder
of NUM and UASA, and (c)
failure to the record the proceedings.
[16]
Gross irregularity: Under this heading the
complaint of the applicant is that the commissioner:
·
Refused to afford it the opportunity to
cross-examine AMCU’s representative on the evidence he
presented;
·
Failed to afford the applicant the
opportunity to peruse the bundle of documents which the respondent
had presented during the proceedings;
·
Refused to afford the respondent’s
representative the opportunity to present oral evidence which he had
requested;
·
Did not require that evidence presented
before him be presented under oath;
·
Misconceived the entire dispute and the
nature of the threshold agreement in particular in relation to the
provisions of section
18 of the Labour Relations Act 66 of 1995 (the
LRA).
[17]
Non-joinder: The applicant contended that
NUM and UASA should have been joined in the arbitration proceedings.
[18]
Additional grounds: The complaint under
this heading concerns the manner in which the CCMA dealt with the
variation of the award.
[19]
Absence of proper record: The applicant
contends that the Commissioners failed to record or keep a proper
record.
The arbitration
award
[20]
It would appear from the reading of the
award that the Commissioner formulated the issue for determination to
be:
“
Whether
the action of BECSA, NUM, and UASA by excluding AMCU during the
negotiation of downscaling and other issues of collective
bargaining
Forum and Wage Agreement are unlawful or in contravention of the
Collective Bargaining Forum and Threshold Agreement,
or not.”
[21]
In the first paragraph under the heading
“ANALYSIS OF EVIDENCE AND SUBMISSIONS,” the Commissioner
confirms the above
formulation of the issue that was before him.
However, in the seCond parAgRaph of the s!me heading he formul!tes
the6issue as concerning
whethur or not the applicant and thE NuM have
complied with the provisions of section 586of the Labour relations
Act 66 of 1995
(the LRA).6In the subsequent sentence the Commissioner
seems to suggest in his conclusion that the case of AMCu was basee on
the
alliance or coalition agreement. In thi36regard the Commissiner
finds that the joint membership of UASA and AMCU was 30%. It would
appear from the reading of the award that this is what influenced the
Commissioner to order the applicant to “engage AMCU
with all
the negotiations” and to allow AMCU “to be a party to any
proceeding (sic) in the interest of their members.”
Evaluation of the
award
[22]
As stated earlier AMCU opposed the review
application on a qualified basis. In this respect AMCU contended that
in as far as the
conclusion on the facts were concerned the decision
of the Commissioner was correct. It however conceded that the
formulation of
the relief was inappropriate. This did not according
to AMCU call for the setting aside of the award but for its
rectification.
AMCU suggested that the
award of the Commissioner be corrected and formulated along the
following lines:
“
1.
The Threshold Agreement is not binding during the period of the
Applicants’ (sic) unequal application of thereof to
UASA
and AMCU by inviting UASA to participate in the BECSA Forum while
ANCU was not afforded the same right.
2. Any collective
agreements concluded in the BECSA Forum during the period of the
unequal application of the Threshold Agreement,
are therefore null
and void from the outset.”
[23]
AMCU was indeed correct to concede that the
award of the Commissioner was inappropriate in that the essence
thereof was to impose
on the applicant the duty to bargaining, a
concept that is not applicable in our law. In other words the effect
of the Commissioner’s
award was that the applicant was
compelled to negotiate with AMCU. Therefore the Commissioner in
making his award exceeded his
powers and thereby committed gross
irregularity which rendered his the award reviewable.
[24]
In my view this matter turns mainly around
the issue of joinder which I will revert to later in this judgment.
Before dealing with
this issue I need to deal briefly with the
complaint that the Commissioner did not allow the applicant to
cross-examine AMCU’s
representative.
In terms of section 138
of the LRA the Commissioner has the power and authority to conduct
the arbitration in a manner that he or
she considers appropriate in
order to determine the dispute fairly and quickly, but must deal with
the substantial merits of the
dispute with the minimum of legal
formalities.
In the unreported case of
Sondolo IT (Pty) Ltd v Gordon Howes and others case number JR321706,
the Court in dealing with the provisions
of section 138(1), per AC
Basson J held that:
“
Section
138(1) of the LRA thus places two distinct but related obligations on
the commissioner. The first is to determine the manner
in which the
arbitration will be conducted. This discretion will be exercised
bearing in mind the legislative instruction to determine
the dispute
fairly and quickly. Secondly, the commissioner must deal with the
substantial merits of the dispute. In dealing with
the matter the
commissioner may rule on the evidence which may be presented to the
arbitration and may also restrict the range
of issues on which the
parties are required to give evidence.”
The Court went further to
quote with approval from the decision in Moloi Euijen v CCMA &
Another (1997) 18 ILJ 1372, where the
Court held that power in
section 138 (1) includes the power to decide what evidence will be
allowed or disallowed.
It would seem to me that
in the present instance, the Commissioner in exercising his powers in
terms of section 138 of the LRA decided
to consider the matter on the
basis of the submissions and the bundle of documents as submitted by
the parties including the heads
of arguments. It is therefore
understandable why, as the Commissioner records in his award, the
proceedings were not electronically
recorded. The Commissioner cannot
be faulted for adopting this approach particularly regard being had
to the facts of this case
which are simple, straight forward and
largely common cause. The facts which were common cause and upon
which the dispute largely
depended on concern, (a) the threshold
agreement concluded between the NUM and the applicant, (b) the
invitation of UASA to join
the BECSA and (c) the exclusion of AMCU
from the!negotiation process and participation in ECSA/
I now return to the issue
of non joinder of NU
and
UASA. The issue of whether a party should havE been joined in any
progegdiogs before a Court or an arbitration received attention
in
the recent decision of the Supreme Court of Appeal i. the case`of
Gordon v Department of Health 8337/2007)
[2008] ZASCA 99n
In that
case the SCA held that¤“The test is whether a party that
is alleged to be a necessary party, has a legaL interest
iN thm
subject matter, which may be affected prejudicially by the judgment
of the court in the proceedings concerned.”
