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[2010] ZALCD 6
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Berthhold v KwaZulu-Natal Department of Health (D498/08) [2010] ZALCD 6 (18 May 2010)
IN THE LABOUR COURT OF
SOUTH AFRICA
HELD
AT DURBAN
Reportable
Heard:
17 May 2010
Delivered: 18 May 2010
Edited:
14 June 2010
D498/08
In the matter between
DR
BERTHOLD
LIND
APPLICANT
And
KWAZULU
NATAL DEPARTMENT OF
HEALTH
RESPONDENT
JUDGMENT
PILLAY
D, J
[1] The parties asked the
Court to make a settlement agreement an order. The terms of the
settlement were:
“
The
respondent is ordered to pay to applicant;
(1.1) an amount equal to
24 months remuneration at the rate that applicant was remunerated as
at May 2007;
(1.2) applicant’s
costs of suit as taxed or agreed”.
[2] The Court expressed
concerns about the apparent generosity of the settlement. It
nevertheless granted the order; however,
on reflection it seemed that
the settlement might be against public policy. The Court
summoned the parties for a hearing
as to why it should not
mero
motu
rescind the order.
[3] Mr Crampton, who
appeared for the applicant employee, urged the Court not to rescind
the order as it was not against public
policy. Furthermore,
there was also no patent or obvious error or omission in Furthermore,
there was also no patent or obvious
error or omission in the order;
consequently, the requirements in terms of section 165 (b) of the
Labour Relations Act 66 of 1995
(LRA) for rescission were absent.
[4] Mr Nankan, who
appeared for the employer, the Department of Education (the
department), attempted to persuade the Court that
the agreement was
not against public policy in the following circumstances:
(1) The employee was a
specialist psychiatrist for 40 years since 1967. Since the 28
March 2000 the employee held the position
of acting head of
psychiatry.
(2)
After he turned 65 the department continued to employ him in terms of
annual cessional contracts. Fifteen such cessional
contracts
were concluded by the time the employee was dismissed on 31 May
2007. Cessional contracts of employment
are not
full time contracts of employment.
[1]
(3) When he was
dismissed, the employee was 80 years old. The psychiatric unit
in which he worked closed down and his
cessional services were no
longer required.
(4)
This necessitated his retrenchment for operational reasons.
(5) By a letter
dated 3 May 2006, Ms HM Findlay, the psychiatric unit manager
informed him as follows:
“
Further
to the various conversations that we have had over the past weeks, I
wish to advise you that permission to undertake cessions
at Edendale
is hereby withdrawn. The effective date will be 31 May 2007.
This decision is based on the comment made
by you when you telephoned
myself and
advised me that you would not be
voluntarily resigning and that I would have to fire you. On
behalf of Edendale Hospital,
thank you for the enormous contributions
you have made to this institution in the field of psychiatry over the
20 years of association.
With good wishes and much
appreciation”.
She copied this letter to
Ms Zuma, the district manager, and Doctor Burns.
(6) The employee
referred an unfair dismissal dispute to arbitration. The
commissioner found from his submissions that
the dismissal was for
operational reasons and ruled that she did not have jurisdiction.
The employee filed a claim on 29
September 2008 for unfair dismissal
in the Labour Court on the following grounds:
a.
The department made no attempt to comply
with the provisions of the Labour Relations Act, 65 of 1995 (LRA)
relating to dismissal
based on operational requirements.
b.
The employee was not told of the reasons
for his dismissal.
c.
The
dismissal was not based on the respondent’s operational
requirements because the department continued to admit and treat
psychiatric patients at Edendale Hospital, despite alleging that it
was closing down the psychiatric ward.
[2]
(7) In its defence, filed
on the 22 August 2008, the department persisted that it complied with
the provisions of the LRA in that:
a.
The dismissal was for operational reasons.
b.
The employee was aware of the reasons for
his dismissal.
c.
The employee was party to the consultative
process that led to the dismissal for operational reasons.
d.
The department’s servants consulted
with the employee before deciding to close down the psychiatric ward.
e.
The employee was consulted about the
measures to avoid dismissal and minimise the effects of the
dismissal.
f.
There were no structures within which the
employee could be absorbed, given his specialised field of practice.
g.
The employee’s advanced age militated
against his absorption,
h.
“
Full
and proper consultation and due compliance with the provisions of
section 189 of the LRA” preceded the dismissal.
