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[2008] ZALCCT 6
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Crouse NO and Another v Workers Union of South Africa (CA1/2006) [2008] ZALCCT 6 (19 May 2008)
IN
THE LABOUR APPEALCOURT OF SOUTH AFRICA
(HELD
AT JOHANNESBURG)
Case
No. CA1/2006
JOHAN
CROUSE
N.O. First
Appellant
THE
DEPARTMENT OF
LABOUR Second
Appellant
and
WORKERS
UNION OF SOUTH AFRICA
Respondent
JUDGMENT:
DAVIS
JA:
Introduction
[1]
In 2002 certain workers employed at Atlantis Farge Plant in Atlantis,
Western Cape, decided to form a new trade union because
they
considered the existing union, the National Union of Metal workers of
South Africa (NUMSA), had not adequately served their
interests,
inter alia,
because they had a lack of confidence in the local
organizer and further because certain employees had complained about
the dismissal
of shop stewards, including Mr. D Braaf and Mr. D
Willemse.
[2]
In October 2003 some fourteen employees at the plant held a meeting
which was chaired by an employee, Mr. R Muller.
At this
meeting, the establishment of a new trade union was discussed.
Muller informed the meeting that he and a Mr.
K Booysen had
visited Braaf and Willemse and inquired as to whether they were
interested in forming a new union. The
two men agreed to
so participate. An interim committee was formed to deal with
the process of union registration. Braaf
and Willemse
were appointed to that committee. They were the only
executive committee members who were not employees
of Atlantis
Farge. It was then agreed that interested employees would
meet on 18
th
October 2003 to elect drafters of the
constitution of the proposed union.
[3]
On 18 October 2003 the executive committee mandated Braaf and
Willemse to do the necessary research in order to draft the
constitution
of the proposed union. They were also
mandated to approach labour lawyers who would advise on the
requirements for
the establishment of the union. Braaf
was elected as chairperson of the committee and Willemse as its
secretary.
[4]
On 25 October 2003 another meeting of the executive committee was
held. At that meeting Willemse reported that he
and Braaf
had approached lawyers, who, unfortunately, had not had the necessary
background in the registration of trade unions.
He
informed the meeting that he and Braaf would do the necessary
research for a fee of R 5 000.00 (five thousand rand).
This matter was deferred to the next meeting. At the next
meeting on October 1, 2003, the chairperson asked those present
to
decide on the name of the proposed union and whether it should
broaden its scope. A proposal was adopted that the
union
be called ‘The Workers Union of South Africa’ and that it
should be multi-sectoral.
[5]
On 18 March 2004 first appellant received an application by
respondent for registration. On 1 April 2004 officials
of
second appellant visited respondent’s offices to which
respondent had moved the day before. Braaf informed these
officials that the office would be occupied for some two months.
A checklist was then completed by these officials.
From
the completed checklist it appeared that respondent had been formed
after Braaf and Willemse had been unfairly dismissed
and that four
members attended the inaugural meeting. The checklist
also reflected that respondent had 3000 “potential
members’.
The checklist showed Braaf to be respondent’s president and
Willemse its secretary.
The constitution had not yet been
adopted and the union was not yet in operation. In short, it appeared
that an application was
made for registration before the union
operationally existed.
[6]
An amended registration form was submitted on 8 April 2004, after
officials of second appellant had advised that the composition
of the
executive had to be altered.
[7]
On 13 April 2004 a special general meeting was held. At
that meeting a central committee was elected, a management
committee
was also elected and it was agreed that a banking account would be
opened.
[8]
On the same day, 13 April 2004, respondent’s attorneys wrote to
first appellant informing him that respondent had been
advised not to
collect monies from members and operate a bank account in that , if
it did so , this would constitute a breach of
the Labour Relations
Act of 66 of 1995 (‘the Act’).
[9]
On 3 June 2004 respondent’s attorneys wrote to first appellant
advising him that respondent was attempting to obtain stop
orders and
membership forms and requested him to finalize the registration of
the union as soon as possible.
