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[2010] ZALCCT 48
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Bloem Water v Nyareli and Others (C823/2018) [2010] ZALCCT 48 (23 November 2010)
THE
LABOUR COURT OF SOUTH AFRICA,
HELD
AT CAPE TOWN
Reportable
Case
no:C823/2018
In
the matter between:
BLOEM
WATER Applicant
And
K
NYARELI First
Respondent
M
GOBUSANG Second
Respondent
DAVID FANAPI
(
N.O.
) Third
Respondent
THE COMMISSION FOR
MEDIATION,
CONCILIATION &
ARBITRATION Fourth
Respondent
Date
of Set Down:
28 October 2020
Date
of Judgment:
This
judgment was handed down electronically by circulation to the
parties’ legal representatives by email, publication on
the
Labour Court website and release to SAFLII. The date and time for
handing down judgment is deemed to be 10h00 on 23 November
2010
[1]
Summary:
(Review - unfair labour practice -
benefits - vehicle allowance-arbitrator’s failure to consider
the practical implementation
of the policy-exclusive focus on the
wording of the policy-misdirection- Jurisdiction-condonation not
required owing to ongoing
nature of alleged unfair labour practice)
JUDGMENT
LAGRANGE
J
Introduction
[1] The
applicant (‘Bloem Water’), seeks to review and set aside
an arbitration award in which the
arbitrator found that the first and
second respondents, Mr K Nyareli and Ms M Gobusaeng (‘Nyareli’
and ‘Gobusaeng’,
jointly referred to as ‘the
respondents’), where unfairly excluded from its motor vehicle
allowance team benefit policy.
[2] The
applicant has also applied for condonation for the late filing of the
review application, which was nine
days late. The respondent did not
assist in their opposition to the condonation at the hearing of the
arbitration and I am satisfied
on a consideration of the extent of
the delay, a reasonable explanation, and the lack of any material
prejudice to the respondent
that condonation should be granted.
The policy
[3] The
policy in question, in effect from 11 May 2017, is entitled ‘Vehicle
Policy Travel and Subsistence
Reimbursement’. Clause 3 of the
policy states that its purpose is “to ensure that private and
Bloem Water official
vehicles, selected, acquired and used in ways
that provide the best possible support to operations.” Clause 7
of the policy
reads:
“
7. POLICY
Bloem Water offers the
following policy on vehicle schemes two different categories of
employees and board members:
·
A private vehicle is used with payments of compensation for
kilometres travelled.
·
Employees/Board member utilizing their own vehicle for official
purposes.
·
A pool vehicle is utilized for official purposes.’
[4] The
policy specifies four types of schemes, namely:
4.1 Section
1- Employees participating in official scheme: This category applies
to “employees qualified
to participate in the vehicle scheme of
the board [bands 7-8]”. Under this scheme an employee is
responsible for providing
their own vehicle and different rates of
allowance of up set out for different employee bands. The last
category provides for a
R 5000 per month allowance for “Plant
Superintendents and other [entry and middle and 7]”.
Participants in this scheme
may also claimed fuel and running costs
based on distance covered on official business and a maximum amount
of private use. In
the provisions of the Section 1 scheme it was
stated:
“
Employees must at
all times provide their own transport may not utilize any of the
scheme in the event that the vehicle is due for
appraisal services.
CEO to consider and
approve alternatives in special circumstances.”
4.2 Section
2 - Board Members: This scheme reimburses board members for running
and fixed costs of a vehicle.
4.3 Section
3 - Pool vehicles: Employees who do not qualify to participate in the
board’s vehicle scheme
but require a vehicle for working
purposes may have the use of a dedicated vehicle, stationed at an
official venue, but use for
private purposes is excluded. The
employee must submit a monthly logbook of distances traveled.
4.4 Section
4 - Other: This scheme is available for employees and “external
members” that do
not qualify for any of the other schemes. In
terms of this scheme, an individual may be reimbursed for using their
private vehicle
for official purposes, subject to the use of their
private vehicle for this purpose being approved.
The arbitrator’s
award
[5] Nyareli
and Gabusaeng are Admin and Finance Officer and Supply Chain Officer
respectively. Both are remunerated
in band 7. They contended that
they qualified for inclusion in the Section 1 scheme outlined above,
and accordingly should have
received the monthly allowance. They
compared themselves to other colleagues on the same level who did
participate in the scheme.
[6] The
essence of the arbitrator’s reasoning in concluding that the
respondents were unfairly excluded from
the scheme was that:
6.1 Other
plant supervisors, entry and middle Band 7 employees who were on the
same level as the respondent
received the car allowance in terms of
Section 1.
6.2 Despite
oral evidence that the employer had a discretion whether to admit
employees to the scheme under
section 1, the policy itself made no
mention of the exercise of any discretion, and if that had been the
intention, it would have
been clearly expressed in the policy. The
employer’s attempts to suggest that it had a discretion as to
who qualified for
the scheme was an afterthought.
