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[2008] ZALCD 21
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Kings And Sons (Pty) Ltd v Commission for Conciliation Mediation And Arbitration and Others (D570/2006) [2008] ZALCD 21 (11 July 2008)
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
AT DURBAN
CASE
NO : D570/2006
In
the matter between:
KING
& SONS (PTY)
LIMITED
Applicant
and
THE
COMMISSION FOR CONCILIATION
MEDIATION
AND
ARBITRATION
First Respondent
PAUL
SHABANGU
N.O.
Second Respondent
RENNIE
JASON
DEAN
Third Respondent
JUDGMENT
PILLEMER,
AJ:
[1]
The Applicant conducts business as a shipping agent. The Third
Respondent was employed by the Applicant as an operations
superintendent
at its Richards Bay offices. He was dismissed for what
was described as “gross negligence” on 5 January 2006. He
disputed
the fairness of his dismissal and sought redress by
referring the unfair dismissal dispute to the CCMA in Richards Bay
where he
claimed compensation. The dispute was determined by
arbitration after evidence was led before the Second Respondent who
found in
favour of the Third Respondent and awarded him compensation
equivalent to five months remuneration. The Applicant seeks in these
proceedings to review and set aside the Second Respondent’s
award.
[2]
The question that has to be asked by the court in a review such as
this has been set out in the case of
Sidumo
& another v Rustenberg Platinum Mines Ltd & another
[2007] 12 BLLR 1097
(CC) at paragraph [110] – “Is the
decision reached by the commissioner one that a reasonable
decision-maker could not
reach?”
[3]
Third Respondent’s duties included making the necessary
arrangements with the various role players for the loading of
coal on
ships that berthed in the Richards Bay Harbour. This is an industry
where time spent in the harbour is extremely costly
and where, by
reason of the product and the volumes involved, an error can result
in losses of millions of rand. Accordingly, while
not that difficult,
Third Respondent’s job carried with it considerable
responsibility and Applicant had to be able to rely
upon him. Over
weekends and on Public Holidays the Richards Bay Coal Terminal’s
offices are closed. A change to the loading
rotation for a vessel due
in port on 18 December 2005 was made and notified to the Applicant in
the evening of 15 December 2005
at a time when Third Respondent was
on duty. The responsibility was his to give effect to that change by
notifying all role players.
That year 16 December, a public holiday,
fell on a Friday. The Third Respondent went about his job and gave
notification to all
the role players of the change, but, in relation
to the Terminal, he did this by merely sending an e-mail
communication at about
19h15 on 16 December. He never checked that it
had been received and would be acted upon before the loading of the
vessel commenced
on Sunday 18 December. As the Third Respondent’s
luck would have it the amendment to the loading rotation was in fact
not
picked up by the Terminal with the result that the Terminal,
working off the incorrect schedule, initially loaded the incorrect
grade of coal on the ship. Third Respondent was advised that there
appeared to be a problem and, to his credit, he immediately
dealt
with the problem and his actions and those of others together with
the cooperation of the owner were such that the potential
loss that
could have resulted, of some R5million, was thankfully averted.
[4]
Arising out of these events the Third Respondent was charged with
gross negligence, which is a specific form of misconduct recognised
by the disciplinary code that governed the workplace. Mirroring the
wording of the code, the charge sheet described the alleged
misconduct as follows: “Gross negligence – forsaking
failure in duty that results in, or could lead to serious loss,
damage or injury.” What this related to was explained in the
charge sheet as “Failing to confirm with RBCT’s
(a
reference to Richards Bay Coal Terminal) weekend operational duty
staff … of. …amended stow/load rotation received
from
the master on the 16
th
December 2005. Failed again on berthing to check whether RBCT
received the amended stow/load rotation and that the vessel was
planned to load accordingly”. The charge sheet goes on to set
out that the consequence of the failure was that loading commenced
with an incorrect grade and fortuitously it had been possible to
avoid extremely costly consequences but that three hours of loading
time had been lost. The last sentence of the charge sheet reads: “Due
to the above and failing to follow normal agency procedures
you have
placed the company under tremendous risk.”
[5]
This was not the first occasion the Third Respondent had faced
discipline for gross negligence. He had been found guilty a little
less than a year earlier and had initially been dismissed, but that
sanction was altered to a final written warning. This warning
was
“current” in that less than a year had expired and was a
factor that was taken into account in relation to the
sanction of
dismissal that was imposed by the Applicant following upon a finding
that the Third Respondent was guilty.