The Court went further
(at para [9]) to say:
“
In
the Amalgamated Engineering Union case (supra) it was found that ‘the
question of joinder should not depend on the nature
of the subject
matter but on the manner in which, and the extent to which, the
court’s order may affect the interests of
third parties’.
The court formulated the approach as, first, to consider whether the
third party would have locus standi
to claim the relief concerning
the same subject-matter, and then to examine whether a situation
could arise in which, because the
third party had not been joined,
any order the court might make would not be res judicata against him,
entitling him to approach
the courts again concerning the same
subject-matter and possibly obtain an order irreconcilable with the
order made in the first
instance. This has been found to mean that if
the order or ‘judgment sought cannot be sustained and carried
into effect without
necessarily prejudicing the interests’ of a
party or parties not joined in the proceedings, then that party or
parties that
have a legal interest in the matter and must be joined.”
[25]
The issue that then arises in the present
matter is whether NUM and UASA had a legal interest in the
determination of the issue
which was before the Commissioner. The
issue as formulated by the Commissioner was whether the action of
BECSA, NUM, and UASA by
excluding AMCU during the negotiation of
downscaling and other issues of collective bargaining forum and wage
agreement were unlawful
or in contravention of the agreement
concluded at BECSA and the threshold agreement. The other issue as
formulated by the Commissioner
in his analysis is whether or not the
applicant and the NUM had complied with the provisions of section 18
of the LRA. In the 7.11
referral form AMCU states the desired outcome
as being:
“
TO
COMPEL THE EMPLOYER NOT TO IMPLEMENT THE AGREEMENT CONCLUDED BETWEEN
INGWE (BECSA), NUM AND UASA IN THE ABSENCE OF AMCU.
TO START AFRESH ALL
DISCUSSION AND ALL COLLECTIVE (sic) MATTERS WHERE AMCU MEMBERS ARE
ALSO AFFECTED WITH AMCU PARTICIPATING IN
THESE DISCUSSIONS.”
[26]
Section 18 of the LRA reads:
“
(1)
An employer and a registered trade union whose members are a majority
of the employees employed
by that employer in a workplace, or the
parties to a bargaining council, may conclude a collective agreement
establishing a threshold
of representativeness required in respect of
one or more of the organisational rights referred to in µsections
12§,
µ13§
and µ15§.
(2)
A collective agreement concluded in terms of subsection (1) is not
binding unless
the thresholds of representativeness in the collective
agreement are applied equally to any registered trade union seeking
any
of the organisational rights referred to in that subsection.”
[27]
AMCU argued that the arbitration award was
as a result of the applicant not applying the threshold agreement
equally to UASA and
AMCU. In other words the relief sought by AMCU
was not directed at NUM and UASA. I do not agree with this contention
because the
relief sought by AMCU was to set aside or render in
effective an agreement to which NUM and AUSA were parties. There seem
to be
no doubt that both NUM and UASA had a substantial and legal
interest in the implementation of the very agreement which AMCU
challenged
and sought to render ineffective or prevent its
implementation. This attack was not only directed at the applicant
but also to
NUM and UASA.
[28]
The other issue which the Commissioner
formulated in his analysis, relates to the issue of whether or not
the applicant and NUM
complied with the provisions of section 18 of
the LRA. In this regard NUM has a substantial interest not only
because it was a
party to the agreement that established BECSA but
also because it was NUM that proposed to BECSA that UASA be invite to
join BECSA
and participate in the negotiations.
[29]
It is therefore my view that NUM and UASA
should have been joined in the proceedings before the Commissioner as
at that stage there
existed potential prejudice which subsequently
materialized with the issuance of the award. The prejudice arose
because NUM and
UASA had a direct and substantial interest in the
determination of the dispute concerning lawfulness or contravention
of the collective
agreement concluded between the applicant, NUM and
UASA. The other interest that NUM had was the legality of the
threshold agreement.
The Commissioner’s award effectively
undermined the threshold agreement in that it gave AMCU the right to
participate in
BCSA when it did meet the required threshold of 30% as
provided for in the threshold agreement.
[30]
In my view the Commissioner’s award
stands to be reviewed. In the light of the above, I also see no
reason in law and fairness
why costs should not follow the results.
[31]
In the premises I make the following order:
(i)
The arbitration award of the Second
Respondent under case number MP2675-07 and dated 3rd June 2007 is
reviewed and set aside.
(ii)
The matter is remitted back to the First
Respondent for arbitration afresh and to be placed before a
Commissioner other than the
Second Respondent.
(iii)
The Third Respondent is to pay the costs of
the Applicant including those of the application to stay the
enforcement of the arbitration
award.
_______________
Molahlehi
J
Date
of Hearing
:
25th
June 2008
Date
of Judgment
:
29th
January 2009
Appearances
For
the Applicant
:
Adv
Alex Freund SC
Instructed
by :
Brink
Cohen Le Roux Inc
For
the Respondent:
Adv R Venter
Instructed
by : Gerhard Bester Attorney