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[2009] ZALCJHB 53
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Parmalt South Africa (Pty) Ltd v Commission for Conciliation Mediation And Arbitration and Others (JR462/07) [2009] ZALCJHB 53 (3 February 2009)
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
IN JOHANNESBURG
REPORTABLE
CASE
NO: JR 462/07
In
the matter between:
PARMALAT
SOUTH AFRICA (PTY) LTD
APPLICANT
and
COMMISSION
FOR CONCILIATION,
MEDIATION
AND
ARBITRATION
1
st
RESPONDENT
COMMISSIONER
H MATSEPE
N.O.
2
nd
RESPONDENT
MARILYN
PRETORIUS
3
rd
RESPONDENT
JUDGMENT
MOLAHLEHI
J
Introduction
[1]
This is an application to review and set
aside the arbitration award of the Second Respondent (the
Commissioner) made under case
number LP1720/06 and dated 28
th
February 2007, in terms of which the dismissal of the Third
Respondent was found to be both substantively and procedurally
unfair.
The relief granted in terms of that award was that the
Applicant should pay the Third Respondent compensation in an amount
of R107
400.
[2]
The Third Respondent opposed this
application.
Background
[3]
The Third Respondent, Ms Pretorius who was
at the time of her dismissal employed as the area distribution
manager, was charged with
misconduct or poor management:
“
In
that you failed to report on time the Simmondsburg expired stock at
the value of plus/minus R200 000 and gross misconduct (dishonesty),
in that you intentionally instructed employees to change the actual
stock count in order not to reflect the true variance in the
variance
report.”
[4]
At the arbitration hearing Mr Bruwer, the
financial accountant based at the Applicant’s head office in
Stellenbosch
testified on behalf of the Applicant that the
variances report which were receive daily were used to reconcile the
physical and
theoretical stock. This is according to him a standard
procedure used to determine the Applicant’s business focus.
[5]
Bruwer further testified that in January
2006 he received a tip-off that the stock in the Polokwane
distribution centre was being
manipulated. There was an exchange of
correspondence between Polokwane and head office about this matter.
The bulk of the variances
were on the cheese lines. When 10 (ten)
lines were tracked, it was discovered that about 1 (one) tone of
variances to the value
of about R30 000 per line and the total value
of about R222 000, were not reported.
[6]
The concern from Bruwer arose when he
discovered that some of the variances were not disclosed. This was
confirmed by the investigation
which was conducted by the Applicant.
[7]
According to Bruwer the applicant used the
services of temporary employees across the country and that for 8
(eight) months Polokwane
did not have a distribution manager. In
relation to charges which were proferred against the employee he
testified that even if
she did not report any theft in Polokwane the
stock loss would be discovered because distribution centres are
audited once a year.
[8]
The second witness of the applicant Mr
Rossouw, the distribution manager at Gauteng testified that he
visited the Polokwane branch
after being requested to do so by the
regional distribution centre manager.
[9]
Rossouw was placed in charge of the
Polokwane branch after the suspension of the employee. The suspension
according to him was because
there was information that indicated
that there was something wrong with the stock taking in Polokwane
distribution centre.
[10]
While the variance report, according to
Rossouw, indicated a variance there was no loss reflected at the end
of the month. The stock
account that he conducted revealed that there
was about R200 000 worth of expired stock in the freezer and that
this stock was
contrary to the Applicant’s policy.
[11]
Rossouw further testified during
cross-examination that the staff compliment during his period was
better at Polokwane compared
to the period of the employee was there.
[12]
The employee testified on her own behalf
that the absence of the warehouse controller impacted negatively on
the ability to run
the depot. The stock controller is responsible for
the stock control report and in this regard provides support to the
manager.
[13]
The employee further testified that at the
time it was unknown what amount of stock was sold to customers and
what orders the stores
were taking. She further in this regard
indicated that she did not receive any support from head office.
[14]
The head office according to the employee
supplied stock that was over ordered and their own factories had to
ask her how to get
rid of the stock.
[15]
The employee denied having instructed other
employees to change the actual stock count and that she had opened a
theft case due
to the stock variance and that the police were at that
time busy investigating this. She also testified that she had
informed her
superior, Mr Schoeman after she had looked at the report
and saw huge discrepancies between the stock that was counted and
that
which was on the floor.
