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[2012] ZALCJHB 89
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Retail and Allied Workers Union v Registrar of Labour Relations, Department of Labour and Another (J2686/07) [2012] ZALCJHB 89; (2012) 33 ILJ 2149 (LC) (12 March 2012)
REPUBLIC OF SOUTH AFRICA
IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable/Not Reportable
Case no: J2686/07
In the matter between:
RETAIL AND ALLIED WORKERS UNION (RAWU)
...........................................
Applicant
(Appellant)
and
THE REGISTRAR OF LABOUR RELATIONS
DEPARTMENT OF LABOUR
......................................................................................
First
Respondent
THE MINISTER OF LABOUR
.................................................................................
Second
Respondent
Heard: 8 December 2011
Date of judgment: 12 March 2012
Summary:
_____________________________________________________________________
JUDGMENT
_____________________________________________________________________
MOKOENA, AJ:
Introduction
This matter came before me as an appeal initiated by the Applicant
pursuant to the provisions of section 111 of the Labour Relations
Act (“LRA”).
The Applicant is a registered trade union which was subsequently
deregistered by the First Respondent as envisaged in section
106 of
the LRA. It was as a result of the cancellation of registration of
the Applicant by the First Respondent that the Applicant
initiated
an appeal as envisaged in section 111 of the LRA.
Brief synopsis of material facts relevant to the judgment
On 22 October 1999, the Applicant was registered as a trade union.
It would appear that from the time when the Applicant was
registered
as a trade union in 1999 until 2005 (a period of approximately 5
years), the Applicant did not foul and/or transgressed
any of the
provisions of the LRA, to the knowledge of the Respondents.
On or about September/October 2005, the First Respondent despatched
a notice in terms of section 106(2B) of the LRA to the Applicant
wherein,
inter alia
, it was recorded that:-
‘
(1) The Applicant was no longer functioning
as a genuine organisation or in terms of its constitution as
envisaged in section 106(2A)(a)
of the LRA.
The trade union is not independent as it is under the direct control
of a labour consultant for self enrichment.
Individuals who initiated the trade union are still running the
organisation for gain.
They are running the organisation as a business and are charging
fees like consultants.’
According to the Applicant, it received the aforesaid notice on 1
September 2005. There is a dispute between the parties as to
whether
or not subsequent to the First Respondent having despatched the
notice in terms of section 106(2B) of the LRA, the Applicant
did
furnish its objections and/or representations as provided for in the
notice.
The Applicant contends that it submitted its representations dated 2
September 2005 by hand delivering same to the offices of
the First
Respondent wherein it clearly denied and challenged the allegations
advanced by the First Respondent in the aforesaid
notice.
According to the First Respondent, after having despatched a letter
dated 28 August 2005 and the notice of September 2005, the
Applicant
despite being afforded an opportunity to make representations and/or
to advance objections, the Applicant failed to
do so and as a
result, the notice of intention to cancel the registration of the
Applicant was published on 7 October 2005.
As a result of the events which ensued subsequent to the aforesaid
notice being despatched, including the urgent application
and these
appeal proceedings, the dispute has resolved itself and nothing
turns on it as I am required to adopt a wider approach
to this
appeal by having regard to all the facts alluded to by the parties
in the record of these proceedings.
Based on the documents and information placed before me, the
question which I have to resolve and determine whether the First
Respondent was correct in cancelling the registration of the
Applicant and arriving at a conclusion that the Applicant has ceased
to operate as a genuine union as envisaged in the provisions of the
LRA.
On or about August 2005, the First Respondent published a notice of
intention to cancel the registration of the Applicant and
provided
the following reasons upon which the cancellation was premised:-
that the Applicant has ceased to function as a genuine organisation
as envisaged by section 106(2A) of the LRA;
that the Applicant has ceased to function in terms of its
constitution;
that the Applicant is operating for personal gain of certain
individuals;
that the Applicant is not independent as it is under the direct
control of a labour consultant and family members for self
enrichment;
that the Applicant did not comply with the legal requirements in
terms of section 100(a) of the LRA (section 106(2A)(b)).
The aforesaid notice invited the Applicant and/or any other
interested party to advance representations to the First Respondent
as to why the Applicant should not be deregistered. This notice
afforded such parties a period of 60 (sixty) days upon which
to make
those representations. On a proper computation of 60 (sixty) days,
this period was to lapse on 7 December 2005. However,
there was an
intervening event which obviously affected the running and/or
lapsing of the period, of which I deal with, more
fully, below.
Prior to the lapsing of the aforesaid period, the Applicant on 7
September 2005 brought an urgent application wherein it sought
an
interim order interdicting the Respondents from effecting and/or
taking any further steps to deregister the Applicant. The
Applicant
successfully obtained an interim order. However, on the return date,
the final order was denied on the basis that the
Applicant has
launched its application prematurely as there was no final decision
to deregister it and that it was nonetheless
afforded a period of 60
(sixty) days upon which to make representations which were to be
considered by the First Respondent prior
to arriving at a final
decision to deregister and/or cancelling the registration of the
Applicant.
On 4 October 2005, the Applicant received a further notice
despatched by the First Respondent dated 30 September 2005 wherein
the First Respondent notified the Applicant of the intention to
cancel its registration as envisaged in section 106(2B) of the
LRA.
The aforesaid notice was to be published in the Government Gazette
of 7 October 2005. The notice afforded the Applicant
and/or any
other interested party to make representations within 60 (sixty)
days and to indicate as to why the cancellation of
the registration
of the Applicant should not be effected.
The aforesaid notice,
inter alia
, provided as follows:-
‘
(1)
The Applicant was no longer functioning as a genuine union or in
terms of its constitution as envisaged by section 106(2A)(a)
of the
LRA.
The Applicant is not
independent as it is under the direct control of a labour consultant
for self enrichment.
Individuals who initiated the
trade union are still running the organisation for gain.
They are running the
organisation as a business and are charging fees like consultants.’
