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[2009] ZALCJHB 22
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Johannesburg City Parks v Mphahlani NO and Others (JR1028/06) [2009] ZALCJHB 22 (10 December 2009)
THE
LABOUR COURT OF SOUTH AFRICA
(HELD
AT JOHANNESBURG)
CASE
NO. JR 1028/06
In
the matter between:
JOHANNESBURG
CITY PARKS
Applicant
And
ADVOCATE
JAFTA MPHAHLANI
N.O. 1
ST
Respondent
THE
SOUTH AFRICAN LOCAL GOVERNMENT
BARGAINING
COUNCIL 2
ND
Respondent
SOUTH
AFRICAN MUNICIPAL
WORKERS
UNION obo S KOK
3
RD
Respondent
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
This is an application to review and set aside an arbitration award
that the first respondent made by default on 1 November
2005.
[2]
The facts giving rise to the application are not in dispute. The
applicant is a section 21 company, established during 2000
by the
City of Johannesburg Metropolitan Municipality. The City appointed
the applicant to maintain parks, cemeteries and the like
within the
Greater Johannesburg area. The second respondent is the South African
Local Government Bargaining Council (the bargaining
council), a body
registered as such in terms of the Labour Relations Act (the LRA) on
1 March 2001. The registered scope of the
bargaining council extends
to “the local government undertaking in the Republic of South
Africa”.
[3]
The applicant is not a party to the council - it contends that its
operations are of such a nature that it does not fall within
the
registered scope of the bargaining council. The South African
Municipal Workers Union (SAMWU) and the Independent Municipal
and
Allied Trade Union (IMATU) represent most of the applicant’s
employees. SAMWU and IMATU contend that the applicant falls
within
the definition of “local government undertaking”
contained in the bargaining council’s constitution, and
that it
is therefore bound by those of the council’s collective
agreements that have been extended to non-parties by the
Minister in
terms of section 32 of the LRA.
[4]
During 2004, a demarcation dispute was referred to the CCMA in terms
of s 62 of the LRA. This dispute required the CCMA to determine
whether the applicant and its employees are engaged in the municipal
services sector. I do not intend to canvass the parties’
respective positions in those proceedings. The demarcation was
pending at the time the arbitrator made his award, and it appears
that despite the lapse of some 5 years since the referral of the
dispute, it remains pending.
[5]
The applicant employed the third respondent, Kok, as a head gardener
in Patterson Park, until his dismissal in November 2004.
An unfair
dismissal dispute was eventually set down for arbitration on 26
October 2005. On 13 October 2005, the applicant addressed
a letter to
the bargaining council stating
inter alia
that it would not
attend the arbitration hearing as it was not subject to the council’s
jurisdiction. The later states:
“
Johannesburg
City Parks does not fall within the jurisdiction of the South African
Local Government Bargaining Council and as a
result it will not
attend arbitration
(sic)
to be held on the 26
th
October 2005 at 09h30.
There is a demarcation
dispute pending at the CCMA case no SA 18299/04. Until this matter is
finalized by the CCMA Johannesburg
City Parks will not be bound by
any decision of the Bargaining Council and our employees are free to
refer disciplinary matters
to the CCMA, which the company duly
attend
(sic)”
[6]
The arbitration commenced in the absence of the applicant. At the
hearing, the arbitrator is recorded as having said the following:
“
...
I intend to
proceed with this matter in the absence of City Park as they have
failed to attend the arbitration hearing; instead
they have sent a
letter dated 13 October 2005, advising the Council that they do not
recognise it and therefore they would not
make any representation or
attend today’s arbitration hearing.
I will therefore
exercise my discretion in terms of
section 138(5)
of the
Labour
Relations Act 66 of 1995
as amended and proceed to hear the matter in
absentia
”
The
arbitration award
[7]
On 1 November 2005 the first respondent issued an award in terms of
which he found, on the uncontested evidence before him,
that Kok’s
dismissal was substantively unfair. The applicant was ordered to
reinstate Kok on or before 15 November 2005 and
to pay him 10 months’
salary. In his award, the arbitrator makes no mention of the
jurisdictional issue, save to record that
the matter proceeded “in
the absence of the respondent who apparently refused to attend the
hearing”.
