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[2013] ZALCJHB 5
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Mxalisa and Others v Dominion Uranium Joint and Another (JR 1475/10) [2013] ZALCJHB 5; (2013) 34 ILJ 2052 (LC) (23 January 2013)
REPUBLIC OF SOUTH AFRICA
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable
Case no: JR 1475/10
In the matter between:
SIYABULELA
MXALISA AND OTHERS
.........................................................
Applicant
and
DOMINION
URANIUM JOINT
.............................................................
First
Respondent
ROLAND
SURTHERLAND
N.O
.....................................................
Second
Respondent
Heard
:
27 September 2012
Delivered
:
23 January 2013
Summary: Review of private arbitration award-
grounds for review governed by section 33 (1) of
the
Arbitration Act of 1969
-
employees
embarking on unprotected strike action- employees formed a crisis
committee to engage with employer- employer statutorily
enjoins to
engage with recognised trade union- crisis committee-
arbitrator conclusion influenced largely by the finding of the
credibility of the witnesses. Courts would interfere with the finding
of credibility of witnesses only if arbitrator did not apply properly
the rules of evidence regarding the assessment of the credibility
of
witnesses. Review application dismissed
JUDGMENT
MOLAHLEHI J
Introduction
This is an application in terms of which the applicants seek to
review and set aside the arbitration award made by the second
respondent (the arbitrator) dated 29 April 2010 in terms of which
the dismissal of the applicants was found to be fair.
After the conciliation at the CCMA had failed, the applicants filed
a statement of case with this Court. The case before the
court was
withdrawn after the parties agreed to refer their dispute to private
arbitration.
Background facts
The dismissal in this matter involves a total of 821 employees who
were dismissed during October 2008, for allegedly participating
in
an unlawful and unprotected strike action. Some of the applicants
were at the time of the dismissal members of the National
Union of
Mine Workers (the NUM) and the others were non-unionised.
The dismissal has its history in the dispute that arose in 2006,
regarding the issue of health and safety standards which was
initially raised by the NUM on behalf of the employees. The
negotiations regarding the matter took a very long time as a result
of which some of the employees lost confidence in NUM. It was a
result of this that the employees formed a crisis committee to
engage with the first respondent on behalf of the employees. The
crisis committee consisted of both members of NUM and non-members.
After its formation, the crisis committee demanded that it be
involved in the negotiation regarding a range of issues including
health and safety, salaries and benefits for the employees. The
first respondent refused to engage the crisis committee and
continued to engage NUM in the negotiations.
In response to the first respondent’s refusal to engage the
crisis committee in the negotiations, the committee organised
a
protest march during July 2008. The members of the crisis committee
were charged and dismissed for inciting the employees to
participate
in a protest march. Thereafter, the applicants sought unsuccessfully
to negotiate the reinstatement of members of
the crisis committee.
Because of the refusal by the first respondent to negotiation the
reinstatement of the dismissed members of the crisis committee,
the
applicants embarked on a work stoppage on 8 October 2008.
The following day on 9 October 2008, the employer approached the
court for an urgent interdict, interdicting the strike action.
The
court papers were served on NUM which did not oppose the
application. Accordingly an order declaring the strike action
unlawful and ordering the employees to cease their unlawful action
was made by the court. The Court order which was in the form
of a
rule
nisi
which was later confirmed unopposed.
On 10 October 2008, the employer issued another ultimatum to the
employees calling on them to show cause why they should not
be
dismissed. The employees did not respond and accordingly the first
respondent dismissed them.
The applicants being unhappy with their dismissal referred a dispute
to the Commission for Conciliation, Mediation and Arbitration
(the
CCMA). The conciliation process having failed to resolve the dispute
the applicants referred the matter to the Labour Court
for
adjudication. However, by agreement between the parties the matter
was withdrawn from the Labour Court and referred to private
arbitration, the outcome of which is the subject of the present
proceedings.
Turning to the agreement to refer the dispute to private
arbitration, the terms of reference are contained in the
pre-arbitration
minutes date 28 August 2009. Paragraph 1 of the
pre-arbitration minutes reads as follows:
‘
1.1 the parties agree for their dispute in
the Labour Court under case number JS355/09 as read with the
Arbitration Act.