There appear to be a further dispute between the parties pertaining
to whether or not subsequent to the First Respondent having
despatched the notice dated 30 September 2005, whether the Applicant
did make representations and/or filed any objections prior
to the
expiry of 60 (sixty) days. Whether or not the Applicant did, in
fact, make such representation is a factor not decisive
to this
appeal in terms of section 111.
As mentioned above, in determining this dispute between the parties
I am entitled to have regard to all the papers and record
as filed
by the parties and arrive at my own independent conclusion as to
whether, based on this information (the record), the
Respondents (in
particular the First Respondent), was correct in arriving at a
decision that the Applicant was not conducting
itself as a genuine
union. In this regard, I will, for the purpose of my judgement,
consider and have regard to the representations
and/or objections
which were filed by the Applicant and contained in the record of the
section 111 appeal.
It was also advanced during oral argument by the representatives of
the parties, that I should adopt a wider approach to this
appeal and
have regard to all the documents before me in arriving at my
judgement. This approach, is indeed correct and sound
in law. I deal
more fully with this aspect below, under the heading “applicable
legal principles”.
Subsequent to this notice dated 30 September 2005 being despatched
to the Applicant and representations made by the Applicant
in
response to the aforesaid notice, a period of approximately 2 (two)
years lapsed without the First Respondent taking any further
steps
as envisaged in section 106 of the LRA. The First Respondent only
despatched a further notice dated 23 November 2007. This
was a
notice in terms of section 106(2A) of the LRA giving the Applicant
notice that its registration as a trade union has been
cancelled.
This notice,
inter alia
, provided that:-
‘
(1)
The name of the organisation was published in the Government Gazette
of the 7
th
October 2005 in terms of section 106(2B). The union did not file
representations as requested by the notice. I am of the opinion
that
the organisation is not a genuine trade union as envisaged by the
Act.
(2) You are hereby therefore
notified that the registration of Retail & Allied Workers Union
(RAWU) LR2/6/2/816 is hereby cancelled
with effect from 23 November
2007 and its name is removed from the register of trade union. A
notice to this effect will be published
in the Government Gazette on
30 November 2007.
(3) Kindly return the original
certificate of registration that was issued on the organisation
within 14 (fourteen) days of the
date of this letter.’
It would appear that this notice dated 23 November 2007 was premised
on the facts and grounds as detailed in a notice which was
despatched on 30 September 2005 and to be published in the
Government Gazette of 7 October 2005 as envisaged in section
106(2B).
I deal more fully with this aspect, below.
On 26 November 2007, the Applicant initiated an urgent application
to stay the First Respondent’s deregistration of the
Applicant
pending the finalisation of the appeal envisaged in section 111 of
the LRA. The order was granted on 28 November 2007.
In terms of the
order as per Pillay J, it was ordered that:-
‘
(1) The First Respondent was to supply the
Applicant with reasons within 30 (thirty) days of the date of the
decision to deregister
the Applicant which is 23 November 2007.
(2) Upon the Respondents furnishing reasons and the Applicant lodging
an appeal in terms of section 111 of the Labour Relations
Act, the
deregistration of the Applicant will be suspended pending the
finalisation of the appeal proceedings.’
In compliance with the court order, the First Respondent despatched
its reasons upon which its decision to cancel the registration
of
the Applicant was premised, dated 19 December 2007. The First
Respondent furnished four main reasons which were couched as
follows:-
the trade union has ceased to function in terms of its constitution.
the trade union ceased to function as a genuine organisation and it
is operating for personal gain of certain individuals.
the trade union is not independent as it is under the direct control
of a labour consultant.
the organisation does not comply with the legal requirements in
terms of section 100(a) of the Act.
It must be added that the reasons advanced by the First Respondent
pursuant to the Court order made by Pillay J, were detailed
in
nature with relevant facts being disclosed to the Applicant.
However, these details and facts were not furnished to the Applicant
prior to the First Respondent invoking the section 106 (2A) process.
The notices were premised on the conclusions arrived at
by the First
Respondent and/or an opinion formulated by the First Respondent
without the facts supporting such opinion and/or
conclusions being
disclosed in any details.
On 7 March 2008, the Applicant delivered its notice of appeal as
envisaged in section 111 of the LRA. On the basis of the facts
and
events which occurred and alluded to above, including the order as
per Pillay, J, the dispute pertaining to whether written
objections
were advanced or not simply does not arise as the parties seems to
have accepted the directions made by Pillay, J,
in her order
referred to above. The issues were then comprehensively canvassed by
the parties through the process and events
leading to the section
111 appeal (this appeal) and the record filed in these proceedings.
It is therefore on these bases that I am enjoined to have regard to
the entire record of these proceedings, the events leading
to this
appeal and assess all the relevant information placed before me in
order to arrive at my decision as to whether the First
Respondent
was correct in deregistering the Applicant.
Applicable legal principles
The First Respondent is appointed in terms of the provisions of
section 108 of the LRA. Section 108 provides that:-
‘
(1)
The
Minister must designate an officer of the Department of Labour as the
registrar of labour relations to perform the functions
conferred on
the registrar by or in terms of this Act.
(2) (a)
The
Minister may designate any number of officers in the Department as
deputy registrars of labour relations to assist the registrar
to
perform the functions of registrar in terms of this Act.
(b)
A
deputy registrar may exercise any of the functions of the registrar
that have been generally or specifically delegated to the
deputy.
(3)
The
deputy registrar of labour relations or if there is more than one,
the most senior of them, will act as registrar whenever—
(a)
the
registrar is absent from the Republic or from duty, or for any reason
is temporarily unable to perform the functions of registrar;
or
(b)
the
office of registrar is vacant.’
The First Respondent conducted his functions as envisaged in section
109 of the LRA. Section 109 of the LRA provides as follows:-
‘
(1)
The
registrar must keep—
(a)
a
register of registered trade unions;
(b)
a
register of registered employers’ organisations;
(c)
a
register of federations of trade unions containing the names of the
federations whose constitutions have been submitted to the
registrar;
(d)
a
register of federations of employers’ organisations containing
the names of the federations whose constitutions have been
submitted
to the registrar; and
(e)
a
register of councils.
