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[2012] ZALCCT 21
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Cape Clothing Association v Southern African Clothing and Textile Workers Union and Another (1006/2011) [2012] ZALCCT 21; [2012] 11 BLLR 1145 (LC); (2012) 33 ILJ 2863 (LC) (12 June 2012)
Reportable
REPUBLIC OF SOUTH AFRICA
IN THE LABOUR COURT OF SOUTH AFRICA
HELD AT CAPE TOWN
CASE NO C 1006/2011
In the
matter between:
CAPE
CLOTHING ASSOCIATION
…...........................................................
Applicant
and
SOUTHERN
AFRICAN CLOTHING
AND
TEXTILE WORKERS UNION
….............................................
First
Respondent
NATIONAL
BARGAINING COUNCIL FOR THE
CLOTHING
MANUFACTURING INDUSTRY
(CAPE
CHAMBER)
…................................................................
Second
Respondent
Date
heard: 26 April 2012
Date of
judgment: 12 June 2012
JUDGMENT
STEENKAMP J
Introduction
This is the return day of a rule
nisi
granted by Van Niekerk
J on 19 December 2011. He granted the following order:
“
1. A rule nisi is issued calling on the
first respondent to show cause on 25 January 2012
1
why a final order should not be made in
the following terms:
1.1 Declaring that the dispute between the applicant and the first
respondent pertaining to the interpretation, application or
rectification
of clause 5 of the 2011/2012 substantive agreement
between the applicant and the first respondent, is a dispute
contemplated by
section 24
of the
Labour Relations Act, 66 of 1995
;
1.2 Ordering that the first respondent is interdicted and
restrained from calling upon its members to embark on strike action
in
relation to the dispute;
1.3 Ordering that the first respondent inform its members that
strike action pertaining to the dispute will be unprotected and that
they should desist from such strike action;
1.4 Ordering the first respondent to pay the costs of these
proceedings.
2. Subparagraphs 1.2 and 1.3 above shall operate as an interim
order pending he final outcome of this application
.”
On 13 January 2012, Van Niekerk J provided written reasons for
granting the order. I have had regard to those reasons when hearing
argument on the return day and in considering my reasons for this
judgment. In setting out the background to the dispute, I have
quoted
verbatim
from his summary.
Background
[2] The facts relevant to the application are common cause. The
essence of the dispute between the parties concerns the quantum
of
annual leave pay for the period of the sector’s annual shut
down. Part F of the National Consolidated Main Agreement makes
provision for every employee to be granted at least three consecutive
weeks’ plus one working day’s annual leave between
15
December of each year and 14 January of the next year. In effect,
employees receive 22 calendar days’ leave.
[3] Clause 5 of the 2011/2012 substantive agreement between the
parties deals separately with the issue of payment for annual leave,
and how public holidays that fall within a period of annual leave are
to be accounted for. That agreement came into effect on 1
September
2011 and remains effective until 31 August 2012. At issue in these
proceedings is clause 5 of the substantive agreement.
It reads as
follows:
“
WESTERN CAPE PUBLIC HOLIDAYS
5.1 The Western Cape collective agreement to be amended to reflect
the wording of the KwaZulu-Natal metro agreement wording on payment
of public holidays falling during the shutdown of the industry. This
parity dispensation shall become binding with effect from
the
2011/2012 annual leave period.
5.2 Consequent to the implementation of the provisions of
sub-clause 5.1 above, Western Cape employees shall be paid an
additional
two (2) days’ paid leave for the 2011/2012 annual
leave period.”
[4] The union contends that the existing terms and conditions of
employment of its members in the Western Cape require that they
be
paid an amount equivalent to 20 (or 21) days pay over the annual
industry shut down period. The claim is computed on the basis
that
the Main Agreement entitles each worker to 18 (or 19) days’
pay, plus the additional two days referred to in clause
5.2 of the
2011/2012 substantive agreement. (Whether the claim is for 20 or 21
days is dependent on whether the Day of Reconciliation,
16 December,
falls within the annual shut down period of any particular employer).
[5] The applicant does not share this interpretation. It contends
that clause 5 of the collective agreement sought to ensure parity
with the dispensation on KwaZulu Natal and that the union’s
interpretation of clause 5 would require employers in the Western
Cape to pay a premium of two days pay, over and above that paid by
employers in KZN. (It appears that in KZN, employers pay employees
for 15 days plus 3 (or 4 if they shut down on 15 December)). On 29
November 2011 the applicant declared a dispute about the
interpretation
and application of clause 5. The dispute was referred
to expedited arbitration.
