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[2012] ZALCCT 23
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South African Post Office Ltd v Commission for Conciliation Mediation and Arbitration and Others (C 293/2011) [2012] ZALCCT 23; [2012] 11 BLLR 1183 (LC); (2012) 33 ILJ 2970 (LC) (18 June 2012)
REPUBLIC OF SOUTH AFRICA
THE LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
JUDGMENT
Reportable
Case
no: C 293/2011
In the matter between:
SOUTH AFRICAN POST OFFICE LTD
Applicant
and
CCMA
First Respondent
W F MARITZ N.O.
Second Respondent
ELTON JACOBS
Third Respondent
Heard
:
29 May 2012
Delivered
:
18 June 2012
Summary:
Review – jurisdiction – whether acting
allowance is a “benefit” as defined in LRA s 186(2)(a).
JUDGMENT
STEENKAMP J:
Introduction
This is a jurisdictional review of an
in limine
ruling by the
second respondent, commissioner Bill Maritz (“the
commissioner”). The crisp question is whether the
first
respondent (the CCMA) had the jurisdiction to arbitrate a dispute
concerning an acting allowance as an unfair labour practice
relating
to “the provision of benefits” as contemplated by
section 186(1)(a) of the LRA.
1
The commissioner found that the CCMA had jurisdiction. He was
persuaded that:
“
...
where the terms of the employment provides for the payment of an
acting allowance in appropriate cases that is the benefit and
if the
employer refuses it when it falls within the provisions of the
particular rules I fail to see why should not be considered
unfair
conduct that could constitute an unfair labour practice."
The commissioner did not rule on a further objection relating to
condonation. He noted:
"I have noted the further
contention to the effect that the applicant is out of time and needs
condonation for a late referral.
It is clear that there is a dispute
about the date to be taken into account and the same applies to
whether the payment of an allowance
is prescribed and in my opinion I
do not need to apply my mind that this time, as that will be based on
evidence."
The applicant has raised two grounds of review:
The dispute was not a benefits dispute and the arbitrator therefore
had no jurisdiction to require the CCMA set the matter
down to
determine the merits. The applicant raises three reasons:
the commissioner ignored binding authority;
the dispute had all the features of an interest dispute; and
even if it was a rights dispute, it was a dispute about
remuneration and not benefits.
The commissioner failed to consider the applicant’s second
jurisdictional objection that the referral was out of time
and
that, as no application for condonation was brought, the
proceedings were a nullity.
Background facts
The third respondent, Elton Jacobs (“the employee"), was
employed as an operational manager from 1 July 2003. Clause
25 of
his contract of employment pointed out the following:
“
There
are various other benefits and conditions of employment, inter alia,
pertaining to 13th cheque, housing loan schemes, housing
allowance
schemes, subsistence and other allowances, et cetera that apply under
specific circumstances. The complete conditions
of employment of
employees are contained in the various staff codes available for
perusal at personnel offices, which are subject
to change from time
to time. "
The applicant has a policy relating to "acting in higher
positions." The policy deals with the situation where employees
acted in positions that have become vacant temporarily. A “higher
position" is defined as:
“
A
position with a higher minimum than the comparable position and the
same or higher maximum in the salary range; or
A
position with the same or lower minimum and higher maximum in salary
range.”
Under the heading, "delegation of authority", the policy
specifies that all acting appointments up to grade level C5
in the
bargaining unit must be approved by a person holding a rank of at
least a manager. Appointments to act in management positions
must it
provides employee holding a rank of general manager or regional
general manager.
The policy further provides for rotation after three months. The
reason is explained as follows:
“
Labour
law recognises that in equity, allowing employees to act for
unreasonably long periods in higher positions can be regarded
as the
creation of a legitimate expectation to ultimately be appointed in a
higher position. Therefore, provided that the vacancy
has been
advertised, the acting period may exceed one month, but is limited to
three months per occasion."
At best, therefore, the policy provided a limited right to an acting
allowance for three months if it was approved. The fact
that
approval was required means that there was no automatic contractual
right to claim the acting allowance in the absence of
such approval.
On 20 December 2010 the employee referred an unfair labour practice
dispute to the CCMA in terms of section 186(2)(a) of the
LRA. He
alleged that the applicant had committed an unfair labour practice
by not paying him an acting allowance.