(2)
Within
30 days of making an entry in, or deletion from, a register, the
registrar must give notice of that entry or deletion in
the
Government Gazette.
(3)
The
registrar, on good cause shown, may extend or condone late compliance
with any of the time periods established in this Chapter,
except the
period within which a person may note an appeal against a decision of
the registrar.
(4)
The
registrar must perform all the other functions conferred on the
registrar by or in terms of this Act.’
A union such as the Applicant is registered as contemplated in
section 95 of the LRA. Upon registration there are peremptory
obligations which a union has to comply with as a registered union.
For instance, a union has to comply with the provisions of
sections
98, 99 and 100 of the LRA.
Section 98 relates to the
keeping of books and
records of the union’s income, expenditure, assets and
liabilities to the standards of generally accepted
accounting
practices. Section 98 provides that:-
‘
(1)
Every
registered trade union and every registered employers’
organisation must, to the standards of generally accepted accounting
practice, principles and procedures—
(a)
keep
books and records of its income, expenditure, assets and liabilities;
and
(b)
within
six months after the end of each financial year, prepare financial
statements, including at least—
(i)
a
statement of income and expenditure for the previous financial year;
and
(ii)
a
balance sheet showing its assets, liabilities and financial position
as at the end of the previous financial year.
(2)
Every
registered trade union and every registered employers’
organisation must arrange for an annual audit of its books and
records of account and its financial statements by an auditor who
must—
(a)
conduct
the audit in accordance with generally accepted auditing standards;
and
(b)
report
in writing to the trade union or employers’ organisation and in
that report—
(i)
express
an opinion as to whether or not the trade union or employers’
organisation has complied with those provisions of its
constitution
relating to financial matters; and
(ii)
if
the trade union is a party to an agency shop agreement referred to in
section
25
or
a closed shop agreement referred to in
section
26
express
an opinion as to whether or not the trade union has complied with the
provisions of those sections.
(3)
Every
registered trade union and every registered employers’
organisation must—
(a)
make
the financial statements and the auditor’s report available to
its members for inspection; and
(b)
submit
those statements and the auditor’s report to a meeting or
meetings of its members or their representatives as provided
for in
its constitution.
(4)
Every
registered trade union and every registered employers’
organisation must preserve each of its books of account, supporting
vouchers, records of subscriptions or levies paid by its members,
income and expenditure statements, balance sheets, and auditor’s
reports, in an original or reproduced form, for a period of three
years from the end of the financial year to which they relate.’
In addition, section 99 of the LRA obliges a union to keep a list of
its members, the minutes of its meetings, in an original
or
reproduced form, for a period of three years from the end of the
financial year to which they relate and the ballot papers
for a
period of three years from the date of every ballot.
While on the other hand, section 100 of the LRA obliges a union to
provide certain information, specified therein, to the First
Respondent. Section 100 provides as follows:-
‘
Every
registered trade union and every registered employers’
organisation must provide to the registrar—
(a)
by
31 March each year, a statement, certified by the secretary that it
accords with its records, showing the number of members as
at 31
December of the previous year and any other related details that may
be required by the registrar;
(b)
within
30 days of receipt of its auditor’s report, a certified copy of
that report and of the financial statements;
(c)
within
30 days of receipt of a written request by the registrar, an
explanation of anything relating to the statement of membership,
the
auditor’s report or the financial statements;
(d)
within
30 days of any appointment or election of its national
office-bearers, the names and work addresses of those office-bearers,
even if their appointment or election did not result in any changes
to its office-bearers; and
(e)
30
days before a new address for service of documents will take effect,
notice of that change of address.’
Relevant to these proceedings is also the provisions of section 106
of the Act which provides as follows:-
‘
(1)
The
registrar of the Labour Court must notify the registrar if the Court—
(a)
in
terms of
section
103
or
104
has
ordered a registered trade union or a registered employers’
organisation to be wound up; or
(b)
in
terms of
section
105
has
declared that a registered trade union is not independent.
(2)
When
the registrar receives a notice from the Labour Court in terms of
subsection (1), the registrar must cancel the registration
of the
trade union or employers’ organisation by removing its name
from the appropriate register.
(2A)
The
registrar may cancel the registration of a trade union or employers’
organisation by removing its name from the appropriate
register if
the registrar—
(a)
is
satisfied that the trade union or employers’ organisation is
not, or has ceased to function as, a genuine trade union or
employers’ organisation, as the case may be; or
(b)
has
issued a written notice requiring the trade union or employers’
organisation to comply with
sections
98, 99
and 100
within
a period of 60 days of the notice and the trade union or employers’
organisation has, despite the notice, not complied
with those
sections.
(2B)
The
registrar may not act in terms of subsection (2A) unless the
registrar has published a notice in the Government Gazette at least
60 days prior to such action—
(a)
giving
notice of the registrar’s intention to cancel the registration
of the trade union or employers’ organisation;
and
(b)
inviting
the trade union or employers’ organisation or any other
interested parties to make written representations as to
why the
registration should not be cancelled.
(3)
When
a trade union’s or employers’ organisation’s
registration is cancelled, all the rights it enjoyed as a result
of
being registered will end.’
The abovementioned sections ought to be read with the provisions of
section 111 of the LRA upon which these appeal proceedings
are
premised and which provides as follows:-
‘
(1)
Within
30 days of the written notice of a decision of the registrar, any
person who is aggrieved by the decision may demand in writing
that
the registrar provide written reasons for the decision.
(2)
The
registrar must give the applicant written reasons for the decision
within 30 days of receiving a demand in terms of subsection
(1).
(3)
Any
person who is aggrieved by a decision of the registrar may appeal to
the Labour Court against that decision, within 60 days
of—
(a)
the
date of the registrar’s decision; or
(b)
if
written reasons for the decision are demanded, the date of those
reasons.
