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[2013] ZALCD 26
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IMATU and Others v Ethekwini Municipality and Others [2013] ZALCD 26; (2014) 35 ILJ 1572 (LC) (12 September 2013)
REPUBLIC OF SOUTH AFRICA
IN THE LABOUR COURT OF SOUTH AFRICA, DURBAN
JUDGMENT
Reportable
Case Number: D295/11
In the matter between:
IMATU
......................................................................................................
First
Applicant
R. CROUCH & 4 OTHERS
.................................................
Second
to Sixth Applicants
and
ETHEKWINI MUNICIPALITY
..............................................................
First
Respondent
SOUTH AFRICAN LOCAL BARGAINING
COUNCIL
(SALGBC) `
..................................................................
Second
Respondent
NHLANHLA
MATHE N.O.
..................................................................
Third
Respondent
Heard:
30 May 2013
Delivered:
12 September 2013.
Summary: Review of award – collective
agreement interpreted by commissioner -
A collective agreement
entered into by the employer and its employees, or their chosen
representatives has the effect of curbing
this common law right, but
only to the extent as is outlined in the collective agreement. As a
corollary, the employer retains
its common law based rights that are
not waved expressly or by necessary implication in any collective
agreement. Award not reviewable.
JUDGMENT
CELE, J
Introduction
[1] The third respondent’s decision dated 20 February 2011
which confirmed the first respondent’s decision to rescind
the
placement of the employees published in the placement circular dated
19 February 2007 is sought to be reviewed and set aside
in terms of
section 158 (1) (g) of the Act
1
.
The first respondent, hereafter referred to as the respondent,
opposed the review application.
Factual Background
[2]
The second to further applicants,
hereafter referred to simply as applicants were in the employ of the
respondent holding various
positions described as:
Crouch – Chief Conservationist;
Stewart – Natural Areas Officer;
Liebenberg – Conservation Supervisor;
Coskey - Conservation Supervisor;
Zuma - Conservation Supervisor.
[3]
An
amalgamation of various
municipalities to form the respondent took place in terms of a
collective agreement called the Placement
Policy which agreement had
been entered into in April 2003 between the first applicant, the
respondent and the South African Municipal
Workers Union,(“the
SAMWU”). A placement committee was formed constituted of 8
members, 4 of which were respondent’s
representatives and the
other four were union representatives, According to the provisions of
the collective agreement, two of
the four union representatives’
seats were allocated to each of the two recognised trade unions. The
Placement Committee
was in charge of placement of staff into the
newly created organogram of the respondent.
[4] Decisions are taken by way of consensus seeking process between
the respondent, being the employer and organised labour components,
taking into account the provisions of the agreement. In circumstances
where consensus cannot be reached between the employer and
organised
labour in respect of a particular placement, Clause 3.3.2 breaks the
deadlock by providing that where the parties cannot
reach consensus,
the employer (“council”) proposal will be published.
Clause 8 provides that employees will be notified
by personalised
letters of any post into which the Committee has confirmed their
placement. It is common cause that all the applicants
received these
personalised letters on 19 February 2007.
[5] Clause 9 sets out the collectively agreed process for disputes or
objections to placements. In terms of this clause, employees
or trade
unions acting on their behalf have the right to lodge grievances
against their placement, within ten days of publication
of the
committee’s decision. If no grievance has been lodged within 10
days, the placement is deemed to be final.
[6]
In terms of the placement
circular dated 19 February 2007, the applicants were placed
onto
the respondent’s new organisational structure on 9 January
2007. But it was not by consensus and in terms of the provisions
of
Clause 3, the employer proposal, as represented by Deputy Head Mr
Christo Swart, was published
as follows:
Crouch – Conservator;
Stewart – Conservator;
Liebenberg – Conservation Officer;
Coskey - Conservation Officer;
Zuma - Conservation Officer.
[7] According to the respondent,
the
applicants' placements made in terms of the placement circular dated
19 February 2007 were done in error. It was said that the
Conservator
position was intended to be a new, strategic post that would be
responsible for five zones. Messrs Butler and Crouch
were tasked with
the drafting of the description for the Conservator post. They used
the donor job description, of chief conservationist.
The positions
were then close- matched to Messrs Crouch and Stewart. Job
descriptions could only be finalised with the approval
of Messrs
Swart and Mkhwanazi. It was their evidence at the arbitration
proceedings that they had not approved the final job description.
Human Resources (HR) staff was responsible for managing the placement
process and advising management. HR were not authorised to
change the
classification of the role.
[8] When according to the respondent the error was discovered, the
matter was investigated and the staff was consulted.
At
a meeting of the placement committee held on 7 July 2009, the
employer, represented by Mr Swart motivated for the rescission
of the
applicant’s placements, a decision taken two and a half years
earlier in terms of clause 3.3.2. The organized labour
component of
the placement committee did not support the rescission proposed by
the employer. SAMWU recorded that they abstained
from the discussion
of the employer proposal and IMATU indicated that they would take the
matter further. Regardless, the views
of the organized labour
component of the placement committee, Mr Swart as employer
representative recorded that he moved forward
with the employer
proposal and that the employer was rescinding the applicant’s
placements as per “Management prerogative”.