[6] Shortly before the commencement of the arbitration, there was a
dispute about the arbitrator’s terms of reference and
the
proceedings were aborted. On 14 December 2011, the union referred a
dispute to the bargaining council, contending that the
applicant had
unilaterally varied the terms and conditions of employment of its
members by paying less than 20 or 21 days for the
2011/2012 holiday
period, and seeking the restoration of the status quo as contemplated
by
s 64
(4). The union subsequently issued a notice of its intention
to strike in circumstances where it contended that the time limits
contained in
s 64
(1) did not apply, at least as against those of the
applicants members who failed or refused to pay 20 or 21 days leave.
Is the union entitled to strike in terms of
s 64(4)?
[7] In these proceedings, in essence, the union contends that the
existing terms and conditions of employment that apply to its
members
in the Western Cape require their employers to pay to them the amount
equivalent to 20 (or 21) days pay over the shut down
period, and that
the applicant’s members have unilaterally changed this term by
stating that the employers will only pay
for 18 (or 19) days pay.
Having declared a dispute in terms of
s 64(4)
, the union contends
that there is no reason in law why it should not declare a dispute in
terms of
s 64(4)
, and to take strike action when the employers do not
reverse the unilateral change complained of within the 48 hour period
referred
to in
s 64(3)
(e).
Mr
Kahanovitz
, for the union, contended that it matters not
what was envisaged by the main agreement and this court need not
interpret it:
on the clear language of clause 5.2, its members are
entitled to be paid two days extra for the 2011/12 shutdown period;
the
applicant refuses to pay it; and that amounts to an unilateral
change to the workers’ terms and conditions of employment
–
ergo
, having followed the procedure prescribed by
s 64(4)
,
they have the right to strike.
[8] Mr
Oosthuizen
, for the applicant, submitted that properly
construed, the dispute between the parties is one concerning the
interpretation and
application of clause 5 of the collective
agreement, and that in terms of
s 24
of the LRA, that is a dispute
that is required to be referred to arbitration. Since the substantive
limitations on the right to
strike in
s 65(1)
(c) of the Act extend
to disputes that the Act requires be referred to arbitration or
adjudication, the strike called by the union
is unprotected. he
argued that clause 5.2 of the agreement cannot be read in isolation:
that clause is “consequent to”
clause 5.1; it was
designed to achieve parity between Western Cape and KwaZulu-Natal;
and there is now a dispute as to whether
it is being correctly
interpreted or applied in order to achieve parity.
The applicable legal principles
[9] In his earlier judgment giving reasons for granting the rule
nisi,
Van Niekerk J had regard to
Ceramic Industries LTA
t/a Betta Sanitary Ware v National Construction Building and Allied
Workers Union (2)
2
,
where Froneman JA dealt with the characterisation of a dispute for
the purposes of strike action. In that case, a union had referred
a
dispute to the CCMA concerning the harassment of its officials and
members by certain members of management. The court started
off by
restating the general principle:
3
“
Broadly
speaking, therefore, the Act seeks to give effect to the fundamental
right to strike by insulating participation in a protected
strike
from the legal consequences that might otherwise have followed in its
wake. On the other hand, it regulates that right both
procedurally
and substantively. Procedurally it does so by requiring that certain
formal requirements have to be met before protection
follows.
Substantively, it imposes limitations, one of which is to limit
protected strikes to issues that are not arbitrable or
justiciable in
terms of the Act ."
And of course one of those issues that are arbitrable in terms of
the Act is a dispute about the interpretation or application
of a
collective agreement in terms of
s 24(2).
Rejecting a characterisation by this court that the subject matter
of the dispute in
Ceramic Industries
included a demand for
the dismissal of the employer’s officials, Froneman JA said:
4
“
Even
it was open to approach the matter on the basis of a characterisation
of the issue as one involving a specific demand, there
are compelling
reasons why it would not in any event not affect the eventual outcome
of the present case. The union’s initial
complaint was the
alleged harassment of union officials and employees. For the reasons
already stated that was a justiciable rights
dispute with a specific
remedy to be pursued at the Labour Court. The union could not convert
the nature of that underlying dispute
into a non-justiciable one
simply by adding a demand for a remedy falling outside those provided
by the Act. The tail cannot wag
the dog. If such an approach is
allowed, an underlying rights dispute normally justiciable or
arbitrable in terms of the Act could
be transformed into a strikeable
issue simply by adding a demand for a remedy not provided for in the
Act. That would not be acceptable.”
[10] As Van Niekerk J pointed out, this has been interpreted by the
Labour Appeal Court to mean that it is this court’s duty
to
ascertain the true or real issue in dispute (see
Coin Security
Group (Pty) Ltd v Adams & others
(2000) 21
ILJ
925
(LAC) at 930B). In doing so, the court is obliged to look at the
substance of a dispute, and not the form in which it is presented.
Nor is the characterisation of a dispute by any of the parties
decisive. This principle was recently confirmed by the Labour Appeal
Court in
BMW South Africa (Pty) Ltd v NUMSA
5
and by this court in
Parliament of the RSA v NEHAWU & Others.