The
application to rescind the arbitration award
[8]
The applicant thereafter brought an application in the bargaining
council to rescind the arbitration award on the basis that
the award
had been erroneously granted since the applicant did not fall within
the bargaining council’s registered scope,
and that the
demarcation dispute remained pending. On 17 March 2006, the
arbitrator issued a ruling in which he dismissed the rescission
application. In his ruling, the arbitrator avoided the jurisdictional
issue and found that the applicant was aware of the date
of the
arbitration hearing, and that it ought to have attended the hearing
to raise its jurisdictional point. On this basis, he
found that the
applicant had been in willful default and had failed to establish
that the award was erroneously granted. The applicant
then filed this
application, seeking to review and set aside both the default
arbitration award and the rescission ruling.
The
application for review
[9]
In these proceedings, in support of the application to review and set
aside the arbitration award, the applicant submits that
the
bargaining council did not have jurisdiction to adjudicate the unfair
dismissal dispute. The applicant submits further that
in arbitrating
the dispute referred to the bargaining council, the arbitrator was
applying a collective agreement concluded under
the auspices of the
bargaining council relating to the rules and conduct of proceedings
before the council. The agreement
inter alia
makes provision
for the referral of disputes to the council (including unfair
dismissal disputes) and for the conduct of arbitration
proceedings.
This being so, and given that the demarcation dispute remained
pending, the arbitrator was required in terms of
s 62
of the Act to
adjourn the arbitration proceedings and his failure to do so amounted
to a failure to comply with a statutory duty
and a misconception of
that duty. In addition, in terms of the applicable agreement, the
arbitrator was obliged to require the
referring party to prove that
the council had jurisdiction to arbitrate the dispute. The terms of
the agreement are such that the
referring party bears an onus to
establish jurisdiction. The arbitrator’s failure to require the
third respondent to discharge
that onus amounted to a reviewable
irregularity. Finally, the applicant submits that the arbitrator was
in any event under a duty
to enquire whether he had jurisdiction,
given the content of the applicant’s letter. His failure to do
so amounted to a failure
to apply his mind to the issues before him,
including the requirements of the LRA and the agreement.
[10]
Mr. van der Riet SC, on behalf of the respondent, referred to a
judgment by this Court (per Hendricks AJ) in
Johannesburg City
Parks v Mphahlani NO and others
(JR 1114/06, 13 December 2007)
where in a similar application, the Court concluded that an
application for the condonation of the
late filing of the application
for review should be refused. The basis of the refusal to grant
condonation appears to be that the
applicant had chosen to bring an
application for the rescission of an arbitration award in the
bargaining council in circumstances
where in the arbitration
proceedings, it had denied that it was subject to the council’s
jurisdiction. In relation to the
application for review, the Court
held that the arbitrator had correctly decided that she was seized
with the matter and that she
had the necessary jurisdiction to
arbitrate the dispute. In support of this conclusion, the Court
referred to
Johannesburg City Parks v SAMWU & others
[2006] 7 BLLR 659
(LC), where the Court (per Revelas J) refused to
interdict a strike in circumstances where the dispute giving rise to
the strike
had been referred to the bargaining council and a
certificate of outcome issued and the applicant had contended that it
was not
subject to the council’s jurisdiction.
[11]
The difficulty presented by the judgment of Hendricks AJ is the
absence of any reference to the provisions of
s 62
of the LRA.
Section 62
deals not only with demarcation disputes but also with
demarcation issues that arise during the course of proceedings under
the
Act. The section must be read in the context of the manner in
which the LRA promotes and regulates sectoral bargaining, and the
importance that is attached to the registered scope of a bargaining
council for a number of purposes under the Act.
