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[2011] ZALCJHB 154
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City of Tshwane Metropolitan Council v South African Local Government Bargaining Council and Others (JR 593/07) [2011] ZALCJHB 154 (26 May 2011)
LABOUR COURT OF SOUTH AFRICA
(HELD AT BRAAMFONTEIN)
Case: JR 593-07
In the matter between:
CITY OF TSHWANE METROPOLITAN COUNCIL
.............................................
Applicant
and
SOUTH AFRICAN LOCAL GOVERNMENT
BARGAINING COUNCIL
...............................................................................
First
Respondent
R VENTER (
N.O
.)
.........................................................................................
Second
Respondent
IMATU obo RETIEF DE VILLIERS
............................................................
Third
Respondent
JUDGMENT
LAGRANGE, J:
Introduction
The applicant wishes to review an arbitration award
issued on 20 October 2006, in terms of which the arbitrator found
that it
had committed an unfair labour practice by not promoting
the third respondent to the position of Manager: Bulk Services with
effect from 1 September 2003. The arbitrator found in favour of the
Mr R de Villiers, of the third respondent, and directed
the
applicant to promote him to the position with retrospective effect
to 1 September 2003.
The review application
The applicant’s founding affidavit briefly cites
four grounds of review, claiming that the arbitrator had exceeded
the
bounds of his authority in that:
"1. He imposed a decision to appoint the third
respondent retrospectively regardless of the position having been
filled;
2. He sought to substitute his finding for the decision
of the interview panel;
3. He was biased in relying on the relevant facts in
support of the Third Respondents case and excluding relevant facts
in support
of the Applicant’s case;
4. He was biased in privately informing the
representative of the third respondent of his decision prior to his
official pronouncement
of the same."
The applicant did not amend its grounds of review when
it filed its notice in terms of rule 7A(8)(b) of the Labour Court
Rules.
The third ground of review is completely lacking in any
factual particularity, making it difficult for the third respondent
to answer other than by an equally bald denial. In view of the lack
of particularity provided in the third ground of review there
is
nothing concrete for the court to consider on this point.
Accordingly, the applicant must stand or fall on its submissions
on
the other grounds it relies on.
The applicant’s heads of argument are not of
much assistance in expanding on the grounds of review. The heads
compromise
a number of bullet points and make no references to the
record of the arbitration in substantiation of the grounds of
review,
nor did they comply with the requirements of rule 18 of the
labour court rules.
Brief chronology
The fourth respondent submitted a grievance on 18
November 2003 concerning his non-promotion to the position of
Manager: Bulk
Services. The grievance could not be resolved
internally and the matter was referred as an alleged unfair labour
practice to
the relevant bargaining council ('the SALGBC').
Ultimately, the matter was referred to arbitration which ended on
13 October
2005 and the award was issued on 20 October 2006.
The new post was advertised on three occasions in
2003. At the time de Villiers held the post of Managing Engineer:
Energy Management.
The employer led evidence that five criteria
were applied in short listing candidates, namely formal
qualifications, relevant
experience, prior learning or exposure to
the working environment, a grace period to acquire suitable
qualifications, and employment
equity. The applicant complied with
all the formal requirements of the post, but he contended that the
successful candidate,
Mr Sivhada, failed to comply with either the
requirements or the recommended criteria.
It was a requirement of appointment that the
successful candidate should have a B Engineering (Electrical)
degree and a government
certificate of competency (a "GCC").
Sivhada did not have a GCC. The recommendations identified in the
advertisement
were "relevant experience and professional
registration with ECSA in terms of the Engineering Professions Act
of South
Africa." Sivhada was not registered as a professional
engineer. His experience as a qualifying engineer included having
been appointed in January 2001 by the City of Tshwane municipality
as an engineer concerned with tariffs and metering in the
Electricity department.
In evaluating the qualifications and experience of de
Villiers and the successful candidate the arbitrator found that it
was
obvious that the fourth respondent was better qualified and had
at least eight years more relevant experience as an engineer.
