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[2011] ZALCJHB 10
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National Education, Health & Allied Workers Union and Others v Vanderbijlpark Society for the Aged (JS 540/05) [2011] ZALCJHB 10; [2011] 7 BLLR 690 (LC); (2011) 32 ILJ 1959 (LC) (17 February 2011)
IN THE LABOUR
COURT OF SOUTH AFRICA
(HELD AT
JOHANNESBURG)
CASE NO: JS
540/05
In
the matter between
NATIONAL
EDUCATION, HEALTH & ALLIED WORKERS UNION
1
st
Applicant
REBECCA
MOLOTSI & 64 OTHERS
2
nd
to 65
th
Applicants
and
VANDERBIJLPARK
SOCIETY FOR THE AGED
Respondent
______________________________________________________________________________
JUDGMENT
______________________________________________________________________________
LAGRANGE, J
This is an
application for condonation of the late filing of a statement of
claim. The individual applicants are 50 members of
the First
applicant, N E H A W U, a trade union,, who claimed they were
unfairly retrenched in March 2004 by the respondent,
a society
running four old age homes (‘the society’).
The degree of
lateness
the dispute was
referred to the CCMA and on 28 January 2005 a certificate of
non-resolution was issued. In terms of section…
Of the Labour
Relations Act 66 of 1995 (' the LRA'). The dispute ought to have
been referred to the Labour court by 28 April
2005, that was only
filed on 22 July 2005, making the referral 87 days late.
The explanation
for the delay
The deponent to the
founding affidavit is the legal coordinator of the first applicant.
He explains the principal reason for the
lateness of the referral as
follows: "
I submit that the reason for the lateness in
filing our Statement of case is primarily due to the fact that
various bodies within
NEHAWU had to give their approval before
attorneys could be instructed to prepare papers on our behalf. The
reason for the lateness
was therefore more to do with the lengthy
process that has to take place before approval is given than
anything else.
" The deponent then went on to elaborate in
more detail about the various internal steps which must be followed
before a
matter that can be referred to the union's attorneys.
On 23 February
2005, the regional organiser for the Sedibeng region who had
received the certificate referred the matter to the
Provincial
Secretary of Gauteng province, requesting assistance. At this point,
it should be mentioned that the same regional
organiser attended the
conciliation meeting at the CCMA on 28 January 2005, where the
employer representative advised him that
all but six of the 50
applicants had agreed to terminate their services by way of
voluntary severance packages. The employer
representative had
proposed that it would be far more expeditious and cheaper to refer
the matter to arbitration at the CCMA
instead of referring the
matter to the Labour court, but this proposal was rejected by the
regional organiser.
It is apparent that
the matter was unresolved on 28 January and the founding affidavit
in the condonation application does not
explain when the certificate
of non-resolution was received by the regional organiser. This is an
important omission in explaining
the sequence of events in the
referral of this matter. On the face of it, it seems it was only a
month after the conciliation
meeting that the matter was referred to
the provincial office. According to the deponent, though this was
not confirmed in any
confirmatory affidavit, it took the provincial
office approximately 5 days to make a decision, and on 3 March 2005
the matter
was referred to the deponent at NEHAWU’s head
office. The deponent says he is solely responsible for the approval
of matters
for litigation, though he must consult with other office
bearers at head office and, in particular, the general secretary
before
he makes a final decision. In this case he provides no
details of any of these consultations or whether they had any impact
on
the delay. He also complains of being 'generally swamped' with
requests from all regions of the union. After making these general
claims, he simply states that after he considered the submissions
made, he gave authorisation for attorneys to be instructed.
This ws
only done on Friday, 17 June 2005.
What is immediately
apparent from this explanation is that a period of more than three
months passed between the referral of the
matter to head office and
the instruction being issued to attorneys. There is no explanation
why the deponent showed no appreciation
for the fact that when he
received the request from the regional office, he ought to have
realised that they were approximately
8 weeks left before the time
period for referral expired. Similarly, there is no explanation why,
when the deadline for referral
was near or had just passed, that the
deponent took no steps to try and accelerate the matter. Even when
the matter was referred
to the union’s attorneys, it took a
further month simply to file the referral. The partial explanation
for this, which
again is not confirmed by the union's attorneys, is
that it was necessary to hold further consultations with the
individual members
to confirm all the details and the exact number
of members retrenched.
It is difficult to
understand why the need for this detail only became apparent after
the matter had been referred to attorneys
when this information
could have been gathered while all the internal steps within the
union were taking place. To identify the
members actually involved
ought to have been a basic part of the union's preparation of the
matter.
