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[2014] ZALCJHB 1
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Steelcor (Pty) Ltd v Mokwena NO and Others (JR812/2012) [2014] ZALCJHB 1 (17 January 2014)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Case
no: JR 812 / 2012
Not
Reportable
DATE:
17 JANUARY 2014
In
the matter between:
STEELCOR
(PTY)
LTD
.........................................................................
Applicant
And
SEELE
MOKWENA N.O.
…..................................................
First
Respondent
METAL
AND ENGINEERING INDUSTRIES
BARGAINING
COUNCIL
....................................................
Second
Respondent
LAWRENCE
RADEBE
.............................................................
Third
Respondent
Heard: 15
January 2014
Delivered: 17
January 2014
Summary:
Bargaining Council arbitration proceedings – Review of
proceedings, decisions and awards of arbitrators – Test
for
review – Section 145 of LRA 1995 – Whether outcome
arrived at by the arbitrator reasonable – determinations
of
arbitrator compared with evidence on record – arbitrator’s
award or unfair dismissal sustainable and upheld
Disciplinary
proceedings – Employee leaving disciplinary proceedings at the
outset – consequences of such conduct in
respect of fairness
and relief – principles stated
Misconduct
– nature of misconduct – sanction of dismissal not
appropriate – determination of arbitrator upheld
Insubordination
– splitting of charges – dismissal not justified for
actual offence – employer contributed to
altercation –
award of arbitrator upheld
Unfair
dismissal – issue of relief – finding of reinstatement
inappropriate – award of reinstatement set aside
–
compensation ordered
JUDGMENT
SNYMAN,
AJ
Introduction
[1]
This matter concerns an application by the applicant to review and
set aside an arbitration award of the first respondent in
his
capacity as arbitrator of the Metal and Engineering Industry
Bargaining Council (the second respondent). This application has
been
brought in terms of Section 145 as read with Section 158(1)(g) of the
Labour Relations Act
1
(“the
LRA”).
[2]
The third respondent was dismissed by the applicant on 18 April 2011,
based on a complaint by the applicant that the third respondent
was
grossly insubordinate and conducted himself in a manner detrimental
to the employment relationship, which issues will be dealt
with
hereunder. In an award dated 13 March 2012, the first respondent
determined that the dismissal of the third respondent by
the
applicant was substantively unfair, and directed that the applicant
had to fully retrospectively reinstate the third respondent.
The
first respondent further directed that the back pay payable to the
third respondent in terms of the reinstatement award to
be some ten
months’ salary in the sum of R148 682.24. It is these
determinations by the first respondent that forms the subject
matter
of the review application brought by the applicant.
Background
facts
[3]
The third respondent was employed by the applicant as a winding shop
supervisor. The third respondent was also a shop steward
of NUMSA.
The third respondent had some five years’ service with the
applicant at the time of his dismissal.
[4]
The production director for the department in which the third
respondent worked was one John Farren (“Farren”).
It was
clear from the record that the working relationship between Farren
and the third respondent was strained to say the least,
and had
consistently deteriorated over the period of the third respondent’s
employment at the applicant. I am also convinced,
in considering the
evidence on record as a whole, that Farren was in any event not an
easy person to work with.
[5]
The incident giving rise to this matter took place on 15 February
2011. The third respondent was on duty and attending to the
winding
of a transformer and experienced a shortage of copper shim, and
sought assistance to complete his work. There was some
dispute of
fact between the third respondent and Farren about what exactly
happened once the third respondent came into contact
with Farren on
the day, but in my view nothing turns on this, in the end. I will
however set out the contentions of both parties.
[6]
Farren contended that the third respondent had called him (Farren) to
ask how the third respondent had to deal with the shortage
of shim.
According to Farren, he then called Nicholas Grobler (“Grobler’),
an electrician employed by the applicant,
to assist in resolving the
issue. Farren then said that in response to this, the third
respondent then said to him that that he
(Farren) never has solutions
to problems and that he always calls Grobler to resolve problems.
Farren said that he considered
this statement to be disrespectful,
provocative and insubordinate. Farren then informed the third
respondent that he should be
careful in making these kind of
statements as he could get himself into trouble. The third
respondent answered that if Farren
wanted to fire him, then he must
do so. There was then an exchange of words between the parties.
[7]
What further appears to be undisputed is that at some time during
this exchange between the third respondent and Farren, Farren
in fact
called the third respondent an arrogant little man, and in fact said
that he could take the third respondent up on the
issue of firing
him. It was also clear that the third respondent was upset as a
result of the altercation.
[8]
According to the third respondent, on the other hand, he asked Farren
for assistance in the form of getting another employee
to help him
with the work he was carrying out. Farren assessed the work and then
called Grobler, and the third respondent asked
why Grobler was being
called, as all the third respondent needed was a person to help him.
Farren then informed the third respondent
that he must watch his big
mouth as it would land him in trouble and he will dismiss the third
respondent.
[9]
It was common cause that in the end, and a short while later, the
third respondent actually completed the work he was required
to
complete. He actually joined the shims without further incident or
protest.
[10]
Following the above incident, and finally on 5 April 2011, the third
respondent was charged with two charges. These charges
were:
‘
i)
Gross insubordination in that when Mr Farren called Mr N Grobler to
instruct him (Mr Grobler) what to do to join two pieces of
shim for
Lawrence. Lawrence said that Mr Farren has no solutions and always
asks for Mr Grobler to solve the problems.
ii)
Conduct affecting the employer/employee relationship detrimentally.’