[9] The applicants who had been placed as Conservation
Officers (Messrs Liebenberg, Coskey and Zuma) were returned to the
posts
of Park Nursery Supervisors. This was on 7 January 2009 when
t
he respondent purportedly exercised its
management prerogative to restructure its department and rescind the
placements. The applicants
were aggrieved and they referred a dispute
for arbitration, in terms of the collective agreement. The third
respondent was appointed
to arbitrate the dispute.
[10] The crisp issue which the commissioner had to determine was
whether the respondent was in the circumstances entitled to rescind
the placements.
It was common cause that there was
no provision in the collective agreement that made provision for
rescission of a placement decision
by the committee.
Nor is
there any provision for the placement committee to change its
decision, save in circumstances where an employee has lodged
a
dispute in terms of Clause 9.
[11]
An argument was advanced before
the commissioner that the decision taken by the respondent was
permitted in order to correct a wrong.
It was agreed in the
pre-arbitration minute that in addition to considering the provisions
of the collective agreement, the commissioner
was to further apply
his mind to whether the first respondent could rely on any other law
in the circumstances of this case entitling
the first respondent to
rescind a placement decision once such placement has been made.
[12] The commissioner found that the Placement Policy
did not prevent management from exercising its authority. The
commissioner
found that the first respondent was entitled to exercise
its discretion and rescind the placements made in error.
[13]
The commissioner made the finding that the
justification or authority for the first respondent’s action of
rescinding the
placement did not reside in the collective agreement
but was derived as follows:
‘
This authority (to
correct the error by rescinding) is located within the province of
managerial discretion of the employer to manage
the municipality. In
line with that discretion the employer has the right to restructure
its operation’.
Grounds for review
[14] In support of the review application the applicants contended
that:
The commissioner’s reasoning was defective and wrong in law.
It is not disputed that an employer ordinarily has a discretion
to
manage and restructure its organization as it pleases, subject to
the applicable legal framework. However, the respondent
in this case
made a decision to enter into a collective agreement that expressly
governs the manner in which decisions regarding
placement of
employees onto the new agreed organizational structure would be
taken.
Decisions are taken by a committee set up specifically for this
purpose. The collective agreement by its very nature limits the
general right of the employer. The employer has given up, by
agreement, the sole discretion to take decisions on the placement
of
employees.
It is only in a deadlock situation where the members of the
committee have attempted to reach consensus, but have been unable
to
do so, where the proposal put forward by the employer assumes
greater weight. The employer proposal is published as a placement
committee decision, giving rise to the rights set out in Clause 9.
In the absence of a grievance by the employee or
his union on his behalf, the agreement dictates that the placement
is deemed
final. At this stage, the placement committee becomes
functus officio
.
What the employer has done in the circumstances
of this case is
ultra vires
the collective agreement. Neither the placement
committee, nor the employer component thereof, has recourse to
revisit, or change
a decision of the committee. Had there been such
an intention between the parties, provision would have been made in
the collective
agreement.
In addition to the legal consequences flowing from the provisions of
the collective agreement, it is submitted that the committee
or any
component thereof would certainly be estopped by virtue of the
passage of time from rescinding its decision. It is not
disputed
that two and a half years elapsed from the date of placement to the
date the employer rescinded the committee decision
to place.
In his consideration of the first respondent’s actions in
light of the provisions of the agreement, the commissioner erred
in
his reasoning. He failed to apply his mind to the express provisions
of the collective agreement and he failed to appreciate
the fact
that the rights of the employer had been limited by virtue of the
provisions of the agreement. He further failed to
appreciate the
purpose behind clause 3.3.2 and he read into the agreement rights
that were never contemplated by the parties.
The limited scope of the “management
prerogative”
2
was misunderstood by the commissioner and the
legal principles applicable to collective agreements and the legal
status of collective
agreements was not properly considered and/or
ignored.
It is submitted that the review must succeed on this ground alone as
the Commissioner clearly committed an error of law and made
a
finding that no reasonable commissioner would have come to having
properly applied their mind to the spirit and specific provisions
of
the collective agreement.
Opposition to the review application
[15] The respondent submitted that the applicants have failed to
establish any factual or legal basis on which this Court can review
and set aside the commissioner's award. The contention was that the
applicants have failed to show any misconduct on the part of
the
commissioner in relation to his duty as a commissioner. It was not
shown that the commissioner neither applied his mind to
the matter
nor committed any gross irregularity in the conduct of the
proceedings. The applicants are said to have failed to demonstrate
that the commissioner's award is not justifiable in relation to the
reasons provided for it, given the evidence properly available
to the
commissioner and that the decision he reached was one which a
reasonable decision-maker could not reach in the circumstances.
