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[2012] ZALCJHB 88
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Chemical, Energy, Paper, Printing, Wood and Allied Workers Union v Astrapak Manufacturing Holdings (Pty) Ltd t/a East Rand Plastics (JS878/10) [2012] ZALCJHB 88; (2012) 33 ILJ 2386 (LC) (12 March 2012)
REPUBLIC OF SOUTH AFRICA
IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable/Not Reportable
Case no: JS878/10
In the matter between:
CHEMICAL, ENERGY, PAPER, PRINTING,
WOOD AND ALLIED WORKERS’ UNION
.....................................................
Applicant
and
ASTRAPAK MANUFACTURING HOLDINGS
(PTY) LTD t/a EAST RAND PLASTICS
......................................................
Respondent
Date of the hearing:
Date of judgment: 12 March 2012
________________________________________________________________
JUDGEMENT
________________________________________________________________
MOKOENA, AJ:
Introduction
The Applicant has initiated these proceedings on behalf of its
members who were affected by the restructuring of the Respondent’s
business which ultimately led to the retrenchment of the Applicant’s
members.
In essence, the Applicant contends that the dismissal of its members
by the Respondent is substantively unfair as the Respondent
unreasonably and unfairly sought to compel the relevant employees to
accept alternative positions on terms which would have resulted
in
such employees agreeing to an unreasonable reduction in their pay,
demotion and/or forfeiture of other benefits of employment,
as well
as the cancellation or variation of previous collective agreements
and benefits provided in terms thereof.
It is common cause between the parties, as evident from the filed
pre-trial minute, that the only issue for determination by
this
court pertains only to the substantive fairness of the
retrenchment/dismissal and that the procedural aspect is not in
dispute.
1
Analysis of pleadings
Applicant’s statement of case
The hallmark and/or centrepiece of the Applicant’s case as
couched in its pleadings can be summarised as follows:-
The Respondent communicated that it was embarking on a restructuring
exercise, which would involve a reorganisation of jobs and
functions, but that no worker would face the loss of his or her
employment. On the contrary, the restructuring would result in
more
and not fewer jobs than before.
The retrenchments were accordingly not brought about by any
requirement that the Respondent reduce the size of its workforce.
The Respondent unreasonably and unfairly sought to compel the
relevant employees to accept alternative positions on terms which
would have resulted in such employees agreeing to an unreasonable
reduction in their pay, demotion and/or forfeiture of other
benefits
of employment, as well as the cancellation or variation of previous
collective agreements and benefits provided in terms
thereof.
The affected members did not in principle reject the alternative
positions offered to them, but justifiably were not willing
to
accept the unreasonable and unfair demands and conditions imposed by
the Respondent.
In the circumstances, such dismissal was:-
without fair reason;
in violation of the rights of employees and the union in terms of
existing contracts of employment and collective agreements;
unfair.
2
Respondent’s statement of defence
During 2009, the Astrapak Group decided to respond to the recession
in a positive manner by aggressively driving sales in order
to trade
itself out of
the recession, thereby protecting the companies in the Group and
their employees.
As a result of the above, the demand for production in the Group
rose, allowing the companies in the Group, including East Rand
Plastics, to keep its machines loaded and to purchase additional
machines.
This in turn resulted in a view being formed by the Astrapak Main
Board that the companies in the Group could be operated more
effectively and more efficiently by changing from a three shift
system to a two shift system. The companies in the Group were
therefore instructed to engage their staff in discussions with
regards to this proposed change.
Initial attempts to engage the staff at East Rand Plastics in
discussions around this change did not bear any fruit and it was
placed on hold.
In the meantime various other companies within the Group proceeded
with the change over to the two shift system where it was
found to
have been effective. Due to the slow progress at some of the
companies within the group, an instruction was given that
the issue
should be finalised by June 2010.
A letter was therefore issued to all East Rand Plastics’
employees, CEPPWAWU and Solidarity on or about 14 April 2010 in
terms of section 189A and 189(3) of the Labour Relations Act
(“LRA”), informing them of the possibility of
retrenchment
and inviting them to consultations.
It is evident from the analysis of the pleadings filed by the
parties, that the crux of the dispute between the parties is whether
the dismissals of the Applicant’s members were substantively
fair as envisaged in section 188(1)(a)(ii) of the LRA.
The burden of proof
Section 192 of the LRA provides as follows:-
‘
(1)
In
any proceedings concerning any dismissal, the employee must establish
the existence of the dismissal.
(2)
If
the existence of the dismissal is established, the employer must
prove that the dismissal is fair.’
It is trite that in dismissal proceedings, the
onus
rests
with the employees to establish and prove that they were dismissed.
On the other hand, the employer has to demonstrate
and/or show that
the dismissal was fair. In general, this means that the Applicant
must prove that the Respondent has taken some
initiative to
terminate the contract, and that the Respondent’s action has
caused the termination.
3
The parties, in their pre-trial minute, were
ad idem
that the
duty to begin and the
onus
of justifying that the dismissal
was premised on a fair reason lies with the Respondent. There is no
dispute pertaining to the
fact that the identified members of the
Applicant, as per annexure “B”, were indeed dismissed
based on the operational
requirements of the Respondent.
4
Oral Evidence
Respondent’s witnesses
The Respondent called the following witnesses:-
Mr Keith Watkins;
Mr Pierre Wentzel;
Ms Angela Van Der Holst.
The evidence of Mr Keith Watkins (“Watkins”)
He is the Regional Chief Executive Officer of the Cape Region and
employed as such by the Respondent. At the time of the restructuring
of the Respondent which led to the retrenchment of the Applicant’s
members, he was a Chief Operations Officer and all the
units of the
Respondent reported to him. East Rand Plastic is a division of
Astrapak Manufacturing Holdings which, in turn, is
part of the
Astrapak Group.
The company consists of mainly two components which are the rigid
divisions and the flexible divisions. East Rand Plastic was
a
flexible division. Furthermore, the flexible divisions were divided
into inland and coastal divisions. The inland flexible
divisions
would be those areas such as Gauteng where East Rand Plastic is
situated and the coastal region will be those flexible
divisions in
Cape Town, Durban, PE etc.
A decision was made by the Respondent to restructure its business.
What motivated this restructuring is the fact that unlike
the rigid
divisions, the flexible division:-
underperformed and was not productive;
experienced low profit margins which were dropping drastically;
were performing poorly.
It was on the basis of the abovementioned factors that the
Respondent decided to restructure its business and operations. In
addition, the flexible division, such as East Rand Plastics were
losing customers. This was a further motivation advanced by
the
Respondent in deciding to sell the flexible divisions.
However, due to the fact that the flexible divisions were
underperforming, loosing customers and with low profit margins, they
could not be sold. A presentation was then made to the shareholders
pertaining to the plans of restructuring the Respondent.