[6]
The Applicant’s case as to what Third Respondent had done wrong
was set out in the evidence of one of the witnesses it
called, a Mr
Van Rooyen, who explained it in the following terms: “After he
received the e-mail from the Captain confirming
his amended load
rotation [he] should have made an effort to pass such information to
the Terminal immediately. He failed to do
a normal agency procedure
and should have made contact with the terminal immediately upon
receipt of the same”. Van Rooyen
agreed that all the role
players, apart from the Terminal, had been informed of the amended
loading rotation and, the reason for
the Terminal not having been
notified, he said, was “because they were not notified via
telephone”. It was put to him
that they were notified by e-mail
and he responded to that proposition by pointing out that 16 December
was a public holiday and
the following days the weekend when nobody
was at the office implying that this was a useless step on the
weekend when the phone
had to be used. He then summarises this line
of reasoning as follows “So, for the Applicant not to inform
the RBCT that was
the downfall, because he did not confirm it,
knowing that on weekends and public holidays they are not at the
office.” Later
he said “it is common knowledge to all
agents that any deviation from the norm must be reported to them via
telephone”.
It was then put to him that there was no rule that
a telephone call had to be made and in answer to this Mr Van Rooyen
explained
that the agents are given a list of weekend Terminal
personnel who are on duty after hours who can be contacted in the
event of
changes and that list is sent out at four o’clock on a
Friday afternoon. The cross-examination then raised the fact that an
e-mail had been sent by the Terminal to the Applicant after the event
which claimed that a “courtesy call” would have
been
appropriate. The point was made that the reference to a
courtesy
call implied that it is not a rule that there had to be such a call.
Having earlier made the point that the stevedores and the
Terminal
were in contact and the stevedores had the amended loading rotation
and should have drawn the error to the attention of
the Terminal, the
cross-examiner put the proposition that the e-mail that referred to a
courtesy call could be interpreted as being
a concession by the
Terminal “that it had been in the wrong but the Applicant
should have phoned and then it would not have
made the mistake”.
To this Van Rooyen stated that he could not comment. The
relevance of all this lies in the fact
that the Third Respondent
denied that there was any practice or rule that required him to make
the call and his case was the e-mail
was sufficient. He also
contended that in any event the stevedores knew of the amended
loading rotation and they should have confirmed
this with the
Terminal. His case therefore was that the potential disaster was not
his fault and that he had not been at fault
in failing to make the
telephone call that Van Rooyen had said was expected of him.
[7]
The arbitrator found on this evidence that the phone call to the
Terminal staff on duty over a weekend that had to be made if
communication with the Terminal was necessary over week-ends and
public holidays was “mere practice which had not crystallized
into a binding rule” and he emphasises the point by using the
phrase “hence the courtesy call”, presumably intending
to
stress the word courtesy. On this basis he records in his award that
it is “doubtful that the [Third Respondent] contravened
any
rule in the light of the status of the phone call that he was
expected to make”. There is no logic in having found that
Third
Respondent was expected to make the call, whether it is called a
courtesy call or anything else, to then fail to take the
further step
in his reasoning and consider whether the failure to do what was
expected of him in the given context amounted to
gross negligence as
it is understood in the code. It was a fundamental misdirection not
to apply his mind to this question and
thereby leave matters hanging
simply because the call was described in an e-mail communication as a
courtesy call as if this was
the complete answer. Had he properly
applied his mind the Arbitrator must have found on the evidence that
Third Respondent knew
that the Terminal was not open to the public on
weekends; that Third Respondent had the contact details of the member
of the Terminal
staff on duty and whom he contacted immediately there
was a problem on the Sunday; that he knew that the failure to comply
with
a changed loading rotation could have very serious financial
consequences; and that there was nothing onerous in checking that the
e-mail had been received by picking up the telephone. A reasonable
person foreseeing the harm that could result if the e-mail had
not
been received and acted upon when it is probable that it would not
have been received would have taken the obvious and usual
step to
ensure it was drawn to the attention of the responsible person on
duty at the Terminal over the weekend. His failure to
do what was
expected of him and which a reasonable person would have done was
clearly negligent. In the context of the dire consequences
that could
flow as a result of his default, the negligence fell under the
categorisation in the code of gross negligence.
