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[2013] ZALCJHB 15
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MEC: Free State Provincial Government: Tourism, Economic and Environmental Affairs v Moeko and Others (JR 2582/07) [2013] ZALCJHB 15; (2013) 34 ILJ 2256 (LC) (8 February 2013)
REPUBLIC
OF SOUTH AFRICA
THE LABOUR COURT OF
SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable
Case no: JR 2582/07
In the matter between:
THE MEMBER OF THE
EXECUTIVE COUNCIL
FREE STATE PROVINCIAL
GOVERNMENT:
TOURISM, ECONOMIC AND
ENVIRONMENTAL
AFFAIRS
...................................................................................................................
Applicant
and
CHAKA JOHANNES MOEKO
......................................................................
First
Respondent
COMMISSIONER BOHELO
PAULUS MOTAKE
....................................
Second
Respondent
COMMISSION FOR
CONCILIATION
MEDIATION AND
ARBITRATION, BLOEMFONTEIN
...............................
Third
Respondent
Heard: 16 November
2012
Delivered: 08 February
2013
___________________________________________________________________
JUDGMENT
BOQWANA AJ
Introduction
This is a review
application for the review and setting aside of the jurisdictional
ruling made by the first respondent (‘the
commissioner’)
on 19 September 2007 under case number FS2729/06.
Facts
The third respondent was
dismissed by the applicant on 26 April 2006.
He referred an unfair
dismissal dispute to both the third respondent (‘the CCMA’)
and to the General Public Service
Sectoral Bargaining Council (‘the
bargaining council’) on advice of his attorneys.
In the referral form to
the CCMA, the third respondent cites the employer as the Department
of Tourism, Environmental and Economic
Affairs (‘the
Department’). He, however, does state under paragraph 6 and
part B of the referral form that he was
employed by the Free State
Gambling and Racing Board (‘the Board’) but was charged
by the applicant whom he submitted
did not have authority.
On 02 June 2006, the
CCMA wrote a letter to the parties advising them that the CCMA had
no jurisdiction to conciliate the dispute.
The reason being that the
bargaining council had jurisdiction to handle the matter and that
the case had been referred to the
bargaining council. It is not
clear when this was done.
On
23 June 2006,
the
bargaining council issued a notice of set down for conciliation to
be held on 17 July 2006.
The
conciliator,
at
the bargaining council, Jerome Mthembu (‘Mthembu’)
advised the parties that the bargaining council had no jurisdiction
to hear the matter.
No
written ruling has been supplied by the parties to that effect.
However,
a
letter dated 18 July 2006 from the State Attorney addressed to the
applicant’s attorney confirmed such a ruling. This
letter
records,
inter
alia
,
that
although the third respondent was an employee of the applicant in
terms of section 10(1) (a) of the Free State Gambling Act,
1
he
was not a public servant. It further recorded that ‘the
conciliator advised that the Bargaining Council would be requested
to transfer the matter to the CCMA. The letter also suggested some
pre-arbitration arrangements be made between the parties,
such
as exchange of documents and pre-arbitration meeting.
On 07 December 2006, the
third respondent’s attorney wrote to the CCMA asking for the
matter to be set down.
The matter was set down
for hearing on 25 January 2007. The applicant did not attend that
inquiry and a default award was issued.
The applicant applied for
rescission of this award which was granted in its favour.
The
matter was set down for arbitration hearing
de
novo
on
06 September 2009. It is a jurisdictional ruling issued at that
hearing that is the subject of this review.
At that arbitration
hearing, the applicant raised a point
in limine
that the CCMA
had no jurisdiction to hear the matter because, whilst the third
respondent was the Chief Executive Officer (‘the
CEO’)
of the Free State Gambling and Racing Board (‘the Board’)
and did not work for the Department he had
been appointed by the
MEC, he was a public servant and thus his dispute ought to have been
resolved by the bargaining council.
The third respondent
disputed this arguing that he was a CEO of the Board and, therefore,
the CCMA and not the bargaining council
had the necessary
jurisdiction.
Jurisdictional ruling
The
commissioner found that from the information provided by both
parties, it was clear that the third respondent did not work
for the
department but for the Board. The Board, although it fell under the
Department,
was
an autonomous entity, and not a government entity. Therefore,
the
applicant was not a civil servant. Accordingly,
the
CCMA had jurisdiction.