De Villiers contended that the successful candidate
should not have been shortlisted because he did not meet one the
requirement
of having a GCC. The employer defended the shortlisting
of Sivhada on the basis that, in terms of the advertisement,
candidates
had to be suitably qualified "or have the capacity
to become suitably qualified within a reasonable period of time",
and since Sivhada was an electrical engineer he had the capacity to
obtain a GCC. On the question of the comparative relevant
experience of de Villiers and Mr S, the employer's witness
confirmed that a person without relevant experience could not be
appointed to the post of manager. However, Sivhada was not willing
to accept that de Villiers had more relevant experience
than he
did. He testified that it was the quality of the experience and not
the extent of it which mattered. However, the arbitrator
found that
Mr Sivhada’s prior contact with the working environment at
best amounted to exposure and did not amount to
relevant
experience.
De Villiers had contended that not all the members of
the interviewing panel had sufficient knowledge of the technical
and strategic
aspects of the questions asked in the interview and
therefore were not able to fairly assess his answers. He maintained
that
only one member of the four member panel had the relevant
knowledge to enable him to assess his answers in the interview.
This
was Mr Ehrich’ The only other member of the panel with a
professional engineering degree, Dr Potgieter, was a civil
engineer,
not an electrical engineer, and according to de Villiers
was therefore not in a position to evaluate his responses.
The arbitrator’s findings
The award is 18 pages in length and is considerably
detailed, which will not be repeated here. Only those portions of
the award
which are relevant to the grounds of review will be
considered.
The arbitrator found the employer had been unable to
dispute the qualifications of the panellists. The points allocated
by the
four members of the interviewing panel for different
questions can be illustrated by way of a table set out below:
Panellists
J Ehrich
L J Potgieter
L Nawa
Ratsiane
Candidate: R de Villiers
Question 1
2
2
3
2
Question 2
4
3
1
2
Question 3
2
2
2
1
Question 4
2
2
3
2
Question 5
4
2
2
3
Question 6
2
3
2
3
Question 7
3
2
1
3
Total
23
16
14
16
Candidate: P Sivhada
Question 1
2
2
4
4
Question 2
3
3
3
4
Question 3
2
2
3
3
Question 4
2
2
3
2
Question 5
3
2
3
3
Question 6
2
3
3
3
Question 7
3
3
4
4
Total
19
17
23
23
The arbitrator also noted that the scores awarded by
the panellists for each question showed that there was more than
one instance
where the scores awarded by the panellists for a
particular question differed by more than one point. The
respondent’s
witness, Mr Ratsiane, attributed this to an
element of subjectivity in the scoring by the different panellists.
The employer
maintained that the basis for the appointment had been
merit, measured by the aggregate points scored by each candidate in
the interviews.
Employment Equity considerations and requirements of
the post
Nonetheless, the arbitrator records that both Ratsiane
and Ehrich conceded that employment equity did play a role in the
selection,
even though at the time there was no employment equity
implementation plan in place. The arbitrator held that the employer
had failed to furnish details of precisely how employment equity
considerations affected the selection process. The arbitrator
also
noted that most decided cases "support the view that
affirmative action measures can only be easily implemented if
it is
done in accordance with an affirmative action plan and may not be
implemented on an ad hoc basis.” He further observed
that
“(t)he onus rests on the employer to prove it applied
affirmative action measures fairly." The arbitrator found
that
the application of employment equity during the process of
selection was procedurally unfair, in the absence of an affirmative
action implementation plan. In particular, he held that not only
did the advertisement clearly express an intention to promote
representivity, but the relaxation of the appointment requirements
to allow candidates not having the required qualifications
to apply
confirmed this intention. In this regard, he noted that the
successful candidate did not satisfy the formal requirements
for
the post and his experience, which did not relate to bulk energy
generation, could not be considered relevant to the advertised
post. In the circumstances, the arbitrator found it surprising that
Sivhada had been shortlisted particularly because Ratsiane
had said
that a person without relevant experience could not be appointed to
the position.