1.2 the parties agree that Advocate Roland Sutherland SC will act as
the arbitrator in this matter.
1.3 the Arbitrator will have the same powers as a Labour Court judge
presiding over this matter and his terms of reference will
determine
this dispute.
1.4 the arbitration will be final and binding upon the parties and
neither party shall have the right to appeal the award.
1.5 the respondent will pay the costs of the arbitration, including
the arbitrator's fees, the venue costs, costs of the recording
of the
proceedings and interpreter's costs. Each party will pay its own
legal fees incurred in this matter, but the arbitrator
may make costs
order which he deems fit at the conclusion of the arbitration.
1.6 the arbitrator will deliver his award within 30 days from the
conclusion of the arbitration by forwarding a copy of his award
to
the parties’ respective attorneys. The arbitrator shall not be
required to reconvene the arbitration only for the purpose
of
delivery of his award.
1.7 the applicant will withdraw their dispute before the Labour
Court.
1.8 the parties agree for the pleadings in the Labour Court matter to
stand as pleadings in this arbitration.’
The issues which the arbitrator was to determine are set out at
paragraph 5 of the pre-arbitration minutes as follows:
‘
5.1 Whether the ultimatum referred to in
paragraph 18.6 below were given to the individual applicants.
5.2. Whether the individual applicants were afforded a reasonable
opportunity to respond to these ultimatum before being dismissed
by
the respondent.
5.3. Whether the individual applicants were afforded a reasonable
opportunity to make submissions concerning the decision to dismiss
them.
5.4. Whether the individual applicants were afforded a reasonable
opportunity to appeal against the decision to dismiss them.
5.5. Whether the dismissals of the individual applicants were
procedurally fair.
5.6. Whether the dismissal was the appropriate sanction in the
circumstances.
5.7. Whether the dismissal of the individual applicants were
substantively unfair.
5.8. If their dismissals were substantively unfair, appropriate
relief to be awarded to individual applicants.
5.9. If their dismissals were procedurally unfair, the appropriate
compensation to be awarded to the applicants.’
The relief sought by the applicants is compensation in terms of
section 193 read with section 194 of the LRA.
Grounds for review
The applicants have raised a number of grounds upon which they rely
on in their contention that the arbitration award is reviewable.
The
grounds of review as raised by the applicants can be summarised as
follows; gross irregularity, the arbitrator exceeding
his powers,
the arbitrator arrived at a conclusion that is not justifiable,
misdirection on the part of the arbitrator and shifting
onus
on to the applicants and ignoring that the ultimatum was not fair.
It was argued on behalf of the applicants during the hearing that
the arbitrator committed gross irregularity in that he made
swiping
statement in saying that the issue of health and safety had no
bearing on the strike. The applicants also disputed that
they were
served with the ultimatum and that the
onus
was on the first
respondent to show that they were indeed served. It was further
argued on behalf of the applicants that the
arbitrator failed to
take into account the unreasonableness of the ultimatum in
particular in relation to the fact that there
was no time indicated
in it and also that it was not translated into any of the language
spoken by the applicants.
In relation to the Court order, which found the applicants to have
been on an unlawful industrial action, the applicants argued
that
the notice of motion that led to the order was served on NUM and not
the applicants.
The applicants further contend that the dismissal was procedurally
unfair because the first respondent, on the advice of the
South
African Police did not conduct a disciplinary hearing. The first
respondent did not dispute this, and stated that the advice
was
based on the level of violence that followed the strike.
The arbitration award
At the beginning of the arbitration award, the arbitrator recorded
that the amendment introduced by the applicants, which the
first
respondent did not oppose, introduced another group of dismissed
employees. These are employees who claimed that they,
for different
circumstances did not participate in the industrial action. The
arbitrator indicated in his arbitration award that
he would not deal
with this group and it was for the parties to deal with their case
in another forum. Their cases have not been
raised in this review
application.
The issue which the arbitrator confined himself with in his
arbitration award concerned those dismissed employees who
notwithstanding
their participation in the strike action contended
that their dismissal was unfair. Before dealing with the facts
relating to
the dismissals, the arbitrator set out the principles
that would guide his decision in relation to the fairness of the
dismissals
of the applicants. The arbitrator specifically relied on
the decisions in the cases of
Modise and Others v Steve’s
Spar, Blackheath
1
and
Mzeku and Others v Volkswagen SA (Pty) Ltd
.