[10]
On 13 July 2004 first appellant informed respondent that the
application for registration had been refused on the grounds that
the
respondent was not a genuine organization as envisaged by the Act.
The first appellant stated that respondent had
not functioned in
terms of its constitution and had been established for personal
financial gain.
[11]
On 22 July 2004 respondent’s attorney requested written reasons
for the decision. These were set out
in a letter
generated by first appellant on 16 August 2004; to which I shall
make detailed reference presently.
[12]
On 15 October 2004 respondent lodged an appeal to the Labour Court in
terms of s111 (3) of the Act against the decision of
first appellant
not to register the respondent. On 29 July 2005 Murphy AJ
upheld the appeal and ordered the registration
of respondent.
It is against this decision that, with the leave of the court
a
quo,
appellants comes on appeal before this Court.
The
applicable legislation
[13]
In order to analyse the merits of this appeal, it is necessary to set
out the relevant provisions of the Act.
Section 95
of the Act provides as follows:
Requirements for
registration of trade unions or employers' organisations
(1) Any trade union may
apply to the registrar for registration if-
(a)
it has adopted a name that meets the requirements of subsection (4);
(b)
it has adopted a constitution that meets the requirements of
subsections (5) and (6);
(c)
it has an address in the Republic; and
(d)
it is independent.
(2)
A trade union is independent if-
(a)
it is not under the direct or indirect control of any employer or
employers' organisation;
and
(b)
it is free of any interference or influence of any kind from any
employer or employers'
organisation.
(3)
Any employers' organisation may apply to the registrar for
registration if-
(a)
it has adopted a name that meets the requirements of subsection(4);
(b)
it has adopted a constitution that meets the requirements of
subsections (5) and (6),
and
(c)
it has an address in the Republic.
(4)
Any trade union or employers' organisation that intends to register
may not have a name
or shortened form of the name that so closely
resembles the name or shortened form of the name of another trade
union or employers'
organisation that it is likely to mislead or
cause confusion.
(5)
The constitution of any trade union or employers' organisation that
intends to register
must-
(a)
state that the trade union or employers' organisation is an
association not for gain;
(b)
prescribe qualifications for, and admission to, membership;
(c)
establish the circumstances in which a member will no longer be
entitled to the benefits
of membership;
(d)
provide for the termination of membership;
(e)
provide for appeals against loss of the benefits of membership or
against termination
of membership, prescribe a procedure for those
appeals and determine the body to which those appeals may be made;
(f)
provide for membership fees and the method for determining membership
fees and
other payments by members;
(g)
prescribe rules for the convening and conducting of meetings of
members and meetings
of representatives of members, including the
quorum required for, and the minutes to be kept of, those meetings;
(h)
establish the manner in which decisions are to be made;
(i)
establish the office of secretary and define its functions;
(j)
provide for other office-bearers, officials and, in the case of a
trade union,
trade union representatives, and define their respective
functions;
(k)
prescribe a procedure for nominating or electing office-bearers and,
in the case of
a trade union, trade union representatives;
(l)
prescribe a procedure for appointing, or nominating and electing,
officials;
(m)
establish the circumstances and manner in which office-bearers,
officials and, in the case
of a trade union, trade union
representatives, may be removed from office;
(n)
provide for appeals against removal from office of office-bearers,
officials and,
in the case of a trade union, trade union
representatives, prescribe a procedure for those appeals and
determine the body to which
those appeals may be made;
(o)
establish the circumstances and manner in which a ballot must be
conducted;
(p)
provide that the trade union or employers' organisation, before
calling a strike or
lock-out, must conduct a ballot of those of its
members in respect of whom it intends to call the strike or lock-out;
(q)
provide that members of the trade union or employers' organisation
may not be disciplined
or have their membership terminated for
failure or refusal to participate in a strike or lock-out if-
(i)
no ballot was held about the strike or lock-out; or
(ii)
a ballot was held but a majority of the members who voted did not
vote in favour
of the strike or lock-out;
(r)
provide for banking and investing its money;
(s)
establish the purposes for which its money may be used;
(t)
provide for acquiring and controlling property;
(u)
determine a date for the end of its financial year;
(v)
prescribe a procedure for changing its constitution; and
(w)
prescribe a procedure by which it may resolve to wind up.
