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[2012] ZALCJHB 57
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National Employers United of South Africa (NEUSA) v Registrar of Labour Relations (J 1947/10) [2012] ZALCJHB 57; (2013) 34 ILJ 384 (LC) (27 June 2012)
Reportable
REPUBLIC OF SOUTH AFRICA
tHE LABOUR COURT OF SOUTH AFRICA,
JOHANNESBURG
JUDGMENT
case
no: J 1947/10
In the matter between:
NATIONAL EMPLOYERS’ UNITED OF SOUTH AFRICA (‘NEUSA’)
Applicant
and
REGISTRAR OF LABOUR RELATIONS
Respondent
Heard
:
1 June 2012
Delivered
:
27 June
2012
JUDGMENT
BHOOLA J
Introduction
This is an appeal in terms of section 111(3) of the Labour Relations
Act, 66 of 1995 (“the Act”), in which the applicant
seeks the following relief :
Declaring as unlawful and invalid the respondent’s refusal
on or about 26 May 2010 of the registration of the appellant in
terms of section 96 of the Act ;
Ordering the respondent to register the appellant in the
register as an employer’s organisation in terms of section 96
of the Act;
Ordering the respondent to issue a certificate of registration
in the appellant’s name.
Background facts
The applicant applied for registration as an employers’
organisation on 1 July 2009 (“the first application”),
attaching a copy of its constitution. In a letter dated 8 July 2009
the respondent advised that the application and accompanying
documents did not meet the requirements for registration and that
the applicant was being afforded an opportunity in terms of
section
96(4) of the Act to prove that it was a genuine employers’
organisation and complied with the Act. The letter requested
that
the following information should be submitted within 30 days :
1. The minutes of the meeting where the employers’
organisation was established, the register with signatures and
contact
details of the members who attended the inaugural meeting. In
this regard also provide me with a list of the officials and office
bearers of the employers’ organisation, their contact details,
physical and business addressed and ID numbers.
2. A membership list indicating paid-up membership for the last 3
months and the sectors in which they operate.
3. A copy of the lease contract of the employers’
organisation offices.
4. Banking account details of the employers’ organisation
(bank statements for 3 months).
Failure to submit the relevant information could result in the
application being refused.
On receipt of the information and if the additional information
shows that the applicant is genuine and complied with the
registration
requirements, an appointment will be made with you to
verify the correctness of the information and to determine whether
the organisation
is operating as a genuine employers’
organisation.
The Applicant again applied for registration as an employer’s
organisation on 14 December 2009 (“the second application”).
In a letter dated 17 December 2009 the respondent requested the
following further information from the applicant:
In order to enable this office to determine whether the
application complies with the Act and [the applicant] is a genuine
organisation,
the following information should be submitted for
consideration within 30 days of the date of this letter.
The minutes of the meeting where the employers’ organisation
was established, the register with signatures and contact details
of
the members who attended the inaugural meeting. In this regard, also
provide me with a list of the officials and office bearers
of the
employers’ organisation, their contact details, physical
addresses and ID numbers.
A membership list indicating the paid-up membership for the last 3
months and the sectors in which they operate.
A copy of the lease contract of the employers’ organisation
offices.
Banking account details of the employers’ organisation (bank
statements for 3 months)
Failure to submit the relevant information could result in the
application being refused.
On receipt of the information and if the additional information
shows that the applicant is genuine and has complied with the
registration
requirements, an appointment will be made with you to
verify the correctness of the information in order to determine
whether the
organisation is operating as a genuine employers’
organisation.
In response to the respondent’s request for additional
information the applicant provided the following information under
cover of its letter dated on 7 January 2010:
Minutes of the meeting at which the applicant was founded. These
are the minutes of an AGM held on 13 December 2009 which reflect
that the meeting was opened by Matlala who indicated the purpose of
the gathering and “also mentioned that the new Employer’s
organization has to be formed”. The minutes reflect that the
interim constitution was presented and amended and election
of
office bearers was conducted. Messrs Matlala and Grobler were
elected as chairperson and general secretary of the applicant
respectively. The chairperson’s address to the meeting
reflects that it is “looking forward to defend all members
in
terms of our organization constitution and the Labour Laws of our
country” and that they sought “fair treatment
for
Employers at all forums and to defend this to the best of our
ability”.