The dispute was set down for conciliation on 24 January 2011. It
could not be resolved and the CCMA (i.e. the conciliating
commissioner) issued a certificate accordingly. The employee
referred the dispute to arbitration, claiming an acting allowance
from June 2008 to 31 January 2011.
The arbitration was convened on 31 March 2008. The Post Office (the
applicant in these proceedings) raised two points
in limine
.
It contended that the dispute was not about benefits; and that it
was about 4 ½ years late, and was not accompanied by
any
condonation application.
The employee has claimed an acting allowance on numerous occasions
since April 2006. It was only approved once in April 2006.
Subsequent to that date, no further acting allowances were granted
by a general manager, as contemplated by the policy.
On the employee's own version, the dispute arose in July 2008 when,
according to him, he learnt that other employees were paid
acting
allowances and he was not.
Despite this, the commissioner found that he did not need to deal
with the question of condonation, as a dispute existed in respect
of
the date on which the dispute had arisen and this was a question of
evidence to be dealt with at arbitration.
With respect to the first point
in limine
, the commissioner
found that the payment of an acting allowance constituted a
"benefit" and that it could be dealt
with at arbitration
as an unfair labour practice.
Evaluation / Analysis
First ground of review: Acting allowance a ‘benefit’
as contemplated by section 186(2)(a)?
Section 186(2)(a) of the LRA provides that:
“
(2) ‘Unfair
labour practice’ means any unfair act or omission that arises
between an employer and an employee
involving—
unfair
conduct by the employer relating to the promotion, demotion,
probation (excluding disputes about dismissals for a reason
relating
to probation) or training of an employee or
relating to the
provision of benefits to an employee
.”
2
The CCMA does not have a general unfairness jurisdiction. An
employee referring an unfair labour practice dispute in terms of
section 186 must demonstrate that it falls within that section.
In considering whether the CCMA had jurisdiction, this court must
decide the matter afresh on review and the
Sidumo
3
test does not apply.
4
Does an acting allowance comprise a ‘benefit’ as
contemplated in section 186(2)(a)? Although the weight of authority
suggests that it does not, our case law has not been wholly
consistent in deciding this question.
In
Northern Cape Provincial Administration v Hambidge NO &
ors
5
Landman J had regard to the similarly worded definition under the
now repealed Item 2(1)(b) of Schedule 7 to the LRA. He commented
as
follows:
“
[12]
It is unnecessary for me to consider the meaning of the term
benefit
exhaustively. It was not argued in detail. For a useful compilation
of the authorities and opinions on the meaning of benefit see
SA
Chemical Workers Union v Longmile/Unitred
(1999)
20
ILJ
244
(CCMA) at 248–253.
[13]
A salary or wage or payment in kind is an essential element in a
contract of service. See Basson et al
Essential
Labour Law
Vol
1 at 22–23. The definition of ‘remuneration’ read
with the definition of ‘employee’ in
section 213
of the Act makes this clear. “Remuneration” in
section 213
means: “any payment in money or kind or both in money and in
kind . . .” remuneration is an
essentialia
of
a contract of employment. Other rights or advantages or benefits
accruing to an employee by agreement are termed
naturalia
to
distinguish them from the
essentialia
of
the contract of employment. Some
naturalia
are
the subject of individual or collective bargaining. others are
conferred by law. In my view a benefit may be part of the
naturalia
.
It is not part of the
essentialia
.
Some support for this distinction may be derived from the definition
of fringe benefit in the
Shorter
Oxford Dictionary
.
It reads:
“
Fringe
Benefit – a perquisite or benefit paid by an employer to
supplement a money wage or salary.”
[14]
The ILO
Wages – A Worker’s Education Manual
(1988)
at 70 makes the point that a fringe benefit is a supplement for which
no work is done. Benedictus and Bercusson
Labour Law
(1987) at
158 speak of wages and non-wage benefits. The word “benefit”
in item 2(1)(b) means, at least, a non-wage benefit.
The decision of
my sister Revelas J in the
Samsung
case is to the same effect.
She says at 1102J–1103A:
“
Remuneration
is different from ‘benefits’. A benefit is something
extra, apart from remuneration. Often it is a term
and condition of
an employment contract and often not. Remuneration is always a term
and condition of the employment contract.”