Sections 27
and
28
provide that a bargaining council may be established for a sector and
area, and that a bargaining council may exercise its statutory
powers
and functions in relation to its registered scope, which must be
specified on registration (see
s 29(15)(a).
Section 51
regulates the
dispute resolution functions of a council, and provides for the
resolution of disputes by a council only in respect
of parties to the
council and those non-parties that fall within its registered scope.
Section 51(4)
requires that if one or more parties to a dispute
referred to a council do not fall within the registered scope of the
council,
the council must refer the dispute to the CCMA.
Section 62
regulates demarcation disputes (in the form of a dispute about
whether a party is or was employed within a sector or area, or
whether any arbitration award, collective agreement or wage
determination is or was binding.)
[12]
Section 62
(3), (3A) and (5) deal with the question of the effect of
a pending demarcation dispute on proceedings initiated in terms of
the
Act.
Section 62(3)
regulates proceedings before this Court, and
requires the Court, in any proceedings, subject to the conditions set
out in subsection
(a), to adjourn those proceedings and refer the
demarcation issue to the CCMA for determination.
Section 62(4)
regulates proceedings before the CCMA, and requires it, in the same
peremptory fashion, to adjourn the proceedings pending the
further
resolution of the demarcation issue.
Section 62(3A)
regulates
proceedings before an arbitrator, and provides as follows:
“
In any
proceedings before an arbitrator about the interpretation or
application of a collective agreement, if a question contemplated
in
subsection (1) (a) or (b) is raised,
[1]
the arbitrator must adjourn those proceedings and refer the question
to the Commission if the arbitrator is satisfied that-
(a)
the
question raised-
(i)
has not previously been determined by arbitration in terms of
this section; and
(ii)
is not the subject of an agreement in terms of subsection (2);
and
(b)
the
determination of the question raised is necessary for the purposes of
the proceedings.
”
[13]
In the proceedings under review, the arbitrator derived his powers
from the agreement concluded in the bargaining council on
3 February
2004, an agreement that was in force at the date of the arbitration
award under review. The agreement makes provision
inter alia
for the referral of disputes (including dismissal disputes) to
arbitration and for the conduct of the arbitration of those disputes.
Whether the applicant was engaged in the sector for which the
bargaining council was registered was a matter that had pertinently
been raised before the arbitrator. In my view, it was incumbent on
him therefore to have adjourned the arbitration proceedings
and to
have referred the matter to the CCMA. A reasonable decision maker
would have enquired into whether he or she had jurisdiction,
faced
with the available information on the demarcation dispute. The
arbitrator’s failure to do so constituted a failure
to comply
with a statutory obligation, and therefore warrants intervention by
this Court. In any event, it is clear from the record
and the terms
of the arbitrator’s award that he failed, as he was obliged to
do in terms of
part 4
of the collective agreement, to require Kok to
prove that the bargaining council had jurisdiction to arbitrate the
dispute.
[14]
In so far as the application for condonation for the late filing of
the review application is concerned, the reason proffered
by the
applicant for its delay is the abortive application for rescission.
It seems to me that having regard to the reasonableness
of the
explanation for delay and particularly to the merits of the
application, that condonation ought to be granted. Finally,
given the existence of a collective bargaining relationship between
the parties, the interests of fairness dictate that no costs
order
should be made.
I
accordingly make the following order:
1. The
application for condonation is granted.
2. The
first respondent’s arbitration award dated 1 November 2005 is
reviewed and set aside.
3.
There is no order as to costs
ANDRE VAN NIEKERK
JUDGE OF THE LABOUR
COURT
Date
of hearing: 15 September 2009
Date
of judgment: 10 December 2009
Appearances:
For
the applicant: Adv T Bruinders SC
Instructed
by: Sim & Botsi Attorneys Inc.
For
the respondent: Adv J van der Riet SC
Instructed
by Cheadle Thompson and Haysom Inc.
[1]
Section 62(1)
(a) refers to a demarcation dispute about whether an
employee, employer, or a class of employers or employees is or were
engaged
in a sector or area.