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[2013] ZALCJHB 76
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City of Johannesburg v South African Local Government Bargaining Council and Others (JR 2996/10) [2013] ZALCJHB 76 (16 May 2013)
REPUBLIC OF SOUTH
AFRICA
THE LABOUR COURT OF
SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable
Case no: JR 2996/10
In the matter between:
CITY OF JOHANNESBURG
...........................................................................
Applicant
and
SOUTH AFRICA LOCAL
GOVERNMENT
BARGAINING COUNCIL
...................................................................
First
Respondent
SMANGA TOLI N.O
......................................................................
Second
Respondent
SOUTH AFRICAN
MUNICIPAL WORKERS UNION
........................
Third Respondent
WILLY LEKOLOANE
......................................................................
Fourth
Respondent
MATSHEDISO MOGASE
...................................................................
Fifth
Respondent
Heard:
19
December 2012
Delivered: 16 May 2013
Summary: Review of a
jurisdictional ruling- Labour Court has exclusive jurisdiction to
adjudicate dispute emanating from section
34 of the BCEA- first
respondent lacks
jurisdiction to deal with such
matters
-
jurisdictional
ruling made by the second respondent reviewed and set aside-
arbitration award annulled- third respondent to pay the costs
of the proceedings.
___________________________________________________________________
JUDGMENT
___________________________________________________________________
NKUTHA AJ
Introduction
City of Johannesburg
[“applicant”] seeks to review and set aside a
jurisdictional ruling made by the Commissioner,
Mr S Toli [“second
respondent”] on 21 August 2009, and to set aside the
arbitration award made by the second respondent
on 15 September 2010
under case number JMD120802.
The application is
opposed by the third, fourth and fifth Respondents [“respondents”].
Condonation
The applicant seeks,
further, condonation for late filing of the application to review
the jurisdictional ruling which is late
by almost two years. Even
though in the notice of motion the applicant clearly requests this
relief in prayer 3 thereof, the
founding affidavit failed to canvass
facts to support the granting of this relief.
The respondents on the
other hand do not seem to bemoan the said omission nor raise an
objection in its answering affidavit. However,
the objection was
raised for the first time in the respondents’ heads of
argument filed on 25 January 2012.
The applicant filed the
supplementary affidavit in support of its applications for
condonation on 8 February 2012 consequent to
the respondents’
objection. The respondents saw no need to grace it with an answer;
not even an oral submission was made
in this regard from the bar in
Court.
I am satisfied with the
explanation furnished for the delay. I endorse the applicant’s
prudent approach to continue and
participate in the arbitration
proceedings with a view that an award in its favour would have
rendered the review of the jurisdictional
ruling moot. Even though
the degree of lateness is extensive, the respondents suffered no
prejudice as result of the said delay
and overall the applicant has
good prospects of success.
In
the circumstances, condonation is granted.
Jurisdiction Ruling
The
second respondent premised his finding on the case of
Fidelity
Guards Holdings (Pty) Ltd v Epstein NO and Others.
1
He
recounts in his jurisdictional ruling made at the commencement of
arbitration proceedings that he derived his right to arbitrate
the
matter from the outcome certificate confirming the dispute as
unresolved and that the said outcome certificate remains valid
until
reviewed and set aside.
2
Factual Background
The fourth and fifth
respondents are in the employ of the applicant’s Development
Planning and Urban Management Department.
During December 2006 the
applicant’s forensic audit service issued its investigation
report consequent to their investigation
pertaining to the Cellphone
Policy and non-payment of excess amount due to the service provider,
Vodacom [“Vodacom”]
by its employees. The applicant had
to pay the outstanding amounts in excess of its subsidised limits
when Vodacom failed to
recover same from defaulting employees.
The forensic report
concerned found the fourth and fifth respondents to have exceeded
their subsidised amounts by R26 483.55 and
R1 520.60
correspondingly, the debts they ardently disputed. The fourth and
fifth respondents requested proof of indebtedness
in a form of
itemised billing from Vodacom to no avail.
The fourth and fifth
refused to sign acknowledgment of debt in accordance with the
forensic report. At this, the applicant began
to deduct from their
salaries monies owned by them, R2000.00 monthly instalments from the
fourth respondent and the whole amount
due was deducted from the
fifth respondent.
The fourth and fifth
respondents lodged an internal grievance which was unsuccessful.
Consequently, an unfair labour practice
dispute was referred to the
first respondent and the main issue in dispute being the unlawful
deduction of monies from the fourth
and fifth respondents’
salaries.
Grounds for Review
The applicant contends,
firstly, that the second respondent failed to consider whether he
had jurisdiction to hear the matter
and such failure amounts to
irregularity.
Secondly, the applicant
contends that the first respondent lacked jurisdiction to determine
the respondents’ dispute as
it pertains to the legality of the
deductions by the employer from employees’ remuneration. In
essence, the applicant contends
that the ward is a nullity since the
second respondent had no jurisdiction to issue it.
