Brief Summary

Labour Law — Review of arbitration award — Applicant sought to review and set aside arbitration award that found employee's dismissal unfair — Employee accused of theft of cheese from delivery truck — Commissioner ordered reinstatement with back pay — Applicant argued Commissioner misapplied legal principles and ignored evidence — Court held that the Commissioner’s approach in assessing circumstantial evidence was appropriate and did not warrant review; the award was upheld as justifiable based on the evidence presented.

Comprehensive Summary

Summary of Judgment

1. Introduction

The proceedings were an application in the Labour Court to review and set aside an arbitration award issued under the auspices of the Commission for Conciliation, Mediation and Arbitration (CCMA). The award had been made by Commissioner Paul Shabangu N.O. (the second respondent) and concerned the dismissal of Vusi Goodhope Thetwayo (the third respondent, referred to in the judgment as “the employee”).

The applicant was Adcan Marine, an employer engaged in the delivery of fresh and frozen products to clients. The first respondent was the CCMA, the statutory body under which the arbitration was conducted. The second respondent was the commissioner in his official capacity, and the third respondent was the employee whose dismissal had been arbitrated.

Procedurally, the matter arose after the commissioner issued an arbitration award on 2 June 2006 (CCMA case number KNRB345-06) finding the dismissal to be unfair and ordering reinstatement with back pay. Adcan Marine then launched review proceedings in the Labour Court under case number D352/06. During the review, the employee delivered an answering affidavit late and sought condonation; the applicant abandoned opposition to condonation, and the court condoned the late filing.

The general subject-matter of the dispute was whether the commissioner’s award—rejecting the employer’s misconduct case based largely on circumstantial evidence relating to missing goods (a block of cheese) and ordering reinstatement—was reviewable under the Labour Court’s review jurisdiction.

2. Material Facts

Adcan Marine’s business involved delivering products to clients. Over a period of months, the applicant received complaints from clients about incorrect and short deliveries, with particular concern regarding cheese and polony products. The complaints related to the route driven by the employee.

After the applicant was unable to find a solution to the problem, it decided to set a trap on the employee’s route. The trap was organised by Mr Stamatis, the manager at the Richards Bay branch. Stamatis testified that, after trucks had been loaded on the night before the planned entrapment, he and another manager remained behind and placed two blocks of cheese into loaded trucks: one block in the truck that would be driven by the employee the next day, and another block in a different truck on a different route. The trucks were then locked. The following morning, while supervising further loading of frozen goods, Stamatis checked in the presence of two other employees and confirmed that the cheese was still present. It also appeared that an extra cheese was loaded onto a third truck on another route.

The employee returned earlier than other drivers because he had a small load. Upon the employee’s return, Stamatis approached the truck to check for the cheese placed there as part of the trap. The cheese was not found. When questioned, the employee denied knowledge of it; according to Stamatis, when informed that a disciplinary hearing would be convened, the employee blamed the missing cheese on his assistant.

Stamatis then indicated that the employee would be required to undergo a polygraph test. The employee initially appeared willing but did not attend on the arranged date for testing.

The employee’s version, relied upon by the court for purposes of assessing the reasonableness of the award, was that he was not made aware of any extra block of cheese having been loaded onto his truck. On the day in question, he was given a contractor as an assistant and was told this was because the load was small. The employee also testified that his truck was not locked when he arrived in the morning and denied having checked stock with Stamatis before dispatch.

The employee further testified that he only saw Stamatis on the Monday when he approached him about leave, seeking to sell some leave days and take leave in January; an argument allegedly occurred regarding the employee’s entitlement to leave. The judgment treated this as part of the employee’s evidence but did not base the outcome on resolving that conflict as determinative.

In assessing the employer’s case, the court considered that the employer’s misconduct allegation depended on circumstantial evidence, and that the employer had not eliminated other plausible possibilities for the disappearance of the cheese. The court specifically noted the significance of evidence that the truck was not locked in the morning, the potential access of other persons (including a security guard and those involved in the entrapment), and the fact that the applicant did not call the assistant who accompanied the employee to testify, despite his potential relevance to whether the cheese was ever seen on the truck that day.