Bias of the panellists
De Villiers asserted that Ratsiane and Nawa were
biased in favour of Mr Sivhada. The arbitrator held that if panel
members had
either limited or non-existent technical managerial or
strategic knowledge of the position, their ability to evaluate
candidates
would depend on what they learnt during the
pre-interview briefing. He accepted that there would be differences
in the scoring
of candidates’ answers to questions because
scoring was subjective, but such differences in scoring should not
be extreme.
The arbitrator embarked on a detailed analysis of
differences between the panellists’ scoring of the
candidates. He observed
that a one-point difference between
panellists when scoring a candidate on each of the seven questions
would result in a seven-point
difference on the aggregate score of
that candidate. He decided that there were substantial divergences
between the panellists
in their scoring of de Villiers and Sivhada
for the first two questions they were asked. The absence of a
satisfactory explanation
for these differences created a suspicion
of favouritism according to the arbitrator. The aggregate scores of
the two candidates
confirmed this suspicion in the arbitrator’s
view: the combined score for the fourth respondent was 39 and 30 by
Ehrich
and Potgieter, and Ratsiane and Nawa , respectively. This
amounted to a nine point difference in the evaluation of the two
candidates. Similarly the combined score for Sivhada was 36 and 44
by Ehrich and Potgieter and Ratsiane and Nawa , respectively.
This
is an eight point difference in the evaluation of the successful
candidate. Comparing the differences between the evaluations
of
Ehrich and Potgieter with that of Ratsiane and Nawa, the arbitrator
noted that the first two panellists only recorded a
three point
difference between de Villiers and Sivhada, whereas the last two
panellists recorded a fourteen point difference.
Consequently, the
arbitrator found that it was an irresistible conclusion that
Ratsiane and Nawa had deliberately given de
Villiers a lower rating
and Sivhada a higher one in order to secure the promotion of the
second respondent.
The arbitrator noted also the divergence in the
results: Ehrich and Potgieter rated the second respondent the third
best candidate
with a score of 36 whereas Ratsiane and Nawa ranked
him first with a score of 44, out of a maximum possible score of
56. In
effect this means the rating by the last two panellists was
a full 15 % higher than that of the first two. Similarly, if one
has regard to the combined rating of de Villiers, the first two
panellists gave him a rating of 39 and the last two a combined
rating of 30, which amounts to a variance of about 16% in the
respective combined assessments. The gap between the combined
assessments of Sivhada and de Villiers is also noteworthy, with
Ehrich and Potgieter rating the former at 36 and the latter
at 39,
representing a gap of only 5 % between the candidates. By contrast,
Ratsiane and Nawa rated Sivhada and de Villiers
at 30 and 44
respectively, which equates to a yawning chasm between their
combined assessments of the two candidates of about
25 %.
The arbitrator also concluded that there was reason to
believe that Potgieter had been biased in his assessment because
his
score for de Villiers was much closer to the scores of Ratsiane
and Nawa and that his score for the successful candidate was closer
to that of Ehrich However, his rating of de Villiers was seven
points lower than that of Ehrich. Potgieter did not testify
to
explain how he arrived at his scores, and in the absence of such an
explanation the arbitrator inferred that there was a
reasonable
suspicion that he too was biased in favour of the successful
candidates. The arbitrator then concluded that it was
substantively
unfair that the "fair scoring by Mr Ehrich could be ousted by
the subjective scoring by Mr Ratsiane, councillor
Nawa and Dr
Potgieter."
The arbitrator found that there was a direct causal
connection between the subjective scoring and the failure to
appoint de
Villiers because the appointment recommendation was
based solely on the cumulative scores of the panellists.
The arbitrator’s remedy
In determining an appropriate remedy, the arbitrator
concluded that the fourth respondent should have been appointed to
the
post. By not doing so, the employer had prejudiced its ability
to render an efficient bulk electricity supply service to taxpayers
in the area of service delivery. It was not sufficient merely to
remedy de Villiers’s claim by awarding compensation
because
this would not address the needs of the community as well. The
award was handed down on 20 October 2006, approximately
three years
after the grievance was lodged in November 2003.