The deponent
mentions that the union has over 230,000 members and 72 branches
falling under the various provincial offices of
the union. The
thrust of the explanation is that a large multi-layer organisation
cannot easily comply with the time limits in
the LRA. However, if
one looks at the detail of the explanation the real delay occurred
at head office, and possibly at the initial
stage before it was
referred to the regional office. When the application was received
there was more than enough time to make
the referral timeously and
the explanation of what occurred during this time is not
satisfactory. It is true that, strictly speaking,
the delay the
court is more concerned with is the period after 28 April 2005, but
to appreciate whether there was a justification
for being nearly
three months late, one must also consider why the matter could not
be referred within the initial three month
period. The request for
assistance from the region lay at the head office for nearly two
months before the expiry of the 90 day
period and for nearly two
months after that before the matter was referred to attorneys. This
delay is not properly explained.
The LRA has been in
existence for more than fifteen years, and the time limits governing
referrals have not changed in that time.
It is reasonable to expect
that trade unions ought to be well aware of the need to act
timeously in the interests of its members
and would adapt their
internal procedures to accommodate those time limits, not vice
versa. The scale of an organisation cannot
serve as a justification
for delays. On the contrary, it is reasonable to expect that larger
organisations, be they trade unions
or businesses ought to be able
to see to it that they are organised to deal with disputes of this
nature in a systematic matter
to ensure that they do not fall foul
of the time limits in the LRA. Where handling such disputes is a
core function of the organisation,
this should go without saying.
The merits of the
claim
The applicant seeks
to rely on the merits of the case as set out there as a basis for
indicating the prospects of success, though
not specifically
confirming the contents thereof on oath. Nevertheless, much of the
chronology appears to be common cause. In
January 2004 the
respondent identified the need to outsource services provided by
staff because it could not cope with the increased
cost of wages and
benefits which the union had succeeded in negotiating previously and
the anticipated demands it would have
to meet in the future. The
management of the old age home explained that the only income of the
society was the levies paid by
residents all of whom were pensioners
and it was unable to increase levies to cater for costs of salaries
and other operational
expenditures. It was anticipated that
approximately one third of the staff positions would be affected by
the outsourcing of
certain services. One of the measures proposed to
limit the possible adverse consequences of the measure, was that any
contractor
engaged would be asked to employ as many of the
retrenched employees as possible as a condition of being awarded the
contract.
At a meeting on 16
January with the union affirmed its wish to minimise job losses as
much as possible and asked to be furnished
with financial
information. A follow up meeting at which the union was asked to
present proposals was arranged for 24 January
2004. The respondent
did not supply a full set of financial statements but supplied
"Revenue Accounts" dating back
to the 2000/2001 financial
year through to projections for 2004/2005 financial year the
accounts showed a R 106,226 deficit of
income over expenditure for
the 2002/03 year, a projected R 29,000 deficit for the current
financial year and a further deficit
of R 93,000 for the following
year.. The union was not satisfied with this document and persisted
with its demand for a full
financial statement, which management
said was privileged information and would only be made available to
the management team.
The union did not invoke any provisions of the
LRA to compel disclosure of the document. The union also did not
table any proposals
at the second meeting.
A further meeting
was held on 29 January 2004. The regional organiser was unable to
attend this and the meeting proceeded without
any employee
representatives present, and therefore without any consultation
taking place. The respondent admits that no union
representatives
attended the meeting, but was unaware that the regional organiser
would not be coming. On phoning the union office
the employer claims
it was advised that the regional organiser was in fact attending the
meeting in question. The union shop
stewards also declined to attend
a meeting. The respondent claims that the meeting in question did
not take any decisions, but
debated the issue of providing the
financial statements to the applicants, given that these were not
even available to all the
residents of the old age home. It claims
that no final decision to outsource was taken at the meeting but an
opinion on it being
the best option was expressed.
A further meeting
was held on 5 February 2004 at which a different union official was
present. The union claims that the respondent
was not prepared to
revisit or consult on any of the decisions that the union claims it
had made. The only agreement reached
at this meeting was that the
employer would make further information available which the union
requested. This was a list of
those employees who would be affected
by the retrenchment, those whom the respondent proposed to retain,
the details of the proposed
voluntary severance package and payments
due from the Provident fund. The minutes of the meeting, which were
never disputed by
the union at the time, reveal that discussions
were held on an alternative of shorter working hours and a shorter
working week
and why the society could not adopt that measure. It is
also recorded that the number of staff who were likely to be
retained
was discussed and retrenchment criteria were dealt with. At
the end of the meeting it was agreed that the union would meet with
employees on 12 February 2004 before the next meeting. The overall
impression gained from the available evidence is that the
parties
were still engaged in consultation over the kind of issues they
ought to be dealing with, and no stalemate had been reached.