(sic)
[11]
The chairperson of the disciplinary hearing, which was a labour
consultant from SEESA, had some difficulty in resolving the
above
factual dispute. The chairperson concluded in his reasoning that it
was not clear what was said, but the chairperson accepted
that the
conduct of the third respondent in saying to Farren that he always
asked Grobler for help was indeed insubordinate, but
found that it
was not grossly insubordinate as the charge read. The chairperson
further concluded that the conduct detrimental
to the employer
resulted from this same event.
[12]
In recommending an appropriate sanction, the chairperson then
recommended that the third respondent be given a final written
warning valid for six months on the first change, but be summarily
dismissed on the second charge. The applicant accepted this
recommendation and implemented the same in writing on 18 April 2011.
[13]
It must also be mentioned that at the time of his dismissal, the
third respondent was subject to a final written warning issued
on 8
February 2011 which appears to have related to an incident where the
third respondent with other employees attended a NUMSA
conference at
the end of October 2010 for a total of three days, when the said
employees were specifically told by management that
they were only
entitled to attend the conference for one day.
[14]
The third respondent then pursued his dismissal to the second
respondent as an unfair dismissal and this dispute ultimately
came
before the first respondent, who made the finding in favour of the
third respondent referred to above.
[15]
This matter will be determined against the above background.
The
relevant test for review
[16]
The proper review test to be applied is known in the general labour
law colloquial tongue as the ‘Sidumo test’.
This test
comes from the judgment in Sidumo and Another v Rustenburg Platinum
Mines Ltd and Others,
2
where Navsa, AJ held that in light of the constitutional requirement
(in s 33 (1) of the Constitution) that everyone has the right
to
administrative action that is lawful, reasonable and procedurally
fair, and that ‘the reasonableness standard should now
suffuse
s 145 of the LRA’. The majority of the Constitutional Court set
the threshold test for the reasonableness of an award
or ruling as
the following: ‘Is the decision reached by the commissioner one
that a reasonable decision-maker could not reach?
3
’
Following on, and in CUSA v Tao Ying Metal Industries and Others,
4
O'Regan J held:
‘
It
is clear…. that a commissioner is obliged to apply his or her
mind to the issues in a case. Commissioners who do not do
so are not
acting lawfully and/or reasonably and their decisions will constitute
a breach of the right to administrative justice.’
[17]
What the Constitutional Court meant in Sidumo and Tao Ying Metal
Industries was a review test based on a comparison by a review
court
of the totality of the evidence that was before the arbitrator as
well as the issues that the arbitrator was required to
determine, to
the outcome the arbitrator arrived at, in order to ascertain if the
outcome the arbitrator came to was reasonable.
[18]
The first occasion the Labour Appeal Court authoritatively considered
the Sidumo review test, and with respect correctly, was
in Fidelity
Cash Management Service v Commission for Conciliation, Mediation and
Arbitration and Others,
5
where the Court said the following:
‘
The
Constitutional Court has decided in Sidumo that the grounds of review
set out in s 145 of the Act are suffused by reasonableness
because a
CCMA arbitration award, as an administrative action, is required by
the Constitution to be lawful, reasonable and procedurally
fair. The
court further held that such an award must be reasonable and if it is
not reasonable, it can be reviewed and set aside.’
As
to what would be considered to be unreasonable, the Court in Fidelity
Cash Management Service held as follows:
6
‘
The
Constitutional Court further held that to determine whether a CCMA
commissioner's arbitration award is reasonable or unreasonable,
the
question that must be asked is whether or not the decision or finding
reached by the commissioner 'is one that a reasonable
decision maker
could not reach' (para 110 of the Sidumo case). If it is an award or
decision that a reasonable decision maker could
not reach, then the
decision or award of the CCMA is unreasonable, and, therefore,
reviewable and could be set aside. If it is
a decision that a
reasonable decision maker could reach, the decision or award is
reasonable and must stand. It is important to
bear in mind that the
question is not whether the arbitration award or decision of the
commissioner is one that a reasonable decision
maker would not reach
but one that a reasonable decision maker could not reach….’
The
Court in Fidelity Cash Management Service then went further and
formulated what can be described as an outcome based review
test
which the Court held the Sidumo review test envisaged, where the
Court said:
7
‘
It
seems to me that, …. there can be no doubt now under Sidumo
that the reasonableness or otherwise of a commissioner's
decision
does not depend - at least not solely - upon the reasons that the
commissioner gives for the decision. In many cases the
reasons which
the commissioner gives for his decision, finding or award will play a
role in the subsequent assessment of whether
or not such decision or
finding is one that a reasonable decision maker could or could not
reach. However, other reasons upon which
the commissioner did not
rely to support his or her decision or finding but which can render
the decision reasonable or unreasonable
can be taken into account.
This would clearly be the case where the commissioner gives reasons
A, B and C in his or her award but,
when one looks at the evidence
and other material that was legitimately before him or her, one finds
that there were reasons D,
E and F upon which he did not rely but
could have relied which are enough to sustain the decision.’
The
Court in Fidelity Cash Management Service concluded:
8
‘…
.