2
The arbitrator summarised the principlesin these two cases as
follows:
‘
According to
Steve’s
Spar
, fair dismissal requires adherence
to the principles
Audi alterem partem.
Preferably before a decision is taken,
but in exceptional circumstances, of which a given strike situation
is one category, a hearing
after de facto provisional decision is
taken. Further, according to
Mzeku
at (54)-(60), an employer is obliged to deal with a worker’s
union as long as he remains a member.’
After setting out the above principles, the arbitrator then
discussed in some details the testimony of the main witness of the
first respondent, Mr Lousteau, the HR Vice President.
In brief, the testimony of Mr Lousteau was that a Relationship
Building by Objective was embarked upon after employees raised
uneasiness about the risk of mining uranium. The issue was
apparently resolved during that process and the outcome thereof was
accepted by NUM.
The arbitrator found that there was unhappiness amongst some of the
employees about the performance of NUM and accordingly repudiated
its role as representative of the employees’ interest. It was
as a result of the unhappiness with the representation of
NUM that
the crisis committee was established. As indicated earlier, the
crisis committee sought to engage with management on
a number of
issues including the health and safety. The arbitrator found that
the crisis committee was established initially
because the employees
were not satisfied with the health assessment of certain employees.
The arbitrator summarised the case of the applicants in the
following terms:
‘
Given the thesis of the applicants’
case that they were indeed on an unprotected strike provoked by the
respondent’s
unfair conduct, it was incumbent upon the
applicants to adduce credible evidence of blameworthy conduct on the
part of the Management.’
In light of the above, the arbitrator considered the testimony of
each of the applicants’ witnesses and found them to have
been
unreliable. The testimony of the applicants’ witnesses on a
number of issues were rejected and that of Mr Lousteau,
accepted.
The arbitrator then made a number of findings relating to the
fairness of the dismissals of the applicants.
In relation to how the first respondent treated the crisis
committee, the arbitrator firstly found that the first respondent’s
management acted appropriately and was willing to engage with those
who purported to speak on behalf of those of the employees
who were
on strike. He further found that the first respondent was obliged to
honour its binding obligations towards NUM. He
in this regard
rejected as fanciful the argument of the applicants that the
agreement with NUM was not valid.
In relation to the steps the first respondent took before dismissing
the applicants the arbitrator found that before taking the
steps
that would have jeopardised the employees’ employment the
first respondent sought the intervention of the recognised
trade
union and that the applicants to their peril rejected such
intervention by the trade union.
In his final analysis the arbitrator found that:
‘
61 In general terms, the inappropriate
action of the workers in admittedly going on an unprotected strike in
support of admittedly
inappropriate demands places them under an
evidentiary burden to adduce facts and circumstances to warrant a
conclusion that the
conduct was mitigated to such an extent that
dismissal was inappropriate. The strike was characterised by
vandalism, and hi-jacking
of vehicles. The strike was repudiated by
the union. Evidence from those selected to testify reveals a taste
for anarchic methods
of dispute resolution. No cogent case to
substantiate culpability by the Respondent is made out.’
Evaluation
It is now common cause that the arbitration proceedings in this
matter were conducted in terms of the provisions of the Arbitration
Act of 1969 (the Act). Therefore the grounds for review as set out
in the applicants’ papers have to be read as those envisaged
in section 33(1) of the Act which reads as follows:
‘
(1) Where –
(a) any member of an arbitration tribunal has misconducted himself in
relation to his duties as arbitrator or as an umpire; or
(b) an arbitration tribunal has committed any gross irregularity in
the conduct of the arbitration proceedings or has exceeded
its
powers; or
(c) an award has been improperly obtained, the Court may, on the
application of any party to the reference after due notice, to
the
other party or parties, make an order setting the award aside.’
This Court has previously on the basis of established authorities
held that an irregularity in private arbitration proceedings
does
not refer to the result or the correctness of the decision but
rather to the reasoning process or the method of the arbitration
proceedings. It is also trite that in private arbitration
proceedings a mistake of law or fact does not necessarily lead to
the conclusion that the arbitrator has committed gross irregularity.