The shareholders were reluctant to commit more funds to the company
as a result of the loss which the Respondent was experiencing,
as
alluded to above. It was presented to the shareholders that the
Respondent should adopt the World Class Manufacturing (“WCM”)
model which will introduce new machines, updated computer systems,
advance electronic planning and to be able to control the
shifts.
In turn, the WCM will enable the Respondent to compete with its
competitors. This presentation was made in August 2010 to the
shareholders. As a result of the flexible divisions not performing
as expected by the shareholders, the CEO of the flexible divisions
had to resign. Watkins remained as the manager of Astrapak. The
executive committee of the Respondent adopted the recommendations
made during the aforesaid presentation.
According to Watkins, the board of governors is solely responsible
for the implementation of the King reports 1 and 2 and does
not deal
with the day to day running of the Respondent and/or any of the
operational issues. The board of governors’ involvement
in
operational issues is limited to capital investment and when it has
to verify same. However, the motivation and calculation
of all
capital investments are done by the executive committee.
He was referred, during his testimony, to a document appearing on
page 296 of the bundle of documents and he identified same
as being
the minutes of the board of directors held on 26 November 2009. He
confirmed that he attended the meeting, by invitation.
He confirmed
the issues discussed in the meeting and his input as apparent from
the minute. He highlighted that the meeting discussed
the WCM and
the 5 point reduction plan in order to improve the gross margins of
the flexible divisions. He further explained
in detail how the WCM’s
plan would assist the company from underperforming.
He planned review strategies which were incorporated within the WCM.
He also described, at length, the advantages of the WCM.
The envisaged new shift system would benefit the company. He further
testified that the introduction of the new shift system
would lead
to less scrap material, less repair of the machines as they would
not be switched on and off. The new system would
lead to continuous
handover which would benefit the employees as they will be learning
the new system and this will increase
productivity as continuous
absenteeism will also be eliminated.
The Respondent’s target was to reduce costs by R106 000 000.00
(one hundred and six million rands). The Respondent focused
at
reducing overtime, salary and/or wage bill costs. This, in turn, led
to even senior management having to agree to a salary
reduction of
10%.
There was a target to reduce expenses by R68 000 000.00 (sixty eight
million rands) which meant that the company had to achieve
a 10%
reduction of its entire expenditure.
5
He confirmed his attendance and the issues discussed in the meeting
which was held on 24 February 2010. He highlighted that the
meeting
dealt with the 10-point plan which had to be implemented from 1
October 2008. He took the court through the identified
10-point plan
which was aimed at a cost reduction for the Respondent.
6
He testified on a presentation which he made in order to motivate a
need for a continuous shift system (4 shift system). He highlighted
the reasons for the change and the benefits which could be achieved
through a 4 shift system.
East Rand Plastic had the same problems like other flexible
divisions which were ultimately shutdown due to loss of profit,
underperformance, loss of customers etc.
The General Manager (Herman Jacobs) and Operational Manager (Pierre
Wentzel) were the individuals involved with the section 189
process
at East Rand Plastics. He testified that both individuals were no
longer employed by the Respondent.
He was referred to a document on page 44 and he reiterated that his
involvement was limited pertaining to this document and the
East
Rand Plastic recovering plan. However, he confirmed the desired
objective of the restructuring and the desired results should
the
restructuring take place.
He confirmed the minutes of a meeting of the executive committee
held on 29 April 2010 and confirmed his attendance. He testified
on
the issues which were discussed in that meeting and highlighted that
the board’s approval was sought in order to implement
the new
shift structure and the cost reduction programme.
7
He confirmed the minutes of a meeting of the executive committee
held on 24 June 2010. He confirmed his attendance and the issues
discussed at that meeting. The section 189 process was implemented
in order to deal with the increased labour costs.
8
He stated that the new strategic plan which was presented to the
board was presented in order to address the losses which the
Respondent was experiencing.
9
The blueprint presentation identified the problems experienced in
the flexible divisions, strategies to be adopted and paving
the way
forward towards the restructuring of the Respondent in order to
avoid recurrence of the losses it suffered.
10
He stated that the Respondent’s shareholders sought to reduce
salary and/or wage costs by 10% across the entire operations
of the
Respondent.
11
As a result of the losses which were suffered by the Respondent, the
Respondent had no option but to invoke the provisions of
section 189
of the LRA.
Subsequent to the restructuring process, there were positive signs
from East Rand Plastics and other business units of the Respondent
which demonstrated a gradual recovery from the initial losses. He,
however, mentioned that the other two flexible divisions,
despite
the restructuring being implemented, could not survive and had to be
shutdown.
He further testified that in the event this court was to reinstate
the Applicant’s members, this would have devastating
consequences to the Respondent as the Respondent has already
invested in training the current workforce. The retrenched workforce
will not be able to meet the new conditions of employment.
Furthermore, the Respondent would have to retrench the entire
existing
workforce in order to accommodate the Applicant’s
members, in the event that the reinstatement is ordered.
The witness was cross-examined by the Applicant’s counsel. In
summary and paraphrasing, the cross examination revealed
the
following:-
The employees were dismissed in June 2010 and the capital
expenditure meeting took place on August 2010. This therefore means
that the capital expenditure could not have an impact on the
decision to dismiss the Respondent. The implementation of the WCM
is
not a reason which led to the retrenchment of the Applicant’s
members as the WCM could have been implemented with the
same
workforce that was retrenched. WCM could have been implemented on
continuous basis with the retrenched employees being trained
accordingly.
He disagreed that the company conflated the cost cutting measures
and insisted that the company did try separating these issues
before
but they could not assist the company in cost cutting. Infact, he
suggested that even the introduction of the new shift
system itself
could not have been sufficient to address the problems which were
being encountered by the Respondent and that
the shareholders had
already placed preconditions which had to be implemented, at once.
The evidence of Mr Pierre Wentzel (“Wentzel”)
He was employed by the Respondent in February 2009 after the Chief
Operations Officer of the flexible division had resigned.
At the
time when he started at the East Rand Plastic, the Respondent was
experiencing low profit margins, huge scrap off materials,
inefficiencies and other factors which made the Respondent to even
lose customers.
He was tasked to deal with all issues which were making the
Respondent to lose profits. There was a task team established which
included him and Herman Jacobs to initiate and implement the 5 and
10 point plans. He testified that subsequent to the 5 and
10 point
plans being introduced, the Respondent had to engage the employees
in order to discuss these plans and to implement
them in order to
meet the required targets and to assist the Respondent to cut costs.
He stated that the shareholders required that the profit margins
should be improved from 7% to 12% in order for the Respondent’s
operations to be endured and sustainable.