Whether or not an arbitration award or decision or finding of a CCMA
commissioner is reasonable must be determined objectively
with due
regard to all H the evidence that was before the commissioner and
what the issues were that were before him or her. There
is no reason
why an arbitration award or a finding or decision that, viewed
objectively, is reasonable should be held to be unreasonable
and set
aside simply because the commissioner failed to identify good reasons
that existed which could demonstrate the reasonableness
of the
decision or finding or arbitration award.’
[19]
Following a number of different interpretations and applications of
the Sidumo test after the judgment in Fidelity Cash Management,
matters came full circle, so to speak, in the judgment of the SCA in
Herholdt v Nedbank Ltd and Another
9
where the Court again specifically considered the Sidumo test, and
concluded as follows:
10
‘
In
summary the position regarding the review of CCMA award is this: A
review of a CCMA award is permissible if the defect in the
proceedings fall within one of the grounds in s 145(2)(a) of the LRA.
For a defect in the conduct of the proceedings to amount
to a gross
irregularity as contemplated by s 145(2)(a)(ii), the arbitrator must
have misconceived the nature of the inquiry or
arrived at an
unreasonable result. A result will only be unreasonable if it is one
that a reasonable arbitrator could not reach
on all the material that
was before the arbitrator. Material errors of fact, as well as the
weight and relevance to be attached
to the particular facts, are not
in and of themselves sufficient for an award to be set aside, but are
only of consequence if their
effect is to render the outcome
unreasonable.’
What
this judgment means is simply that if the arbitrator ignored material
evidence, and the review court in considering this material
evidence
so ignored together with the case as a whole, believes that the
arbitration award outcome cannot still be reasonably sustained
on any
basis, then the award would be reviewable.
[20]
Following the judgment of the SCA in Herholdt, the Labour Appeal
Court has most recently in Gold Fields Mining South Africa
(Pty) Ltd
(Kloof Gold Mine) v Commission for Conciliation, Mediation and
Arbitration and Others
11
again authoritatively interpreted and applied the Sidumo test and
held as follows:
12
‘
Sidumo
does not postulate a test that requires a simple evaluation of the
evidence presented to the arbitrator and based on that
evaluation, a
determination of the reasonableness of the decision arrived at by the
arbitrator… In other words, in a case
such as the present,
where a gross irregularity in the proceedings is alleged, the enquiry
is not confined to whether the arbitrator
misconceived the nature of
the proceedings, but extends to whether the result was unreasonable,
or put another way, whether the
decision that the arbitrator arrived
at is one that falls in a band of decisions a reasonable decision
maker could come to on the
available material’
With
respect, this clearly postulates that the Sidumo test is limited to
an outcome based review test. The Court further said:
13
‘…
.
What is required is first to consider the gross irregularity that the
arbitrator is said to have committed and then to apply the
reasonableness test established by Sidumo. The gross irregularity is
not a self-standing ground insulated from or standing independent
of
the Sidumo test.…’
And
concluded:
14
‘
In
short: A review court must ascertain whether the arbitrator
considered the principal issue before him/her, evaluated the facts
presented at the hearing and came to a conclusion which was
reasonable to justify the decision he or she arrived at.’
[21]
In my view, and with the view to encapsulate a practical application
of the review test in line with the principles set out
above, the
first step in a review enquiry is to consider or determine if an
irregularity indeed exists where it comes to the arbitration
award or
the arbitration proceedings. A review court determines whether such
an irregularity exists by considering the evidence
before the
arbitrator as a whole, as gathered from the review record, and
comparing this to the award and reasoning of the arbitrator
as
reflected in such award. The review court must also at this stage
apply all the relevant principles of law in order to determine
what
indeed constituted the proper evidence that the arbitrator, as a
whole, would have had to consider. Once an irregularity is
identified, the materiality of the irregularity then becomes relevant
and must be considered. This means that the irregularity
committed by
the arbitrator must be a material departure from the acceptable norm
or a material deviation from the actual evidence
before him or a
material departure from the proper principles of law or a material
failure to consider and determine the evidence
or case, in order to
constitute an irregularity of sufficient magnitude to satisfy this
first step in the enquiry. This approach
of also requiring
materiality of the irregularity takes care of the imperative that not
every possible individual irregularity
that may exist, would be
contemplated by the review test, as the review test requires the
irregularity in the first place to be
‘gross’.
15
If the review court in conducting this first step enquiry should
find that no irregularity exists in the first instance, the matter
is
at an end, no further determinations needs to be made, and the review
must fail.
[22]
Should the review court however conclude that an irregularity indeed
exists, then the second step in the review test follows,
which is
simply a determination as to whether if this irregularity did not
exist, this could reasonably lead to a different outcome
in the
arbitration proceedings. Put differently, could another reasonable
decision-maker, in conducting the arbitration and arriving
at a
determination, in the absence of the irregularity and considering the
evidence and issues as a whole, still reasonably arrive
at the same
outcome. In conducting this second step of the review enquiry, the
review court need not concern itself with the reasons
the arbitrator
has given for the outcome he or she has arrived at, because the issue
of the arbitrator’s own reasoning was
already considered in
deciding whether an irregularity exists in the first place. The
review court, in essence, takes the proper
evidence as a whole, as
ascertained from the review record, considers the relevant legal
principles and decides whether the outcome
that the arbitrator
arrived at could nonetheless be arrived at by another reasonable
decision-maker, even if it is for different
reasons. If, and pursuant
to this second step in the review enquiry, the review court is
satisfied that the same outcome could
not reasonably follow even for
any other reasons, then the review must succeed, because, simply put,
the irregularity would have
affected the outcome. The end result
always has to be an unreasonable outcome for a review to succeed.