6
In
Eskom v NUMSA and Others
7
the Labour Appeal Court held that the clear purpose of
sections
64(4)
and (5) is:
“
...to
retain or restore the status quo until the conciliation stage
regarding a dispute about a unilateral change to terms and conditions
of employment is over and both parties are in a position to resort to
the use of economic power.”
In the present case, though, as Van Niekerk J pointed out, there is
a dispute about what the status quo is: The parties differ
over the
interpretation of the substantive agreement currently in force. In
other words, it is not clear that there has been
a unilateral
variation in circumstances where the existing terms and conditions
(as amended by agreement in the Bargaining Council)
are not clear.
This is analogous to the position in
Kathmer Investments Ltd v
Woolworths (Pty) Ltd
8
where it was held that a dispute about what any term of an agreement
was, is a dispute which arises out of the agreement or which
concerns the agreement, and was therefore referable to arbitration.
The union placed much reliance on the decision of the Labour Appeal
Court in
Maritime Industries Union of South Africa (MITUSA) and
Others v Transnet Ltd and Others.
9
In
MITUSA
, Zondo JP stated
obiter:
“
[106]
It is clear that
s 64(4)
relates to a dispute about a unilateral
change to terms and conditions of employment. It is also clear that
it affirms that such
a dispute can be the subject of a referral in
terms of
s 64(1)
D
which
is a referral of a dispute that can be the subject of a strike.
Accordingly, it can be accepted that a strike is competent
in respect
of a dispute about a unilateral change to terms and conditions of
employment. However, if a dispute about a unilateral
change of
conditions of employment can properly fall within the provisions of
E
item
2(1)
(b)
of schedule 7, it will nevertheless be arbitrable. 'Strikeable' and
arbitrable disputes do not necessarily divide into watertight
compartments. Although in relation to dispute resolution the Act
contemplates the separation of disputes into those that are resolved
through arbitration, those that are resolved through
F
adjudication
and those that are resolved through power-play, there are disputes in
respect of which the Act provides a choice between
power-play, on the
one hand, and, arbitration, on the other, as a means for their
resolution. This is the case, for example, with
disputes about
organizational rights. (see
s 65(2)
(a)
and
(b)
read with
s 65(1)
(c)
G
and
ss 12
-
15
and
s 21
and
s 22.)
[107]
A dispute about a unilateral change to terms and conditions of
employment, which, as already stated above, is a dispute in
respect
of which a strike is competent, may, arguably also be said to fall
within the ambit of an unfair labour practice as defined
in item
2(1)
(b)
,
H
especially
in relation to training, demotion and the provision of benefits to an
employee. A dispute falling under item 2(1)
(b)
is, of course, subject to arbitration in terms of item 3(4)
(b)
. The idea of giving such a choice is also to be found in the
Labour
Relations Amendment Act 12 of 2002
. In
s 189(7)
a registered trade
union is
I
given
a choice, when an employer has given a notice to terminate employees'
contracts of employment for operational requirements
either to refer
the dispute about such a termination to the Labour Court for
adjudication or to resort to a strike.”
Of course, Item 2(1)(b) of Schedule 7 has since been replaced by
s
186(2)
of the LRA, dealing with unfair labour practices. I accept
that there will be instances where the same action – for
example,
the removal of training, as in
MITUSA –
could
give rise to either an unfair labour practice claim or a dispute in
terms of
section 64(4)
, where an existing right appears to have been
varied. But that judgment does not go so far as to suggest, in my
view, that a
dispute about the interpretaion of a collective
agreement is also strikeable.
A dispute about the interpretation and application of a collective
agreement falls squarely within the ambit of
s 24
of the LRA. And
the limitation on the right to strike in
s 65(1)(c)
is unequivocal:
“
(1)
No person may take part in a
strike
or
a
lock-out
or
in any conduct in contemplation or furtherance of a
strike
or
a
lock-out
if-
(a)
...
(b)
...
(c)
the
issue
in dispute
is one that a party has the right to refer to arbitration or to the
Labour Court in terms of
this
Act
;”
And
s 24
creates the remedy for a dispute about the interpretation
or application of a collective agreement:
“
24 (2)
If there is a
dispute
about the interpretation or application of a
collective
agreement
,
any party to the
dispute
may refer the
dispute
in writing to the Commission if-
(a)
the
collective agreement
does not provide for a procedure as
required by subsection (1);
(b)
the
procedure provided for in the
collective agreement
is not
operative; or
(c)
any
party to the
collective agreement
has frustrated the
resolution of the
dispute
in terms of the
collective
agreement
.”
Applying the legal principles to this case
[11] Applying these principles, I agree with Van Niekerk J that
properly characterised, the dispute between the parties in the
present instance concerns the application and interpretation of the
collective agreement between them, and more particularly of
clause 5.