6.3 He
dismissed the suggestion made by one of the employer’s
witnesses, Mr O Stadler (‘Stadler’)
that the extract from
section 1 cited in paragraph 3.1 above indicated that the CEO had a
discretion as to who received the benefit
of that scheme. The CEO’s
discretion plainly referred to situations where the employee’s
vehicle was undergoing repairs.
6.4 Although
evidence was led that traveling was a qualifying requirement for an
employee to participate
in the scheme, the employer’s other
witness, Mr T Kheane (‘Khaeane’), testified that he never
travelled but did
receive the allowance. Accordingly, there was no
operational reason for not awarding the allowance to the respondents.
6.5 He
also dismissed an argument that granting the benefits to the
respondent would be wasteful expenditure
in terms of the Public
Finance Management Act (‘PFMA’), since the PFMA could not
be used to unfairly exclude employees
from benefits enjoyed by
others.
[7] As
a remedy, the arbitrator ordered the employer to pay the allowance to
the respondent with retrospective
effect to the inception of the
policy in May 2012, amounting to R 380, 333.36 for each respondent.
He also found that qualified
to participate in the scheme with effect
from 1 August 2018.
Grounds of review
[8] Bloem
Water’s grounds of review, in short, are that the arbitrator:
8.1 while
expressly acknowledging that the dispute was not an interpretation
dispute misconstrued the issue
as being one of interpreting the
written policy;
8.2 in
so doing, he found that if the policy did not clearly state that the
employer has a discretion as
to who qualified for the scheme and if
the criteria for exercising a discretion were not set out in the
policy document, then the
employer had no discretion as to who
qualified, and no criteria existed;
8.3 the
arbitrator prevented its main witness, Ms S Meyer from testifying;
8.4 the
arbitrator ignored the fact that 27 out of 60 employees in salary
band 7 did not receive the benefit;
and
8.5 the
arbitrator failed to appreciate that Kheaene received the allowance
as part of his remuneration package
as a manager.
[9] At
the hearing of the review application, Bloem Water focused in
argument firstly on the Commissioner’s
reasoning on the
existence of a discretion. Secondly, it raised a jurisdictional issue
relating to the respondent only having referred
the dispute to
conciliation in February 2018, whereas the dispute arose when the
policy was implemented in 2012, and no condonation
had been granted
for the ‘late’ referral. Bloem Water contended therefore
that the arbitration proceedings in their
entirety were a nullity,
because the arbitrator lacked jurisdiction to hear the dispute in the
absence of condonation been granted.
[10] The
applicant did not pursue the issue of the failure of Meyer to
testify. Nonetheless, the arbitrator’s
conduct in this regard
does bear mentioning. It is true, as the respondents pointed, out
that the arbitrator did not actually prevent
Bloem Water from calling
her as a witness. However, when the respondent’s representative
objected to her testifying on the
basis that she had been present
when the respondents testified, the arbitrator made it clear that
this might negatively affect
his assessment of her evidence. He
compared her situation to that of Gabusaeng who had been absent while
her colleague, Nyareli,
had testified. In this regard, the arbitrator
clearly misunderstood the difference between the inferences to be
drawn from a respondent’s
witness hearing the case against the
respondent and the value attached to one co-witness not been present
when another testifies.
Clearly, the arbitrator’s remark, which
he should not have made, directly influenced the applicant’s
decision not to
call Meyer as a witness. Be that as it may because
the applicant did not pursue this issue, the review has been
determined on the
grounds set out below.
Jurisdictional issue
[11] It
is common cause that the respondents only articulated the grievances
about not qualifying under Section
1 of the scheme in 2017 and
referred the dispute to conciliation early the following year. Bloem
Water contends that the alleged
unfair labour practice must have
arisen when the vehicle policy was introduced in 2012, at which stage
the respondent were not
made beneficiaries of the Section 1 scheme.
The respondents retort that their exclusion from the scheme is an
ongoing unfair labour
practice and did not simply arise at one point
in time, though they concede that the fact that the respondents had
to refer their
unfair labour practice claim within 90 days of
becoming aware of it in terms of section 191(1)(b)(ii) of the Labor
Relations Act
66 of 1995 (‘the LRA’) would probably have
limited the retrospectivity of their claim.