3. Legal Issues

The central legal question was whether the arbitration award was reviewable on the basis that the commissioner committed misconduct or a gross irregularity, or otherwise reached an outcome that could not be sustained under the applicable review test.

Within that enquiry, the key issue concerned the evaluation of circumstantial evidence and probabilities: whether, on the facts, the commissioner could reasonably conclude that the employer had not established that the employee was responsible for the missing cheese (and thus had not proved a fair reason for dismissal), given the range of potential inferences and the employer’s evidential presentation.

The dispute primarily concerned the application of law to fact and the assessment of probabilities in a circumstantial-evidence case, as filtered through the Labour Court’s review standard. It also involved an evaluative determination about whether the commissioner’s conclusion fell within the range of decisions open to a reasonable decision-maker.

4. Court’s Reasoning

The Labour Court first addressed condonation and, given the applicant’s abandonment of opposition and the court’s view that the delay was not excessive and the explanation acceptable, condoned the late filing of the answering affidavit.

On the merits, the court identified that the applicant’s case sought to prove misconduct largely through circumstantial evidence, namely the placement of cheese on the truck, its later absence, and the employer’s contention that the employee must have been responsible. The court approached the matter through established principles governing inferences in civil matters: the onus in circumstantial-evidence cases is discharged if the inference sought is the most readily acceptable inference among competing possibilities, while caution is required to distinguish a permissible inference from a mere conjecture. The judgment emphasised the need for objective proved facts from which other facts may be inferred.

The court then considered whether the commissioner’s approach was defective in the manner alleged by the applicant. The applicant argued that the commissioner had focused only on the possibility that the assistant might have removed the cheese, and had not properly weighed probabilities. The court, however, found that the commissioner could not be faulted for the approach adopted in determining whether there was a proper basis for drawing an inference implicating the employee.

In developing this conclusion, the court distinguished the case from Aluminium City (Pty) Ltd v Metal & Engineering Industries Bargaining Council & Others (2006) 27 ILJ 2567 (LC). In that matter, the employee was present during loading, transportation, and off-loading, and the employer established a prima facie case that goods left the premises and were within the knowledge of the driver and assistant; the evidentiary burden then shifted to the employee to provide a credible explanation. By contrast, in the present matter, the court held that the employer did not establish a comparable prima facie case that would have called upon the employee to explain what happened to the cheese.

The court reasoned that several plausible possibilities were not eliminated by the employer’s evidence. The commissioner’s acceptance of the assistant as a plausible alternative perpetrator was treated as a permissible approach, and the court also pointed to other potential actors and circumstances. The judgment noted, for example, that a security guard arrived after the cheese was allegedly placed in the truck and there was no evidence excluding the guard’s access. The number of people involved in the entrapment was also relevant. The employee’s unchallenged evidence that the truck was not locked in the morning supported the possibility that the cheese could have disappeared overnight or before the employee commenced the day’s work.

The court further considered that the assistant’s version—that he never saw the cheese—was not contradicted, and it highlighted that the employer did not call the assistant as a witness, despite that evidence being critical to whether the cheese was ever present on the truck during the deliveries. The court treated this as reinforcing the plausibility that the cheese was not on the truck in the morning. The judgment also mentioned evidence that the employee was not present when frozen stock was loaded that morning, supporting a broader uncertainty about the employee’s awareness of what had been loaded.

Additionally, the court accepted that there was a possibility that someone involved in the entrapment might have removed the cheese to ensure the trap succeeded, and that the assistant, being new, might have taken incorrect stock during deliveries. The court concluded that the mere fact that the driver was responsible for delivery did not make him responsible for goods he was never made aware of.