The
commissioner held that even if the CCMA did not have jurisdiction,
it would be entitled in terms of section 147 of the Labour
Relations
Act
2
(‘the
LRA’) to assume jurisdiction for the purposes of speedy but
fair resolution of the dispute taking into account
that the dispute
is relatively old. He,
however,
stressed
that he did not base his ruling on that provision.
The commissioner went
further by substituting the Board as the correct employer in the
stead of the Department by stating the
following:
‘
6.
SUBSTITUTION:
6.1 In line with my finding above in
respect of jurisdiction that is based on the fact that the Applicant
was an employee of the
Board and not the Department, it follows that
the Board must be substituted as the employer and, therefore, the
correct Respondent.
I hereby therefore substitute the Board as the
correct employer and Respondent.
’ (own underline).
The commissioner then
found that the CCMA and not the bargaining council had jurisdiction
to hear the matter.
Grounds for review
Although the applicant
raises the following issues as its grounds for review:
The ruling made by the
commissioner was materially influenced by an error of law as it was
contrary to the Free State Gambling
and Racing Board Act. The third
respondent could only be disciplined and dismissed by the applicant
who had authority to appoint
and who appointed him in terms of
section 10(1)(a) of that Act. The applicant contends that the Board
is only empowered to
appoint the staff excluding the CEO. The Board
is a creature of statute and cannot go beyond the powers granted by
statute.
The commissioner
committed an error of law by substituting the employer with the
Board. The applicant submits that the Rules
of the CCMA make
provision for substitution and joinder of the parties. Rule 26(1)
to (5) deals with joinder whilst Rule 26(6)
to (8) deals with
substitution. Of importance for the purposes of argument by the
applicant is that substitution necessitates
an application (notice
of motion accompanied by an affidavit), which must be brought on
notice to all the parties who have
an interest in the matter. In
other words, the commissioner could not, out of his own volition,
simply substitute without the
substituted party being given an
opportunity to comment on whether or not they should be party to
the proceedings, before a
decision to substitute is made.
The third issue raised
although not strongly argued by the applicant was that the CCMA had
already found that it did not have
jurisdiction as per the letter
dated 2 June 2006, that I have already referred to above, it was
thereafter
functus officio
and could not again decide on the
matter of jurisdiction.
Further there is no
reference that the matter was ever conciliated by the CCMA.
Third Respondent’s
case
The respondent’s
case is that the first respondent was employed by the Board and not
the applicant; therefore, the applicant
had no power or authority to
suspend him.
After his appointment,
he concluded and signed a memorandum of agreement in terms of which
his contract of employment was governed.
This memorandum records
that the CEO and the Board decided to give content to the
appointment (by the applicant) by concluding
an employment contract.
This memorandum recorded
terms and conditions that governed the relationship between the
Board and the third respondent. It detailed
duties, responsibilities
and functions of the CEO as well as remuneration, conditions of
service and including termination of
the agreement.
According to the first
respondent, the Free State Gambling and Racing Board Act is silent
on the issue of termination of employment.
That lacuna is therefore
filled by the memorandum of agreement between the Board and the
first respondent.
He
also refers to Chapter 6 of the Public Finance Management Act
3
(‘the
PFMA’) and specifically section 51(e) which states that the
accounting authority (the Board, according to the
first respondent)
must take effective and appropriate disciplinary steps against any
employee of the public entity who,
inter
alia
,
contravenes the provisions of that Act.
He further submits that
he was subjected to the code of conduct and disciplinary
jurisdiction of the Board. Also, the policy of
the applicant
subjects the contract of employment to the applicable disciplinary
code and procedure.
The first respondent
further alleges that section 3(3) of the PMFA provides that in the
event of inconsistency between the PFMA
and any other legislation
the PMFA superseded that Act.
Analysis
In dealing with this
matter, I propose to start with the issue of whether the CCMA could
after having issued a letter that it
had no jurisdiction to consider
the matter, proceed with the arbitration. Secondly, I will deal with
the issue of the employment
relationship and finally the issue of
substitution and then consider which forum is appropriate for the
hearing of this matter.
CCMA Jurisdiction
The legal effect of
the CCMA letter on jurisdiction
According to Hoexter,
the
functus
officio
doctrine
applies only to final decisions. A decision is,
therefore,
revocable before it
becomes final. Finality is considered to be arrived at when the
decision is published, announced or otherwise
conveyed to those
affected by it.
4
In
this case,
a
letter was written by the CCMA case management, no submissions were
made and there is no evidence that the referral form was
considered
by a commissioner. In my view,
the
letter by the CCMA case management cannot be viewed as a final
decision of a commissioner.