(4)
The
Labour Court, on good cause shown, may extend the period within which
a person may note an appeal against a decision of the
registrar.’
Applying the legal principles to the facts
The court’s approach to the section 111 proceedings
In
Motor Industry Staff Association v Registrar of Labour
Relations and Another,
1
it was noted that:-
‘
[A]n
appeal and not any form of review is contemplated in section
111(3) of the Act. In my view, such an appeal would then mean
a
re-hearing on the merits but limited to the evidence or information
on which the decision under appeal was given, and in which
the only
determination is whether that decision was right or wrong.’
In
National Union of Textile Workers v Textile Workers Industrial
Union SA and Others,
2
the then Appellant Division held that:-
‘
[T]o
interpret ‘appeal’ as restricted to ‘review’
. . . is to give the word a meaning which is
not its
ordinary meaning’.
3
In
NEWU v Mtshali,
4
Ngwenya
AJ found that:-
‘
the
appeal envisaged in terms of section
111 of the Act is sui generis. Firstly because it is an appeal
from an administrative
decision and not a review. Secondly because
there is no record. The record is only generated for the first time
on appeal . . .
The issue to be decided by the court on
appeal is whether the registrar’s decision was correct or not.
The enquiry is not
that he exercised his discretion honestly and
properly.’
The effect, it was held in
Edgars Stores (Pty) Ltd v Director,
CCMA and Others
,
5
is
that the court must deal with a matter on its merits whereas in the
case of judicial review “decisions can be described
as
tolerable even though they may be wrong”.
Was the First Respondent correct in arriving at his decision to
deregister the Applicant
Having analysed the applicable legal principles, above, it is
important to properly locate the First Respondent’s conduct
and powers derived from the enabling Act to deregister the Applicant
as a trade union.
The First Respondent derives his powers from the Labour Relations
Act and exercises his discretionary powers through the permissive
statutory language conferred upon him in section 106 signalled by
the use of words “may” in the empowering provisions.
In
Dawood v Minister of Home Affairs
,
6
the Constitutional Court held that “Discretion plays a crucial
role in any legal system. It permits abstract and general
rules to
be applied to specific and particular circumstances in a fair
manner.”
As mentioned above and in line with the authorities already referred
to above, the First Respondent when exercising his discretion
in
terms of the enabling Act (LRA) discharges and/or exercises an
administrative action which has to pass the muster test as
envisaged
in section 33 of the Constitution read with the provisions of PAJA.
When exercising his discretion as such, the First Respondent’s
conduct constitutes an administrative action. An administrative
action is described as one that implements or gives effect to a
policy, a piece of legislation or an adjudicative decision.
7
Even though the First Respondent’s conduct has to be tested in
terms of the administrative law principles (as it constitutes
an
administrative action) one should not lose sight of the fact that
this matter involves a
sui-generis
appeal as envisaged in
section 111 of the LRA. The approach or the test in other words it
is hybrid in nature.
In
Tikly and Others v Johannes NO and Others,
8
Trollip J drew a distinction between two types of appeal. Appeal in
the wide sense, or wide appeal, refers to a complete rehearing
and
determination on the merits of a case, with or without additional
evidence or information. This means that the appeal body
is not
confined to the record of the body
a quo
. In an ordinary
appeal, on the other hand, the hearing on the merits is limited to
the evidence on which the decision was originally
given, and thus
restricted to the record of the authority
a quo
.
In the
National Employer’s Forum v Minister of Labour and
Others,
9
it was held that:-
‘
The
degree of
audi
alteram partem
required
for the Registrar to publish a notice in terms of the provisions of
section 106(2B) . . . may differ from the
degree of
audi
alteram partem
required
in terms of the provisions of section 106(2A) . . .
Normally
audi
alteram partem
requires
that [a] party which may be prejudiced be given proper notice of the
intended action and reasonable opportunity to make
representations
which must be considered by the official concerned. In addition, a
clear statement of the administrative action
is required. The right
to a personal appearance and/or legal representation, whilst perhaps
desirable, does not necessarily follow.
It seems clear that to give
any satisfactory meaning and effect to the provisions of section
106(2B) and uphold the efficacy of
the LRA that an attenuated form of
audi
alteram partem
must
be applied in respect of section 106(2B) of the LRA, failing which
the LRA would be unworkable and the ability of the Registrar
to deal
with such matters would be severely hampered.’
The LRA clearly outlines and prescribes a process which the First
Respondent ought to undertake when contemplating exercising
his
discretionary powers in terms of section 106. Prior to deregistering
the Applicant and/or any other trade union for that
matter, the
First Respondent must give a notice of his intention to cancel the
registration of the trade union and importantly
must invite the
trade union to make written representations as to why the
registration should not be cancelled.
This therefore means that the First Respondent cannot deregister any
trade union without having invited that union to make
representations. Such representations are not simply made as a mere
requirement to satisfy and/or justify the process, but such
representations must indeed be considered by the First Respondent
prior to exercising his discretion as envisaged in section
106(2A).
Meaning that, the First Respondent must apply his mind to the
representations advanced pursuant to the provisions of
section
106(2B) prior to making his decision as contemplated in section
106(2A).
In this matter, Mr Mokhare (appearing on behalf of the First
Respondent), eloquently and in the most lucid argument contended
on
behalf of the First Respondent that the First Respondent did not
receive any representations made by the Applicant despite
notice
being despatched to the Applicant to make such representations.
As indicated above, on the other hand, the Applicant persisted with
its contentions that it did provide and furnish the First
Respondent
with the aforesaid representations. During the oral argument
advanced on behalf of the Applicant, I was referred to
the written
representations which the Applicant persists that it had despatched
to the First Respondent.
At the heart of this dispute of fact is a consistent denial on the
part of the First Respondent that he did not receive the
representations which the Applicant persists that it had delivered
to him. This therefore means that, on the First Respondent’s
own version, when exercising his discretion as contemplated in
section 106(2A), did so, without having had regard to the
representations
made by the Applicant as he persists that same were
not furnished to him.