The grounds of review
[16]
The Applicant has in its founding affidavit
raised a number of grounds of review, the essence of which is that
the Commissioner
committed a gross irregularity, failed to apply his
mind, contradicted his earlier findings in the award, change his
findings midway
through his award having found the Third Respondent
to have committed an offence.
[17]
The Third Respondent argued that the
Commissioner never contradicted himself and that when he referred to
the elements (a)-(d) of
substantive fairness he was referring to the
first charge which related to failure to report the expired stock to
the value of
R200 000.
[18]
The Third Respondent further argued that
she was not afforded the opportunity to cross-examine the witnesses
and was also denied
access to the contents of the computer.
[19]
In essence the issue for determination in
the present instance is whether the Commissioner committed gross
irregularity in relation
to:
·
His duties as a commissioner;
·
In the conduct of the arbitration hearing;
and
·
Whether the Commissioner did exceed his
powers.
Evaluation of the
award
[20]
In the analysis of the evidence presented
before him the Commissioner deals firstly with what the employer is
required to prove
in order to show that the dismissal was both
substantively and procedurally fair. In this regard the Commissioner
correctly points
to the factors to consider in determining the
substantive fairness of the dismissal as follows:
“
In
dealing with the substantive fairness the respondent has to prove
inter alia the following: (a) that there is a rule in the
respondent’s company prohibiting the particular behaviour or
offence, (b) that the applicants knew about the said rule or
could
reasonable be expected to have known about the said rule when the
offence was committed, (c) that the said rule is legitimate
and
reasonable, (d) that the said rule has been consistently applied, (e)
that the applicant in deed breached the said rule, and
(f) that the
sanction imposed by the employer to the applicant was appropriate
under the circumstances.”
[21]
After setting out the above requirements to
show substantive fairness by the employer, the Commissioner proceeded
to indicate in
relation to charge 1 (one) that the employee would not
have been entitled to refer the dispute to the CCMA as she was not
dismissed
for it as she was issued with a written warning. It was for
this reason that the Commissioner concluded that “
dealing
with the merits of charge 1 would be academic.”
[22]
After indicating the approach he adopted in
relation to charge 1 (one) the Commissioner then proceeded to deal
with charge 2 (two).
In dealing with charge 2 (two) the Commissioner
started off by saying:
“
The
respondent in effect called therefore only one witness in as far as
count 2 is concerned.
From
the evidence of this witness, from, perusal of respondent’s
bundle of documents as amplified by applicant concession
during
cross-examination it is clear that elements
(a)-(d)
of substantive fairness can be accepted as proven
.
(My underlining)
Applicant herself
agreed that she gave a plea of guilty on count number 2 for which she
was subsequently found guilty.”
[23]
The Commissioner then rejected the version
of the third respondent that she was influenced to plead guilty to
charge 2 (two) by
the Applicant. In rejecting the allegation of undue
influence the Commissioner reasoned that:
·
The allegation of undue influence was never
put to the Applicant’s witnesses during cross-examination.
·
The Third Respondent being at the position
she was could not be influence in the manner she alleged.
·
The Third Respondent did not during the
cross-examination indicate that its version when she presented her
case would be that the
plea of guilty by the Third Respondent was due
to undue influence.
·
The Third Respondent had enough time to
between the time of the alleged undue influence to have consulted her
attorney regarding
her rights in this regard.
[24]
In addition the Commissioner found that the
Third Respondent had conceded during her testimony to the allegations
concerning charge
2 (two) being that she had ordered staff to alter
the variances report in order to give them (the employee) an
opportunity to correct
their mistakes. The Commissioner found in this
respect that even if the Third Respondent had good intentions in
ordering the employees
to change the variances that would not have
absolved her from an act of dishonesty.
[25]
The Commissioner proceeded in her analyses
of the conduct of the third respondent and stated that:
“
She
further stated that the mistake could have been over the past six
months yet she allowed it to continue by ordering the altering
of the
original stock counts. This constitutes nothing but dishonesty on the
part of the applicant whatever the reason may be.
I therefore reject the
excuse of applicant and find that she indeed committed count 2 for
which she gave a plea of guilty.”