[23]
I will now proceed to determine the applicant’s review
application on the basis of the above principles and the two step
enquiry in the application of the Sidumo test as I have set out
above.
Merits
of the review: substantive fairness
[24]
From the outset, I must state that I have found the arbitration award
of the first respondent to be a properly reasoned and
motivated
award. The first respondent dealt with all the pertinent evidence in
a manner that is fully in line with the relevant
principles of law
relating to the determination of evidence. The first respondent for
example excluded evidence not put to the
witnesses for the applicant
by the third respondent and made proper credibility findings on
pertinent issues. I have no hesitation
in saying that the award of
the first respondent on the merits of this matter is a good example
of what an arbitration award should
look like. As a general
proposition, I can find no irregularity in the arbitration award of
the first respondent on the merits
of the matter.
[25]
In applying the Sidumo test, I am of the view that the ultimate
outcome arrived at by the first respondent that dismissal was
inappropriate is unassailable, and must be upheld. One only needs to
consider two pertinent issues in coming to such a conclusion,
both of
which issues the first respondent was very much alive to, and were
pertinently addressed in the arbitration award.
[26]
The first issue can be found in the conduct of the applicant itself
in deciding to dismiss the third respondent. The primary
duty of an
arbitratorn is not to determine if an employee is guilty or not
guilty of a charge. The arbitrator’s duty is
determine whether
the dismissal of an employee is fair or not. In deciding this issue,
the point of departure is to consider precisely
what the employer in
fact dismissed the employee for. In Fidelity Cash Management
Service
16
the Labour Appeal Court specifically held as follows:
‘
It
is an elementary principle of not only our labour law in this country
but also of labour law in many other countries that the
fairness or
otherwise of the dismissal of an employee must be determined on the
basis of the reasons for dismissal which the employer
gave at the
time of the dismissal. ….’ (emphasis added)
[27]
The above being said, the applicant never dismissed the third
respondent for what he had said to Farren per se. The chairperson
of
the disciplinary hearing recorded, and this was accepted by the
applicant, that this misconduct was not gross, and justified
a final
written warning valid for six months. Therefore, the fact that the
third respondent actually made the statement that he
did to Farren,
even on the applicant’s own version, was not the reason for his
dismissal.
[28]
What the third respondent was actually dismissed for was the second
charge, being conduct affecting the employer / employee
relationship
detrimentally. How this can be a change in itself in any event
escapes me. The fact is that the factual basis for
this charge is
exactly the same as that of the first charge. The two charges are
inextricably linked. What the applicant clearly
did was to elevate
an issue which really must be considered when an appropriate sanction
is determined to a charge in itself.
This is a fundamentally wrong
approach and in fact is nothing more than the irregular splitting of
charges to bolster the case
against the third respondent. To
describe it simply – the misconduct is found in what the third
respondent said to Farren.
Whether this conduct detrimentally
affected the employment relationship is a consideration in deciding
what to do about the misconduct
in the form of a sanction. The fact
is that the applicant’s own case was that what was actually
said by the third respondent
did not justify dismissal. It is then
simply wrong and unfair to use the exact same statement made, then
call it conduct detrimentally
affecting the employment relationship,
and dismissing the third respondent for what is actually the same
thing not dismissable
in the first instance. The first respondent
was very much alive to this, and specifically so found in her award,
where the first
respondent concluded that based on this reasoning the
third respondent should have ‘escaped’ with a final
written warning.
There is simply no irregularity in this reasoning
of the first respondent, and therefore, in respect of the first part
of the
review test referred to above, no irregularity can be found to
exist.
[29]
This matter is in fact comparative to what the Court deal with in
Volkswagen SA (Pty) Ltd v Koorts NO and Others
17
. The following extract from the judgment is pertinent, and in my
view supports what has been set out above:
18
‘…
.
Thirdly, I must point out that there appears to be a splitting of
charges. The employees are charged with making false explanations
to
Rautenbach about their absence from their workstation and activities
in the locker room although there appears to be no explicit
provision
in the code for this offence. This charge or the evidence relating to
this in turn, according to the appellant, to be
used to demonstrate
that the employees were dishonest in the sense that they stole
company time to spend on their own private interests
while being paid
for this time.’
[30]
Of further relevance is the judgment in Ntshangane v Speciality
Metals CC
19
where Mlambo J, as he then was, said the following:
‘…
.
Respondent's contention is that applicant's false explanation for his
lateness and absenteeism presented a clear breach of the
trust the
respondent had placed on him. Respondent therefore contends that with
the trust breached it was entitled to formulate
a separate charge
following therefrom and dismiss him.
If
applicant had a good and acceptable explanation for his lateness and
absenteeism it would have been unfair to dismiss him under
those
circumstances. The fact that applicant had no good or acceptable
reason for being late and absent made it proper for him
to be
charged. In charging him on account of lateness and absenteeism
respondent made an election. Having made this election respondent
went further and used applicant's unacceptable and false explanation
to formulate a third charge.
In
my view this was unfair. It is clear that the basis for finding
applicant guilty on the first two charges was applicant's
unacceptable
explanation. Using the explanation to formulate a third
charge took the issue beyond the realms of fairness. ….’
In
casu, the third respondent was found by the applicant itself not to
be subject to dismissal for the actual conduct. To now formulate
a
separate charge based on breach of trust for the same issue is simply
not fair. That is the point.