However, what is more revealing is the fact that this matter has a
lengthy history which involved two urgent applications, of
which I
was also invited by the parties to have sight of same, in adopting a
wider appeal approach, when determining the dispute
between the
parties. From the record of this appeal, it is evident that the
representations which the First Respondent has consistently
denied
having received were indeed either filed by the Applicant as
annexures to the aforesaid urgent applications and/or were
brought
to the attention of the First Respondent through the filing of
processes leading to this appeal.
In
Tseleng v Chairman, Unemployment Insurance Board,and Another,
10
Heher J (as he was then), held that:
‘
It is
… administratively unfair to fail to draw to the attention of
an applicant that a board relies on a particular policy
and by such
failure to deprive the applicant of the opportunity of making
submission as to why he should be treated as one who
qualifies in
terms of that policy.’
In other words, the First Respondent instead of applying his mind to
the representations which were made by the Applicant and
which
subsequently came to his attention either during the urgent
applications and/or during the filing of processes in this
appeal
decided to proceed exercising his discretion in terms of section
106(2A) without giving effect to the provisions of section
106(2B)
by having regard to and considering those representations.
What appears to be also inconsistent with what is expected from the
First Respondent when exercising his discretion in terms
of section
106 is the fact that after having despatched the initial notice in
2005 a period of two years lapsed prior to the
First Respondent
invoking his powers in terms of section 106. Two years after the
First Respondent has despatched the 106(2B)
notice, the First
Respondent relying on the same notice and grounds purported to
exercise his discretion in terms of section
106 without even
verifying whether the grounds and/or reasons upon which he sought to
invoke his powers in terms of section 106
were still in existence
and/or cured either by the efflux of time and/or the Applicant’s
repentance from the aforesaid
conduct and/or any other intervening
factors.
In
W G Davey (Pty) Ltd v National Union of Metalworkers of SA,
11
the Supreme Court of Appeal (even though this matter dealt with
dismissal, the principle enunciated therein is sound in law and
to
some extent relevant to this matter), held that it was unfair for a
company to dismiss employees in instances whereby there
was
subsequent developments relevant to its decision which it failed to
take into account and simply closed its mind to those
developments.
Equally so, there is no reason why the First Respondent after
becoming aware of the representations made by the Applicant, to
consider same and apply his mind to them in exercising its
discretion envisaged in section 106(2A). I have not come across any
report by the First Respondent to the effect that he had considered
the representations made by the Applicant and/or has applied
his
mind to same when arriving at the decision to deregister the
Applicant.
In dealing with the principle of legality, the Constitutional Court
in
Fedsure Life Assurance
Ltd v Greater Johannesburg
Transitional Metropolitan Council and Others,
12
held that the principle of legality is an aspect of the rule of law
in that a body exercising public power had to act within
the powers
lawfully conferred on it.
In Pharmaceutical Manufacturers
Association of SA: In re Ex parte President of the Republic of South
Africa,
13
the Constitutional Court held that:-
‘
It is
a requirement of the rule of law that the exercise of public power by
the Executive and other functionaries should not be
arbitrary.
Decisions must be rationally related to the purpose for which the
power was given, otherwise they are in effect arbitrary
and
inconsistent with this requirement. It follows that in order to pass
constitutional scrutiny the exercise of public power by
the Executive
and other functionaries must, at least, comply with this requirement.
If it does not, it falls short of the standards
demanded by our
Constitution for such action.’
It cannot be said that the decision of the First Respondent in
deregistering the Applicant was rationally related to the purpose
for which the power was given when in fact he failed to apply his
mind to the representations made by the Applicant prior to
invoking
his powers in terms of section 106(2A).
Lawful administrative action means in essence that administrative
actions and decisions must be duly authorised by law and that
any
statutory requirements or preconditions that attach to the exercise
of the power must be complied with. In
Johannesburg Stock
Exchange v Witwatersrand Nigel Ltd and Another,
14
the Appellant Division (as it was then), when dealing with the
failure to apply the mind of an administrator, held that:-
‘
[T]he
decision was arrived at arbitrarily or capriciously or
mala
fide
or as a result of unwarranted adherence to a fixed principle or in
order to further an ulterior or improper purpose; or that the
[administrator] misconceived the nature of the discretion conferred
upon him and took into account irrelevant considerations or
ignored
relevant ones …’
In this matter, the First Respondent has failed to take into account
the representations made by the Applicant and thereby failed
to
apply his mind to the representations advanced on behalf of the
Applicant. These representations were relevant considerations
which
he had to take into account in exercising his discretion in terms of
section 106.
In addition, pursuant to the directions by Pillay J, the First
Respondent was to supply the Applicant with reasons of the decision
to deregister it. Upon the Respondents furnishing reasons, the
Applicant was to launch an appeal in terms of section 111.
In compliance with the above order, the First Respondent despatched
its reasons which were broadly couched and/or categorised
into four
main reasons, as follows:-
the trade union has ceased to function in terms of its constitution.
the trade union ceased to function as a genuine organisation and it
is operating for personal gain of certain individuals.
the trade union is not independent as it is under the direct control
of a labour consultant.
the organisation does not comply with the legal requirements in
terms of section 100(a) of the Act.
It must be reiterated that the reasons advanced by the First
Respondent were detailed in nature and disclosing some of the
relevant facts upon which the decision to cancel the registration of
the Applicant is premised. However, these details and supporting
information or documents were not furnished to the Applicant prior
to the First Respondent invoking section 106(2A). This therefore
denied the Applicant a crucial procedural right to meaningfully deal
with those allegations. In turn the conduct of the First
Respondent
rendered the provisions of section 106(2B) meaningless.
The Applicant, in its appeal in terms of section 111, dealt with the
aforesaid reasons as follows:-
‘
The
trade union ceased to function in terms of its constitution
25.3
The First Respondent was wrong in his opinion that the union has
ceased to function in terms of its constitution. That the
Secretary
of the union acted outside the ambit of the constitution by assisting
non-members under the auspices of the union RAWU.