[3]
(8) The department
had not complied with section 189 (1) (d) (2), (3), (5), (6) and (7)
of the LRA.
(9) Furthermore, the
legal representatives for the department had difficulty securing Ms
Findlay’s attendance at consultations.
The first
consultation with her took place on the 7 May 2010, barely 10 days
before trial.
(10) As the result of the
consultation, the department and its representatives concluded that
Ms Findlay would not make a good witness
and the department should
settle.
(11) The legal
representatives received a mandate to settle only on Friday, 14 May
2010, the last court day before trial.
(12) The department
attempted to settle the matter earlier in 2008, however, the employee
wanted reinstatement and the department
was not agreeable to
reinstating him. When the pre-trial minute was concluded, the
legal representatives did not have a new
mandate to settle the
dispute. In any event, the employee persisted with
reinstatement.
[5] Against these facts,
Mr Nankan urged the Court to uphold the settlement. The Court
had little choice but to grant the
order mainly because it is not
obvious to the Court that the settlement was against public policy.
The Court does not have
a full picture of the strengths and
weaknesses of the department’s case.
[6] Given the apparent
lack of proper supervision and accountability by the department over
the employee’s supervisors, the
Court can also not say with any
conviction that the supervisor(s) did not facilitate the employee
succeeding in his claim, in other
words, whether the supervisor(s)
colluded with the employee to the prejudice of the department and the
public interest.
[7] Even though the Court
does not know, the department must know the strengths and weaknesses
of its case. It should nevertheless
be held publicly
accountable for its decision to settle on these terms.
Consequently, even though the Court allows the settlement
order to
stand, it calls on the department to respond to the following
questions in writing by 30 June 2010:
(a)
Did Ms Findlay notify the employee of his
retrenchment?
(b)
Who supervised Ms Findlay or any other
person who was the employee’s immediate supervisor who notified
him of his retrenchment?
(c)
When did Ms Findlay leave the department?
(d)
Who supplied the legal representatives with
information to plead that the department had complied with the LRA?
(e)
Whoever provided such information to the
legal representatives to prepare the statement of defence was
untruthful, negligent, careless
or perhaps even corrupt. What
steps have the department taken to call such officials to account for
the incorrect information
they supplied the department’s
representatives?
(f)
Who mandated the settlement that is made an
order of this Court?
(g)
On what basis did the department agree to
pay 24 months compensation?
(h)
Why did the department’s officials
fear that the Labour Court might reinstate the employee when
(i)
the unit had closed down,
(ii)
the employee was employed on cessional
contracts of not more than a year each time,
(iii)
the employee was 80 years old,
(iv)
the hospital continued to hold patients for
only 72 hours observation before transferring them to Town Hill
Hospital?
(i)
Why did the department not terminate
employment by paying the employee for the balance of the duration of
his cessional contract?
(j)
Why did the department renew his cessional
contract for a year when it had decided in December 2006 to close
down the unit which
it did in April 2007?
(k)
Why was the employee’s cessional
contract renewed orally?
(l)
Is it lawful for the department to renew
contracts of employment of public employees orally?
(m)
What steps have the department taken
to improve its efficiency and accountability to eliminate the kind of
waste of public recourses
evidenced in this case?
(n)
Can the department recover its losses from
any individuals and if not, why not?
(o)
Why did the department not tender with
prejudice to pay the employee a lesser amount when it was instructed
to defend the matter
or soon thereafter when it commenced settlement
negotiations?
[8] The order that I
grant therefore is the following:
(1)
The order granted on the 17 May 2010 making
the settlement agreement an order of court stands
(2)
The department is directed to respond to
the questions (a) to (o) above by 30 June 2010.
(3)
There is no order as to costs.
____________
PILLAY D, J
APPEARANCES
FOR
APPLICANT
:
Adv CRAMPTON
Instructed
by
:
Venn Nemeth & Hart Attorneys
FOR
RESPONDENT
:
Adv S NANKAN
Instructed
by
:
STATE ATTORNEY
[1]
Paragraph
4.2 of the statement of defence, paragraph 26.
[2]
Pages
5 and 6 of the bundle, paragraphs 5 of the statement of claim.
[3]
paragraph
7.8, page 28 of the bundle, paragraph 7.3 of the defendant’s
statement of defence.