Legal Principles and
Analysis
The crux of the matter
is whether or not the certificate of outcome issued by the
conciliating commissioner conferred jurisdiction
to the second
respondent to determine the matter concerning legality of the
deduction of monies from the fourth and fifth respondents’
salaries by the applicant.
The
second respondent’s ruling seem to have been induced by
Fidelity
Guards
where
the Labour Appeal Court held that once a certificate of outcome is
issued by a conciliating commissioner, an arbitrating
commissioner
has jurisdiction to determine a dispute until such time as the
certificate is reviewed and set aside.
However,
the facts in that case are distinguishable from the matter at hand.
In
Fidelity
Guards
the
jurisdictional issue pertained to the late referral of the dispute
to the Commission for Conciliation Mediation and Arbitration
[“CCMA”]. Despite being aware of the late referral, the
applicant in that case objected to the CCMA jurisdiction
for the
first time in its review application. Accordingly, the second
respondent seriously misapprehended the context within
which the
learned Judge President Zondo, as he was then, dealt with the
question of reasonableness of the time within which a
party may
object to the processing of the dispute because CCMA lacks of
jurisdiction.
3
In
Bombardier
Transportation (Pty) Ltd v Mtiya NO and Others
4
Van
Niekerk J, after extensive analysis of relevant case law, succinctly
provided a more practical and plausible approach which
I align
myself with :
‘
In
other words, a certificate of outcome is no more than a document
issued by a commissioner stating that, on a particular date,
a
dispute referred to the CCMA for conciliation remained unresolved. It
does not confer jurisdiction on the CCMA to do anything
that the CCMA
is not empowered to do, nor does it preclude the CCMA from exercising
any of its statutory powers. In short, a certificate
of outcome has
nothing to do with jurisdiction. If a party wishes to challenge the
CCMA’s jurisdiction to deal with an unfair
dismissal dispute,
it may do so, whether or not the certificate of outcome has been
issued. Jurisdiction is not granted or afforded
by a CCMA
commissioner issuing a certificate of outcome. Jurisdiction either
exists as a fact or it does not
.’’
5
This Court has, on
several occasions and subsequent to
Bombardier
, endorsed the
finding that a certificate of outcome issued by a commissioner has
less legal significance, if at all. The second
respondent’s
finding that unless reviewed and set aside, the certificate of
outcome gave him jurisdiction to arbitrate
the matter clearly shown
that he
misconstrued his statutory powers.
Furthermore,
regard must be had to the provisions
of
Rule 22 of the CCMA Rules which enjoined a commissioner to deal with
a jurisdictional issue if during arbitration it becomes
apparent
that it has not been determined. In essence, the second respondent
should have satisfied himself that, based on evidence
before him, he
had jurisdiction to arbitrate the matter.
Reliance on the outcome
certificate was misplaced and did not amount to a proper application
of the second respondent’s
mind to Rule 22 obligation for, at
least, one or more or all of the reasons hereunder.
The respondents had
conceded in their submission, as recorded in paragraph 5 of the
jurisdictional ruling, that the dispute before
the second respondent
had nothing to do with unfair labour practice as it did not relate
to benefits as provided for in section
186(2)(a) of the Labour
Relations Act 66 of 1996 as amended [“LRA”].
The main issue in
dispute had to do with amounts of money allegedly deducted from the
fourth and fifths respondents’ salaries
in breach of
section
34
of the
Basic Conditions of Employment Act 77 of 1997
as amended
[“BCEA”].
Section
77(1)
of the BCEA grants this Court exclusive jurisdiction in
respect of all matters in terms of that Act, subject to the
Constitution
and the jurisdiction of the Labour Appeal Court and
except in respect of an offence specified in sections 43, 44, 46,
48, 90
and 92 or where that Act provides otherwise.
In
S
A Rugby Players Association and Others v S A Rugby (Pty) Ltd and
Others,
6
the Labour Appeal Court, following
the approach in
In
Benicon
Earthworks and Mining Services (EDMS) BPK v Jacobs NO and Others
7
held that:
‘
The
CCMA is a creature of statute and is not a court of law. As a general
rule, it cannot decide its own jurisdiction. It can only
make a
ruling for convenience. Whether it has jurisdiction or not in a
particular matter is a matter to be decided by the Labour
Court...
The CCMA may not grant itself jurisdiction which it does not have.
Nor may it deprive itself of jurisdiction by making
a wrong finding
that it lacks jurisdiction which it actually has. There is, however,
nothing wrong with the CCMA enquiring whether
it has jurisdiction in
a particular matter provided it is understood that it does so for
purposes of convenience and not because
its decision on such an issue
is binding in law on the parties.
