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[2014] ZALCJHB 66
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South African Medical Association obo Mabuza and Others v Commissioner Molestane and Others (JR834/12) [2014] ZALCJHB 66 (14 March 2014)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Not
reportable
CASE
NO JR 834/12
In
the matter between:
SOUTH
AFRICAN MEDICAL ASSOCIATION obo
DR
I MABUZA & 4
OTHERS APPLICANT
and
COMMISSIONER
R
MOLETSANE 1
ST
RESPONDENT
PUBLIC
HEALTH AND SOCIAL DEVELOPMENT
SECTORAL
BARGAINING
COUNCIL 2
ND
RESPONDENT
DEPT
OF HEALTH AND SOCIAL DEVELOPMENT:
GAUTENG
PROVINCE 3
RD
RESPONDENT
UNIVERSITY
OF
LIMPOPO 4
TH
RESPONDENT
MEC
FOR HEALTH AND SOCIAL DEVELOPMENT
GAUTENG
PROVINCE
5
TH
RESPONDENT
Date
heard: 6 March 2014
Judgment
delivered: 14 March 2014
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
This is an application to review and set aside an arbitration award
issued by the first respondent (the arbitrator) on 22 February
2012.
In his award, the arbitrator found that the persons whom the
applicant represents in these proceedings (the doctors) were
not
entitled to payment of an acting allowance for periods during which
they had acted in posts of a higher grade.
The
material facts
[2]
The factual background to the dispute referred to arbitration is not
disputed. The applicant referred a dispute to the second
respondent
(the bargaining council) after the respondent failed to pay its
members an acting allowance in accordance with a collective
agreement
referred to as Resolution 1 of 2002. The agreement regulates the
payment of acting allowances to employees who act in
higher posts for
period of that appointment.
[3]
Clause 3.1 of Resolution 1 reads as follows:
“
3.1 An employee
appointed in writing to act in a post of a higher grade than the
grade of the employee by the Head of Department
or his/her delegate
at provincial or national level (hereafter the appointing authority)
shall be paid an acting allowance to act
in vacant posts provided
that:
3.1.1
The post is a vacant and funded post;
3.1.2
The acting period is longer than 6 weeks;
3.1.3
The appointing authority is a level higher than the acting appointee;
3.1.4
The employee must accept the acting appointment.”
[4]
The doctors were appointed in terms of letters signed by the chief
executive officer of the hospital. These letters date from
2004 to
2009 depending on the doctor concerned, and make specific reference
to the payment of an acting allowance. Indeed , they
state
unequivocally that approval had been granted for the acting
appointment for a period not exceeding six months, and
that the
doctor concerned will be entitled to an acting allowance, being the
difference of their then current packages and the
remuneration
package applicable at the next higher post level. It was
common cause in the proceedings under review
that the doctors
rendered services in their acting positions in accordance with the
letter of appointment, they were not paid acting
allowances and that
at no stage were they advised that their appointments were not
authorised.
The
award
[5]
The arbitrator correctly records that his function was to determine
whether the third respondent had failed to comply with the
collective
agreement and that in doing so, he had necessarily to consider
whether the appointments of the applicants in acting
posts complied
with clause 3.1 of the agreement. The arbitrator went on to find that
there was no ambiguity in the agreement and
that the applicants had
acted in the posts to which they had been appointed. He found against
the applicants on the basis, it would
seem, that “
it is
trite law that any delegation of a function/power by a person holding
a public power must be in writing
”, and that the applicants
had been “
unable to discharge proof that their acting in
higher grades was authorized by the HOD or his/her delegate as per
clause 3.1 of
the collective agreement
”. He ruled that in
the absence of such delegated authority from the HOD, the applicants
were not entitled to be paid acting
allowances for the period that
they had worked in that capacity. In short: the arbitrator came to
the conclusion he did on the
basis that the doctors had failed for
the purposes of clause 3.1 of the collective agreement to prove that
they were appointed
by the HOD or his or her delegate, and in
particular, that the doctors had failed to provide proof of any
written delegation of
authority from the head of department to any
person or body that made the appointments.