In general gross irregularity occurs when the arbitrator
misconceives the whole nature of the enquiry or the duties he or she
is supposed to perform.
3
It is now well established that in private arbitration review
proceedings the test to apply is based on a narrow approach.
4
The basis for this approach is the consensual basis upon which the
parties seek to resolve their dispute by way of arbitration
with
limited statutory imposition on the process.
5
The Courts are as a matter of principle enjoined in considering
reviews of private arbitrations to ‘
adherence
to the principle of party autonomy, which requires a high degree of
deference to arbitral decisions and minimises the
scope for
intervention by the courts.’
6
This is the approach which was adopted by the Supreme Court of
Appeal
in Telcordia
and subsequently endorsed by the Constitutional Court in
Lufuno
Mphaphuli & Associates (Pty) Ltd v Andrews and Another
.
7
In upholding and summarising what was said in the
Telcordia
matter, the Constitutional Court in
Lufuno Mphaphuli
, had the
following to say:
‘
[65] In
Telcordia
the Supreme Court of Appeal held, inter
alia, that—
private arbitrations would, as a starting point, fall within the
ambit of s 34 of the Constitution;
the rights contained in the section "may
be waived unless the waiver is contrary to some other constitutional
principle or
otherwise
contra bonos
mores
;"
by agreeing to arbitration, parties waive
their rights
pro tanto
;
they usually waive the right to a public hearing;
by agreeing to arbitration the parties to a dispute necessarily
agree that the fairness of the hearing will be determined by
the
provisions of the Arbitration Act and nothing else; and
by agreeing to arbitration the parties limit interference by the
courts to the grounds of procedural irregularities set out in
s
33(1) of the Act, and, by necessary implication, they waive the
right to rely on any further ground of review, "common
law"
or otherwise.’ (footnotes left out).
The essence of the enquiry of allegations of gross irregularity in
private arbitration entails essentially a determination of
whether
the conduct of the arbitrator presented a fair trial of the issues
which were presented before him or her by the parties.
8
The issue of “exceeding powers” entails the arbitrator
exercising powers that he or she does not have or exercising
those
powers erroneously.
9
Misconduct on the other hand entails serious mistake of fact or law
but does not extend to
bona fide
mistakes made by the
arbitrator.
10
The restriction from interfering with private arbitration is
essentially because the powers given to the arbitrator are
consensual
between the parties.
In the present case, the first three grounds of review as set out in
the applicants’ founding affidavit are indeed those
envisaged
in section 33(1) of the Act including allegation that the arbitrator
misdirected himself in finding that the grievance
over the safety
and health issues had no bearing on the strike. The remainder of the
grounds of review are those envisaged in
section 145 of the Labour
Relations Act. It is trite that the test to apply when considering
reviews under the provisions of
section 145 of the LRA is that of a
reasonable decision-maker which does not apply in reviews involving
private arbitrations
as is the case in the present instance. In
other words, the remainder of the grounds of review as set out in
the applicants’
papers are those that seek to challenge the
outcome of the arbitrator’s arbitration award on the basis of
its reasonableness.
In light of the above discussion, this Court will confine itself to
considering those grounds of review provided for in terms
of the
provisions of section 33(1) of the Act.
The question of whether the arbitration award is reviewable has to
be answered on the basis of the facts and the guiding principles
set
out in the authorities.
It is clear in as far as the facts and the circumstances of this
case are concerned that the arbitrator arrived at the conclusion
as
he did, influenced largely by the finding of the credibility of the
witnesses. In this respect, the arbitrator found the credibility
of
the applicants’ witnesses to be questionable. The version of
the first respondent which was mainly based on the testimony
of one
witness was found to have been credible and accepted for that
reason.
It is trite in law that the Courts are very slow in interfering with
the finding of credibility by trial of facts. Of course
the Court
would readily intervene where a case has been made that the
arbitrator failed to apply properly the rules of evidence
regarding
the assessment of the credibility of witnesses.