The next meeting
took place on 13 February 2004, by which state it seems the union
had received the documentation it had requested.
At this meeting,
the society's rationale for the outsourcing was interrogated by the
union and the society explained that a contractor
would charge less
for the services currently rendered by the staff whom they were
considering retrenching. At the end of the
meeting it was agreed the
society would make enquiries with the possible contractors and
obtain figures of potential re-employment
numbers. It was also
agreed that the society would re-consider supplying financial
statements to the union and the union would
revert to the society on
the key posts which the society envisaged retaining for full-time
employees. The next consultation meeting
was scheduled for 4 March
2004. Apart from revisiting the question of shorter working hours,
financial statements were handed
to the union representative on the
understanding that they would be kept confidential. The society
reported that undertakings
have been obtained from two contractors
to the effect that all of those employees who might be retrenched
would be absorbed by
them. Discussion then moved on to voluntary
severance packages and the society confirmed that even if employees
accepted the
voluntary severance package they would still qualify
for re-employment by the contractors. The voluntary package entailed
an
additional month’s salary for those accepting it, over and
above the statutory severance pay and other payments that would
be
due to anyone retrenched.
It appears that the
meeting of on 4 March 2004 did not take place and a letter was sent
by the union on 5 March indicating that
the union rejected what it
characterised as “a decision" taken by management to
outsource work, and called on at to
reverse all decisions taken
because the process had taken place without the union's
participation. The society responded to this
letter agreeing to ‘an
extension’ to 15 March 2004 after which a follow-up meeting
would be arranged. It is not entirely
clear what the extension
refers to, but the only plausible explanation is that the society
was allowing further time to the union
before another meeting was
scheduled. A further letter indicates that a follow up meeting was
arranged for 25 March 2004, but
according to the society no union
representatives arrived for the schedule meeting on that day and no
request had been made to
reschedule it. The applicant claims that
workers were approached during March and forced to sign voluntary
severance agreements,
which the respondent denies.
On 30 March 2004
the union complained about the alleged threats and called upon the
society to withdraw the letters and negotiate
in good faith, failing
which it would refer a dispute to the CCMA. The society responded to
this the following day advising that
eight consultation meetings had
been held, and all but four of the affected employees had secured
employment with various contractors.
It further said it believed
sufficient consultation had taken place and that it had decided to
proceed with the retrenchments.
The union alleges that consultation
was still in progress in March yet the respondent was in the process
of implementing its
plans without telling the union. In response to
the union’s claim that the consultations had yet to be
finalised the society
responded that the last meeting on 25 March
2004, which the union did not attend was expected to finalise
discussions. It seems
that the union had decided that for better or
worse, it was unable to persuade the society to change course, and
decided at a
late stage to escalate issues. This stance is difficult
to reconcile with the course the consultations had taken until March
during which the parties moved progressively through the issues and
had reached a point when the terms of retrenchment and the
selection
of retrenchees had been discussed. Moreover, after the union did get
the financial statements, no other concrete alternative
proposals
were forthcoming from it thereafter.
Having regard to
the course of discussions between the parties it appears that the
society did engage with the union, did consider
alternative
proposals which the union proposed and did provide information
requested without the union having to compel it to
do so.
A complaint of the
union is that even though all but six of the individual applicants
accepted voluntary severance packages, those
who did so were
pressurised by the society to accept them. The society in turn
claimed that none of those who accepted the voluntary
severance
packages have locus standi to challenge their termination as unfair
dismissals because they accepted the packages and
accordingly they
terminations were by agreement. The society also contends that the
referral of the dispute to the CCMA, which
was also late, was
originally only in respect of the six employees. Indeed, the
founding affidavit of the applicants in the CCMA
condonation
application is ambiguous about whether the dispute concerns six
employees or sixty-four.
What is apparent is
that the proposal for a voluntary severance package was in fact made
by the union at one of the consultation
meetings on 23 January 2004.