(6)
The constitution of any trade union or employers' organisation which
intends to register
may not include any provision that discriminates
directly or indirectly against any person on the grounds of race or
sex.
(7)
The registrar must not register a trade union or an employers'
organisation unless the
registrar is satisfied that the applicant is
a genuine trade union or a genuine employers' organisation.
(8)
The Minister, in consultation with NEDLAC, may by notice in the
Government Gazette publish guidelines
to be applied by the registrar
in determining whether an applicant is a genuine trade union or a
genuine employers' organisation.
The
Relevant Factual Matrix
[14]
Within the context of this legal framework, it is now possible to
turn to the key
facts
which gave rise to the present dispute. To recapitulate: (a)
respondent lodged an application for registration on 18
th
March 2004; (b) on 1
st
April 2004 an inspection by
officials of second appellant took place; (c)on 12 July 2006, first
appellant
refused to register respondent.
[15]
A flurry of correspondence was then generated, not all of which is
strictly relevant to this dispute. However,
of particular
relevance is the fact that on 13
th
July 2004, respondent’s
attorneys received a letter from first appellant stating that its
application for registration had
been refused with effect from 12
July 2004. That letter reads: “I acknowledge
receipt of your letter ….
dated 13 April 2004 and have to
advised that the union’s application for registration has been
perused and found not acceptable
for approval and I base my decision
on the following grounds:
·
The union is not a genuine organization as envisaged by the Act
·
The union does not function in terms of its constitution
·
The trade union was established for financial gain and to circumvent
the provisions
of the Act
Consequently
you are advised that the application for registration is refused with
effect from 12 July 2004.”
[16]
On 22
nd
July 2004 respondent’s attorneys requested
reasons for this decision, which were provided on 16
th
August 2004. The relevant portion of this letter reads: “I
refer to the facsimile letters dated 22 July 2004 and 4
August 2004
respectively and have to inform you that the decision of the
Registrar is final and cannot be reconsidered.
The only
route to follow is provided for in section 111 of the Act ….
In
arriving at the above decision, I relied on the guidelines issued by
the Minister of Labour in terms of section 95 (8) of the
Act and the
following facts regarding the application:
·
The trade union is not a genuine organization as envisaged by the Act
Trade union as per
definition of the Act means “An association of employees whose
principal purpose is to regulate relations
between employees and
employers, including any employers’ organization”.From
the information at hand, the formation
of the union and the
subsequent operation thereof, did not involve employees associating
together, but was initiated by the President
Mr. Dalton Braaf, and
the General Secretary, Mr. David Willemse, after they were dismissed
from their respective employment.
This means that
unemployed persons established the union. Mr. Braaf
claims to be self-employed and the conclusion was
that the formation
of the union did not involve “employees” as defined in
section 213 of the Act. The democratic
principles on
which a union is based did not apply and it cannot be argued that
worker established this union.
·
The union was established for gain of individuals The argument above
also applies
to this point as it can only be argued that the motive
behind the establishment of the union by the two individuals was for
gain.
A new application form with an amended executive
committee that was later submitted to this Office, reflects Mr.
Dalton Braaf who,
in conjunction with Mr. David Willemse established
the union, as the general secretary whilst Mr. Willemse position is
that of
treasurer. This happened after it was
pointed out to the officials of the union that the office bearers
namely
Mr. Braaf who is not an employee, could not in terms of the
definition of “office bearer” qualify to be the
President,
he was then positioned as the General Secretary.