[12] On
the question of whether or not the labour practice in question was a
single occurrence which took place
when the policy was implemented in
2012 and the respondents were not made beneficiaries of Section 1
scheme of the policy, both
parties relied on the same authorities. In
City of Johannesburg v South African Local Govt Bargaining Council
and Others
(JR3204/10) [2014] ZALCJHB 85 (10 February 2014) the
labour court it was considering a review of a demotion decision in
which a
similar issue of condonation had arisen. The court found:
‘
[11] It was
submitted on behalf of the third respondent that the nature of the
dispute was continuous, one akin to a discrimination
dispute and that
since it continued well into 2009 (and indeed to the date of
referral), the referral was not late. I have difficulty
appreciating
the logic of this submission. I see no reason why a demotion does not
fall into the same category as a dispute concerning
a dismissal or
any other disciplinary penalty, both of which are the subject of
strict time limits which run from the date of the
employer’s
actions. Of course, an act of demotion has consequences in the form
of a diminution of status perhaps, and those
consequences may well be
ongoing. But it is not so as it necessarily is in the case of an act
of unfair discrimination, where the
unfair act complained of is
continuous, uninterrupted or repeated. For example, in a claim for
equal pay, the fact that the employer
continues each month to pay a
lower wage on one or more discriminatory grounds, has the result that
the act of discrimination is
continuous. But an act of demotion is
not continuous in the same sense. This much is acknowledged by the
wording of s 191 (1) (b)
(ii) which requires a referral within 90
days ‘of the date of the act or omission which allegedly
constitutes an unfair labour
practice or, if it is a later date,
within 90 days of the date on which the employee became aware of the
act or occurrence’.
The case in which the third respondent
relies in support of its submission, SABC Ltd v CCMA & others
[2010] 3 BLLR 251
(LAC), supports this analysis.
That was a case
that concerned unfair discrimination in the form of continuous
conduct rather than a single act. Not only is it
distinguishable on
that basis, but the court drew a clear distinction between ongoing
unfair labour practices (unequal pay) and
‘one-off’
decisions or single acts that are not repetitive in nature. Were an
act of demotion (or dismissal or the
issuing of a final warning for a
12 month period) to be regarded as continuous for the purposes of s
191, that would make a mockery
of the time limits imposed by the
section. An employee need only allege that he or she continues to
suffer the consequences of
dismissal, some lesser disciplinary
measure or demotion to avoid the prescribed time limits altogether
.’
[Emphasis added]
[13] The
extract above was cited with approval
in
Eskom Holdings
SOC Ltd v National Union of Mineworkers obo Kaya and others
[2017] 8 BLLR 797
(LC)
, and the court in that matter went on to
expand on the distinction as follows:
‘
[59] I
consider the above reasoning in
City
of Johannesburg v South African Local Government Bargaining Council
and Others
to be sound, and equally applicable to an unfair labour practice
based on promotion. The ratio in SABC
[2]
is clearly distinguishable. The point can be illustrated by way of a
simple example. Two employees apply for a promoted position
and one
employee is promoted whilst the other is not. Accepting that the
decision not to promote the one employee is unfair, does
this now
mean that that every month after that decision was taken the employer
commits a continuous unfair labour practice because
the employee does
not occupy the promoted position and is paid less? Surely not. This
would render the 90 day time limit under
Section 191(10 completely
valueless. The employee can in effect do nothing about an employer’s
decision not to promote for
a year, and then decide to pursue it
because it is purportedly “continuous”. This flies in the
face of the primary
consideration of the expeditious resolution of
ointment disputes. I accept that one mistreated failure to promote
for example based
on race differently, but that would be proposed the
course of the action is founded on discrimination, and not an unfair
labour
practice
per
se
,
with discrimination requiring a different level of continuous
protection
.
[60] Another
comparable example case be found in
South
African Post Office Ltd v Commission for Conciliation, Mediation and
Arbitration and Others
[3]
.
In that case, the employer stopped paying the employee an acting
allowance, but the employee only pursued the dispute as an unfair
labour practice to the CCMA more than four years later, contending
that the dispute had been ongoing because of a pending grievance.
The
Court did not accept this contention and held that the dispute was
pursued late.’
[14] Considering
the authority above, there is nothing to suggest that when the policy
was introduced in 2012 that
there was a decision taken on the
eligibility of every employee of Bloem Water to become members of one
or other of the schemes
contained in the policy. The benefit
obtainable from the policy is a recurring one in the form of an
allowance due every month.
If the respondents qualify for the scheme
today, they are just as much entitled to it now as they would have
been if they had qualified
for it in 2012, everything else being
equal. This is very different from a situation where a clear decision
is taken at a point
in time to reduce someone’s benefits, or to
promote somebody else, and similar examples where the alleged
prejudice suffered
can be identified as originating in a distinct
positive decision by the employer. In the circumstances, I am
satisfied that the
alleged exclusion from the Section 1 scheme was an
ongoing matter and it was not necessary for the respondents to apply
for condonation
for referring an unfair labour practice dispute which
arose in 2012.