He testified about the minutes of the meeting of 29 June 2009 which
discussed the cost cutting measures of which the Respondent
had to
implement. These,
inter alia
, included the 4 shift system,
operational issues and reporting structures, absenteeism keeping the
machines running and other
factors of concern which had to be
identified and addressed in order to avoid further loses experienced
by the Respondent.
12
The outcome of the meeting was to engage the employees with these
planned strategies and operational issues. Employees were engaged
and this led to the employees protesting against the 4 shift system.
There was no consensus reached on these issues.
He was referred to a document on page 13 of the bundle and
identified same as a document despatched by the Applicant wherein
it
was indicating that it would embark on a strike action.
It was the Respondent’s desire to implement the 4 shift system
by no later than June 2010. The discussions around the 4
shift
system had already embarked in March 2010.
He was referred to a document on page 14 of the bundle, with
particular reference to the last paragraph on page 16 and gave his
interpretation on that paragraph as being a threat which was made by
the Applicant that the strike would also be spread to other
departments of the Respondent.
The Respondent inviting the employees to embark on consultations as
envisaged in section 189 of the LRA. He testified about the
background facts as set out in the letter,
13
reasons for the proposed dismissal as envisaged in section 189,
alternatives considered by management, severance pay for the
proposed dismissals and the purpose of the consultations.
He testified about the minutes of the first meeting pursuant to
section 189A which was held on 4 May 2010 at the Respondent’s
premises wherein all the relevant parties were present and duly
represented. His evidence was led on point 5(d) of the minutes
of
the meeting and stated that according to the CCMA’s
facilitator it was agreed that there should be 4 meetings to be
held
during the section 189 process. He further testified on point 10 of
the minutes which was an explanation proffered by the
Respondent
pertaining to the shifts. This explanation was also amplified on
paragraphs 15 and 18 of the minutes where the Respondent
indicated
its desire to cut costs. He confirmed the entire minutes and the
contents recorded therein.
14
He testified on the minutes of the second session of the section 189
meeting held on 17 May 2010. All the parties were duly represented
at this meeting. He identified the 4 suggestions and/or proposals
made by the union during the aforesaid meeting. He confirmed
the
entire contents of these minutes. These minutes are not in dispute
and are common cause between the parties.
15
He stated that in all the proposals which were made by the
Applicant, the Respondent did accommodate the Applicant and acceded
to those proposals and/or demands. The only point of disagreement
was whether or not Mr Hollard should be dismissed. He testified
that
even if he was dismissed, in the bigger scheme of things, this could
not have made any difference to cut the costs which
the shareholders
envisaged.
He emphasised that Solidarity Union agreed to all the proposals made
in the third meeting and this is apparent from paragraphs
50 to 54
of the minute. However, the Applicant wanted the discussions to take
place at a national level. Furthermore, it is indicated
in
paragraphs 59 to 61 that the Applicant did not agree to anything as
it simply echoed its sentiments that it was against the
section 189
process.
16
It was accordingly recorded by the CCMA facilitator that there was
no agreement on the issues discussed by the parties. He was
then
going to report accordingly that the section 189A consultations were
held and being exhausted. The parties were advised
on the available
remedies should they wish to deal with the issues further.
He testified that in all these three consultation meetings which
were held, nowhere did the Applicant indicate and/or object
to the
process on the basis that the Respondent was conflating the issues.
He was referred to a letter dated 2 June 2010 despatched by the
Respondent to the Applicant inviting the Applicant to a further
consultation. This was done despite the fact that, according to the
CCMA facilitator the section 189A consultations were exhausted.
In
this letter, the Respondent confirmed that it intended to discuss
different alternatives which were made to the Applicant
and
furthermore that should the Applicant’s members unreasonably
not accept this alternative, the Respondent will not pay
them any
severance pay.
17
On 3 June 2010, the Applicant despatched a letter to the Respondent
wherein the Applicant indicated that retrenchment has never
been an
issue during the section 189A consultation. Furthermore, that the
Applicant has not yet received a report from the Commissioner
who
facilitated the section 189A consultation and will only be in the
position to respond to the Respondent once it was favoured
by such a
report from the Commissioner.
18
On 4 June 2010, the Respondent despatched a letter wherein it
invited the Applicant to a further consultation in terms of section
189A. Paragraph 11 of the aforesaid letter records that:-
‘
Your
input on employees accepting the changed terms and conditions of
employment and/or alternative positions that would be available
which
would then ultimately avoid retrenchments, would also be appreciated
during this meeting.’
19
Eventually, the Applicant acceded to the proposed further
consultation meeting which was held on 8 June 2010 as evident from
page 85 of the bundle of documents. The witness emphasised that as
apparent from the minutes of the meeting, there were no proposals
which were made by the Applicant. Furthermore, no representations
were made pertaining to severance payment. He further testified
that
no further communication and/or correspondence were received from
the Applicant.
On 14 June 2010, the Respondent addressed a further letter to the
Applicant. In this letter, the Respondent intimated that it
remained
committed to ensure that no employees,
alternatively
, as
fewer employees
as possible be retrenched, which is why it was offering the
alternatives to retrenchment to the Applicant’s members.
The employees were afforded until 21 June 2010 to react to the
alternatives offered to them by the Respondent. Furthermore, that
should the employees not accept the alternatives offered to them,
they would not be paid any severance pay, as the Respondent
views
the alternative employment offered to them to be reasonable and
accordingly their refusal to accept same would be considered
unreasonable.
These letters were despatched to the Applicant’s regional
offices. The same letter was also despatched to individual employees
affected by the section 189 process. It was recorded in this letter
as to how the changes will affect each individual as recorded
on
page 95, paragraph 9 of the bundle of documents, to be read with a
document on page 97 which contains the annexure explaining
the plan
presented during the section 189A consultations, of which plan was
to be implemented by the Respondent. These letters
should also be
read with the letter on page 100 demonstrating that it was
despatched to each and every employee affected and
not only to the
Applicant as a trade union representing those members.
20
The witness also testified that despite all the efforts which the
Respondent has made in despatching the letters to the Applicant
and
to the respective individual members who were affected by the
section 189 process, there was never any feedback received
from the
Applicant and/or the respective members pertaining to the
restructuring process embarked upon by the Respondent. He
further
testified that the members of Solidarity Union and other non-union
members did accept the alternatives.
He testified about the letter appearing on page 16 of the bundle and
identified same as a letter from the Applicant which was
addressed
to the Respondent dated 18 June 2010. In this letter, the Applicant
was requesting the Respondent to extend the deadline
which was given
to the members of the Applicant to react to the offers made by the
Respondent. This letter was despatched at
15h52 on 18 June 2010.