Evaluation of the grounds of review
Taking irrelevant considerations into account and
ignoring relevant ones
I have already indicated that the applicant did not
set out any factual basis for its claim that the arbitrator took
irrelevant
considerations into account and ignored relevant ones.
Accordingly this ground of review cannot be considered. The three
remaining
grounds of review are discussed below.
Allegation of bias
The applicant alleged in its founding affidavits that
the arbitrator had demonstrated bias by privately informing de
Villiers’s
representative of his decision prior to his
official pronouncement. Once again, no details are provided to
substantiate this
in the founding affidavit and the allegation is
denied by the third respondent. There was simply no factual basis
for me to
conclude that such communication took place. Consequently
this ground of review also falls away.
The arbitrator substituted his own finding for that
of the interviewing panel
A number of decisions by CCMA commissioners and
arbitrators of bargaining councils have adopted a deferential
approach to the
employer’s choice of candidates in promotion
disputes. Support for such an approach has sometimes been sought in
the
judgement
Pharmaceutical
Manufacturers Association SA & another: In re Ex parte
President of the RSA & others
[2000] ZACC 1
;
2000
(2) SA 674
(CC)
where the
following was said:
“
The
setting of this standard does not mean that courts can and or should
substitute their opinions as to what is appropriate for
the opinions
of those in whom the power has been vested. As long as the purpose
sought to be achieved by the exercise of public
power is within the
authority of the functionary and as long as the functionary’s
decision, viewed objectively, is rational,
a court cannot interfere
with the decision simply because it disagree with it or considers
that the power was exercised inappropriately.
”
1
However, the correctness of this approach was
questioned in the case of
Minister of Safety & Security v
Safety & Security Sectoral Bargaining Council & others
[2010] 4 BLLR 428
(LC)
. Francis J pointed out in the
judgment that:
“
It
is clear from
section
193(4)
of
the Act that an arbitrator must determine the dispute on the terms
that the arbitrator deems reasonable. Those terms may include
an
order for reinstatement, re-employment or compensation. The three
examples given in the said section are not the only terms
that the
arbitrator may use. If, as in the present case the parties agreed
that the arbitrator had to decide whether the third
respondent was
suitable and whether he should be promoted, it cannot be said that
the terms used by the arbitrator to determine
the dispute was not
reasonable. The third respondent had in his opening address stated
that the relief that he was seeking was
to be promoted to the rank
of superintendent. The relief that an arbitrator may grant in an
unfair labour practice dispute appears
to be wider that what can be
granted in an unfair dismissal dispute.”
2
A little further on in the
judgment, Francis J rejected the applicant’s reliance on the
test for intervention set out
in the
Pharmaceutical
judgement:
“
The
applicant’s reliance on the Pharmaceutical case appears to be
misguided. It finds no application in [an] unfair labour
practice
dispute since the Act grants the arbitrator certain powers
”
3
I do not understand the decision
in the
Minister
of Safety and Security
case
to be suggesting that arbitrators should readily interfere in
promotion decisions, but they are required to determine whether
the
promotion decision was unfair to the aggrieved employee and to
grant such relief which appropriately remedies that unfairness
as
far as possible. I agree that the review standard set out in the
Pharmaceutical
case is not
apposite, given that the arbitrator is required to make a
determination based on fairness which has a procedural
and
substantive component, rather than make a finding based on
administrative review principles. In making such a determination
an
arbitrator is entitled to enquire into the substance of the
promotion decision.
Having said this, it must be recognised that, unlike
substantive fairness in dismissals, for which a closed list of
legitimate
reasons are recognised in terms of section 188(1) of the
LRA, there are a myriad of factors which might legitimately be
taken
into account in the employment decision. These will vary from
employer to employer and from post to post. Some employers will
use
sophisticated rating systems and competency testing to identify
appropriate candidates for shortlisting and will strive
for
selection methods that minimise the effect of subjective factors on
the final choice. Others may wish to balance objective
criteria
with more subjective assessments based, for example, on interviews.