A list of office bearers and officials which includes Messrs
Matlala (Chairperson), Grobler (General Secretary) and Jardim
(Treasurer) as elected office bearers (in the same positions as
reflected in the first application).
An attendance register of the meeting on 13 December 2009 (from
which some of the addresses are illegible or incomplete).
A list of members (which does not contain addresses and is not
identical to the aforementioned attendance register).
A statement of account for the period October, November and
December 2009 from which it appears that the applicant received
membership fees. The statement of account was submitted in response
to the respondent’s request that bank statements
for three
months should be submitted.
Copies of receipts of payments from which it appears that the
applicant received membership fees.
The chairperson of the applicant, Matlala, alleges that on 17 August
2010 he was provided with a copy of a letter dated 26 May
2010 which
informed the applicant that its application for registration had
been turned down for the following reasons:
The organisation is not a genuine employers’ organisation as
envisaged in the Act; and
The individual established the employers’ organisation to
circumvent the provisions of the Act;
Consequently your application is refused from 26-5-10.
The applicant was not satisfied with the decision and Matlala
addressed a letter to the respondent on 18 August 2010 to this
effect and proposed a meeting between the parties.. The respondent
replied on the same day indicating that it could not reverse
the
decision taken and the applicant had recourse to section 111 of the
Act if it was dissatisfied with the decision.
Thereafter the respondent complied with a request for reasons for
its decision on 14 September 2010. The essence of the reasons
were
that the organisation is not a genuine employers’
organisation. In this regard the respondent explained that it is
required to base its decision on the registration requirements in
the Act as well as the guidelines issued by the Minister in
2002 to
determine whether an applicant is a genuine employers’
organisation. Following reiteration of the definition of
an
employers’ organisation the respondent states as follows :
“
The
applicant employers’ organisation was established by labour
consultants Mr Ben Matlala (Chairperson) who is the owner
of Mpotoka
Dithamaga (MM labour) and Mr Kobus Grobler (General Secretary) the
owner EEE Professional Services established the applicant
employers’
organisation. Mpotoka Dithamaga (MM labour) labour consultancy
specialises in human resource services and labour
relations. Mr Ben
Matlala’s (Chairperson) idea came as a result of him helping
his clients with hosts of issues especially
human resources and
labour related matters. Mr Matlala through his labour consultancy has
been assisting his clients with their
labour dispute cases. Mr Kobus
Grobler’s (General Secretary) labour consultancy (EEE
Professional Services) specialises in
training.
From the above it is clear
that the main purpose of the application is for the individuals to
use the organisation for their own
financial gain and to further
their businesses. The organisation is clearly going to be used by
individuals including its principles
for the financial benefit and
for the purpose of gaining representations under the auspices of a
registered employers’ organisation.
The organisation is a profit
making enterprise and not a genuine employers’ organisation as
envisaged by the Act. The individuals
that established the
organisation did it for personal gain. It is to be used as a vehicle
to represent clients at dispute resolution
institutions such as the
CCMA. The organisation will be used to give it an unlawful advantage
and unfair advantage in the labour
relations environment which is not
in the public interest.
An employers’
organisation should be used in the interest of its members to pursue
its objectives collectively. It should
not be used to enrich
individuals and be exploited to give individuals the right of
appearance to labour forums such as the CCMA.
See National Employers’
Forum v Minister of Labour (2003). The reason behind the
establishment of the applicant organisation
is to enable Attorneys
and labour consultants to get access to the CCMA. If the organisation
is registered, it will only benefit
Attorneys and labour consultants,
which according to the judge is a sham.
An application of this kind,
namely one designed for and motivated by a desire to circumvent some
of the provisions of the Act,
is ultimately driven by the self
interests of the attorneys and labour consultants for personal gain.