The
applicable legal principles
[6]
The test to be applied is that enunciated by the Constitutional Court
in
Sidumo v Rustenburg Platinum Mines Ltd
, recently affirmed
by the Supreme Court of appeal in
Herholdt v Nedbank
(2013) 34
ILJ
2779 (SCA). In the latter judgment the court summarised
the position as follows:
‘
[25]
In summary, the position regarding the review of CCMA awards is this:
A review of a CCMA award is permissible
if the defect in the
proceedings falls 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 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 particular facts,
are not in and of themselves sufficient for an award to be set aside,
but are only of any consequence
if their effect is to render
the outcome unreasonable.’
[7]
The
Heroldt
decision clarifies the
Sidumo
test, at
least to the following extent:
a.
The test to be applied is cast in the negative- the court must
ask
whether the arbitrator’s decision is one that could not
reasonably be reached on the available material.
b.
The test is concerned primarily with the result of the arbitration
proceedings and not the arbitrator’s reasoning. The
arbitrator’s reasons are relevant only in so far as they assist
the court to determine how the result was reached, and whether the
result can reasonably be reached by that route.
c.
A ‘latent irregularity’ or ‘dialectical
unreasonableness’
on the part of the arbitrator (i.e. a failure
by the arbitrator to take into account one or more material facts, or
the taking
into account of irrelevant facts, or any unreasonableness
flowing from the arbitrator’s process of reasoning) is not in
itself
a sufficient basis for review. The arbitrator’s conduct
in this regard is relevant only in so far as it renders the outcome
of the arbitration proceedings unreasonable.
[8]
In
Goldfields Mining South Africa (Pty) Ltd v
CCMA
(JA
2/2012, 4 November 2013) the Labour Appeal Court confirmed that the
applicable test does not admit what has been referred to
as a
“process-related review”, at least in the sense that it
is no longer open to a reviewing court to set aside an
arbitration
award only on account of a process- related irregularity on the part
of the arbitrator. This has the consequence that
the failure by an
arbitrator to mention a material fact in the award, or to deal with
any issue that has a bearing on the issue
in dispute, or any error in
regard to the evaluation of the facts presented at the arbitration
hearing, is of no consequence. Provided
that the arbitrator gave the
parties a full opportunity to state their respective cases at the
hearing, identified the issue that
he or she was required to
arbitrate, understood the nature of the dispute and dealt with its
substantive merits, the function of
the reviewing court is limited to
a determination whether the arbitrator’s decision is one that
could not be reached by a
reasonable decision-maker on the available
material.
[9]
At paragraph [20] of the judgment, the court stated:
‘
The
questions to ask are these: (i) In terms of his or her duty to deal
with the matter with the minimum of legal formalities, did
the
process that the arbitrator employed give the parties a full
opportunity to have their say in respect of the dispute? (ii)
Did the
arbitrator identify the dispute he was required to arbitrate (this
may in certain cases only become clear after both parties
have led
their evidence)? (iii) Did the arbitrator understand the nature of
the dispute he or she was required to arbitrate? (iv)
Did he or she
deal with the substantial merits of the dispute? and (v) Is the
arbitrator’s decision one that another decision-maker
could
reasonably have arrived at based on the evidence?
[21]
Where the arbitrator fails to have regard to the material facts it is
likely that he or she will
fail to arrive at a reasonable decision.
Where the arbitrator fails to follow proper process he or she may
produce an unreasonable
outcome (see
Minister
of Health and Another v New Clicks South Africa (Pty) Ltd and Others
2006 (2) SA 311
(CC)). But again, this
is considered on the totality of the evidence not on a fragmented,
piecemeal analysis. As soon as it is
done in a piecemeal fashion, the
evaluation of the decision arrived at by the arbitrator assumes the
form of an appeal. A fragmented
analysis rather than a broad-based
evaluation of the totality of the evidence defeats review
as a
process. It follows that the argument that the
failure to have regard to material facts
may potentially
result in a wrong decision has no place in review applications.
Failure to have regard to material facts must a
actually
defeat the constitutional imperative that the award must be rational
and reasonable - there is no room for conjecture and
guesswork.