Where interview techniques are used it should
also be recognised
that there will also always be a degree of subjectivity present in
such assessments, for which a certain
allowance must be made, and
an arbitrator considering the fairness of a failure to promote a
candidate must be mindful of not
having had the benefit of the
first hand interaction which takes place between interviewers and
candidates.
Which criteria are used will depend on factors such as
the employer’s operational needs, organisational values,
human
resources policy, resources it is willing to devote to
recruitment, the number of candidates it might have to consider for
each vacancy, and such like considerations, which generally are not
prescribed by law.
However, if a criterion used is one that unfairly
discriminates directly or indirectly between candidates, because it
is constitutionally
offensive then it will be impermissible to use
it under the provisions of section 6(1) of the Employment Equity
Act 55 of 1998
(‘the EEA’), subject to the exceptions
for employment equity measures or inherent job requirements which
are provided
for in sections 6(2)(a) or (b) of the same Act.
So too, if a candidate ought to have been successful
based on legitimate criteria used by an employer, but the employer
cannot
provide a rational explanation for that person’s
non-appointment then an arbitrator might be justified in regarding
that
non-appointment as unfair.
Consequently, in my view, it
would still be prudent to follow the two stage approach outlined in
Wallis AJ’s decision
in
Ndlovu v Commission for
Conciliation, Mediation and Arbitration and others
(2000)
21
ILJ
1653 (LC)
, to determine if the
failure to promote the employee was unfair, namely
that:
“
[11] ... It can never
suffice in relation to any such question for the complainant to say
that he or she is qualified by experience,
ability and technical
qualifications such as university degrees and the like, for the
post. That is merely the first hurdle.
Obviously a person who is not
so qualified cannot complain if they are not appointed.
[12] The
next hurdle is of equal if not greater importance. It is to show
that the decision to appoint someone
else to the post in preference
to the complainant was unfair. That will almost invariably involve
comparing the qualities of
the two candidates. Provided the decision
by the employer to appoint one in preference to the other is
rational it seems to me
that no question of unfairness can arise.
”
4
In this instance, the arbitrator found there was an
unacceptable degree of bias on the part of some of the
interviewers. There
does appear to be sufficient factual basis for
this finding, and in the absence of a satisfactory explanation for
the notably
wide discrepancies in the panellists’ evaluations
discussed above, I cannot say the arbitrator’s finding was
irrational,
even if some of his reasoning may be criticised.
Further, the arbitrator found that the successful candidate did not
meet the
formal requirements for the post nor did he have the
suitable experience for the position, which the employer’s
own witness
confirmed was a pre-requisite for appointment. These
were sound reasons for finding that the employer had not acted
fairly
towards de Villiers.
Regarding the arbitrator’s findings of bias on
the basis of the relative scoring of the candidates by the
panellists,
it cannot be said that his detailed evaluation was
irrational. His analysis was a plausible interpretation of the
panellists’
scoring of the successful candidate and de
Villiers. This does not mean that his approach was necessarily
correct, or the only
way of looking at the results. I have some
misgivings about his analysis. For example, in a panel of four
interviewers it is
not easy to attribute great significance to
divergences in scoring. Such divergences might be expected where
scores are not
calibrated against a guideline score sheet. Having
said this, the degree of discrepancy between Nawa and Ratsiane’s
respective
assessments of de Villiers and Sivhada is marked. Nawa
and Ratsiane’s scoring of the two candidates rated de
Villiers
30% and 40% lower than Sivhada respectively, whereas the
comparable ratings by the other two panellists differed by only 5%
and 17%. Add to this the huge discrepancy in Nawa and Ratsiane’s
scoring of the two candidates there was a need to explain
these
large variations in greater detail and not simply to dismiss them
as mere subjective differences.