In
Benicon
’
s
case the Court said at 804C-D:
‘
In
practice, however, an Industrial Court would be short-sighted if it
made no such enquiry before embarking upon its task. Just
as it would
be foolhardy to embark upon proceedings which are bound to be
fruitless, so too would it be fainthearted to abort the
proceedings
because of a jurisdictional challenge which is clearly without
merit...’
The same approach was
endorsed in
Sanlam Life
Insurance Ltd v CCMA and Others,
8
wherein the Labour Appeal Court
stated that:
‘
It
was, therefore, incumbent upon the Labour Court to deal with the
issue whether or not there had been an employment relationship
between the appellant and the third respondent and, therefore,
whether
the CCMA had the requisite jurisdiction to deal with the dispute
.
The issue of jurisdiction is dependent on the answer to this
question. In my view the Labour Court erred in holding that the issue
of jurisdiction was an interlocutory point which the commissioner
could revisit and on which he could perhaps later come to a different
conclusion.
The
Labour Court was called upon to decide de novo
whether
there was an employer/employee relationship between the parties
.
It was not called upon to decide whether the commissioner’s
findings were justifiable or rational.’[Emphasis added]
It was argued on behalf
on the applicant that the second respondent’s failure to
consider the existence of a jurisdictional
facts amounts to a gross
irregularity rendering the award reviewable on that ground alone, a
submission correctly conceded by
the respondents in Court. However,
the respondents argued further that cell phone allowance is a
benefit in terms of the section186(2)(a)
of the LRA and therefore it
is merely the second respondent’s incorrect reliance on
section 34 of the BCEA that should
be reviewed and set aside.
Instead of remitting the matter to CCMA, this Court should replace
the award with the order that the
a cell phone allowance is a
benefit section186 (2)(a) of the LRA and the result would remain the
same.
The respondents’
proposition stands to be rejected, firstly, because it is flawed in
the light of the facts that they had
placed before the second
respondent, which were manifestly about unlawful deductions in terms
of section 34 of the BCEA. Secondly,
and disconcertingly, it is an
opportunistic afterthought which is not only a deviation from the
respondents’ written submissions,
but amounts to a counter
review application lodged from the bar.
In conclusion, it is
abundantly clear that the second respondent misconstrued the legal
principles relating jurisdictional authority
of the first
respondent. It is discernible from above that this Court has
exclusive jurisdiction to adjudicate dispute in terms
of section 34
of the BCEA. I
n coming to
the conclusion that the first respondent had the requisite
jurisdiction to arbitrate the dispute, the second respondent
committed a material error of law and his jurisdictional ruling
stands to be reviewed and set aside accordingly.
In light of the above,
the arbitration award is accordingly nullified. The only issue
remaining is whether or not to remit the
matter to the first
respondent. The finding that the first respondent lacked
jurisdiction to deal with the matter has in essence
deposed of the
matter. Remitting it back to the first respondent is accordingly
rendered moot.
Costs
There is no reason to
depart from the usual rule that costs follow the result in respect
of the third respondent, who is the fourth
and fifth respondent’s
trade union and represented them the during arbitration proceedings.
The respondents opposed the
relief sought by the applicant even
though they had consistently maintained during the arbitration
proceedings that the dispute
was about unlawful deductions.
Given their late
concession, the respondents may well have been better advised to
abide by this Court’s decision, rather
than to oppose the
application.
For these reasons, I
make the following order:
1.
The
jurisdictional ruling made by the second respondent
on 21
August 2009
is reviewed and set aside and, for
it, is substituted with the following order:
‘
That
this Court has exclusive jurisdiction to adjudicate dispute emanating
from section 34 of the BCEA and
the
first respondent, South Africa Local Government Bargaining Council,
accordingly lacks
jurisdiction
to deal with such matters
.’
2. The
arbitration award
made by the first respondent on
15
September 2010
is accordingly annulled.
3. The third respondent
is to pay the costs of these proceedings.
_________________
P Nkutha
Acting Judge of the
Labour Court of South Africa
APPEARANCES
FOR THE APPLICANT:
Advocate FA Boda
Instructed by Norton Rose
Attorneys.
FOR THE RESPONDENTS:
Advocate M Euijesil
Instructed by Cheadle
Thomson & Haysom.
1
(2000)
21 ILJ 2382 (LAC).
2
See
Paragraph 11 of Jurisdictional Ruling.
3
Fidelity
Guards
at para 15.
4
(2010)
31 ILJ 2065 (LC).at para 14.
5
See
also
Seeff Residential Properties v Mbhele NO and Others
(2006)
27 ILJ 1940 (LC) at para 12.
6
(2008)
29 ILJ 2218 (LAC) at para 40 .
7
(1994)
15 ILJ 801 (LAC) at para 804 C to D.
8
(2009)
30 ILJ 2903 (LAC) at para17.