[26]
Having concluded the above analysis which
firmly establish that not only did the Commissioner reject the
defence of the Third Respondent
but also that the Applicant had
satisfied the requirements of proving its case, the Commissioner
asked himself the following question:
“…
the
question is whether the respondent succeeded to prove other elements
of substantive fairness.”
[27]
In answering this question the Commissioner
finds that the Applicant did not prove all the elements of
substantive fairness in that
it did not apply the rule consistently.
The Applicant failed to prove that the rule was consistently applied
according to the Commissioner
because:
“
It
is clear from the evidence led that the respondent did not prove at
all that the rule of the company was consistently applied.
No
evidence was introduced that certain senior or ordinary employees
were dismissed for acts of dishonesty and if so what their
names are,
clock numbers, types of dishonesty committed, dates thereof and the
sanction accordingly.”
[28]
The Commissioner based his conclusion on
the reasoning that:
“
Since
the respondent did not succeed to prove that the rule was
consistently applied it cannot be said that the sanction of dismissal
is appropriate under the circumstances.”
[29]
It is clear, the Commissioner committed a
gross irregularity by issuing an award that was contradictory and
confusing. On the one
hand the Commissioner found that the Applicant
had successfully proven all the elements of substantive fairness. And
on the other
hand, found that the Applicant has failed to show that
it had complied with the requirement relating to inconsistency. In
Abdull & Another v Cloete NO &
Others
[1998] 3 BLLR 264
(LC),
the
Court held that:
“
[12]
As far as misconduct is concerned, it is at least arguable that an
arbitrator will make himself guilty of misconduct in relation
to his
duties as an arbitrator if he fails to apply his mind responsibly and
fairly to the issues before him. An arbitrator that
acts in this
fashion is not conducting himself in accordance with the requirements
of the LRA which enjoins the arbitrator to give
due consideration to
the issues before him, to apply his mind thereto and to come to a
reasoned conclusion. For example, section
138 of the LRA directs a
commissioner to determine the dispute fairly and quickly and to deal
with the substantial merits of the
dispute albeit with the minimum
legal formalities. The section also requires the commissioner to
issue an arbitration award with
brief reasons for his award. Solomon
JA in Dickenson and Brown v Fisher’s Executors
1915 AD 166
stated (at 176):
“
It
may be also that an arbitrator has been guilty of the grossest
carelessness and that in consequence he had come to a wrong
conclusion
on a question of fact or of law, and in such a case I am
not prepared to say that a court might not properly find that there
had
been misconduct on his part.””
[30]
The Commissioner’s decision is
further reviewable on the ground of unreasonableness. It is well
established that a decision
is unreasonable if it is one which a
reasonable decision-maker could not reach. See
Sidumo
& Another v Rustenburg Platinum Mines Ltd & Others (2007) 28
ILJ 2405 (CC).
The decision in the
present instance is unreasonable in that the Commissioner
misunderstood the application of the concept of inconsistency.
In
essence the finding of the Commissioner is that in every case of
misconduct the employer must adduce evidence indicating that
the rule
has been consistently applied. In other words the Commissioner
required the Applicant to prove the negative. The conclusion
of the
Commissioner is also unreasonable because it is not supported by
evidence. The issue of inconsistency never arose during
the
arbitration proceedings. There is no evidence of any other employee
having committed the same offence, and not being charged
or being
charged and a lesser or no punishment being imposed on such an
employee.
[31]
In the premises I issue the following
order:
(i)
The arbitration award issued by the
Second Respondent under case number LP1720/06 and dated 28
th
February 2007, is reviewed and set aside.
(ii)
The Second Respondent’s award is
substituted with the following award:
“
The
dismissal of the applicant, Ms Marilyn Pretorius, was both
procedurally and substantively fair.
The
unfair dismissal claim of the Applicant is dismissed.”
_______________
Molahlehi
J
Date
of Hearing : 8
th
August 2008
Date
of Judgment : 3
rd
February 2009
Appearances
For
the Applicant : Mr Matyolo of Perrott, Van Niekerk &
Woodhouse Inc
For
the Respondent: Mr Jan Stemmett of Stemmett & Coetzee Attorneys