The Respondent did respond to the aforesaid letter as evident from
page 117 of the bundle. In that letter, the Respondent adopted
an
attitude that it has provided the Applicant with more than
sufficient opportunity to react to its section 189 proposals and
to
make a meaningful input, however, the Applicant has failed to do so.
As a result, the Respondent indicated that it would continue
to
notify employees of their dismissal based on operational
requirements.
This is also evident from reading the document on page 114, of which
the witness was referred to, wherein the Respondent despatched
a
notice of termination to the employees based on operational
requirements. As the employees were on strike and their strike
action became violent, the Respondent obtained interdicts against
them. The employees werereferred to different court orders
obtained
against the Applicant’s members as appearing on pages 158 to
163 of the bundle of documents.
The witness testified that after the Applicant’s members were
retrenched, the Respondent went ahead to implement its restructuring
plan and achieved the results which are indicated on page 164 of the
bundle. According to the witness, the company was able to
cut costs
on wages and salaries.
21
He identified the different sets of organogram of the Respondent
which were discussed with the Applicant during the section 189
proceedings.
22
He testified about the letters which were sent to different
employees after the restructuring process and those employees having
accepted the alternative employment offered to them by the
Respondent.
23
He testified that all employees were treated the same. The same
letters and contracts despatched to employees subsequent to the
restructuring process also appears on page 247 and page 261 of the
bundle. He stated that it would not be practical to reinstate
the
retrenched employees, as they will not be able to adapt to the new
employment conditions due to the fact that most of them
lacked the
necessary level of education to be trainable.
In respect of annexure “B” he confirmed those employees
who were properly before this court and those which were
in dispute.
In relation to annexure “C”, he confirmed the contents
thereof as it pertains to current job titles of
employees and the
proposed job titles subsequent to the restructuring process.
Under cross-examination, he was referred to a document on page 19
and confirmed that he had a limited input towards the drafting
of
the aforesaid document and/or the contents contained therein. It was
put to him that in that letter, there is no reference
about any
positions becoming redundant and he confirmed same. It was
emphasised to him that as at April 2010 the Respondent did
not
envisage any posts becoming redundant and he confirmed same. He
later disagreed with the proposition, however, he could not
explain
why if the Respondent had envisaged that some of the positions would
become redundant, why was this not canvassed in
the aforesaid
letter.
He was referred to the minutes of the first consultation on page 34
and it was put to him that even at that meeting, except the
tea
ladies and those other positions identified, there was no mention of
further posts being declared redundant.
For the purpose of my judgment, it is evident that these issues
pertaining to redundancy of positions are issues which ought
to have
been addressed during the consultation process. It is evident from
the consultation process that the Applicant never
objected to the
process and/or issues canvassed therein pertaining to redundancy of
positions. Infact, it was common cause between
the parties that the
Applicant was not challenging the consultation process.
It was put to him that if one has regard to the document on page 75,
the Respondent has indicated that 93 positions will be declared
redundant, while during the consultation process only 4 positions
were indicated to be redundant.
The witness was referred to the documents on pages 102 and 106 of
the bundle which depicts the new industry wage. It was put
to the
witness that had the members of the Applicant accepted the
alternative employment they would have been entitled to the
new wage
rates and/or structure as depicted in those documents and they would
have been entitled to the increments as indicated
therein. This was
conceded by the witness.
It was put to the witness that by accepting the alternative offer of
the Respondent, the Applicant’s members wages could
have been
reduced to a lower scale and the increase, if any, by the industry
would be realised based on the lower salary/wage
scale as per the
alternatives offered by the Respondent.
It was put to the witness that the introduction of the 4 shift
system would have resulted in the total scraping of the overtime
which was worked by the Applicant’s members prior to the
restructuring. This was conceded by the witness. Furthermore,
that
this would result in the members of the Applicant taking home low
wages compared to prior the restructuring process when
they worked a
great deal of overtime.
It was put to him under cross-examination that by restructuring its
business operations, the Respondent sought to achieve three
main
objectives, to wit:-
The introduction of the continuous shift system.
The removal of wage disparities and the reduction of salaries so as
to accord with the minimum standards of the industry.
The doing away with those positions which were regarded as being
redundant.
In re-examination, he testified that during the section 189 process
there was indeed mention of the posts which were going to
be
redundant as clearly indicated in a document appearing on page 44
and also in the organogram structures which were discussed
with the
union as evident from the documents in the bundle.
He testified that had the members of the Applicant accepted the
alternative, most of them would have been in far much more better
salary structure than before, others would retain the same salary
structure while others would receive lower wages than before.
However, that all employees would be entitled to the increase which
was due within 9 days of the proposed alternatives.
The evidence of Ms Angela Van Der Holst (“Van Der Holst”)
She was employed by the Respondent at the East Rand Plastic as the
HR Manager from October 2009. She was referred to annexure
“B”
to the bundle of documents and confirmed that it contains the names
of the Applicant’s members who were
retrenched including their
severance payment.
She confirmed that those employees who were placed in dispute as not
being members of the Applicant properly before this court
should not
be entitled to any relief. She confirmed that the majority of the
members of the Applicant were not paid severance
pay and only five
employees were paid , as they were not offered alternative
employment. She testified that the members of the
Applicant were not
paid severance pay as they considered their refusal of the
alternative employment offered to them by the Respondent
as being
unreasonable.
She testified that having regard to the alternative employment
offered by the Respondent to the respective members of the
Applicant,
most of the Applicant’s members would have been in
a better position, while others would have remained on the same
salary
scale and others would have been paid lower wages/salaries.
She testified that all the employees would have been entitled to the
increase which was due in July almost 9 days after the alternative
employment offers were made to them.
She testified that even though a document on page 75 was referring
to the concept of redundancy, there was no redundancy in an
actual
sense of the word as most of those positions would have been
transferred to the newly proposed structure.
She was cross-examined on a document on page 19 and asked whether
she had any input towards the letter. She testified that she
had
some input on the contents of the letter. It was put to her that as
at that time, the Respondent had considered paying severance
pay to
the employees who were affected by the restructuring process.
Furthermore, that there was no reason why the Respondent failed to
pay severance payment to the members of the Applicant. It
was put to
her that the reason why the members of the Applicant were not paid
severance pay was a punitive measure on the side
of the Respondent
to demonstrate its dissatisfaction in the manner in which the
Applicant’s members conducted themselves
during the section
189 consultation process.
It was further put to her that the new 4 shift system would do away
with overtime and this would mean that the members of the
Applicant
would take home lesser wages than before. Furthermore, that even
though there was an increase to be implemented in
July, this
increase would be on the new wage and therefore it was not
unreasonable for the Applicant’s members to refuse
the offers.
In re-examination, she maintained that it was indeed unreasonable
for the members of the Applicant to have refused to accept
the
alternative employment.