Under these circumstances
such an application would not be genuine,
but a stratagem which cannot be countenances because to do so would
mean that the Registrar
would act contrary to the objectives of the
Act. Such an applicant would not be a genuine organisation but in
truth a business
of consultants striving for personal gain.
It is this Office’s
contention that the status of this employers’ organisation
cannot be remedied to be deemed an employers’
organisation as
envisaged by the Act. I am therefore of the view that the application
was, inter alia, lodged to circumvent the
provisions of the Act and
the application for registration was, as a result, refused.”
Merits of the appeal
The applicant relies on the following grounds of appeal :
the respondent was mistaken in its interpretation and application
of the guidelines in terms of section 95 of the Act ;.
the respondent has failed to take important relevant considerations
into account and was influenced by irrelevant considerations;
and.
the respondent’s finding that the individual established an
employers’ organisation to circumvent the provisions
of the
Act amounts to irrelevant considerations and is clearly wrong.
Mr Mosebo, appearing for the applicant, submitted that the
documentary evidence reveals that it was formed by a group of
employers
at a general meeting exercising their right to freedom of
association; only two employers tendered their apologies for
non-attendance,
a draft interim constitution was presented and
amended, and the executive and office bearers were elected. The fact
that Matlala
facilitated the formation and establishment of the
organisation does not render it not a genuine employers’
organisation.
The applicant had therefore complied with all the
requirements for registration and the respondent was obliged to
register it.
This is the import of section 96(3)(b). Given the
nature of an appeal he submitted, this court was simply required to
determine
whether the respondent was right or wrong in refusing to
register the applicant. In this regard the applicant relies on
Crouse NO & Another v WUSA
1
as well as the interpretation of this court’s duties under
section 111 (3) in
Motor Industry Staff Association v Registrar
of Labour Relations & Another
.
2
[13] Ms Baloyi, for the respondent, submitted that the
Motor
Industry Staff Association
decision relied upon by the applicant
was overturned by the Labour Appeal Court in
Staff Association for
the Motor & Related Industries v Motor Industry Staff Association
& Another
.
3
The Labour Appeal Court made it clear that an appeal of this nature
is an appeal in the wide sense and is therefore not limited
to a
determination of whether the respondent erred in making its decision.
Instead, the LAC held that the applicant must show that
it has met
the requirements for registration. In the words of Ngcobo AJP (as he
then was):
4
The appeal contemplated in section 111(3) is an appeal in the wide
sense of a complete rehearing and adjudication on the merits with
or
without additional evidence or information.”
Ms Baloyi therefore submitted that on all the evidence before this
court the applicant has patently failed to show that it has
passed
the definition hurdle to show that it is a genuine employers’
organisation, let alone that it has met the requirements
for
registration. Section 213 of the Act defines an employers’
organisation as “any number of employers associated
together
for the purpose, whether by itself or with other purposes, of
regulating relations between employers and employees or
trade
unions”. In this regard, she submitted, the guidelines issued
in terms of section 95(8) of the Act in item 26 require
the
respondent to consider
inter alia
the process of formation of
the organisation, including the number and/or size of the founding
members who attended the inaugural
meeting to establish the
organisation; the means by which the constitution was drafted and
adopted; the election of executive
committee or council members and
the election of office-bearers. The crucial issue that the
guidelines require, she submitted,
is consideration of whether the
formation “involved employers associating with one another to
establish an employers’
organisation” as defined in
section 213. The respondent clearly applied his mind to these
requirements based on the detailed
investigation reports provided to
him, and has given full reasons for his conclusion that the
requirements for a genuine employers’
organisation were not
met.
Ms Baloyi submitted that it was significant that the applicant
failed to disclose to this court, when it filed the second
application
for registration (dated 13 December 2009 i.e. the day
after the so-called inaugural meeting) that an application for
registration
had been lodged on 9 February 2009. Therefore, at the
time the applicant alleges an inaugural meeting was held to form an
association,
it had already been formed months previously. This
renders it improbable that the members met for the purposes of
forming the
organisation on 12 December 2009. The applicant has not
disclosed this fact to the court either in their pleadings or heads
of
argument, despite the reference to the first application in the
respondent’s bundle and heads. It is apparent from the first
application that the constitution was signed on 9 February 2009 and
it is therefore improbable and incorrect that the organisation
was
formed on 13 December 2009 as is alleged. On this ground alone, Ms
Baloyi submitted, the appeal falls to be dismissed.