This is unconstitutional and it was clearly done only to satisfy the
registration requirements. Although this was clearly an
attempt to remedy the composition of the executive committee
by
moving the names around, the executive committee is still not
acceptable in light of the involvement of the people who established
the organization.
·
The organization is not functioning in terms of its constitutionThe
organization
is not functioning as yet and has only potential members
who are willing to join the union after it is registered.
Only the “steering committee” is active. The
constitution that was submitted for approval does not make
provision
for a steering committee. The organization has to
function according to its constitution even if its not
registered and
upon application for registration, must prove that it is operational
in terms of the constitution.’
Judgment
of the court
a quo
[17]
It was against this decision of first appellant that the appeal to
the court
a quo
was lodged. In his judgment,
Murphy AJ examined section 95 through the prism of the guidelines
issued in terms of section
95 (8) of the Act [Government Gazette
25515 of 10 October 2003]. The learned judge concluded that
section 95 (7) of the Act
read together with the guidelines gave
first appellant a narrow discretion to refuse to register an
unregistered trade union seeking
registration.
Accordingly, ‘it makes sense to limit the determination to
paying attention to the manner in
which the organization was
established and formed and without having regard to the actual
activities and functioning’. para
21 of the judgment.
[18]
Murphy AJ proceeded to find that in terms of section 111 of the Act
the appeal before him constituted an appeal in the wide
sense.
It could involve a complete rehearing and adjudication on the merits
with or without additional evidence or
information.
[19]
Based on these premises and his examination of the reasons provided
by first appellant in his letter of 16 August 2004, Murphy
AJ
concluded: ‘I am persuaded that the registrar is mistaken
in his interpretation and application to the facts
before him
of the guidelines issued in terms of section 95 of the LRA.
Most particularly in that he clearly failed
to take important
relevant considerations into account and was influenced by irrelevant
considerations. His finding
that the appellant is not an
association of employees by reason that certain of its promoters were
unemployed is simply wrong.
Likewise, his conclusion that
the union was not operational in terms of its constitution and was
established for the gain of two
individuals is also incorrect and
amounts to irrelevant consideration that improperly influenced his
exercise of discretion’.
para 31 of the judgment.
The
appeal to this court
[20]
On appeal, Ms. Rabkin-Naicker, who appeared on behalf of respondent,
submitted that section 111 of the Act provided for an
appeal in the
wide sense to the Labour Court. Thus, it involved a
complete rehearing and adjudication of the merits.
She
submitted that, the court
a quo
had correctly followed this
approach and had made its own findings on the evidence placed before
it. She submitted
further that for these reasons there
was no basis to upset the court
a quo’s
order.
[21]
In support of this submission, counsel for the respondent relied upon
a judgment of this Court in
Staff Association for Motor and
Related Industries Motor Industries Staff Association and another
(1999) 20 ILJ 2552 (LAC). In that case, this Court examined s111 (3)
of the Act. S113 (3) provides “any person who is aggrieved
by a
decision of the registrar may appeal to the Labour Court against that
decision in 60 days of
(a) the date of the
registrar’s decision or
(b) if written reasons
for the decision are demanded, the date of those reasons.”
[22]
In both judgments which were delivered, by Ngcobo AJP and
Conradie JA, emphasis was placed on the fact that the aggrieved
person in that case was a third party, being a trade union which had
objected to the registrar’s decision to register another
union. Accordingly, in both judgments it was held that a
review of such a decision was not possible, because the third
party
had not been involved in the decision making process nor in the
provision of information to the registrar prior to the decision
to
register the other trade union. The Court held that the matter
had to be heard afresh, the court held that the word ‘appeal’,
as it appears in s111 (3), had to be given a wide meaning.
[23]
That case did not, in any way, examine the problem posed by the facts
of the present case, namely whether an applicant trade
union which
was refused registration in terms of a discretionary act of the
registrar pursuant to s95 (7) of the Act, is entitled
to an appeal
(in the wide sense) against the adverse decision of the registrar as
opposed to a review of such a decision.