No evidence was led on behalf of the applicant’s members.
Contentions/arguments advanced on behalf of the parties
Applicant’s oral submissions
During oral argument it was contended on behalf of the Applicant
that the dismissal of its members was substantively unfair.
The
submissions were premised on the following grounds:-
The Applicant realised the value of the four shift system and that
the Respondent was entitled to introduce it;
It is apparent that the four shift system, on its own, was going to
introduce significant cost savings and greater productivity,
thereby
having a significant impact on the profitability of the respondent;
The Applicant accepts that the introduction of WCM would also impact
positively on productivity;
The Respondent should have sought, in its restructuring exercise,
only to address the shift system. The impact of this may have
been
sufficient to render the need for reducing of wage bill and the
declaring of posts redundant was unnecessary;
The Applicant accordingly submits that the Respondent has not
demonstrated a proper consideration of alternative employment as
required by the LRA;
The Applicant submits that as a result of conflating three
operational issues into one, the Respondent sought to compel the
Applicant’s members to accept changes to terms and conditions
of employment, not all of which were dictated by the Respondent’s
operational circumstances;
Furthermore, the Respondent has provided no evidence at all to
operationally justify the conflation of the three exercises into
a
single restructuring. On the contrary, this restructuring took place
against the backdrop of a Group reporting enormous profits;
The Respondent has placed no evidence before the Court in relation
to the redundant posts other than a general contention that
these
were not essential to manufacturing. In the absence of specific
evidence in relation to these posts, it is impossible for
the Court
to assess whether the dismissal of employees as a result of alleged
redundancy was fair.
On the basis of the above summarised submissions advanced on behalf
of the Applicant, the Applicant seeks relief that its members
be
reinstated on the existing terms and conditions applicable at the
Respondent.
In the event that this court finding reinstatement to be
impractical, then in the alternative, the Applicant seeks
compensation
of twelve months salary on behalf of its members.
Further in the alternative, the Applicant seeks that its members be
paid a severance pay as envisaged in the Basic Conditions
of
Employment Act.
Respondent’s written submissions
The Respondent’s main
contention can be summarised as follows:-
ERP was faced with a situation
where its profit was only 7% and it would have decreased through
time to come as a result of, amongst
others, changing markets, high
overheads / cost structure and outdated equipment causing slower
production and longer lead times
to deliver.
In addition thereto, the view
taken by the shareholders was that such companies within the
flexibles division would face closure
due to their businesses not
being viable which would not even have enabled the group to sell
them.
In order to ensure the
long-term survival of ERP, amongst others, the shareholders
indicated their willingness to invest money
in ERP and the other
companies to buy 7 new machines at a cost of R106m, on condition
that their profits be increased to 12%,
their salaries and wages
across the group be cut by 10% and further cost saving measures be
implemented.
Two other companies within the
group were, despite the cost cutting exercises, ultimately closed
down, as even the cost cutting
measures could not ensure their
survival.
As a result of the indication
from the shareholders, ERP was party to cutting costs in terms of
the 10-point plan, also developed
their own unique 5 point costs
savings plan and proceeded with restructuring and ultimately
retrenchment exercises to ensure
an effective system for purposes of
WCM and to cut costs.
At the end of two retrenchment
exercises (one for the wages employees and one for the salaried
employees), employees were retrenched.
With the exception of 5 of the
287 Applicants, all of them were retrenched when they did not accept
reasonable alternatives to
retrenchment that were offered to them.
The remaining 5 employees were not offered alternatives.
The Respondent submits that
these alternatives that were offered to them were reasonable in the
circumstances and that the Applicants
unreasonably refused the
offers. I intend elaborating on this issue herein below when the
issue of severance pay is addressed.
In total, 282 Applicants were
therefore retrenched as a result of their own actions,
alternatively, the actions of their union,
CEPPWAWU. Was it not for
such, they would still have been employed by the Respondent.
The Applicants were not even
prepared to accept only the change with regards to the overtime as
alluded to by their counsel during
the trial. They made it
abundantly clear during the third consultation meeting that they do
not agree to any of the proposed
changes (including cutting overtime
as a result of implementing a 4 shift system) and stated that they
were completely against
the whole Section 189 process.
The Respondent therefore
submits that 282 Applicants were offered reasonable alternative
employment which they unreasonably refused.
Even Applicants’
whose wages would ultimately have remained lower than their old
wages, were unreasonable when they did
not accept the only viable
alternatives available at the Respondent to them.
As a result of the submissions made above, the Respondent submitted
that the retrenchment was premised on a fair reason and as
a result,
the Applicant’s application should be dismissed with costs.
In the alternative and only in the event this court finding that the
retrenchment was unfair, then this court should not order
reinstatement as it will not be reasonably practicable for the
Respondent to reinstate the retrenched employees based on the
evidence of the Respondent’s witnesses.
Further in the alternative, should this court order compensation,
then this court should take into account the delays occasioned
by
the Applicant in prosecuting this matter.
Analysis of the facts, contentions advanced on behalf of the
parties in relation to the law (applicable legal principles)
Substantive fairness
As evident from the papers that were filed on behalf of the parties
in these proceedings, the oral evidence adduced and the submissions
advanced on behalf of the parties, there is no dispute pertaining to
the procedural aspect of the section 189 process. In order
words,
the Applicant do not challenge that the dismissal of its members
were procedurally unfair. As a result, the only question
which I
have to determine is whether or not the dismissal of the employees
(Applicant’s members) was substantively fair.
Section 213 defines the term “operational requirements”
to mean requirements based on economic, technological, structural
or
similar needs of an employer. The code of good practice, states as
follows:-
‘
As a
general rule, economic reasons are those that relate to the financial
management of the enterprise. Technological reasons refer
to the
introduction of new technology that affects work relationships either
by making existing jobs redundant or by requiring
employees to adapt
to the new technology or a consequential restructuring of the
workplace. Structural reasons relate to the redundancy
of posts
consequent to a restructuring of the employer’s enterprise.’
24
In
SACWU v Afrox Ltd
25
,
the Labour Appeal Court held that:-
‘
it can
no longer be said that the court’s function in scrutinising the
consultation process in dismissal for operational requirements
is
merely to determine the good faith of the employer . . .
The matter is now one of proof by the employer, on a balance
of
probabilities, of:
(a) the cause or reason for the
dismissal . . .;
(b) the defined ‘operational
requirements’ that the dismissal was based on . . .;
(c) a fair procedure in
accordance with section 189 . . .;
(d) the facts upon which a
finding of a substantively fair reason for the dismissal can be
made.’
This therefore means that it is not sufficient for the court to
merely find that an employer has acted in good faith but the
court
should be satisfied that on a balance of probabilities, the employer
has discharged its
onus
pertaining to the factors alluded to
above.