He further acted
unconstitutionally by charging the non-member R500 deposit for his
service. At the conclusion of the he insisted
that an amount of R20,
000 be paid to him from the arbitration award against the employer
besides the trade union membership fees
that he in the meantime
insisted that members should also pay. The union in the
representations it made to the Department admitted
to this conduct.
The Constitution of the Union stipulates in clause 8.1 that the Union
membership fee shall not be less than R20.00
or more than R40.00 per
month. This clearly contravenes the provisions of the union's
constitution.
25.3.1
With regard to the First Respondent's opinion and/or allegations
against the Applicant's Secretary as above, the Secretary
and/or the
Applicant disputes and deny the said allegation. Not only the
allegation are now disputed, on its written representation
hereto,
the said allegations were challenged and denied.
The
First Respondent was further made aware that in terms of clause 17.5
- 17.6.8 of the Applicant's (union) constitution, any office
bearer,
official, member and/or employee including the General Secretary who
commits and/or purported to had committed misconduct,
is subjected
for disciplinary measures accordingly.
The
First Respondent was therefore requested by the Applicant's elected
National Office Bearers to substantiate its allegations
(furnish
and/or provide full particulars of all or any documentation and
information of whatever nature upon which his opinion
was based) to
enable the Applicant to investigate. Not only would the Applicant
investigate, but also to take appropriate corrective
steps including
but not limited to disciplinary measures and properly respond.
However, to date the First Respondent failed to
comply and/or to
respond thereto.
25.3.2
With regard to the allegation that the above conduct were admitted to
by the union in its representations it made to the
Department;
(i)
The Applicant finds it interesting to learn that the First Respondent
appears to admit that it received the Applicant's representation
hereto, despite alleging on its notice of cancellation dated 23
November 2007 that the Applicant failed to submit its representation
as requested.
(ii)
It is further submitted that on its representation it made, the First
Respondent was informed that the benefit of the union
are enjoyed
and/or entitled to Applicants members in good standing only. That
none of its members were charged consultation fee
and or made to pay
as alleged.
The
First Respondent was further informed that as the Act allows
registered trade unions and employers organizations to act on behalf
of its members who affiliated after the dispute arose, the
Applicant's resolution hereto was that if a member who affiliated
after
a dispute arose request the Applicant to act on his/her behalf
for the said dispute that took place before the membership, the said
member would be requested to meet disbursement costs thereto as per
decision of the executive in that the said member cannot be
expected
to enjoy benefits of which he/she was not part thereof.
25.3.3
With regard to the First Respondent's new allegation that clause 22
of the Applicant constitution places an obligation on
the union to
submit to the Department its audited financial statements, its
membership figures per sector and the unions name and
addresses of
its office-bearers annually. That for 2005 and 2006 the union have
still not submitted its financial statements in
terms of the above
constitutional obligations and is therefore operating
unconstitutional.
The
Applicant find it strange for the First Respondent to include new
allegation (unrelated issues not part of notice dated 30 September
2005). However, it is should be noted that on 30 September 2005 'the
date of the said notice that led to cancellation, audited
financial
report for 2005/2006 and 2006/2007 were not yet due. Further, the
First Respondent should be aware that when a trade
union fails to
comply in terms of Section 98; 99 and/or 100 of the LRA, a notice in
terms of Section 106(2A)(b) should follow.
It is submitted that to
date, the Applicant did not receive any notice hereto from the First
Respondent.
25.3.4
With regard to further new allegation relating to Applicant's
previous financial year report. The Honourable Court is referred
to
paragraph 25.7 below that incorporates these allegation.
The
trade union is not independent as it is under the direct control of
labour consultant
25.4
The First Respondent was wrong in his opinion that the union is not
independent as it is under the direct control of Mr. Khoza
who is
operating as consultant and abusing his position in the union. He
claims to be employed by the union as the General Secretary
since
inception, and on other hand he is using the union certificate to
represent his clients at the CCMA for his own personal
gain. The fact
that he represents non-members and charge them 50% settlement amount
is clearly the activities of the consultant
or attorneys. Those
activities are in contrast with the provisions of the constitution of
the union as adopted and it also circumvents
the provision of the
Act.
The
allegation is disputed and denied. It is submitted that the
organization is under the control of its National Office Bearers
in
terms of its constitution. That Mr. Khoza is employed as the General
Secretary of the Applicant in terms of the said constitution,
registered as such like further Applicant's employees including but
not limited with the UIF and carries function in terms of the
said
constitution. The First Respondent is further called upon to furnish
and provide full particulars of all or any documentation
and
information of whatever nature upon which the alleged opinion is
based to enable the Applicant and/or Mr. Khoza to take appropriate
steps.
NB.
The Applicant's constitution 'is annexed hereto as annexure "A11"
The
trade union is not a genuine trade union and is being used for
personal gain of certain individuals
25.5
The First Respondent was wrong in his opinion that that the Secretary
of the union is using the union to enrich himself and
insisted that
an amount of R20,000 be paid into his private ABSA account as part of
the arbitration award made by the CCMA an indication
that Mr. Khoza
is using the union to his own benefit.
The
allegation is denied and disputed by the Secretary hereto. The First
Respondent is further called upon to furnish and provide
full
particulars of all or any documentation and information of whatever
nature upon which his opinion was based to enable the
Applicant
and/or Mr. Khoza to take appropriate steps hereto.
25.6
The First Respondent was wrong in his opinion that the Applicant is
not a genuine trade union and is being used for personal
gain of
certain individuals.
It
is submitted that at the time the First Respondent is aware that not
only did the Applicant had substantial membership at the
following
workplaces: Superand Superspar; Queenswood Superspar; Cherrylane Kwik
Spar; Select Bakeries; Med Clinic; Shoprite Checkers;
Nedbank;
Standard Bank; Kwela fleet; Sky Golf in One; Mr. Clean amongst
others.