[31]
The second issue is what can basically be described as the
contributory conduct of Farren. The first respondent found that
whilst two wrongs did not make a right, the conduct of Farren himself
and what he actually said to the third respondent must mitigate
against the sanction dismissal being imposed on the third respondent.
This conclusion of the first respondent is in my view not
only a
reasonable conclusion, but actually correct and fully supported by
the evidence. There is simply no irregularity in this
reasoning and
conclusion. The fact is that Farren called the third respondent an
arrogant little man, when there was no reason
for doing so. On his
own version, he in fact implied that he would dismiss the third
respondent. These issues cannot be ignored.
The first respondent’s
conclusion that these events justified a mitigation of the sanction
of dismissal must be sustained.
[32]
Having found as set out above, there is no need for me to consider
any further issues raised by the applicant in its review
application.
The fact is that the there exists no irregularity in the reasoning
and conclusions of the first respondent in respect
of the above two
pertinent issues. Because there exists no irregularity in the first
place, there is simply no reason to enquire
whether or not the
outcome is reasonable. In the circumstances, I uphold the
determination of the first respondent that the dismissal
of the third
respondent was substantively unfair.
The
issue of the relief
[33]
It is clear from the award of the first respondent that the first
respondent simply opted for awarding reinstatement to the
third
respondent. The first respondent gave no reason for this
determination, referred to no evidence in this regard and exercised
no judicial discretion as required. This the first respondent did
despite the issue of reinstatement is being an inappropriate
remedy
being specifically raised by the applicant. In applying the review
test referred to above, this conduct of the first respondent
would
constitute a material irregularity which would justify an enquiry
into whether the outcome of the relief of reinstatement
would
nonetheless be reasonable. Now it is true that reinstatement is the
primary remedy in the case of a dismissal of an employee
that is
found to be substantively unfair. Section 193(1) provides that:
‘
If
the Labour Court or an arbitrator appointed in terms of this Act
finds that a dismissal is unfair, the Court or the arbitrator
may -
(a) order the employer to reinstate the employee from any date not
earlier than the date of dismissal … ‘Section
193(2)
then provides that ‘The Labour Court or the arbitrator must
require the employer to re-instate or re-employ the employee
unless -
(a) the employee does not wish to be reinstated or re-employed; (b)
the circumstances surrounding the dismissal are such
that a continued
employment relationship would be intolerable; (c) it is not
reasonably practicable for the employer to reinstate
or re-employ the
employee; or (d) the dismissal is unfair only because the employer
did not follow a fair procedure.’
In
applying the above provisions, the Court in Equity Aviation Services
Ltd v Commission for Conciliation, Mediation and Arbitration
and
Others
20
said:
‘
The
legislative structure for the resolution of unfair dismissal disputes
is clear and coherently crafted. The LRA allows for any
of the three
remedies set out in s 193(1) to be granted to an unfairly dismissed
employee. Reinstatement or re-employment remains
the legislatively
preferred remedy so as to restore the employee to the employment
relationship. They safeguard the employee's
security of employment.
Either of the two remedies may be granted except in the specified
circumstances set out in s 193(2) in
which case compensation in terms
of s 193(1)(c) may be ordered, the amount of which depends on the
nature of the dismissal.’
[34]
What the above means is that, despite the fact that reinstatement is
indeed the primary remedy for a substantively unfair dismissal,
it is
not a compulsory remedy. In this regard, in Mediterranean Textile
Mills (Pty) Ltd v SA Clothing and Textile Workers Union
and Others,
21
the Court said:
‘
By
its use of the word 'must' in s 193(1)(a) of the LRA, the legislature
clearly intended that upon the finding in a given case
that the
employee concerned was substantively unfairly dismissed, such
employee must be reinstated, if the employee so wished,
unless either
or both of the conditions referred to in paras (b) and (c) of
subsection (2) of the said section (hereinafter, for
the present
purpose, referred to as 'the non-reinstatable conditions') are
present. It was common cause that the appellant sought
to rely only
on the second-mentioned condition, namely, that it was 'not
reasonably practicable' for the appellant to reinstate
the employees.
It is notable that in terms of the earlier decisions, s 193(2) was
construed as placing an onus on the employer
to establish the
existence of any of the non-reinstatable conditions, but since Equity
Aviation there has been a constitutional
paradigm shift in this
regard. Rather than departing from the premise of a legal onus, the
focal point and overriding consideration
in this enquiry should be
the underlying notion of fairness between the parties and that
“[f]airness ought to be assessed
objectively on the facts of
each case bearing in mind that the core value of the LRA is security
of employment”. In further
amplification, the Constitutional
Court, in Billiton Aluminium SA Ltd t/a Hillside Aluminium v Khanyile
and Others, stated: “The
remedies awarded in terms of s 193 of
the LRA must be made in accordance with the approach set out in
Equity Aviation. That approach
is based on underlying fairness to
both employee and employer. It would introduce unwanted and
unnecessary rigidity to saddle an
enquiry into fairness with notions
of a legal onus.”'
The
Court in Mediterranean Textile Mills (Pty) Ltd concluded that:
22
‘…
at
the conclusion of each case it remains the responsibility of the
court or the arbitrator to determine whether or not, on the
evidentiary material properly presented and in the light of the
Equity Aviation principle, it can be said that the reinstatement
order is justified. In other words, even in a situation such as the
present, where no specific evidence was canvassed or submissions
made
during the trial on the issue of the non-reinstatable conditions, the
court or the arbitrator is not only entitled but, in
my view, is
obliged to take into account any factor which in the opinion of the
court or the arbitrator is relevant in the determination
of whether
or not such conditions exist.’