By the time the union met with workers on 12 February 2004, it was
in a position to report on the
list of names of those to be
retrenched and those to be retained, the details of the voluntary
severance package offered and
the anticipated savings the society
expected to make if the outsourcing was implemented. At the meeting
of 13 February 2004 and
1 March 2004 it is clear that discussions
focused primarily on the re-employment of staff in the outsourced
functions by contractors
and the terms on which this would be done
including whether those employees who accepted voluntary severance
packages would be
eligible for re-employment by the contractors. The
question of disclosure of the financial statements was settled in
the meeting
on 1 March 2004 when the society handed the documents to
the union representative. No new proposals were forthcoming from the
union on alternatives to retrenchment during these meetings, after
these documents were received.
In the condonation
application before the CCMA, the union describes its prospects of
success in that application as being based
on insufficient
consultation before the services of employees were terminated and
that no other alternatives were considered.
No mention at all is
made of anyone being coerced to accept voluntary severance packages,
which might have been expected to have
featured prominently if this
had indeed been a real grievance.
An overview of the
available evidence suggests that the fundamental needs of the
society to cut costs was never seriously disputed,
that the only
alternative proposed by the union was considered and the society
explained the reasons why shorter working hours
would not be a
viable alternative. Further, the society both consulted and adopted
proactive measures to alleviate the impact
of retrenchment and the
union had ample opportunities to make representations on all matters
affecting the retrenchment. In the
circumstances, it seems unlikely
that a court would find that the retrenchments were substantively or
procedurally unfair. Accordingly,
the applicant's prospects of
success appear to be weak rather than reasonable.
Prejudice
The union submits
that the society will not suffer no prejudice support if the matter
proceeds, whereas the unprocedural and unilateral
implementation of
retrenchment which led to the dismissal of the individual applicants
outweighs any prejudice that the society
may have suffered. It is
noticeable that the union makes no reference to the fact that the
persons affected by the exercise are
unemployed. The society
reiterates the details of the retrenchment consultations and that
they proceeded without objections from
the union. It also points out
that the condonation application had only been served in October
2005. Given the measures which
were adopted to alleviate the impact
of the retrenchment and the fact that the vast bulk of those
affected did obtain alternative
employment, and considering the
prospects of success I did not believe that the prejudice to the
individual applicants outweighs
the prejudice to the society of
having to now defend their actions at that stage.
I am mindful of the
fact that although the condonation application ought to have been
ripe for a hearing 2006, for reasons which
are not apparent, the
matter lay dormant until 2010. Based on the contents of the court
file, little seems to have happened since
the parties were directed
to file a pre-trial minute by 15 November 2006, by this court. It
does not seem since then that any
effort was made by the applicant
to have the matter enrolled earlier. However, even if the matter had
come before court in 2006
I do not believe that the balance of
prejudice would have been materially different.
In argument before
me, applicant's representative, Ms Maenetje, urged me to follow the
approach of this court in the case of
Gaoshubelwe & others
v Pie Man’s Pantry (Pty) Ltd
(2009) 30
ILJ
347 (LC)
. However, I think the facts contemplated by my
brother Molahlehi J in that case, are distinguishable from those
before me. In
Gaoshubelwe
the individual applicants had
effectively been abandoned by their union. A lack of funds also
delayed their ability to take matters
forward timeously. It appeared
that the applicants who had been dismissed for allegedly
participating in an unprotected strike
and were still unemployed.
Moreover, the court found their prospects of success were good. In
this instance, no factual claims
were made about the individual
applicants having shown an ongoing interest in the matter, but being
misled by the union about
its progress. As mentioned above, the
prospects of success are weak, and they were not unemployed after
the retrenchment. Accordingly,
I do not think the two case are on a
par.
In view of the
above consideration of the factors laid down in
Melane
v Santam Insurance Co. Ltd
1962
(4) SA 531
(A)
1
,
I believe that this is not a case in which condonation is warranted.
On the matter of
costs, there appears to be no ongoing relationship to consider and
the merits of the application were weak. Consequently
I believe this
is an instance in which there is no reason not to award costs,
considering also that the society is not a profit
making
organisation.
Order
The application for
condonation of the late referral of the applicant's statement of
case is dismissed.
No order is made as
to costs.
ROBERT LAGRANGE
JUDGE OF THE
LABOUR COURT
Date of Hearing:
20 August 2010
Date of Judgment:
17 February 2011
Appearances
For the
Applicants: Ms Maenetje of Thaanyane Attorneys
For the
Respondent: H J Van Rensburg of H J Van Rensburg Inc.
1
At
532C-F