Not
only was the First Respondent aware that the Applicant had
substantial membership at the above workplaces, the First Respondent
was further aware that there were pending collective agreements on
organizational rights disputes between the Applicant and below
companies before the CCMA and the Labour Court involving about 300
members.
RAWU
v SHOPRITE CHECKERS GA39474/02
RAWU v MENLO SUPERSPAR
GA123537
RAWU v DOORNPOORTSPAR GAPT8490-05
RAWU v SHOPRITE
CHECKERS GA39474/02
RAWU
v GLADIATOURS SECURITY (GA4501-03)
RAWU v MORELETA SUPERSPAR
RAWU
v BACHELLORS ROAD TOURS
Labour
Court
RAWU
v MENLO SUPERSPAR
JR492/03
RAWU v BACHELLORS ROAD TOURS
JR822/03
RAWU v GLADIATOURS SECURITY
See
annexed "A9"
The
above submission is proof enough that the Applicant is a genuine
trade union not for personal gain as alleged by at the interest
of
its members as it would not had taken the organizational matters thus
far and/or engage and/or negotiate benefits and annual
salary
increment amongst others
The
trade union failed to comply with legal requirements in terms of
section 100(a) of the Act.
25.7
The First Respondent was wrong in his opinion that the Applicant
failed to comply in terms of section 100(a) of the Act. That
even
after submitting written representation, the Applicant failed to
comply in terms of section 98, 99, and 100 of the Act. That
the
Applicant failed to submit financial statements for the year 2005 and
2006 despite numerous reminder letter mailed to the union.
That as
far as the previous financial years (2000 to 2004) are concerned the
auditors reports also did not comply with section
98(2)(b) of the
Act, in that it did not express an opinion as to whether the union
have complied with those provisions of the constitution
relating to
financial matters. Judging from the qualification by the auditor it
appears that the union will also not be able to
comply with the act.
The
Applicant find it further strange for the First Respondent’s
sudden unjustified new allegation hereto. The fact remains
the First
Respondent was provided with audited financial report for the said
2000 to 2004 period. Since then to date, the Applicant
was never
called upon to provide any explanation hereto and/or receive any
correspondence from the First Respondent hereto.
It
is clear that the First Respondent sudden allegations suggest that
the First Respondent is constructing, smear campaigning and/
or
witch-hunt to tarnish the Applicant's reputation for unknown reasons.
A
copy of copy of 2004/2005 audited report which is self explanatory is
attached hereto for perusal.
See
annexed "A10"
25.8
The First Respondent was wrong in his opinion that despite numerous
reminder letter mailed to the union hereto (compliance),
the
Applicant failed to comply.
It
is submitted that not a single notice or correspondence received from
the First Respondent which the Applicant failed to respond.
Therefore, the First Respondent is called upon to provide proof
hereof.
25.9
The Applicant further submit that it was surprised at one of current
arbitration hearing to learn from Shoprite regional manager
one Mr
Oosthuisen that Shoprite is the one which lodged a complaint to the
First Respondent. The said confession was not strange
for Shoprite to
had alleged hereto in that about 90% of disputes between Shoprite and
the Applicant both at the CCMA and Labour
Court including Labour
Appeal Court were in favour of the Applicant. The latest was the
Labour Appeal Court judgment handed down
on 21 December 2007 between
RAWU obo Maake under case number JA 03/05.
In
conclusion
26.
Fo
r
the
abo
v
e
submissions
,
it
is submitted that the First Respondent’s opinion that the trade
un
i
on
has ceased to funct
i
on
in terms its constitu
t
ion
,
it
is no longer a genuine
trade union and its regis
tr
atio
n
i
s
cancelled is wrong, baseless, irrational and unjustifiable.
”
The abovementioned grounds of appeal, on closer scrutiny and proper
analysis mirrors the objections and/or representations which
the
Applicant contends that it had advanced to the First Respondent of
which representations were not considered by the First
Respondent
even after same coming to its attention during the urgent
applications and/or even subsequently.
The principle of
audi alteram partem
apparent from a proper
construction of section 106(2B) viewed within the context of
administrative action, dictates that a union
should be furnished
with comprehensive information or allegations upon which the First
Respondent intends exercising his discretion
to cancel the
registration as envisaged in 106(2A), such information should not be
furnished piece meal in vague and broad terms
after the decision to
cancel has already been taken.
In the case of
Chief Constable of the North Wales Police v
Evans,
15
the court held that:
‘
Judicial
review is concerned, not with the decision, but with the
decision-making process. Unless that restriction on the power
of the
court is observed, the court will in my view, under the guise of
preventing the abuse of power, be itself guilty of usurping
power.’
Even though this decision dealt with judicial review, however, it is
indeed informative pertaining to a fair procedure or process
to be
followed prior to a decision, which may adversely affect another
person could be taken into account.
This judgment does not in any way suggest that there are no genuine
reasons for the First Respondent to belief or to form an
opinion
that the Applicant has ceased to operate as a genuine union as
contemplated in the provisions of the LRA. Such reason
might indeed
exist but the First Respondent has failed to exercise his discretion
properly and as envisaged or expected from
him in terms of section
106. In other words the First Respondent was wrong to conclude that
the Applicant has ceased to operate
as a genuine union and thereby
cancelling its registration without having considered the
Applicant’s representations and
applying his mind to same.
All the facts, allegations or concerns ought to be made known and
disclosed to the Applicant in order for the Applicant to be
able to
meaningfully react on them through representations which the
Applicant may choose to make, if it deems necessary to do
so. This
approach will indeed give meaning and effect to the provisions of
section 106(2B). Failure to do so will indeed make
section 106(2B)
to have no meaning as the First Respondent may proceed to exercise
his discretion in terms of section 106(2A)
without having observed
or adhered to requirements in section 106(2B).