[35]
In applying a judicial discretion in order to determine whether the
“non-reinstatable” conditions exist in the
current
matter, so as to determine the issue of a reasonable outcome, as
would be required in terms of the above principles, it
is my view
that this is clearly an instance where reinstatement would simply not
be appropriate as a reasonable outcome because
of the fact that
Section 193(2)(b) would certainly find application. I say this for a
number of reasons. The first and immediate
issue is that it appears
clearly from the record that there was no prospect of establishing
any sound working relationship between
the third respondent and
Farren into the future, and there was simply no way in which it could
be avoided that they would come
into contact with one another on a
day to day basis in the workplace. The fact that the third
respondent was also a shop steward
exacerbates this conflict and this
would certainly persist. There is documentary evidence on record
that meetings between the
third respondent and other shop stewards,
and Farren, would deteriorate in accusations and the trading of
insults by both of them
to one another. The third respondent accused
Farren that it was his “number one” task to dismiss the
third respondent.
Farren on the other hand contended that the third
respondent never wanted to listen and whenever he gave the third
respondent
work to do there would be shouting. In the recent past,
the third respondent had been subjected to several disciplinary
processes,
all relating to insubordination / insolence issues. I am
satisfied that a proper and reasonable consideration of the entire
record
of evidence in this matter can leave little doubt that the
employment relationship between Farren and the third respondent had
been irretrievably destroyed and if the third respondent went back to
work for Farren, which is what reinstatement would compel
to happen,
it would not be long before the parties are back in a dispute again.
[36]
The third respondent never showed any remorse for any of his conduct,
even in the arbitration. The fact is that the third respondent
did
not behave in an acceptable manner as well. The third respondent
never said that he would try and mend the relationship with
Farren or
testified that a continued working relationship may be possible.
Farren specifically testified that any continued working
relationship
with the third respondent was not possible, which testimony was
uncontradicted. Without the third respondent at least
showing some
remorse for what he did and exhibited a willingness to rehabilitate,
no working relationship with can be restored.
As the Court said in De
Beers Consolidated Mines Ltd v Commission for Conciliation, Mediation
and Arbitration and Others:
23
‘
This
brings me to remorse. It would in my view be difficult for an
employer to re-employ an employee who has shown no remorse.
Acknowledgment of wrong doing is the first step towards
rehabilitation. In the absence of a re-commitment to the employer's
workplace
values, an employee cannot hope to re-establish the trust
which he himself has broken. ….’
In
my view, the above directly applies to the current matter.
[37]
The Labour Appeal Court specifically dealt with the issue of
appropriate relief in the case of a finding of unfair dismissal
in
the matter of Independent Municipal and Allied Trade Union on behalf
of Strydom v Witzenberg Municipality and Others
24
.
The Court held that:
25
‘I have noted that the relief sought by the employee was that
of reinstatement, alternatively compensation. It is trite
that the
primary remedy is that of reinstatement, except where same is
inappropriate, in which event compensation should be ordered.’
The Court considered the conduct of the employee party, and the fact
that the employee had not worked for the employer for a considerable
period of time as relevant factors in coming to the conclusion that
reinstatement was not appropriate
26
.
[38]
I also find guidance in the judgment of National Union of
Metalworkers of SA on behalf of Maifo and Others v Ulrich Seats (Pty)
Ltd,
27
where the Court dealt with the same issue. It was held as follows:
‘
In
the present matter, the applicants prayed for reinstatement. The
issue that then arises is whether any of the factors listed
in of the
LRA exists, which may in terms of the principles of fairness require
the court to make an order that is less than reinstatement.’
After analysing the case law on this issue, the Court concluded as
follows, which I respectfully agree with:
28
‘
It
would seem to me that in considering whether the remedy of
reinstatement is just and equitable, account should be taken of the
following:
(a)
the outcome of the enquiry into the fairness or otherwise of the
dismissal;
(b)
the core value of the LRA being security of employment;
(c)
the period between the dismissal and trial or the arbitration
hearing;
(d)
the impact that the delays between the date of the dismissal and the
date of the hearing may have on the fairness of the relief
to be
made;
(e)
that the employees were without income during the period of
dismissal.’
[39]
I also refer to Boxer Superstores (Pty) Ltd v Zuma and Others,
29
where the Court held as follows:
‘
Secondly,
in attacking the conclusion reached by the court a quo that 'the only
appropriate remedy was to reinstate the employee
fully', Mr Smithers
correctly referred to the architecture of the Labour Relations Act 66
of 1995 (the Act) and particularly to
s 193(2) thereof. In a case, as
in the present dispute, where it is found that an employer has not
discharged the onus of proving
that a dismissal was fair, the
competent remedy is that of reinstatement. Reinstatement is in
effect, the default position. Section
193(2) sets out alternative
remedies that the Labour Court or an arbitrator may utilize other
than reinstatement. These include
re-employment or compensation.