The court then applied the review test as articulated in Sidumo and Another v Rustenburg Platinum Mines Ltd and Others (2007) 12 BLLR 1097 (CC), namely whether the commissioner’s decision was one that a reasonable decision-maker could not reach. In light of the uneliminated possibilities and the weakness of the employer’s inferential case, the court held that the applicant failed to establish reviewable defect under that standard.

In relation to the commissioner’s reliance on the assistant possibility, the court also referred to the commissioner’s power under section 138 of the Labour Relations Act to conduct arbitration with minimum legal formalities and determine the substance of the dispute fairly and quickly. The court treated the commissioner’s approach as consistent with the statutory scheme and not indicative of a reviewable misdirection.

Finally, the court exercised a value judgment on costs and held that fairness required costs to follow the result.

5. Outcome and Relief

The Labour Court dismissed the application to review and set aside the arbitration award issued under CCMA case number KNRB345-06 dated 2 June 2006.

The effect was that the arbitration award remained in force, including the commissioner’s finding that the dismissal was unfair and the order of reinstatement with back pay.

The court ordered that the review application was dismissed with costs. The court also condoned the late filing of the employee’s answering affidavit.

Cases Cited

National Union of Mineworkers v Commission for Conciliation, Mediation and Arbitration and Others (2007) 28 ILJ 1614 (LC)

AA Onderlinge Assuransie-Associasie Bpk v De Beer 1982 (2) SA 603 (A)

Victor and Another v Picardi D Rebel (2008) 26 ILJ 2469 (CCMA)

Caswell v Powell Duffry Associated Collieries Ltd [1939] 3 All E.R. 722 (HL)

Aluminium City (Pty) Ltd v Metal & Engineering Industries Bargaining Council & Others (2006) 27 ILJ 2567 (LC)

Aluminum City (Pty) Ltd v NUMSA obo Pheneous Buthelezi unreported case number JR1812/05

SA Nylon Printers Pty Ltd v Daniels (1998) 2 BLLR 135 (LAC)

Sidumo and Another v Rustenburg Platinum Mines Ltd and Others (2007) 12 BLLR 1097 (CC)

Legislation Cited

Labour Relations Act 66 of 1995, section 138

Rules of Court Cited

No rules of court were cited in the judgment.

Held

The court held that the employer’s case depended on circumstantial evidence and that it failed to establish a prima facie case that the employee was responsible for the missing cheese, particularly because multiple plausible possibilities were not excluded on the evidence presented.

The court held further that, applying the Sidumo reasonableness test, the commissioner’s finding of unfair dismissal and the consequent reinstatement order were not decisions that a reasonable decision-maker could not reach. The review application therefore failed.

LEGAL PRINCIPLES

The judgment applied the principle that in civil matters decided on circumstantial evidence, an inference is permissible only where it is the most readily acceptable inference from the proved facts, and decision-makers must guard against confusing a legitimate inference with mere conjecture.

It applied the requirement that inferences must be grounded in objective facts proved by evidence; absent such facts, inferential reasoning risks error by overlooking other equally plausible explanations.

The judgment reaffirmed that where an employer establishes a prima facie case of misconduct on circumstantial evidence, an evidentiary burden may arise for an employee to provide a credible explanation; however, where the employer does not establish such a prima facie case (particularly because it fails to exclude other plausible causes), that evidentiary shift does not occur.

The court applied the review standard from Sidumo and Another v Rustenburg Platinum Mines Ltd and Others (2007) 12 BLLR 1097 (CC), asking whether the commissioner’s decision was one that a reasonable decision-maker could not reach, and held that the award fell within the range of reasonable outcomes.

The judgment also recognised the commissioner’s statutory mandate under section 138 of the Labour Relations Act 66 of 1995 to conduct arbitration proceedings with minimum legal formalities while determining the substance of the dispute fairly and expeditiously, and treated the commissioner’s approach as consistent with that framework.

Marine v Commission for Conciliation Mediation And Arbitration and Others (D352/06) [2009] ZALCD 17 (19 March 2009)