The proper approach to section 106 requires that all facts negative
or positive must be disclosed to a union not on vague basis
but with
the necessary detailed information and where necessary with the
supporting documents. The union will then react to such
allegations
by means of representation if it chooses to do so. After having
received this representation, the First Respondent
must consider
same and apply his mind to those representations. Should the union
fail to make this representation within the
allowed time period
afforded to it, only then can the First Respondent exercise his
discretion in terms of section 106(2A). It
may be that even after
the First Respondent having considered and applied his mind to the
representation made by the union, he
is still of the opinion that
the union has ceased to operate as a genuine union for the reasons
already advanced by him. He can
then still be entitled to invoke the
provisions of section 106(2A) and formulate his conclusions as
such.
16
In addition to what I had found above and based on all the documents
and information placed before me, including the grounds
of appeal
and the representations made by the Applicant, I summarise my
findings below and come to the conclusions that the First
Respondent’s decision to deregister the Applicant was wrong on
the following basis:-
The First Respondent failed to take into account and to properly
consider the representations advanced on behalf of the Applicant.
These representations ought to have been taken into account prior to
the First Respondent exercising his discretion in terms
of section
106(2A).
It was unreasonable for the First Respondent to delay the exercise
of his discretion for a period of two years. Furthermore,
without
verifying the facts and/or the conduct initially complained about
pertaining to the operations of the Applicant, the
First Respondent
proceeded to exercise his discretion in terms of section 106(2A)
without explaining its delay and providing
a justification as to why
it was relying on a notice which was issued two years ago. Within
the aforesaid two years delay, the
First Respondent created an
impression that it was satisfied in the manner in which the
Applicant was conducting its affairs,
as the Applicant was led to
operate within that two year period without any interference and/or
intervention by the First Respondent.
Such a conduct, is indeed,
unreasonable and cannot be justified within the context of a fair
and just administrative action and/or
the exercise of the First
Respondent’s powers in terms of section 106.
The grounds upon which this appeal is premised, as advanced by the
Applicant, are persuasive as the First Respondent,
inter alia
:-
premised its justification to deregister the Applicant on the
grounds which were infact not properly ventilated for the Applicant
to deal with;
were added subsequent to the decision already been taken to
deregister the Applicant;
not existing at the time when the decision to deregister was made
(i.e for instance the expectation to submit the audited statements
which were infact not due at the time); and
were vaguely and broadly couched without the Applicant being
furnished with the supporting documents to deal with same.
The First Respondent failed to act consistent with what is expected
from him in exercising his discretion and/or powers in terms
of
section 106, in that, despite the representations which came to the
attention of the Applicant (whether before or after the
urgent
applications), the First Respondent was adamant to exercise his
discretion in terms of section 106(2A) without giving
any due weight
to the aforesaid representations.
The letters from the attorneys Perrott Van Niekerk Woodhouse Matyolo
and the affidavit from a member of the public complaining
about the
conduct of the Applicant and/or its President (Mr Khoza) were not
furnished to the Applicant prior to the First Respondent
exercising
his discretion in terms of section 106(2A). This information ought
to have been furnished to the Applicant in order
for the Applicant
to be able to make meaningful representations, if any, and/or if it
chose to do so, in terms of the provisions
of section 106(2B).
My findings above are strengthened by the decision of
Rustenburg
Platinum Mines Ltd
(
Rustenburg Section) v Commission for
Conciliation, Mediation and Arbitration,
17
where it was held that:-
‘
This
is partly because process-related scrutiny can never blind itself to
the substantive merits of the outcome. Indeed, under PAJA
the merits
to some extent always intrude, since the court must examine the
connection between the decision and the reasons the
decision-maker
gives for it, and determine whether the connection is rational. That
task can never be performed without taking
some account of the
substantive merits of the decision.’
In the premises, I make the following order:-
The section 111 appeal is upheld.
The decision made by the First Respondent pursuant to section 106 in
cancelling the registration of the Applicant is set aside.
The First Respondent is ordered to pay the costs of the section 111
appeal.
_____________________
MOKOENA AJ
Acting Judge of the Labour Court
Appearances
For the Applicant: Mr Khoza
Instructed by: Retail and Allied Workers Union
For the Respondents: Adv W.R. Mokhari SC
Instructed by: State Attorney, Johannesburg
1
[1998]
10 BLLR 1027
(LC) at para 10.
2
1988 (1) SA 925
(A) at 937G–938A.
3
Id
at para 9.
4
[2000]
3 BLLR 337
(LC) at 341–342.
5
[1998]
1 BLLR 34
(LC) at 41, See also
Meyer v Iscor Pension Fund
[2003] 5 BLLR 439
(SCA) at para 8
6
[2000] ZACC 8
;
2000
(3) SA 936
(CC) at para 53.
7
Cora
Hoexter “Administrative Law in South Africa”, 2007, pg
53, para c.
8
1963
(2) SA 588
(T) at 590F – 591A, See also
Nichol
v Registrar of Pension Funds
[2006] 1
All SA 589
(SCA) at paras 21 and 22.
9
[2003]
5 BLLR 460
(LC) at para 25, See also Section 3(2)(b) of PAJA. As
found by the Constitutional Court in
Zondi v MEC for Traditional
and Local Government Affairs
2005 (3) SA 589
(CC) at para 101
‘decision makers who are entrusted with the authority to make
administrative decisions by any statute
are … required to do
so in any manner that is consistent with PAJA.’
10
1995
(3) SA 162
(T) at 178J – 179A.
11
(1999)
20
ILJ
217 (SCA).
12
[1998] ZACC 17
;
1999
(1) SA 374
(CC) at para 59.
13
[2000] ZACC 1
;
2000
(2) SA 674
(CC) at para 85.
14
1988
(3) SA 132
(A) at 152C-D.
15
[1982] UKHL 10
;
[1982]
3 All ER 141
(HL) at 154d
.
16
National
Entitled Workers Union v Ministry of Labour and Others
(2011) 32
ILJ
1372 (LC);
National Entitled Workers Union v Ministry
of Labour and Others
(LAC) (JA 84/2010) as per Davis JA.
17
2007
(1) SA 576
(SCA) at para 31.