In
Volkswagen SA (Pty) Ltd v Brand NO and Others (2001) 22 ILJ 993 (LC);
[2001] 5 BLLR 558 (LC) at 582, Landman J found that it
was not open
to an arbitrator, if the circumstances surrounding the dismissal were
that a continued employment relationship would
be intolerable,
nevertheless to order reinstatement. In these circumstances, an
arbitrator would have no discretion, she could
only award
compensation and not reinstatement. In short, s 193(2) mandates the
arbitrator or the court, where applicable, to examine
the factors set
out in the section, in order to craft the remedy. If the evidence
indicates, for example, that a continued employment
relationship is
intolerable, the arbitrator cannot reinstate but must employ an
alternative remedy, in this case compensation.
Mr Smithers correctly
noted that Pillay J had not engaged with the requirements of s 193(2)
but simply concluded that the only
appropriate remedy was to
reinstate. The only appropriate remedy may well have been to
reinstate but that could not simply be concluded
without more. The
enquiry required an engagement with the requirements of s 193(2) and
the evidence before the court as to the
nature of the relationship
between the parties.’
The
Court concluded as follows:
30
‘
The
third respondent's award was manifestly irrational and to that extent
the judgment of Pillay J is correct. It is irrational
because the
third respondent gave no reasons for awarding compensation after
having found that the appellant had failed to discharge
the onus in
relation to substantive dismissal. What third respondent should have
done was to have said in effect: I have examined
the evidence. It
appears to me that, given the grave nature of the charges levelled
against first respondent, that is of dishonesty,
it is clear that the
relationship between the two parties is at the level where they can
no longer work together. Reinstatement
would therefore be
inappropriate, re-employment would be inappropriate because of the
conclusions reached by the appellant as set
out in my award.
Accordingly in terms of the powers that I have under s 193(2), I make
a small award of compensation.’
[40]
In the end, what is clear from the award of the first respondent is
that the first respondent simply plumbs for reinstatement,
and does
not properly determine the issue, and does not exercise any
discretion at all. This is a material irregularity. Then
having
regard to the events before her in the arbitration as evidenced by
the record of the arbitration proceedings, the first
respondent would
be compelled to have, had he exercised his discretion on the issue of
relief in a judicial manner, determined
that any award of
reinstatement simply could not have been made due to the existence of
the non-reinstatable factor as contemplated
by Section 193(2)(b). The
first respondent’s conduct in simply making an award of
reinstatement in this instance thus constituted
a reviewable
irregularity in terms of the principles as set out above, and such
conduct does not fall within the bands of what
would be a reasonable
outcome expected of an arbitrator such as the first respondent. I,
accordingly, review and set aside the
award of reinstatement made by
the first respondent in favour of the third respondent.
[41]
In this matter, the appropriate relief to have been afforded to the
third respondent was one of compensation.
31
Since this was not the determination of the first respondent in his
award, I intend to substitute the award of the first respondent
on
the issue of relief by making a determination of compensation. I see
no need to refer the issue of compensation back to the
second
respondent for determination by the first respondent, and will
determine appropriate quantum of compensation having regard
to the
evidence on record, which is sufficient to properly and reasonably do
so in this instance.
32
Similarly, this requires the exercise of a judicial discretion, and
I refer to what the Court said in Matjhabeng Municipality
v Mothupi
No and Others:
33
‘
The
commissioner then decided that R250,000 was a just and equitable
amount without giving reasons why he came to that conclusion.
In my
opinion he should have gone further and given reasons why he accepted
that the said amount was just and equitable, and perhaps
also taken
into account whether the third respondent was working, how much he
was paid, etc. Even if he came to the same conclusion
at least one
would know why he came to that conclusion. On that basis, it is my
conclusion that the failure on the part of the
commissioner to
justify the compensation amounts to a reviewable irregularity.
Commissioners
should be vigilant at all times, especially where they decide not to
grant compensation or they grant one or two months
or so
compensation, or where the maximum compensation is granted, to make
sure that they give reasons therefor. Therefore, commissioners
should
be careful not [to burden] the courts with the task of making
inferences from the body of evidence for the reasons for the
compensation, although the courts will not fail in their duty in that
respect.’
[42]
As to the exercise of the discretion in making a determination of the
quantum of compensation, reference is made to the well
known
considerations as set out in Ferodo (Pty) Ltd v De Ruiter.
34
In Le Monde Luggage CC t/a Pakwells Petje v Dunn NO and Others,
35
the Court held:
‘
The
compensation which must be made to the wronged party is a payment to
offset the financial loss which has resulted from a wrongful
act. The
primary enquiry for a court is to determine the extent of that loss,
taking into account the nature of the unfair dismissal
and hence the
scope of the wrongful act on the part of the employer. This court has
been careful to ensure that the purpose of
the compensation is to
make good the employee's loss and not to punish the employer.’
[43]
Reference is also made, with regard to how this discretion has been
exercised in the past, to the judgments in Mohlakoane v
CCMA and
Others (2010) 31 ILJ 2688 (LC); SA Post Office Ltd v Jansen Van
Vuuren NO and Others (2008) 29 ILJ 2793 (LC); Metalogik
Engineering
and Manufacturing CC v Fernandes and Others (2002) 23 ILJ 1592 (LC):
Rope Constructions Co (Pty) Ltd v Commission for
Conciliation,
Mediation and Arbitration and Others (2002) 23 ILJ 157 (LC); H M
Liebowitz (Pty) Ltd t/a the Auto Industrial Centre
Group of Companies
v Fernandes (2002) 23 ILJ 278 (LAC); Ensign Brickford SA (Pty) Ltd v
Shongwe NO and Others (2001) 22 ILJ 146
(LC).