[24]
Given the approach which I adopt, it is unnecessary for me to deal
with this interpretive question. The key issue
is whether
an appeal against first appellant’s ‘decision’ was
competent. For section 111 (3) to be
applicable, a final
decision by the registrar has to made. The appeal, in
terms of s111(3) of the Act, is against this
decision. In
terms of s96 (4) of the Act, it is clear that, where the registrar
acting in terms of his power under
s 95, decides that he is not
satisfied that the applicant union meets the requirements for
registration, he is obliged to notify
the applicant of this decision
and must provide reasons for the decision. Further, he
must provide a 30 day period
in which the applicant union has an
opportunity to meet the statutory requirements for registration.
[25]
It is common cause that no such application of this provision took
place in the present case. First appellant made his
decision on
12
th
July 2004. Only after a letter from
respondent’s attorneys were reasons provided on 16 August 2004
by the first
appellant. There was clear non compliance
with the provisions of section 96 (4), in that no opportunity was
provided
to respondent to deal with the problems raised by first
appellant in his letter of 16
th
August 2004.
[26]
Though section 96 (4) (a) refers to “a written notice of the
decision
and the reasons for that
decision
”, (my
emphasis) it is clear, when this provision is read together with
subsections (5) and (6), that the
decision
taken in terms of
section 96 (4) (a), is but a provisional decision. The
Act mandates first appellant to inform the
applicant that it has 30
days from the date of the notice to meet the requirements which the
first appellant has found not to have
been met and the failure of
which justified the initial decision. In terms of s96
(5), where an applicant such as respondent
meets the requirements for
registration in this 30 day period, first appellant is mandated to
register the union.
[27]
For this reason, no legally effective decision was taken by first
appellant which was final and therefor could have been the
subject of
an appeal. Expressed differently, until there was compliance
with the provisions sections 96(4), (5), (6), no
decision had been
made which determined the rights or interests of respondent.
This could have only taken place after
due compliance with s 96(3),
being the provision of reasons, an opportunity to respond and a
decision taken pursuant to such response.
As the
Constitutional Court held in
Fedsure Life Assurance Ltd v The
Greater Johannesburg Transitional Metropolitan Council
[1998] ZACC 17
;
1999 (1)
SA 374
(CC) at para 59, the principle of legality is central to the
rule of law. That means that a body exercising a power
such as first appellant is required to act lawfully within the powers
granted to it. In this case, a decision by first appellant
could not
have been lawfully made until there was due compliance with its
provisions of section 96 of the Act.
Conclusion
[28]
It follows from this analysis of the law that, when the matter came
before the court
a quo,
the proper course was to find that no
appeal could be prosecuted in terms of section 111 until a final
decision had been made which
could then be the subject of an appeal.
Given the lack of compliance with the provisions of s96(3), in
particular, the court
a quo
was required to refer the matter
back to first appellant in order that a decision could be made
pursuant to the provisions of the
Act. With regard to costs, I am of
the view that the requirements of the law and fairness dictate that
there should be no order
of costs both in this Court and in the Court
a quo.
[29]
For these reasons therefor the following order is made:
1.
The appeal is upheld.
2.
There is no order of costs
on appeal.
3.
The decision of the Labour
Court of 29 July 2005 is set aside and
replaced with the following order.
(a) The decision
which first respondent took on 12
th
July 2004 in which he
refused to register applicant in terms of Section 96 of the Act 66 of
1995 is set aside.
(b) The
application for registration by applicant is referred back to first
respondent in order for him to comply with
the provisions of Section
96(3) of the Labour Relations Act 66 of 1995
(c)
There is no order as to costs.
______________
DAVIS
JA
___________
I
agree
ZONDO JP
___________
I
agree
TLALETSI AJA
Date
of Judgment: 19 May 2008
Appearances
For
the Appellant
Advocate
T Bruinders SC assisted by Adv. E. Tolmay
For
the respondent
Advocate H Radkin-Naiker