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[2010] ZALCCT 35
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Rheeder v Mirkin and Co T/A A&D Distributors and Others (C947/2008) [2010] ZALCCT 35 (3 December 2010)
Not
reportable
Of
interest to other judges
IN
THE LABOUR COURT OF SOUTH AFRICA
HELD
AT CAPE TOWN
C
ase
no: C 947 / 2008
In
the matter between:
ANNA
M
RHEEDER
Applicant
and
D
MIRKIN & CO T/A
A&D
DISTRIBUTORS
First
respondent
Adv
C DE KOCK
N.O.
Second
respondent
CCMA
Third
respondent
JUDGMENT
STEENKAMP
J:
Introduction
[1]
This
is an application for review in terms of s 145 of the Labour
Relations Act.
[1]
The arbitrator
(the second respondent) of the CCMA (the third respondent) found that
the dismissal of the applicant was substantively
unfair.
Nevertheless, he deemed it “equitable and fair to both parties”
not to award any relief to the applicant, “given
the
circumstances surrounding the employment relationship”.
[2]
The applicant seeks to review the award
only insofar as no award of compensation was made.
Background facts
[3]
The applicant (Rheeder) was employed as a
bookkeeper by the first respondent (“the company”) since
January 1995. In
January 2008 she increased her own salary without
consulting the company’s directors, but it appears from the
evidence led
at arbitration that this was in accordance with an
existing practice.
[4]
In November 2007, due to her unhappiness
about alleged non-payment of a bonus, victimisation and alleged
unfair labour practices,
Rheeder engaged the services of a labour
consultant in Worcester, one Eloise Peacock.
[5]
Rheeder paid Peacock a fee and provided her
with documents relating to her grievances.
Inter
alia,
and at Peacock’s request,
Rheeder sent her a letter or memorandum comprising some 18 pages
setting out in detail the background
to her grievances, her
employment history with the company, and – in a two page
annexure headed “characters of the
play” – her
perceptions of the
dramatis personae
at
the helm of the company. It is this document, and especially the
latter annexure, that loomed large in the mind of the arbitrator
when
he declined to award Rheeder any compensation in his eventual unfair
dismissal award.
[6]
Rheeder
set out her view of the
dramatis
personae
in
emotional, uncouth and irrational terms. For example, she described
the “owner”
[2]
of
the company, Mr Avi Milstein, as “arrogant”, loving the
sound of his own voice, and: “If he has had enough
of you and
what you say he will look around as if to see some imaginary escape
hatch, then he will cut you off in mid sentence
or whatever and start
shouting fuck off – get the fuck out of my shop. Then duck and
run.” Mrs Toni Millstein was described
as a “kugel,
verbal diarrhea (
sic
)
diva”. Their daughter, Ronit, “daddy’s darling”
and a “bitch” who “manipulates him and
bosses him
around.”
[7]
Rheeder was unhappy with Peacock’s
lack of diligence and terminated her services. She asked Peacock to
return her documentation.
Although there is some dispute on the
papers as to exactly what transpired, Avi Milstein testified at
arbitration that Peacock
delivered the documentation to the company’s
post box. Although Rheeder testified that that the envelope was
clearly marked
for her attention, Milstein opened it and read the
document containing the unflattering descriptions of him and his
family members.
[8]
In March 2008, Milstein confronted Rheeder
with the documents. He also confronted her with having increased her
salary without his
consent. On 13 March 2008 Rheeder received a
notice to attend a disciplinary hearing on 7 April 2008 on a charge
of “fraud”
and she was suspended pending the hearing. To
her surprise, the disciplinary hearing was to be chaired by Eloise
Peacock –
the very person whom she had consulted a few months
earlier and to who the letter was addressed containing the details of
her relationship
with the company and her views of its directors.
[9]
On 7 April 2008 Rheeder received a “notice
of dismissal” signed by Peacock and Milstein. It read,
inter
alia
:
“
This
letter serves to confirm that your services with the company has been
terminated. The above sanction is the outcome of a disciplinary
hearing held on the premises of A&D Distributors on 7 April 2008
at 09h15.
You have the right to
appeal this finding within three working days of the above date. An
appeal form can be obtained from the company
on request.”
[10]
Rheeder appealed on the same day. However,
the company did not entertain the appeal and confirmed the dismissal
on 15 April 2008.
Rheeder referred an unfair dismissal dispute to the
CCMA.
The award
[11]
With regard to the substantive fairness of
the dismissal, the arbitrator took into account prior practice and
found that Rheeder
had no dishonest intention in failing to ask
Milstein’s authorisation before awarding herself a 10% salary
increase in February
2008. He found the dismissal to have been
substantively unfair.
[12]
With regard to alleged procedural
unfairness, the arbitrator said: “The applicant ...
participated in the disciplinary proceedings
and although I am not
entirely satisfied with the conduct of Mrs Peacock deciding to chair
the disciplinary hearing, I do not believe
that it is sufficient to
lead to a finding that the dismissal was procedurally unfair.”