It
has been recently held by the Labour Appeal Court in the judgment of
PT
Operational Services (Pty) Ltd v RAWU obo Ngwetsana
5
that it is only
after an administrative agency has finally performed all its
statutory duties or functions in relation to a particular
matter
which is subject to its jurisdiction that it can be said that its
powers or functions were spent by its first exercise.
6
The LAC went further to
conclude that:
‘
...Cellier
did not finally perform his statutory function or duty in relation to
the merits of the rescission application on 12
August 2004. It cannot
therefore be said that he exhausted his powers and discharged his
mandate in relation to the rescission
application. The Court
a
quo
erred
in coming to the conclusion that the ruling of 12 August 2004
rendered Cellier
functus
officio
and
that he could therefore not entertain the subsequent applications for
condonation and rescission on 26 February 2007. There
were proper
applications before him. He applied his mind and granted the
applications. It is not suggested that his ruling should
be reviewed
and set aside on any other ground other than him being
functus
officio
.
The Court
a
quo’s
order
relating to the ruling of 26 February 2007 ought to be set aside.’
7
The
functus officio
argument must therefore fail.
Employment
relationship
Section 10(1)(a) and(b)
of the Free State Gambling and Racing Board Act provides as follows:
‘
10. (1) The
Board shall, in the exercise of its powers and the performance of its
functions under this Act, be assisted by –
Subject to sections 5(1) (a) (i),
(iii) and 5 (1) (b), a suitably qualified and experienced person as
chief executive officer, appointed
by the responsible Member after
consultation with the board, or seconded in terms of subsection (3)
for the purpose of assisting
the board in the performance of all
financial, administrative and clerical responsibilities pertaining to
the functions of the
board, and shall in respect thereof be
accountable to the board and;
(b) such staff, appointed by the board
or seconded in terms of subsection (3), as may be necessary to enable
the board to exercise
and perform its powers and functions under this
Act effectively: Provided that a person shall not be appointed by the
board in
terms of this paragraph or remain a member of the staff of
the board if he or she is subject to any disqualification as referred
to in sections 5(1)(a)(i),(iii) and 5(1)(b).’
Responsible member is
defined as: ‘The member of the Executive Council responsible
for Economic Affairs and Tourism’,
which is the applicant in
this case.
The Board was created by
statute and the statute clearly provides how the appointments of the
CEO and other members of staff are
done. It empowers the MEC to
appoint the CEO in consultation with the Board and the Board is
empowered with the appointment of
other staff members but excludes
the CEO’s appointment.
In
the judgment
of
Masetlha
v President of the Republic of South Africa and Another
,
8
Moseneke DCJ, held as
follows:
‘
The
power to dismiss is necessary in order to exercise the power to
appoint. The High Court is right that the power to dismiss a
head of
the Agency is a necessary power without which the pursuit of national
security through intelligence services would fail.
Without the
competence to dismiss, the President would not be able to remove the
head of the Agency without his or her consent
before the end of the
term of office, whatever the circumstances might be. That would
indeed lead to an absurdity and severely
undermine the constitutional
pursuit of the security of this country and its people. That is why
the power to dismiss is an essential
corollary of the power to
appoint and the power to dismiss must be read into section 209(2) of
the Constitution. There is no doubt
that the power to appoint under
section 209(2) of the Constitution and the power under ISA implies a
power to dismiss.’
I align myself with this
reasoning. It follows therefore that the power to dismiss is located
in section10 (1) (a) of the Free
State Gambling and Racing Board
Act. The applicant had the power to dismiss the CEO. The CEO becomes
a board member, ex officio.
Further members of the Board are
appointed by the applicant in consultation with the Executive
Council. Other staff members are
appointed by the Board. This
distinction is quite important as it shows the intention of the
statute.
It is also clear from
the legislation that the CEO is appointed for the purposes of
assisting the Board in the performance of
its functions.
To the extent that the
memorandum of agreement entered into between the third respondent
and the Board is seen to delegate the
powers of the employer to the
Board, that view would be misplaced in that those parties had no
such authority in terms of the
statute. In any event, the applicant
did not delegate his duties as an employer to the Board. Even if he
did, he would have to
have been authorised by the relevant statute
to do that.
It is clear to me that
the commissioner erred in finding that the applicant was not the
employer of the applicant.
Substitution
Turning
to the issue of substitution, it is common cause that the Department
was cited as the employer in the referral form. The
applicant did
not take issue with this citation. The applicant attended the CCMA
proceedings as the employer to defend the matter.