In the matter of
BMD Knitting Mills (Pty) Ltd v SACTWU,
26
the Labour Appeal Court found that:-
‘
The
word ‘fair’ introduces a comparator …. The
starting point is whether there is a commercial rationale for
the
decision. But, rather than take such justification at face value, a
court is entitled to examine whether the particular decision
has been
taken in a manner which is also fair to the fair to the affected
party, namely the employees to be retrenched. To this
extent the
court is entitled to enquire as to whether a reasonable basis exists
on which the decision, … is predicated.
Viewed accordingly,
the test becomes less deferential and the court is entitled to
examine the content of the reasons given by
the employer, albeit that
the enquiry is not directed to whether the reason offered is the one
which would have been chosen by
the court. Fairness, not correctness
is the mandated test.’
In the matter of
CWIU v Algorax (Pty) Ltd,
27
the Labour Appeal Court held that:
‘
The
question whether the dismissal was fair or not must be answered by
the court. The court must not defer to the employer for the
purpose
of answering that question. In other words it cannot say that the
employer thinks it is fair, and therefore, it is or should
be fair
. . . Furthermore, the court should not hesitate to deal
with an issue which requires no special expertise, skills
or
knowledge that it does not have but simply requires common sense or
logic.’
As already stated above, in discharging its
onus
, the
Respondent relied on the evidence of Mr Watkins, Mr Wentzel and Ms
Van Der Holst. These witnesses’ evidence complimented
and
corroborated each other in the following material respects:-
The Respondent was experiencing loss of profit.
The performance of the flexible divisions of the Respondent was
causing the Respondent serious losses as compared to its rigid
divisions.
The situation in the flexible divisions were of such a nature that
they would ultimately be forced to be closed down.
The shareholders of the Respondent were not willing to invest any
further funds to the flexible divisions unless the costs cutting
methods were implemented in order to demonstrate and to realise
increase in profits.
There was a condition stipulated by the shareholders that the
Respondent’s profit margins must increase from 7% to 12%.
It was not feasible to sell the flexible divisions of the Respondent
as they were experiencing serious losses and there could
not have
been potential purchasers to be attracted to purchase an entity
which was trading at a loss.
The Respondent was required to implement the WCM. This in turn
required that the Respondent should adapt to new shift operations
and in this regard, it had to implement a 4 shift system as this was
beneficial to the Respondent.
East Rand Plastics, in terms of the new operational systems, was
required to cut its salaries and wages by R800 000.00 per month.
The shareholders of the Respondent also required that salaries and
wages be cut throughout the group by 10%.
The abovementioned evidence adduced by the Respondent was not
contradicted and/or challenged by any evidence adduced on behalf
of
the Applicant. I am aware and alive to the fact that the Respondent
bears the
onus
of demonstrating that the dismissal was
substantively fair, as already mentioned above. However, without any
contrary version,
disputed fact and/or contradictions from the
evidence of the Respondent’s witnesses, I am left with no
other option but
to accept the evidence of the Respondent and assess
it through the legal tests, alluded to above.
I am satisfied, having regard to the bundle of documents placed
before me and the uncontradicted oral evidence of the Respondent’s
witnesses, that the Respondent has on balance of probabilities
discharged its
onus
in respect of proving that:-
There was indeed a cause and/or reason for the dismissal.
There were substantive grounds upon which the dismissal based on
operational requirements was premised.
There were indeed facts upon which a finding of a substantively fair
reason for dismissal can be made.
Having regard to the losses which were being experienced by the
flexible divisions of the Respondent, there was indeed a commercial
rationale decision for the Respondent to invoke the provisions of
section 189, read with section 189A.
Indeed, the Respondent’s witnesses were vigorously and in the
most able way cross-examined by the Applicant’s counsel.
The
theme of the cross-examination was to demonstrate that the
Respondent conflated the three exercises into a single restructuring
means in order to achieve the reduction of costs.
This cross-examination should be viewed in the light of the
unchallenged evidence of the Respondent’s witnesses when it
was stated that there were two flexible units of the Respondent
which were closed despite the costs cutting measures having been
implemented. In other words, in order to convince the shareholders
to commit more funds to the flexible divisions, the Respondent
had
to demonstrate a comprehensive approach which will ensure that the
profit margins are improved from 7% to 12%.
There was no evidence adduced to the contrary demonstrating that it
was not necessary for the Respondent to adopt and implement
the 5
and 10 point strategy in order to realise the objectives set by the
Respondent in order to increase the profits from 7%
to 12%, to cut
the salaries and wages by 10% and to reduce the salaries and wages
of the East Rand Plastics by R800 000.00 per
month.
Furthermore, should the Respondent opted to cut wages in isolation
to other measures which were implemented, this would inevitably
have
led to strike action. It could have exacerbated the unhappiness
pertaining to the anomalies which the Applicant was complaining
about within the Respondent. Accordingly, I am persuaded that there
was a substantively fair reason to implement the retrenchment
process and to dismiss the Applicant’s members.
Section 189A (19)
Section 189A (19) provides as follows:-
“
(19)
In
any dispute referred to the Labour Court in terms of section
191(5)(b)(ii) that concerns the dismissal of the number of employees
specified in subsection (1), the Labour Court must find that the
employee was dismissed for a fair reason if —
the
dismissal was to give effect to a requirement based on the
employer’s economic, technological, structural or similar
needs;
the
dismissal was operationally justifiable on rational grounds;
there was a proper
consideration of alternatives; and
selection criteria were fair
and objective.”
In my view, this section does not establish a test which is
different from the test which is normally applicable in analysing
and/or interpreting the provisions of section 189 of the LRA. The
authorities which I have alluded above, are equally applicable
to
the provisions of section 189A.
What requires special attention in my judgment, is whether or not
there was a proper consideration of alternatives by the Respondent.
I have already found above, that there was indeed a fair reason
justifying the retrenchment and the subsequent dismissals. I
still
maintain what I have stated above.
However, due to the lucid argument advanced by the Applicant’s
counsel pertaining to the issue of conflation and that the
Respondent has failed to properly assess and consider alternatives
which could have led to few members being retrenched and/or
the
retrenchment being avoided at all, I had to address this aspect
separately.
In
Mamabolo and Others v Manchu Consulting CC,
28
Van Niekerk AJ (as he was then), held that:-
‘
The
first issue that the court is required to determine is the
substantive fairness of the applicants' dismissal. Section 188 of
the
Labour Relations Act 66 of 1995 (the LRA) requires an employer that
dismisses an employee for reasons relating to operational
requirements to establish a fair reason for the dismissal. The
approach adopted by this court is to require the employer to provide
substantive proof of a need to retrench in the form of a commercially
rational and sustainable reason, but not to question the
commercial
imperatives that underlay that decision, unless some ulterior motive
is established. In other words, it is not the function
of the court
to second-guess the employer's decision to retrench. It is not
appropriate to intervene only because the decision
taken by the
employer was not the one to which the court would have come in same
circumstances. See
SACTWU
& others v Discreto - A Division of Trump and Springbok Holdings
(1998) 19 ILJ 1451 (LAC);
[1998] 12 BLLR 1228
(LAC) at 1230E.’