The interpretation of clause 5 is, as he said, “contested
terrain”; and what the union effectively claims
is that those
employers who fail to pay the additional two days’ leave pay
are in breach of the collective agreement. Despite
Mr
Kahanovitz
’s
argument to the contrary, clause 5.2 is not clear and does not create
a clear term or condition of employment that has
been unilaterally
varied. The clause cannot be read in isolation
10
;
it is intended to be implemented “consequent to” clause
5.1, ie to achieve parity; and there is clearly a dispute
as to its
interpretation and application between the parties.
This situation is not the same as the one that pertained in
SA
Federation of Civil Engineering Contractors v NUM & another
11
to which Mr
Kahanovitz
referred me. In that case, the court
accepted – correctly – that, as a general rule,
employees are not precluded
from striking over an issue covered by a
current agreement in support of a demand relating to a future
agreement. But in the
case before me, there is a dispute about the
interpretation and application of the current collective agreement.
The union has
not formulated a new demand to be embodied in a future
agreement.
The appropriate remedy in this instance, as Van Niekerk J found when
granting the rule
nisi
, is to invoke the provisions of
s 24.
He referred to a number of authorities to suggest that the CCMA has
the necessary jurisdiction to correct any erroneous interpretation
of a collective agreement and to order a party in breach of the
agreement to comply with it. Even though it was an arbitration
award
and thus not authoritative, I agree with the findings of Fouché
A – referred to by Van Niekerk J -- in
Oelofsen &
another and SA Police Service
(2006) 27
ILJ
639 (A),
especially at 651, referring to
Coetzee v SAPS
PSCB
146-03/04).
Van Niekerk J correctly pointed out that, to find that the union
members’ existing terms and conditions of employment entitle
them to leave as contended for by the union, this court would
necessarily be obliged to determine the dispute about the
interpretation
of clause 5. This it is not empowered to do – a
dispute of this nature must in the first instance be referred to
arbitration.
It is not possible for this court to make a ruling in
favour of the union without usurping the arbitrator’s
function. This
court has no jurisdiction to adjudicate a dispute
that the Act requires to be arbitrated (see
s 157(3)).
For those
reasons, the application cannot succeed on the return day either.
[12] Van Niekerk J was in any event not persuaded that the provisions
of
s 64(4)
give rise to a right to strike in the present
circumstances. Neither am I. As he pointed out, that section is
concerned to preserve
the status quo, pending the outcome of the
conciliation process prescribed by the Act. To invoke the remedy
established by
s 64
, it is necessary to establish both an existing
term and condition of employment and the fact of a variation of that
term and condition
by the employer, in circumstances where the
employee has not consented to the variation. That has not happened in
this case. The
status quo relied on by the union is its
interpretation of the Main Agreement and the 2011/2012 substantive
agreement. That interpretation
is, in the words of Van Niekerk J,
contested terrain. Even if the dispute between the parties is to be
categorised as a dispute
concerning a unilateral change to conditions
of employment, the status quo remedy established by
s 64
is not
applicable in the present instance, and the union is not entitled to
rely on
s 64
(4) to give notice of a strike without the time periods
established by
s 64
being exhausted.
Conclusion
[14] I am satisfied that the applicant has established a clear right
for the purposes of granting final relief.
Both parties have argued that costs should follow the result,
despite their continuing relationship.
The rule
nisi
is confirmed. The respondent is ordered to pay
the applicant’s costs, including the costs of senior counsel.
_______________________
Anton Steenkamp
Judge of the Labour Court
APPEARANCES
APPLICANT: Adv André Oosthuizen SC,
instructed by Norton Rose.
FIRST RESPONDENT: Adv Colin Kahanovitz SC,
instructed by Cheadle Thomson and Haysom Inc.
1
The
rule
nisi
was
extended a number of times by agreement between the parties. The
return day, when I finally heard argument on whether the
rule should
be confirmed, was 26 April 2012; and, given that I reserved judgment
on that day, the rule
nisi
was
further extended by agreement to 12 June 2012.
2
(1997)
18
ILJ
671 (LAC).
3
At
675 C-D.
4
at
677J-678A.
5
[2012]
3 BLLR 274
(LAC); (2012) 33
ILJ
140
(LAC) para [27] and authorities there cited.
6
(2011)
32
ILJ
2534 (LC).
7
(2002)
23
ILJ
2208
(LAC) para [12].
8
1970
(2) SA 498
(A) at 503 G-H.
9
(2002)
23
ILJ
2213
(LAC) para [106] – [107].
10
See
Cinema City v Morgenstern Family
Estates & Others
1980 (1) SA 796
(A) 804 E-F;
Richter v Bloemfonten Town
Council
1922 AD 57
at 69
infra
.
11
(2010)
31
ILJ
426
(LC).