In the present instance, the arbitrator accepted the testimony of Mr
Lousteau as more convincing than that of the applicants’
witnesses. He did so after considering in details the evidence
presented by the witnesses, analysing that evidence and weighing
the
circumstances surrounding the dismissals. The arbitrator accepted as
common cause that the first respondent had issued an
ultimatum
before issuing dismissal notices. This finding is based firstly on
the testimony of Mr Lousteau who testified that
a final ultimatum
was issued wherein the employees were advised that the first
respondent was of the “prima facie view
that they should be
dismissed for their persistent misconduct”. That ultimatum was
issued after several others were ignored
by the employees, including
ignoring the Labour Court order. Although the applicants claim not
have been served with the papers
instituting the proceedings that
Court order remains unchallenged and therefore has all the necessary
force and effect in law.
The order was initially made as a rule
nisi
, which was later made a final order. The applicants did
not oppose the application to have the order confirmed.
The fact that the final ultimatum was issued is confirmed by the
applicants in their statement of claim which was filed with
the
Court before the matter was withdrawn. It has to be noted that the
parties had agreed that the pleadings which had been filed
with the
Court before the case was withdrawn would constitute pleadings in
the arbitration proceedings. The case of the applicants
is in this
respect stated at paragraph 5.8 of the statement of case as follows:
‘
At 13h30 the Respondent issued a final
ultimatum to the employees to return to work on 8 October 2008 06h00,
without speaking to
the delegation or attending to their grievances.
The employees were advised that failure to comply with the
instruction to return
to work might result in their dismissal.’
And at paragraph 5.13 the applicants aver that:
‘
The Respondent did not react to their
demand and instead issued a pre-dismissal ultimatum on 10 October
2008 in terms of which the
employees should say why they should not
be dismissed.’
In as far as the issue of the
audi altarem partem
rule is
concerned, it is common cause that no formal hearing was conducted
by the first respondent. In considering and applying
his mind to
this issue it is apparent that the arbitrator took into account the
totality of the facts and the circumstance of
the matter and arrived
at the conclusion that:
‘
54. Prior to taking any steps to jeopardise
the employment of the strikers, the Management called upon their
recognised union to
intervene. The applicants recklessly and at their
peril rejected the entreaties to cease the strike.
55. The decision to not convene a hearing but rather to dismiss
subject to an appeal was appropriate in the circumstances.’
In the circumstances where the employees refused to engage with
management through the formal dispute resolution mechanism and
also
where they were uncooperative in relation to seeking to deal with
the matter through their delegation starting from 7 October
2008,
there can be no basis for attacking the decision of the arbitrator.
The approach adopted by the arbitrator has to also
be understood in
the context where the first respondent was dealing with the
dismissal of 1428 employees who were not only involved
in an
unlawful industrial act, which had been so declared by the Labour
Court, but also who were involved in intense acts of
violence and
intimidation.
In my view, in the circumstances of this case the applicants had two
opportunities where they could have presented their case/s
and be
heard by the first respondent. The first instance is as it is stated
in their statement of case, when they were in the
ultimatum invited
to “say why they should not be dismissed,” and secondly
with the use of the appeal procedure.
The other basis upon which the arbitrator’s arbitration award
is criticised seems to be on the basis that he misconstrued
the
inquiry he had to conduct in that he shifted the
onus
onto
the applicants. Although this allegation is not fully substantiated,
it is apparent that it relates to the finding that
the applicants
had the evidentiary burden to explain their conduct.
It is common cause that the applicants participated in an
unprotected industrial action which constitutes misconduct in terms
of the law. Once the first respondent had established the
misconduct, it was for the applicants to provide an explanation or
some justification for their unlawful conduct. That as I understand
it, is what the arbitrator is referring to when he speaks
about the
evidentiary burden that rested on the applicants.
The explanation proffered by the applicants for their conduct which
was rejected by the arbitrator is that the first respondent
provoked
the strike by refusing to recognise their crisis committee and
engaging them in the collective bargaining process in
particular
with regard to the issues of health and safety.