[13]
The “crux of the matter”, the
arbitrator found, lay with the relief to be awarded. He had regard to
the letter that
Rheeder had addressed to Peacock and stated that
“...the remarks made by the applicant were slanderous and of
extremely bad
taste”. He also found that Rheeder had, during
cross-examination, “...admitted that the trust relationship
between
her and her employer ‘incinerated’, was gone,
finished and did not exist when Mr Milstein got hold of the letter in
question.”
[14]
Given
these factors, the arbitrator concluded that “the applicant
played a huge role in the complete breakdown of the trust
relationship and it will certainly not be fair, under these
circumstances, to award to the applicant any relief.”
[3]
Grounds of review
[15]
The
applicant submits that the arbitrator committed a gross irregularity,
failed to apply his mind to relevant considerations and
hence came to
a decision that no reasonable arbitrator could reach.
[4]
Relevance of the letter
to Peacock
[16]
As set out above, the decision of the
arbitrator not to award any compensation, despite his finding of
substantive fairness, was
largely influenced by the sentiments
Rheeder expressed in her letter to Peacock.
[17]
Mr
Le Roux
,
who appeared for the applicant in these proceedings, submitted that
the arbitrator did not apply his mind to the question of the
intention of the letter in question. I agree.
[18]
Rheeder sent the document to Peacock, at
the latter’s request, in order to instruct her with regard to
her employment related
grievances with the company. Had Peacock been
a practising attorney, the communication may well have been governed
by attorney-client
privilege. But she is not, and I need not decide
that point. Suffice to say that the communication was clearly
intended for Peacock’s
eyes only. Rheeder did not intend to
publish her remarks to the world at large, and she could certainly
not have foreseen that
her employer would make use of the services of
the very same consultant that Rheeder had instructed, much less that
the document
would find its way from Peacock to Milstein.
The contributors to the
breakdown in the relationship
[19]
The arbitrator appears to have considered
two factors when deciding that “the applicant played a huge
role in the breakdown
of the trust relationship”: Firstly, the
contents of the letter addressed to Peacock; and secondly, that
Rheeder “had
no intentions to return to her workplace”.
[20]
I have already dealt with the relevance of
the letter. With regard to the second factor, it does not appear from
the award that
the arbitrator had any regard to the reasons why
Rheeder did not want to return to the company, or what the company’s
contribution
to the breakdown – if any – was.
[21]
Rheeder had, as set out above, voiced a
number of grievances she had with the company. That was the very
reason why she had retained
the services of Peacock, who ended up
chairing her disciplinary hearing. At the arbitration, the arbitrator
– perhaps understandably
– made it clear that he did not
wish to hear any evidence about those grievances. That was not the
reason for her dismissal.
But then the arbitrator did take into
account the breakdown in the relationship when deciding whether to
grant any relief, without
having any regard to the underlying causes
(other than the letter to Peacock).
[22]
In attributing the breakdown solely to the
applicant, without having had the benefit of any evidence setting out
the reasons for
her mistrust in the employer, the arbitrator failed
to apply his mind to relevant considerations. His process of
reasoning was
such that it led to a conclusion a reasonable
arbitrator could not have reached.
Procedural fairness
[23]
The applicant also raised procedural
unfairness as a ground of review, specifically relating to the
appointment of Peacock as chairperson.
[24]
It is indeed astounding that a so-called
labour consultant should, within a month of two of having advised an
employee, agree to
act as a chairperson in a disciplinary hearing
involving the very same employee and the same employer. Any
practising lawyer would
have recognised the conflict of interest
immediately and would not have accepted the instruction.
[25]
Nevertheless, Rheeder did not ask Peacock
to recuse herself at the outset of the disciplinary hearing. She only
raised an allegation
of bias after all the evidence had been led and
before Peacock gave her decision. I share the arbitrator’s
misgivings about
Peacock’s role, but I do not find his
conclusion on procedural fairness so unreasonable that no reasonable
arbitrator could
have come to the same conclusion.
Remit or substitute?
[26]
I have come to the conclusion that, given
his finding on substantive unfairness and the evidence before him,
the arbitrator’s
decision not to award any relief was
unreasonable.
[27]
The applicant submitted that I have all the
evidence before that served before the arbitrator and that I am in as
good a position
as he was to make a decision on the appropriate
award. I agree that it would serve no purpose to remit the matter to
hear evidence
afresh for another arbitrator to decide on the
appropriate relief.
What relief?
[28]
The applicant does not wish to be
reinstated. She seeks compensation in terms of s 193(1)(c ) read with
s 194(1) of the LRA.
[29]
In
Boxer
Superstores (Pty) Ltd v Zuma & others
[5]
Davis
JA summarised the factors to be taken into account when deciding on
the appropriate relief:
“
What
[the arbitrator] should have done was to have said in effect: I have
examined the evidence. It appears to me that, given the
grave nature
of the charges levelled against [the employee], that is of
dishonesty, it is clear that the relationship between the
two parties
is at the level where they can no longer work together. Reinstatement
would therefore be inappropriate, re-employment
would be
inappropriate because of the conclusions reached by the [employer] as
set out in my award. Accordingly in terms of the
powers that I have
under s 193(2), I make a small award of compensation.”