[15]
It is unnecessary to refine a benefit further for the purposes of
this case.
[17]
In the instant case Ms Roos wanted to be paid for acting in the
higher position; one carrying more responsibility. It certainly
seems
fair that she should be so paid.
However, a claim that an employer
has acted unfairly by not paying the higher rate cannot be said to
concern a benefit even if its
receipt would be beneficial to the
employee. It is essentially a claim or a complaint that the
complainant has not been paid more
for a certain period for carrying
extra responsibilities. It is a salary or wage issue. It is not about
a benefit. It is about
a matter of mutual interest
. The
interpretation by the commissioner is wrong in law. It was central to
her decision. She did not have jurisdiction to entertain
the dispute
and to decide it in the way she did.”
On appeal, the Labour Appeal Court
6
confirmed that an acting allowance is embodied in the concept
‘remuneration’ which is a matter of mutual interest.
The
CCMA, it held, did not have jurisdiction to deal with the demand for
an acting allowance as an unfair labour practice.
The Labour Appeal Court confirmed this approach in
Gauteng
Provinsiale Administrasie v Scheepers & others
,
7
handed down two weeks later.
The Labour Court followed
Hospersa
in
Eskom v Marshall &
ors
8
when it held:
“
The
Labour Appeal Court’s decision in
HOSPERSA
is binding on me, not simply as a matter of precedent, but also in
terms of the Labour Relations Act. As Dr Marshall does not have
a
contractual right to the resignation or separation package, I must
find that the commissioner had no jurisdiction to arbitrate
the
dispute, even though he had been led by Eskom to believe that he had
such jurisdiction. The award is consequently a nullity
and must be
declared to be so.”
The court also followed
Hospersa
in
Polokwane Local
Municipality v SALGBC & ors
9
and held that the employer’s refusal to pay an acting
allowance did not constitute an unfair labour practice in the form
of a dispute relating to ‘benefits’ as contemplated in s
186(2)(a) of the LRA.
A dissenting view was recently expressed by Lagrange J in
IMATU
obo Vorster v Umhlatuze Municipality.
10
After a thorough review of the case law and academic commentary, he
held:
“
[22]
What the brief review of the case law and academic commentary reveals
is that there has been a shift in the conceptualisation
of the ambit
of the unfair labour practice claim at least in relation to the
notion that a prerequisite for bringing such a claim
is proof of a
pre-existing right. Le Roux
11
argues that a rejection of the narrow approach in
HOSPERSA
is implicit even in the majority decision in
Department
of Justice
.
12
I agree.
[23] Once this conceptual hurdle
has been overcome, it stands to reason that an unfair labour practice
dispute over an acting allowance,
in which an employee is making the
claim on the basis that it was granted to him or others in similar
circumstances on other occasions,
is a claim that the employer has
unfairly refused to confer the benefit on the occasion in question.
This does not amount to a
demand to make the benefit obligatory in
the future. The latter claim would properly be the subject-matter of
collective bargaining.
It is still true that if the employee is
successful in his unfair labour practice claim this might clarify the
factors the employer
ought to consider in granting or refusing to
grant the benefit in the future and might mean that it will be easier
to predict when
the benefit is likely to be granted, but that does
not, in principle, make the dispute one about the creation of new
rights.”
The learned judge did not refer to the LAC judgment in
Scheepers
13
.
However, given his view that
Hospersa
had been overtaken by
subsequent developments in the law, the same view would probably
have prevailed. But there is a later judgment
by the LAC to which he
had not been referred.
In
G4S Security Services v NASGAWU & ors
14
the LAC confirmed the approach taken in
Hospersa
. After
quoting extensively from
Hospersa
, the court held:
15
“
My
understanding of what Mogoeng AJA is
inter
alia
saying
is that, in order for the respondents to bring a successful claim
under Item 2(1)(b) of Schedule 7, they have to show that
they have a
right arising
ex
contractu
or
ex
lege.
It is only then that, having established the right, the commissioner
would have jurisdiction to entertain the dispute as a dispute
of
right.”
Persuasive as the discussion by Lagrange J in
Umhlatuze
Municipality
is, I consider myself bound by the authority of the
Labour Appeal Court.