Arbitrator’s
finding on the absence of any discretion
[15] It
is noteworthy that despite the evidence given by Stadler on why only
half the employees on level 7 received
the vehicle allowance under
Section 1, the arbitrator focused almost exclusively on his answers
when being cross-examined on the
wording of the policy. Similarly, he
completely ignored the detailed evidence on why the respondent had
been declined a vehicle
allowance under that part of the scheme, but
nonetheless qualified for use of a pool car or reimbursement of
their business
travel in their private vehicle.
[16] The
evidence was that there was a period when Gabusaeng, a supply chain
officer, stationed at the head office
in Bloemfontein, had done a
certain amount of traveling. Stadler explained this was partly
related to her filling in duties for
an assistant manager who was
absent, and she had been a reimbursed for the mileage travelled. He
explained that in general her
work related duties did not require her
to travel extensively. Gabusaeng herself confirmed that over a period
of four years she
only took 21 trips on official business.
[17] In
the case of Nyareli, an administration and finance officer, his own
evidence and that of Kheane showed
that he was chiefly office bound.
His complaint was that the pool vehicle was not always available when
needed, but he had not
made use of the option of being reimbursed for
the use of his private vehicle because he claimed he was not aware of
it until the
matter came to arbitration. He disputed that his job
function was the reason that he was not included in the Section 1
scheme and
that it was not sufficient to warrant his inclusion that
he had to use a vehicle once a week or a couple of times a month.
Stadler
testified that none of the other regional administration and
finance officers qualified for the vehicle allowance either.
[18] Stadler
also testified that the list of those who were included and excluded
from the Section 1 scheme was
considered on a continuous basis, and
had been re-examined by management and the CEO in 2018, that they had
concluded that the
number of participants out of the 60 persons
employed in band 7, should remain at 33.
[19] The
arbitrator did not deal with any of this factual evidence, but seized
on a statement by Kheaene that he
never travelled, yet qualified for
the allowance. This single observation did no justice to Kheaene’s
evidence. In his evidence
he explained that the HR department
explained to him that he qualified for the vehicle allowance because
of his duties in terms
of which he was expected to go to regional
offices and to certain meetings outside the province as well. The
reason he had not
travelled since his appointment four months prior
to the arbitration was that he had to familiarize himself with how
worked before
he started to travel to the regions.
[20] Considering
all of the above, the arbitrator was only able to reach the
conclusion he did by focusing exclusively
on the text of the policy,
which was not a model of drafting. As a result, he failed to
appreciate that the differentiation between
employees to qualified
for the vehicle allowance was not simply arbitrary, but was linked to
job functions and the normal transport
requirements linked to those
positions, which was reviewed on a regular basis by management. By
focusing exclusively on the policy
and ignoring how it was
implemented in practice was possible for him to adopt a literal
reading of the policy that all employees
on band 7 qualified for the
vehicle allowance automatically, and to conclude that there was no
scope for the exercise of any property
discretion as to who received
it and who did not. Had he not done this he would not have been able
to come to the conclusion he
did.
[21] In
the circumstances, the award stands to be set aside.
[22] On
the question of costs, neither party pressed this issue and the
interests of law and fairness do not justify
a cost award being made.
Order
[1] The
late filing of the review application is condoned.
[2]
The
arbitration award of the Third Respondent issued on 6 August 2018
under case number FSBF1019-18 is reviewed and set aside.
[3] No
award of costs is made.
Lagrange
J
Judge
of the Labour Court of South Africa
Representatives -
For
the Applicant:
F
Boda SC,
instructed by Phatsoane Henney Attorneys
For
the Third Respondent:
J G Rautenbach
SC, instructed by Thaanyane Attorneys.
[1]
As
varied on 27 October 2021
[2]
This is a reference to
SABC
Ltd v CCMA and Others
[2010] 3 BLLR 251
(LAC) in which the LAC held:
‘
[27] The
ruling of the Commissioner would therefore be open to be reviewed
and set aside if the dispute
constituting the unfair labour practice
was said to occur in 1998 as alleged by the appellant. The problem
however is that the
argument presented by the appellant is premised
upon the belief that the unfair labour practice/unfair
discrimination consisted
of a single act. There is however no basis
to justify such belief. While an unfair labour practice/unfair
discrimination may
consist of a single act it may also be
continuous, continuing or repetitive. For example where an employer
selects an employee
on the basis of race to be awarded a once off
bonus this could possibly constitute a single act of unfair labour
practice or
unfair discrimination because like a dismissal the
unfair labour practice commences and ends at a given time. But,
where an employer
decides to pay its employees who are similarly
qualified with similar experience performing similar duties
different wages based
on race or any other arbitrary grounds then
notwithstanding the fact that the employer implemented the
differential on a particular
date, the discrimination is continual
and repetitive. The discrimination in the latter case has no end and
is therefore ongoing
and will only terminate when the employer stops
implementing the different wages. Each time the employer pays one of
its employees
more than the other he is evincing continued
discrimination.’
[3]
[2015] 12 BLLR 1224.