There was no evidence adduced before me challenging the 33 points
which were listed in the recovery plan of the Respondent.
Furthermore, there was no evidence, as stated above, challenging the
substance and/or content of the Respondent’s 5 and
10 point
systems which were to be implemented in order to cut costs and to
increase the profit margins of the Respondent.
In addition, the entire strategies implemented by the Respondent
cannot be criticised as the evidence demonstrates that once
they
were implemented, the Respondent did not have to close any of its
operations and furthermore the profit margins increased
to the
satisfaction of the shareholders.
The decision of the Respondent was not in any manner commercially
irrational. There was no evidence adduced demonstrating that
the
Respondent acted in bad faith and/or to serve an ulterior motive. It
was in fact common cause, that the flexible divisions
of the
Respondent were experiencing profit losses. One cannot criticise the
Respondent for adopting the strategies which it did
in order to save
the Respondent from possible closure which would impact to the
entire division.
Furthermore, these methods which were adopted by the Respondent, in
their entirety and/or simultaneously, were not in any meaningful
manner challenged by the Applicant during the consultation
processes.
As evident from the record, the Applicant to the detriment of its
members, decided to adopt a passive approach during the section
189
process which required it to meaningfully engage with the
Respondent. It was not placed in dispute that all the proposals
which the Applicant advanced during the consultation process were
indeed considered by the Respondent except for the one which
was
calling for the dismissal of Mr Hollard of which dismissal could not
have addressed the serious losses which the Respondent
was
experiencing, having regard to the bigger scheme of things.
Furthermore, the evidence demonstrates that it was not the intention
of the Respondent to dismiss any of its employees, but to
implement
measures which will ensure that no one should lose his/her
employment and that the company should cut its costs and
increase
its profit margins.
In the case of
Kotze v Rebel Discount Liquor Group (Pty) Ltd,
29
the Labour Appeal Court found that:-
‘
[35]
It is common cause that the respondent was trading under difficult
and recessionary conditions as at the time of the appellant’s
retrenchment. This state of affairs is borne out by the profit losses
which ran into millions of ands over a period of two successive
financial/trading years. Having perceived this situation the
appellant identified and suggested the retrenchment of employees from
the level of store manager and below as the appropriate remedial
measure. His suggestion was endorsed by the top management of
the
respondent. The appellant was charged with the responsibility to
identify 30 of the 60 employees to be retrenched at the beginning
of
1993 and he carried out that responsibility. Furthermore, the
appellant admitted under cross-examination that retrenchment in
general was a necessary and fair option as at January 1993. He also
admitted that as a matter of business planning or commercial
rationale retrenchment was a fair decision to make as at the
beginning of 1993. He only had reservations about retrenchment in
so
far as it affected employees at the executive level.
[36]
I have considered Mr Rogers’ submission that there should have
been a moratorium on salary raises, bonuses, promotions
etc as an
alternative cost-cutting measure to the appellant’s
retrenchment. This suggestion effectively ignores that the
subject
was previously raised with top management and rejected because of its
potentially demoralising effect on employees. The
appellant had also
suggested that the GDV throughput policy, which required of the
respondent to give prominence to the GDV products
in its trading, be
abandoned. He believed that such a move would improve the
respondent’s trading and therefore its profitability.
This
suggestion was also previously discussed with the top management and
it was rejected. These so-called alternatives do not
only fly in the
face of the appellant’s own admission that retrenchment was
fair and necessary but also the correct approach
that this Court has
to adopt in scrutinising the consultation process. The appellant now
wants this Court to second-guess the commercial
and business efficacy
of the employer’s decision to retrench. He also wants us to
decide whether the employer made the best
decision under the
circumstances. This we cannot do. What we have to do is to decide
whether the respondent’s decision to
retrench was informed and
is justified by a proper and valid commercial or business rationale.
If it is, then that is the end of
the enquiry even if it might not
have been the best under the circumstances. In the present case, I am
satisfied that there was
a genuine commercial rationale for a staff
reduction.’
Based on the above quoted authority and the evidence adduced before
me, I am satisfied and persuaded that there was indeed a
valid
commercial and business rationale for the Respondent’s
decision to retrench the Applicant’s members. The method
which
was adopted by the Respondent in arriving at this decision, was not
challenged. The strategies which were implemented by
the Respondent
and discussed with the Applicant during the consultation processes
were never placed in dispute by the Applicant.
This court, cannot as
an afterthought by the Applicant seek to reintroduce the
consultation process through the ably and lucid
argument advanced by
the Applicant’s counsel. The issues which were argued by the
Applicant’s counsel, ought to have
been dealt with by the
Applicant itself during the consultation process, but the Applicant
did not avail itself to this opportunity
to the detriment of its
members. This court cannot therefore second-guess the commercial and
business efficacy of the Respondent’s
decision to retrench
while such challenge was not mounted by the Applicant during the
consultation process.
It was further argued on behalf of the Applicant that the entire
restructuring exercise undertaken by the Respondent ought to
be
placed in the context of a group which made profits of R267 761
000.00 in 2010. Even the ostensibly struggling division of
flexible
plastics, within which the Respondent fell, made a profit of R66 567
000.00 in 2010.
However, it was not disputed by the Applicant that the flexible
divisions would eventually close down unless the shareholders
committed further investment as they were experiencing loss of
profit.
In the case of General Food Industries Ltd v FAWU,
30
the Labour Appeal Court held that:-
‘
[47]
Mr Wallis indicated that, as a result of the recent judgment of this
court in
National
Union of Metalworkers of SA v Fry's Metals
(2003) 24 ILJ 133 (LAC);
[2003] 2 BLLR 140
(LAC), he was unable to
defend the finding of the court a quo that the dismissals were
automatically unfair. In that case this
court held that the argument
that an employer cannot dismiss employees for operational
requirements in order to increase profits,
but can only do so to
ensure its survival, is not supported by the provisions of the Act.
…
.
[60] The first substantive issue
really is whether a company is prevented from effecting economic
adjustments in an already profitable
region in order to increase its
national profits.
[61] The question of outsourcing
had been engaging the attention of the company and the union for some
years. Retrenchments had
occurred at a number of mills prior to that
in the Cape. That the shop stewards demanded that it be dealt with at
national level
admits of no dispute. The suggested measures to
decrease costs (in the region of R20 000) were directed at the Salt
River Mill
itself and came nowhere near satisfying the amount that
outsourcing would save.