The employee in the present case has not established a right to an
acting allowance
ex contractu
or
ex lege
beyond the
initial three month period in 2006. In seeking to establish a
further entitlement to an acting allowance, the employee
has strayed
into the realm of a dispute of interest. In these circumstances, the
commissioner had no jurisdiction to entertain
an unfair labour
practice dispute in terms of s 186(2)(b) of the LRA.
I find, therefore, that the commissioner had no jurisdiction to
entertain an unfair labour practice dispute in terms of s 186(2)(b)
of the LRA.
But even if I am wrong, the commissioner exceeded his powers by
arbitrating the dispute without having ruled on condonation,
where
such a ruling was clearly required.
Second ground of review: Condonation
The commissioner was of the view that he need not consider the
aspect of condonation. This was a clear misdirection based on
the
facts before him and on the applicable legal principles.
The applicant stopped paying the employee an acting allowance after
the first three month period expired at the end of June 2006.
The
referral to the CCMA was about 1642 days or 4 ½ years out of
time, based on that time period.
In his referral form
16
the employee indicated that the dispute had arisen on 25 August
2010, referring to an unresolved grievance process. But even
on that
construction, the referral was about 26 days late and the employee
did not apply for condonation.
As this court has held in
Bombardier Transportation (Pty) Ltd v
Mtiya N.O. & ors
17
and in
Mickelet v Tray International Services &
Administration (Pty) Ltd,
18
the commissioner was duty bound to make a jurisdictional ruling at
the conciliation stage. He could not simply defer it to arbitration,
as he did with regard to the question of condonation. This approach
was recently confirmed by the LAC in
BMW SA (Pty) Ltd v National
Union of Metalworkers of SA on behalf of Members
.
19
Conclusion
The commissioner’s finding that the CCMA had jurisdiction
cannot be sustained on either point of review raised by the
applicant.
With regard to costs, I take into account that the law is not
settled on the questions raised on review; and that the employee
was
armed with a ruling in his favour. He should not, in law or
fairness, be held liable for the applicant’s costs.
Order
The
in limine
ruling of the second respondent under case
number WECT 18369/10 is reviewed and set aside. There is no order as
to costs.
_______________________
Steenkamp J
APPEARANCES
APPLICANT:
Adv FA Boda
Instructed by
Eversheds, Sandton.
THIRD RESPONDENT:
Adv K Allen
Instructed by Marais
Muller Yekiso, Cape Town.
1
Labour
Relations Act 66 of 1995
.
2
My
emphasis.
3
Sidumo
& ano v Rustenburg PLatunum Mines Ltd & ors
(2007) 28
ILJ
2405 (CC);
[2007] 12 BLLR 1097
(CC).
4
SA
Rugby Players Association & ors v SA Rugby (Pty) Ltd & ors
[2008] ZALAC 3
;
[2008] 9 BLLR 845
(LAC) paras [39] – [41];
Fidelity
Supercare Cleaning Services (Pty) Ltd v Busakwe N.O.& ors
(unreported, Labour Appeal Court, PA
1/10, 6 June 2012) para [9].
5
[1999]
7 BLLR 698
(LC) paras [12] – [17] (my emphasis).
6
Hospersa
& ano v Northern Cape Provincial Administration
(2000) 21
ILJ
1066 (LAC) para [12] per Mogoeng AJA (as he then was).
7
[2000]
7 BLLR 756
(LAC).
8
[2003]
1 BLLR 12
(LC) para [24}.
9
[2008] ZALC 29
;
[2008]
8 BLLR 783
(LC).
10
[2011]
9 BLLR 882
(LC).
11
PAK
le Roux, “What is an employment benefit?”
Contemporary
Labour Law
Vol 15(1), August 2005 at 5-6.
12
Department
of Justice v CCMA & ors
[2004] 4 BLLR 297
(LAC); (2004) 25
ILJ
248 (LAC).
13
Supra.
14
Unreported
(case no DA 3/08), 26 November 2009.
15
Para
[25].
16
CCMA
form 7.11.
17
(2010)
31
ILJ
2065 (LC).
18
(2012)
33
ILJ
661 (LC).
19
(2012)
33
ILJ
140 (LAC) para [30].