[44]
In applying the above principles, and in order to come to a fair and
equitable determination on the issue of the appropriate
amount in
compensation, I consider the following: (1) The applicant did have a
proper cause of complaint against the third respondent,
but in
essence overreacted and split the charges; (2) the third respondent
was still unemployed as at the date of the arbitration;
(3) the third
respondent had a length of service of five years at the time of his
dismissal; (4) the third respondent presented
no evidence as to his
attempts to mitigate damages; (5) the third respondent showed no
remorse; and finally (6) the fact that the
conduct of Farren
contributed to the problem. Applying these considerations, and
applying a general sense of fairness, it is my
view that an award of
9(nine) months’ salary in compensation in favour of the third
respondent is appropriate. It was common
cause that the third
respondent earned R13 904.84 per month, giving a total compensation
award of R125 143.56.
[45]
Accordingly, in the light of all of the above, I conclude that the
award of the first respondent on the issue that the third
respondent’s dismissal was substantively unfair is upheld. I
further conclude that the award of the first respondent as
regards
the issue of relief be reviewed and set aside, and I shall substitute
such award with an award of compensation on the basis
as set out
above.
[46]The
applicant did not press the issue of costs and in essence left the
matter in the hands of the Court. In terms of the provisions
of
Section 162(1) and (2) of the LRA, I have a wide discretion where it
comes to the issue of costs. I exercise this discretion
in favour of
making no order as to costs, as I am of the view that this would be
fair and appropriate in this instance.
Order
[47]
In the premises, I make the following order:
47.1The
arbitration award of the first respondent, being arbitrator Seele
Mokwena, dated 13 March 2012 in the arbitration proceedings
between
the applicant and the third respondent, under case number MEGA 32858,
to the effect that the dismissal of the third respondent
by the
applicant was substantively unfair, is upheld and confirmed;
47.2The
arbitration award of the first respondent, being arbitrator Seele
Mokwena, dated 13 March 2012 in the arbitration proceedings
between
the applicant and the third respondent, under case number MEGA 32858,
as to the relief of reinstatement and back pay afforded
to the third
respondent, is reviewed and set aside;
47.3The
award of the first respondent with regard to the issue of relief as
contained in the arbitration award dated 13 March 2012
is substituted
in toto by an award that the third respondent is entitled to
compensation in an amount equivalent to 9(nine) months’
salary,
being an amount of R125 143.56;
47.4The
applicant is ordered to make payment to the third respondent in the
amount of R125 143.56 within 10(ten) days of date of
this judgment;
47.5There
is no order as to costs.
Snyman
AJ
Acting
Judge of the Labour Court
APPEARANCES:
For
the Applicant:Advocate Connie Prinsloo
Instructed
by:De Villiers Du Plessis Attorneys
For
the third Respondent:None
1
66
of 1995.
2
(2007)
28 ILJ 2405 (CC).
3
Ibid
at para 110.
4
(2008)
29 ILJ 2461 (CC)
at para
134.
5
(2008)
29 ILJ 964 (LAC) at para 96.
6
Id
at para 97.
7
Id
at para 102.
8
Id
at para 103.
9
2013
(6) SA 224 (SCA); [2013] 11 BLLR 1074 (SCA)
Cachalia
and Wallis JJA.
10
Id
at para 25.
11
(JA
2/2012) [2013] ZALAC 28 (4 November 2013)
(4
November 2013) not yet reported, per Wag
lay
JP.
12
Id
at para 14.
13
Id
at para 15.
14
Id
at para 16.
15
See
Section 145(2)(ii).
16
(supra)
footnote 5 at para 32
17
(2011)
32 ILJ 1892 (LAC)
18
Id
at para 33
19
(1998)
19 ILJ 584 (LC) at para 15 – 17
20
(2008)
29 ILJ 2507 (CC)
at
para 44
21
(2012)
33 ILJ 160 (LAC) at para 28.
22
Id
at
para 30.
23
(2000)
21 ILJ 1051 (LAC)
at
para 25.
24
(2012)
33 ILJ 1081 (LAC).
25
Id
at para 30.
26
Id
at paras 31 – 34.
27
(2012)
33 ILJ 2918 (LC) at para 40.
28
Id
at para 48.
29
(2008)
29 ILJ 2680 (LAC) at para –11.
30
Id
at para 11.
31
See
Section 193(1)(c)
32
As
the Court did in
Plasticwrap
- A Division of CTP Ltd v Statutory Council for the Printing,
Newspaper and Packaging Industry and Others
(2012)
33 ILJ 2668 (LC) at para 22
33
(2011)
32 ILJ 2154 (LC) at paras 47 – 48
34
(1993)
14
ILJ
974 (LAC)
.
The Court held that ‘(a)
[T]here
must be evidence of actual financial loss suffered by the person
claiming compensation; (b) There must be proof that the
loss was
caused by the unfair labour practice; (c) The loss must be
foreseeable, ie not too remote or speculative ; (d) The award
must
endeavour to place the applicant in monetary terms in that position
which he would have been had the unfair labour practice
not been
committed ; (e) In making the award the court must be guided by what
is reasonable and fair in the circumstances ; (f)
There is a duty on
the employee (if he is seeking compensation) to mitigate his damages
by taking all reasonable steps to acquire
alternative employment.’
35
(2007)
28
ILJ
2238 (LAC)
.