[62] I am of the judgment that a
natural consequence of the Fry's Metals judgment is that, all things
being equal, a company is
entitled to insist by economic restructing
that a profitable centre becomes even more profitable. It is also
clear from the evidence
that the appellant required flexibility on
the part of the employees' terms and conditions of employment in
order to be competitive.
The respondent did not offer such
flexibility. In my view that need of the appellant also provided a
fair reason to dismiss the
employees when they were not able or
prepared to offer such flexibility to the appellant. Accordingly, I
am of the view that the
dismissal of the employees concerned was
substantively fair.”
I am therefore satisfied that an entity such as the Respondent is
entitled to retrench in order to make more profit and to avoid
closure of those entities which their profit margins has drastically
dropped.
Severance pay
It was common cause during these proceedings that five employees
were paid severance pay. These employees were not offered
alternatives to retrenchment.
The Respondent contends that the Applicant’s members who
refused to accept the alternative employment offered to them acted
unreasonably, in that, those employees were either offered a higher
basic wage or the exact same wage that they earned prior
to the
retrenchment process. Others, their wages could have been cut by 3%.
Accordingly, the Respondent contends that 282 members of the
Applicant were offered reasonable alternative employment which they
unreasonably refused. Even those Applicant’s members whose
wages would have ultimately remained lower than their older
wages,
they acted unreasonably when they did not accept the only viable
alternative available at the Respondent for them.
On the other hand, it was contended on behalf of the Applicant that
the non-payment of severance pay is in violation of section
41 of
the Basic Conditions of Employment Act (“BCEA”). In this
regard, it was contended on behalf of the Applicant
that the
implementation of the 4 shift system alone would have resulted in
lesser money being paid to the employees due to the
loss of
overtime.
The evidence demonstrates that the members of the Applicant were
indeed used to earning more money through overtime. Even though
they
are not entitled as a matter of right to work overtime, however,
this is a factor which one would have to consider in assessing
whether or not having worked overtime over a long period of time and
having planned and budgeted their lives from the money received
for
overtime, they acted unreasonably by not accepting the alternative
employment offered by the Respondent.
The difficult issue which this portion of the judgment raises is in
relation to a number of correspondence which was despatched
by the
Respondent to the union and attempting to engage the union (the
Applicant) in an attempt to avoid job losses and to discuss,
where
possible, severance pay. There was a concession made by the
Applicant that this correspondence was never responded to by
the
Applicant.
The members of the Applicant who were ultimately dismissed, relied
on the expertise and/or knowledge of the Applicant as a trade
union
to protect their interest during those testing times where they were
faced with a possibility of losing their employment.
Most of the
correspondence was despatched to the Applicant who had to advise its
members as to how to proceed during this consultation
processes.
On the basis of the above, I do not find that the members of the
Applicant, individually acted unreasonably by not accepting
the
alternative employment offer advanced to them through the Applicant.
The severance pay, as the evidence demonstrates, was offered to
these individuals, at some point by the Respondent. It was only
as a
result of the Applicant as a union having failed to meaningfully
engage with the Respondent on behalf of its members, that
the
Respondent decided to withdraw the offer to pay severance pay. On
this basis, I find that the failure by the Respondent to
pay the
members of the Applicant is in violation of the provisions of
section 41 of the BCEA.
Accordingly, I find that the members of the Applicant, agreed upon
as the Applicant’s members properly before these proceedings,
should be paid the severance payment.
I therefore make the following order:-
The dismissal of the Applicant’s members based on operational
requirements is substantively fair.
The Respondent is to pay the members of the Applicant severance pay,
to be computed in terms of section 41 of the BCEA.
Each party to pay its own costs.
_____________________
MOKOENA AJ
Acting Judge of the Labour Court
Appearances:
For the Applicant: Adv C. Orr
Instructed by: Cheadle Thompson & Haysom Inc
For the Respondents: Adv L. Erasmus
Instructed by: Du Randt Du Toit Pelser Attorneys
1
Pleadings
bundle, p. 52 - 74
2
Pleadings
bundle, p. 3, para 9 – p. 4, para 14.3
3
Ouwehand
v Hout Bay Fishing Industries
[2004] 8 BLLR 815
(LC); See also
CWIU v Johnson and Johnson (Pty) Ltd
[1997] 9 BLLR 1186
(LC)
4
Pre-trial
conference minute, p. 55, para 2.14; p. 61, para 8.
5
He
was referred to a document on page 313 which he identified as the 5
point cost reduction plan which had to be implemented by
the
Respondent in order to achieve its goals to reduce its losses.
6
He
was referred to a document on page 298 and he identified same as the
minutes of a meeting of the executive committee which
was held on 24
February 2010. He was also referred to documents on pages 310, 311
and 312 and confirmed same as being the versions
of the 10 point
plan which was discussed at the meeting of the 24 February 2010.
7
He
was referred to a document on page 300 of the consolidated bundle.
8
He
was further led through a document on page 302 of the consolidated
bundle.
9
He
testified about a document on page 304 and identified same as the
minutes of a meeting of the executive committee held on 22
July 2010
wherein he was present.
10
He
testified about a document on page 316 of the consolidated bundle.
11
He
further testified on a document on page 164 of the consolidated
bundle.
12
He
was referred to page 6 of the bundle.
13
He
further testified on a document on page 18.
14
He
was referred to a document on page 34.
15
He
was referred to a document on page 55.
16
He
was referred to a document on page 67 which he identified as the
minutes of the third meeting pursuant to section 189A which
was held
on 28 May 2010 at the Respondent’s premises.
17
He
was referred to a document on page 74.
18
He
testified on a document on page 79 and identified same as a letter
dated 3 June 2010.
19
He
was further referred to a document on page 81 which he has
identified as a letter dated 4 June 2010.
20
It
is evident from pages 92.
21
He
was led through a document on page 164.
22
He
was also led through a document which appears from page 165 to page
223.
23
He
was referred to the documents appearing on pages 224, 229 to 234.
24
Item
1 of the Code of Good practice on dismissal based on operational
requirements at 347, see also
Associated Biscuits (a
division of National Brands Ltd) v Munsamy
[1997] 9 BLLR 1121
(LAC).
25
[1999]
10 BLLR 1005
(LAC).
26
[2001]
7 BLLR 705
(LAC).at para {19E-F]
27
[2003]
11 BLLR 1081
(LAC).at paras [69]-[70]
28
(1999)
20 ILJ 1826 (LC) at para 18.
29
[2000]
2 BLLR 138
(LAC) at paras 35 and 36.
30
(2004)
25
ILJ
1260 (LAC) at paras 47, 52, 60 - 65.