The
point
in limine
they raised pertained to the
CCMA not being a correct forum to arbitrate due to the third
respondent being employed by the applicant. The commissioner however
found that the Board was the employer and substituted the Board as
the employer in place of the applicant as already stated.
Rule 26(6) of the CCMA
rules stipulates that:
‘
If in any
proceedings it becomes necessary to substitute a person for an
existing party, any party to the proceedings may apply
to the
Commission for an order substituting that party for an existing
party, and a commissioner may make such order or give appropriate
directions as to the further procedure in the proceedings.’
From the above, the
commissioner may make an order or give direction for further
procedure when it becomes necessary to substitute
a person for an
existing party. That order or directive is however preceded by an
application.
I agree with the
applicant’s propositions that a formal application ought to
have been served and filed. The commissioner
ought to have postponed
the matter and allowed for service of the notice of substitution to
the affected party, the Board. It
was improper to make an order
against a non-party, in my view. Accordingly, the commissioner
committed gross irregularity by
substituting a party without notice.
In view of my finding on
the employment relationship, the substitution issue becomes
academic.
The issue that remains
is whether the CCMA or the bargaining council has jurisdiction. My
approach is that this matter has been
going on for a long time and
does need to be brought to finality.
The applicant has been
blowing hot and cold I must say. On the one hand, it seemed to have
accepted in the letter written by the
state attorney to the third
respondent’s attorney that the matter will be at the CCMA as
per the bargaining council’s
conciliator’s advice. It
even went further in their letter suggesting that they would request
that a senior commissioner
be appointed. From the transcribed
record, it appears that the applicant’s representative
conceded that the CCMA had concurrent
jurisdiction with the
bargaining council and also submitted that they will abide by the
ruling of the commissioner.
The applicant also
submitted, in argument, that if the commissioner’s ruling had
stopped on the issue of which forum was
appropriate, then there
would have been no need for the review.
My view is that the
matter should remitted back for the arbitration hearing to continue
before another commissioner at the CCMA.
This is done for the
purposes of ensuring that this matter is finally brought to
finality. I agree with the commissioner that
section 147 of the LRA
does allow the CCMA to still hear the matter even if it is found
that the parties belong to the bargaining
council.
I have also noted that
the Department of Tourism and Environmental Affairs, which in itself
is not a legal persona has been cited
as a party in the referral
form. I will give no view on this as the applicant has not taken
issue with it.
I also note that these
proceedings were brought by the applicant although the party who was
substituted was the Board. I am, however,
satisfied that the
applicant has interest in the matter and was entitled to bring this
application. In any event, that was also
not raised as an issue by
the third respondent.
Conclusion
In conclusion, I find
that the applicant was the employer of the third respondent by
virtue of section 10(1) (a) of the Free State
Gambling and Racing
Board. He had the authority to appoint and, accordingly, to
terminate the third respondent’s appointment.
That authority
was not delegated to the Board.
Secondly, the
commissioner committed a gross irregularity by substituting the
Board as the employer, without having given them
notice.
Thirdly, the letter from
the CCMA was not a final decision making the CCMA
functus
officio.
Fourthly, for the sake
of expediency the matter must be remitted back to the CCMA for the
hearing of the arbitration before another
commissioner.
I make no cost order
against the first respondent.
I, therefore, make the
following order:
The ruling made by the
first respondent on 19 September 2007 under case number FS2729/06 is
reviewed and set aside.
The ruling is
substituted with the following:
The applicant is the
employer of the third respondent.
The matter is remitted
back to the third respondent for an arbitration hearing to continue
before another commissioner other than
the first respondent.
The second respondent is
directed to set this matter down for arbitration hearing as a matter
of urgency.
There is no order as to
costs.
__________________
Boqwana AJ
Acting Judge of the
Labour Court
APPEARANCES:
For the applicants:
Advocate J.Y. Classen SC
Instructed by: B M
Maranyane, Bloemfontein
For
the first respondent: Mr M Khang of Mphafi Khang Inc., Bloemfontein
1
Free
State Gambling and Racing Act, No.6 of 1996
2
Act
No. 66 of
1995
3
Act
No.1
of 1999.
4
See
Cora Hoexter, Administrative Law in South Africa, 2007 at 247.
5
(Case
number JA7/11)
[2012] ZALAC 34
(27
November 2012).
6
Id
at para 30.
7
Id
at para 38.
8
[2007] ZACC 20
;
2008
(1) SA 566
(CC) at para 68.