The applicants seek to locate the issue of provocation within the
allegation that the first respondent failed to address the
issues of
health and safety and refused to engage with the crisis committee in
negotiating that issue and other demands they
had. Those issues as
stated earlier were addressed with the representative trade union in
terms of the collective agreement which
the first respondent had
with the union. In terms of the law, the first respondent was
obliged to respect the recognition agreement
it had with the union
and abide with any collective agreement it had with it. This cannot
constitute provocation as all what
the first respondent was doing
was compliance with its obligations as provided for in the law. It
follows that the agreement
which the first respondent had reached
with the union regarding the issue of health and safety was binding
on the first respondent
and compliance with it could never have
constituted provocation. The agreement was also binding on the
employees in terms of
the provisions of section 200(1) of the LRA
which reads:
11
‘
A registered trade union or registered
employees’ organisation may act in any one or more of the
following capacities in any
dispute to which any of its members is a
party –
in its own interest;
on behalf of any of its members;
in the interest of any of its members.’
In fact, what triggered the strike in my view was the dismissal of
the crisis committee members by the first respondent. The
strike
commenced even on the version of the applicants after the unfair
dismissal dispute of the dismissed crisis committee members
which
was referred to the CCMA was unsuccessful. This analysis is
supported by what is stated in the applicants’ statement
of
case at paragraph 5.10 where they state the following:
‘
On 9 October the employees handed their
demands to the Respondent, demanding inter alia
5.10.1 The release of the arrested employees
5.10.2 The re-instatement of a workers forum known as the crisis
committee
5.10.3 To cancel members contribution stop orders of the NUM from
their salaries. ‘
It follows that the claim that the first respondent provoked the
applicants into striking bears no merit. Thus the only reasonable
and correct conclusion to have reached, as the arbitrator did, was
that the applicants were guilty of unacceptable conduct which
amounted to a serious breach of their employment contract with the
first respondent.
I do not on the basis of the above reasons find a basis upon which
there can be any justification for interfering with the decision
of
the arbitrator. And accordingly the applicants’ application
stands to fail. It seems to me to be inappropriate to order
costs to
follow the results.
Order
In the premises, the applicants’ application to have the
arbitration award of the second respondent reviewed is dismissed
with no order as to costs.
_______________________
Molahlehi J
Judge of the Labour Court of South Africa
APPEARANCES
FOR THE APPLICANT: Adv L.D Harlam
Instructed by Pangwa Attorneys.
FOR THE RESPONDENT: Adv M Van As
Instructed by Edward Nathan Sonnenbergs
1
(2000)
21 ILJ 519 (LAC).
2
(2001)
8 BLLR 857
(LAC).
3
See
Goldfields Investment Ltd and Another v City of Johannesburg and
Another
1938 TPD 551
at 560).
4
In
Standard Bank of SA
Ltd v Mosime NO and Anothers,
[2008]
10 BLLR 1010
(LC), in adopting the narrow test of review the
court followed the decision in
Telcordia
Technologies v Telkom SA Ltd
[2006]
SCA 139 (RSA) [also reported at
[2006] ZASCA 112
;
[2007]
2 All SA 243
(SCA).
5
See
Total Support Management
(
Pty
)
Ltd v Diversified
Health Systems SA
(
Pty
)
Ltd and Another
[2002] ZASCA 14
;
2002 (4)
SA 661
(SCA) [also reported at
[2002] JOL 9517
(A) – Ed],
South African Airways
(
Pty
)
Ltd v SATAWU obo
Mashele and Others
case JR 2618/04 and
National Union of Mine
Workers and Others v Grogan NO and Another
(2007) 28
ILJ
1808
(LC) [also reported at
[2007] JOL 19449
(LC).
6
See
Telcordia v Technologies
-supra.
7
[2009]
JOL 23310
(CC);
2009 (4) SA 529
(CC) at para 64.
8
See
Standard Bank
s
upra.
9
See
Lesotho Highlands Development Authority v Impregelio SPA
(2005)
UKHL 43
, a case quoted with approval as to what constituted
exceeding powers, a case quoted with approval as concerning the
issue of
exceeding powers by
Telcordia.
10
Amalgamated
Clothing & Textile Workers Union of SA v Veldspun
(
Pty
)
Ltd
[1993] ZASCA 158
;
1994 (1) SA 162
(AD) at 169.
11
See
the interpretation of section 200(1) of the LRA in
Mzeku
and
Others v Volkswagen SA (Pty) Ltd and Others
[2001]
8 BLLR 857
(LAC).