[8]
The award is confusing and contradictory because, on the one hand,
the arbitrator appears to find that the sanction of dismissal
was
inappropriate but that would only be of relevance if guilt was proven
and yet, on the other hand, also seems to find that guilt
was not
established. I am satisfied that the arbitrator misdirected himself
in relation to the finding that guilt had not been
proven, if that is
what he did find. He makes too much of the formal existence of a rule
even though he correctly finds that the
making of the telephone call
was to be expected as he had to find because it is obvious that
making the call was what the circumstances
required. The Arbitrator
ought therefore to have found that the charge of gross negligence, in
the special meaning it has in the
code, was proved. The Arbitrator’s
failure to do so falls short of what was required of him on the
Sidumo test rendering
this aspect of his award liable to be set aside
on review.
[9] As
I indicated earlier the main thrust of the reasoning in the award
does seem to be premised on the notion that guilt was established.
I
say this because the arbitrator relies on the provision of the
disciplinary code that provides in cases of gross negligence for
a
sequence of sanctions, a written warning for a first offence, a final
written warning for a second and dismissal for a third.
The
arbitrator reasoned from this that the earlier guilty finding that
resulted in a final written warning, being the first offence,
ought
to have resulted in a written warning and not a final written warning
and, on this logic, the misconduct in issue in this
case should have
attracted the final written warning that comes with a second offence
and not dismissal that can only be imposed
as a sanction for a third
offence. Implicit in this reasoning is a finding of guilt on a second
occasion. I am afraid this approach
is too technical and fails to
consider relevant material. The reasoning overlooks the fact that the
code is a guide and has no
regard to the important feature that Third
Respondent accepted, and by all accounts was fortunate to have
received, the sanction
of a final written warning in respect of his
previous disciplinary experience. It was a much more serious form of
misconduct and
resulted in a very substantial loss to the employer,
where he escaped being dismissed by a whisker. The existence of this
history
and the final written warning cannot be wished away and there
is no basis to downgrade the final written warning and pretend it
was
something else simply because it was given in relation to a first
offence. The approach of the arbitrator fell short of that
required
of a reasonable arbitrator and constituted a serious misdirection
undermining the reasonableness of the award.
[10] I
accept that a case could possibly have been made that because the
misconduct was not intentional and, as Mr Dalton for the
Applicant
testified, “there isn’t a man in shipping that hasn’t
made one error”; dismissal could be found
to be too harsh a
sanction for failing to make a single telephone call. The arbitrator
however did not approach the matter on this
basis and did not ask
himself the question the Constitutional Court in Sidumo said had to
be asked in relation to sanction, after
taking all circumstances into
account, namely whether the dismissal is fair. Had that
question been asked then a reasonable
arbitrator in my view would on
analysing the relevant material find that the Third Respondent’s
slackness or lack of common
sense in failing to ensure that his
e-mail had been read and acted upon by the recipient went to the root
of the responsibilities
of his job. This feature renders his default
fundamental to the employment relationship because it had the
resultant impact of
rendering it impossible for the employer to be
able to continue to place reliance in him, more especially because
the incident
was the second of its kind and occurred after a previous
incident where the outcome was a last chance as reflected in a final
written
warning. In that context,if one is to ask the question
without giving any deference to the employer’s decision or to
the
employee: “Was the decision to dismiss fair in this context
i.e. did the misconduct destroy the element of trust essential
for
the employment relationship to continue?”; the answer, it seems
to me, is self evident that dismissal as a sanction is
fair and that
the employer has good reason to believe that the employment
relationship has been destroyed even though the error
consisted of
only not making one telephone call. On the face of it not making a
telephone call appears to be a small oversight,
but in fact it goes
much deeper because the need to make that call should have been
obvious and the failure to do the obvious must
undermine any
confidence that he can be relied upon to do his job without putting
the Applicant at considerable risk.
[11]
In the result I find that the decision as embodied in the award that
the dismissal was substantively unfair fails the Sidumo
test; it is a
decision that a reasonable decision maker could not reach. It follows
that it falls to be set aside on review. There
is no need to
substitute the award with a finding that the unfair dismissal dispute
is dismissed because that follows for the reasons
set out in this
judgment.
[12]
The Order I make therefore is that:-
[12.1]
the award of the Second Respondent under Case No. KNRB216-06 dated 19
July 2006 is hereby reviewed and set aside; and
[12.2] the Third
Respondent is ordered to pay the costs of the application.
_____________________
M PILLEMER
ACTING JUDGE OF THE
LABOUR COURT
Date
of Judgment: 11 July 2008.
For
the Applicant:
Attorney I Lawrence
For
the Respondent:
Adv M M Posemann
instructed by Riaan Kruger and
Associates