[14] Ms Baloyi however relied on further facts which establish the
improbability of the organisation being formed in December 2009
–
inter alia
that correspondence with the respondent in regard
to the office bearers and officials reflects the treasurer as Manny
Jardim. However
his name does not appear on the list of members who
attended the inaugural meeting and at which he would have been
elected treasurer,
nor do the minutes of the AGM (which reflects that
it was held on 13 December 2009) reflect his attendance or his
election. This
would imply either that it is incorrect that he was
elected treasurer or that the supporting documents provided to the
respondent
were incorrect. The AGM minutes moreover do not state that
the constitution was adopted, merely that the interim constitution
was
amended. In fact minutes of the inaugural meeting are not
provided and it is apparent from the AGM minutes that this is not the
first meeting of a new organisation. Another relevant fact is that
the lease agreement provided to the respondent reflects that
the
lease (the signatory to which is Ben Matlala on behalf of the
applicant), was entered into on 10 September 2009, three months
prior
to the date when the applicant alleges the organisation was formed.
Based on these factors, the applicant’s contention
that it was
formed in December 2009 is not correct and it cannot therefore be
considered to be a genuine employers’ organisation.
Moreover,
proper financial statements are not forthcoming nor are banking
statements as requested by the respondent. Ms Baloyi
submitted
therefore that even if the applicant had submitted all the
information required for registration it would still have
to overcome
the definition hurdle in terms of section 213 and has not succeeded
in doing so.
[15] In reply Mr Mosebo conceded that insofar as information is still
outstanding the applicant should be given a further opportunity
to
comply. He was asked by the court whether the relief sought was being
amended and he indicated that he was proposing an alternative
but
persisted with the relief sought in the notice of motion. He
submitted that the respondent was misdirected in that there was
firstly no requirement that the AGM minutes should reflect the names
of all the office bearers elected and the fact that the minutes
do
not reflect this does not imply that they were not elected. Secondly,
in regard to the constitution he submitted that the same
constitution
was provided in February and has not been amended, and the fact that
it may have been signed in February does not
mean it was adopted at
that stage. He does not deal with the fact that the minutes do not
appear to reflect an inaugural meeting
or that the constitution was
in fact adopted. Lastly he submitted that the first application has
no bearing on the appeal and should
be ignored. No further evidence
or documentation was provided by the applicant in support of its
assertions, and the concession
implies that this application may
itself be premature and therefore and vexatious. Moreover the failure
to disclose the first application
is in my mind not insignificant and
would imply a measure of duplicity on the part of the applicant,
which would cast doubt on
the nature of the enterprise.
[16] I am in agreement with the submissions made by Ms Baloyi that on
the facts and evidence before this court, and in particular
given the
concession in reply, the applicant does not meet the definition of an
employers’ organisation nor can it be said
to have met the
requirements for registration even if it were to pass this hurdle. No
substantive legal or factual submissions
were made in support of any
of the grounds of appeal, and it is evident from the process as well
as the reasons provided by the
respondent that a considered decision
was made based on the facts and the respondent cannot be said to have
erred, acted capriciously
or misdirected himself in so doing. In the
premises, the decision of the respondent is upheld but no order for
costs is made since
the respondent does not seek costs.
Order
In the premises, I make the following order :
The application is dismissed. No order as to costs.
_______________________
Bhoola J
Judge of the Labour Court of South Africa
APPEARANCES
APPLICANT:
Mr P Mosebo, Maserumule
Inc
RESPONDENT:
Ms S Baloyi (with her
Ms L Madima)
Instructed by the State
Attorney, Johannesburg
1
[2008] ZALAC 5
;
(2008)
10 BLLR 919
(LAC)
2
1998
(19)
ILJ
1520 (LC)
3
1999
(20)
ILJ
2552 (LAC)
4
At
para [26].