[30]
And
in
Maepe
v CCMA
[6]
Zondo
JP pointed out that, in that case, the employee ought to have been
awarded compensation for a substantively unfair dismissal,
even
though he had given dishonest evidence at arbitration and
reinstatement would therefore be inappropriate.
[31]
In
Maepe
’s
case, he was awarded the maximum compensation of 12 months’
remuneration, even though he had lied under oath in his
arbitration.
Without any disrespect to the Labour Appeal Court, I do not consider
that to be an appropriate award in a case where
the trust
relationship between the parities has manifestly broken down and
where the employee has played a significant role in
that breakdown.
[32]
I am more inclined to follow the cue of the
LAC in
Zuma
’s
case and to make “a small award of compensation”. Even
though there is no evidence or even a remaining allegation
of
dishonesty on the part of Rheeder, I have to take into account the
part that she played in the breakdown of the relationship,
even
though she is not solely to blame. I base this not on the letter that
she had sent to her labour consultant in confidence,
but on the
common cause evidence that there was a mutual breakdown in the
relationship. Her attorney, Mr
Le Roux
,
also agreed that the maximum award envisaged by the Act would not be
appropriate.
[33]
I
have also had regard to the judgment of the Labour Appeal Court in
Dr
DC Kemp t/a Centralmed v MB Rawlins.
[7]
In
that case, Zondo JP
[8]
stated
that the ultimate question that the Labour Court or an arbitrator has
to answer in order to determine whether compensation
should be
granted or refused is the following: “Which one of the two
options would better meet the requirements of fairness
having regard
to all teh circumstances of the case?” And Waglay JA
[9]
added:
“
If
the arbitrator or the Labour Court decides to award or order payment
of compensation as provided in s 193(1)(c) then it must
turn to s
194(1) to determine the amount of compensation. Although s 194(1)
sets out the parameters for the amount of compensation
the arbitrator
or the Labour Court may order, teh arbitrator or the Labour Court has
a discretion to decide on the appropriate
amount. The parameters do
not hinder the choice: it merely sets the outer limits beyond which
the arbitrator may not go. Within
the limits, however, the arbitrator
or the Labour Court may make any decision which it considers to be
the correct one.”
[34]
In
that case, recently confirmed on appeal to the SCA
[10]
,
the court decided that no compensation should have been awarded in
circumstances where the employee was offered reinstatement.
[35]
Taking the relevant case law and the facts
of the dismissal and its surrounding circumstances into account, I
consider compensation
equivalent to four months’ remuneration
to be fair. The parties were
ad idem
that, at the time of her dismissal, the
applicant earned R 12 665, 00 per month.
[36]
The applicant has incurred legal costs in
pursuing this review application. She is an individual who is
not assisted by a
trade union. I can see no reason in law or fairness
why costs should not follow the result.
Conclusion
[37]
The arbitration award of 3 November 2008
under case number WE 5755-08 is reviewed and set aside only insofar
as it directs that
the applicant is not entitled to any relief.
[38]
The award is substituted with the following
award:
38.1
The dismissal of the applicant was
substantively unfair.
38.2
The first respondent, D Mirkin & Co Ltd
t/a A & D Distributors, is ordered to pay the applicant
compensation in the amount
of R50 660, 00, being the equivalent of
four months’ remuneration.
[39]
The first respondent is ordered to pay the
amount referred to in paragraph [36.2] into the trust account of the
applicant’s
attorneys within seven days of this order.
[40]
The first respondent is ordered to pay the
applicant’s costs.
_______________________
ANTON
STEENKAMP
Judge
of the Labour Court
Cape
Town
Date
of hearing:
25 November 2010
Date
of judgment:
3
December 2010
For
the applicants:
Dawie
le Roux
Murray
Fourie & Le Roux Inc, Worcester
For
the respondent:
Brandon
Schiff
Bagraims
attorneys, Cape Town
[1]
Act 66 of 1995 (the LRA).
[2]
It appears that he was, in fact, the managing director of the
private company.
[3]
It is common cause that the applicant sought compensation, and not
reinstatement, from the CCMA.
[4]
In accordance with the test set out in
Sidumo
v Rustenburg Platinum Mines Ltd
(2007)
28
ILJ
2405
(CC).
[5]
(2008) 29
ILJ
2685
(LAC) 2684 E-F para [11]
[6]
(2008) 29
ILJ
2189
(LAC) 2203 G-I para [26]
[7]
Unreported, case no JA 11/06, 26 March 2009.
[8]
(as he then was) at para [22]
[9]
(now Wagley DJP) at para [54]
[10]
Rawlins
v Kemp
(438/09)
[2010] ZASCA 102
(7 September 2010)