Evaluation
[16]
The
Constitutional Court decision in
Sidumo
and Another v Rustenburg Platinum Mines Ltd and Others
3
provides an approach to reviewing
decisions of the Commission for Conciliation, Mediation and
Arbitration (CCMA) and similarly to
decisions of bargaining councils
in arbitration proceedings. The Court held that the appropriate
standard of review is one of reasonableness.
The question to ask is
whether the decision reached by a commissioner or arbitrator is one
that a reasonable decision-maker could
not reach. Paragraph 109 of
the judgment contains an important warning as the Court said:
‘
Review
for reasonableness, as explained by Professor Hoexter, does threaten
the distinction between review and appeal. The Labour
Court in
reviewing the awards of commissioners inevitably deals with the
merits of the matter. This does tend to blur the distinction
between
appeal and review. She points out that it does so in the limited
sense that it necessarily entails scrutiny of the merits
of
administrative decisions. She states that the danger lies, not in
careful scrutiny, but in "judicial overzealousness in
setting
aside administrative decisions that do not coincide with the judge's
own opinions’. This Court in Bato Star recognised
that danger.
A judge's task is to ensure that the decisions taken by
administrative agencies fall within the bounds of reasonableness
as
required by the Constitution’.
[17] In summary, i
t was submitted by the
applicants that the review application ought to succeed on the ground
that the commissioner committed an
error of law and made a finding
that no reasonable commissioner would have come to, having properly
applied their mind to the spirit
and specific provisions of the
collective agreement. The commissioner was said to have erred by
failing to apply his mind to the
express provisions of the collective
agreement and thus to appreciate the fact that the rights of the
employer had been limited
by virtue of the provisions of the
agreement. This was in reference to the
commissioner having
found that the Placement Policy did not prevent management from
exercising its authority and therefore that
the first respondent was
entitled to exercise its discretion and rescind the placements made
in error.
[18] It is trite that the employer has a common law right to arrange
the working environment of its employees in conformity with
what it
considers appropriate and expedient so as to achieve maximum
production in its workplace. The employer is however obliged
to
provide employees with reasonably safe and healthy working
conditions. The scope of this duty extends to providing proper
machinery
and relevant equipment, properly trained and competent
supervisory staff and a safe system of working.
4
A collective agreement entered into by the employer and its
employees, or their chosen representatives has the effect of curbing
this common law right, but only to the extent as is outlined in the
collective agreement. As a corollary, the employer retains
its common
law based rights that are not waved expressly or by necessary
implication in any collective agreement.
[19] In the present matter the parties agreed on a Placement Policy
which agreement had been entered into in April 2003, in terms
of
which a Placement Committee was formed to be in charge of placement
of staff into the newly created organogram of the respondent.
In
circumstances where consensus cannot be reached between the employer
and organised labour in respect of a particular placement,
Clause
3.3.2 breaks the deadlock by providing that where the parties cannot
reach consensus, the proposal of council as the employer,
will be
published. Clause 8 provides that employees will be notified by
personalised letters of any post into which the Committee
has
confirmed their placement. Therefore, where the parties cannot reach
consensus, the employer’s discretionary powers,
ordinarily
waved through a collective agreement, resurface.
[20] The commissioner had to determine whether the first respondent
was entitled to exercise its discretion and rescind the placements
which it considered to have been made in error. He found that the
Placement Policy did not prevent management from exercising its
authority.
The commissioner made the finding that
the justification or authority for the first respondent’s
action of rescinding the
placement did not reside in the collective
agreement but was derived or located within the province of
managerial discretion of
the employer to manage the municipality. He
found that in line with that discretion the employer had the right to
restructure its
operation.
[21] In reaching the decision he came to, the commissioner has not
been shown by the applicants to have strayed from utilizing
the
evidence adduced or to have applied his mind to any irrelevant
considerations. On the contrary, and as submitted by the respondent,
he appears to have:
properly considered and evaluated the evidence
presented to him during the arbitration proceedings;
applied his mind to the facts and evidence before him;
made findings and reached a determination that is
justifiable in relation to the reasons given for it;
properly and correctly came to the conclusion that the
first respondent acted within its managerial discretion to rescind
the
incorrect placements;
made a well balanced, coherent and logically reasoned
award; and
reached a decision which a "reasonable decision-maker"
could reach in the circumstances.
[22] The applicants have made bold but unsubstantiated allegations
that the commissioner
failed to apply his mind to
the express provisions of the collective agreement; that he failed to
appreciate the fact that the rights
of the employer had been limited
by virtue of the provisions of the agreement,and that he failed to
appreciate the purpose behind
clause 3.3.2 and he read into the
agreement rights that were never contemplated by the parties.
[23] In my view, this application failed to demonstrate any
circumstances under which the award in this case stands to be
reviewed
and set aside.
[24] Accordingly, the following order will issue:
The review application is dismissed.
No costs order is made.
________
Cele, J
Judge of the Labour Court of South Africa.
1
The
Labour Relations Act Number 66 of 1995 ( as amended).
2
3
2008(2)
SA 24 (CC).
4
See
Wilsons and Clyde Coal Co Ltd v English
[1937] UKHL 2
;
[1937] 3 ALL ER, 628.