It is possible that the differences could have been
explained by employment equity considerations, but then these
should have
been set out as separate criteria and have been
attributed specific points. Taking employment equity into account
us an unstated
factor in weighting the scoring on other criteria
cannot be fair.
It must be mentioned in passing that the arbitrator’s
designation of the panellist with the greatest relevant technical
expertise as the benchmark against which all the other panellists’
scoring should be evaluated, is questionable. It will
often happen
that the persons interviewing an applicant with specialist
expertise will not have such expertise themselves.
To assist them
making a choice they might rely on person with the appropriate
specialist knowledge to advise them on the suitability
of
candidates based on their training and relevant work experience.
However, other values do play a part in making an appointment,
apart from a candidate’s technical competence. Be that as it
may, the arbitrator’s basic finding that there was
a
significant degree of bias, as illustrated by the comparative
scores of the panellists, was sufficient to justify his conclusion,
even if one ignores his finding on the ‘objective’
character of Ehrich’s judgment, which I have.
The arbitrator imposed a decision to appoint the
third respondent retrospectively regardless of the position having
been filled
If this criticism was always fatal to awards in
promotion disputes, it would render the remedy of instatement in a
post non-existent.
However, in the context of the timing of the
award relative to the lodging of the grievance, I believe the
applicant does have
a point. Nearly three years had elapsed between
the lodging of the grievance by de Villiers and the issuing of the
award. During
this time Sivhada had occupied the post. While I
accept the validity of the arbitrator’s reasoning that the
interests
of service delivery played a part in his decision to
appoint de Villiers to the post notwithstanding de Villiers’s
incumbency,
it does not seem he paid any regard to the length of
time Sivhada had already held the position by the time the
arbitration
was finalised. This was a relevant factor which he
ought to have considered, and in this respect his decision to
appoint de
Villiers retrospectively was flawed.
Accordingly, his determination of an appropriate
remedy must be set aside. The respondents point out that the
fairness Mr Ehrich’s
assessment was not challenged in the
arbitration by the applicant. Given that Sivhada did not have the
necessary experience
which the applicant conceded was a
pre-requisite for appointment and since the other panellists’
impartiality in respect
of Sivhada was held to be suspect on the
arbitrator’s findings, Ehrich’s assessment ought to
have prevailed. In
that case, de Villiers would have been the
highest rated candidate and would have been appointed. Because of
the elapse of
time between the grievance and the award, this is no
longer appropriate. Consequently in my view the most appropriate
alternative
relief would be a form of protective promotion which at
least will have the effect of ensuring de Villiers was not
financially
disadvantaged by being passed over for promotion.
Order
For the reasons set out above, the following order is
made:
The arbitration award issued by the second respondent
on 20 October 2006 is reviewed and set aside only to the extent of
the
relief awarded by the arbitrator in paragraph 55.2 of the
award.
The award of relief made by the second respondent in
paragraph 55.2 of the award is substituted with the following:
‘
55.2 The First Respondent
must compensate the Applicant for its failure to promote him to the
position of Manager: Bulk Services
with effect from 1 September
2003, by paying him the difference between the remuneration he
actually received and the remuneration
he would have received had he
been appointed to that position for the period he remains in the
applicant’s employment from
1 September 2003, to the extent
that the actual remuneration he received from that date is less than
what he would have received.’
The payment of arrear compensation accrued by the
date of this judgment, in terms of the compensation due in terms
of paragraph
2 above, must be made by 30 June 2011.
No order is made as to costs.
R LAGRANGE, J
JUDGE
OF THE LABOUR COURT
Date
of hearing: 25 February 2010
Date
of judgment: 26 May 2011
For
the applicant: M Van Staden of Savage Jooste & Adams Inc.
For
the respondent: G P Ngoepe of Ngoepe Atttorneys
1
at
709, para [90]
2
At
435, para [19]
3
At
436,para [23]
4
At
1655-6, paras [11] – [12]