[10]
The test to be applied clearly maintains the distinction between a
review and an appeal. The correctness of the commissioner’s
decision is not in issue, and the court is not entitled to interfere
only because it would have come to a different conclusion
on the same
material. It also requires the court to overlook any lapses in
reasoning on the part of the commissioner and to determine
whether
the outcome of the proceedings is nonetheless reasonable.
Grounds
for review
[11]
The applicants have raised a number of grounds for review. The first
is that the arbitrator failed to determine the true issue
in dispute,
and misconceived the nature of the enquiry. In particular, the
applicant submits that when a dispute relates to the
interpretation
and application of a collective agreement (as does the present) the
dispute must be resolved by having regard to
the principles of
interpretation established by this court. Secondly, the applicant
submits that the arbitrator failed to hear
evidence and to allow
cross examination, that he failed to allow evidence of actual and
implied authority, and that he failed to
consider estoppel and/or
waiver.
Analysis
[12]
The terms of the arbitrator’s award are such that he patently
acknowledges that the applicants had been treated unfairly,
in that
they had performed the work required of them while appointed in
acting positions, but had not been paid.
[13]
Section 138 of the LRA requires that the Commissioner determine a
dispute in an appropriate manner, but must do so freely and
quickly
while dealing with the substantial merits of the dispute with a
minimum of legal formalities. A commissioner is accordingly
entitled
to play and inquisitorial role and to take measures to shorten
proceedings. However, in doing so, a commissioner must
provide the
parties with a full opportunity to state their case before any
determination is made (see
Goldfields
above). In the present
instance, it is not disputed that the arbitrator did not hear any
evidence and that he determined the issues
on the papers before him,
in the light of what amounted to an interrogation by him of the
parties in relation to the facts in dispute.
It is apparent from the
engagement that the third respondent’s argument that they were
no vacant posts for the purposes of
clause 3 of the collective
agreement was abandoned. The engagement between the parties in
respect of the issue of the validity
of the delegation of authority
is less clear. What can be determined from the record is that the
arbitrator required the applicants
to produce a written delegation of
authority, issued by the head of department or his delegate. Mr
Sibeko, the applicant’s
representative at the hearing, was
specifically charged to forward the letter of delegation from the
HOD. In the exchange with
the parties, the arbitrator says the
following:
‘
COMMISSIONER:
No, I don’t think, it’s not necessary because my
understanding because both parties
are here, unless you are going to
dispute it, Mr Luzwano [
i.e. Letsoalo
] says, let me place it
on record, Mr Luzwano says there is no letter of delegation, Mr
Luzwano, by the way, is the director HR
at George Mukhari Hospital,
he says that there is no letter of delegation from the HOD, what are
you saying, are you denying that?
Mr Sibeko: We are denying
that, that’s not in dispute, and as we have indicated, Mr
Commissioner, we bear the responsibility
to (inaudible).
What
follows is an exchange between the arbitrator and the parties’
representatives but at no point in that exchange, is there
a
concession in any unequivocal terms by the applicant’s
representative that Letsoao did not have delegated authority.
Further,
it is not at all clear from the record that it was common
cause that the persons who issued the doctors with the letters of
appointment
did not have delegated authority. Nowhere is there any
mention made of any requirement that any delegation be reduced to
writing.
[14]
The arbitrator’s ruling, simply put, is to the effect that it
was incumbent on the applicants to furnish him with a copy
of a
written delegation of authority by the head of department or his or
her delegate, and that in the face of the applicant’s
failure
to produce such a document, there was no such authority.
[15]
It is apparent to me from the exchange between the parties and the
arbitrator and from the heads of argument that the parties
filed
subsequently that they were a number of factual disputes. Not least
of these is the question of who was authorised to appoint
the doctors
to the acting posts, whether the HR director and the Medex committee
had to delegated powers and perhaps more fundamentally,
whether the
doctors were entitled to conclude that their appointments had been
authorised on the basis of actual or implied authority,
or in the
absence of any actual authority whether they were entitled to rely on
ostensible authority. The manner in which the proceedings
were
conducted, and in particular the failure by the arbitrator to hear
evidence on these issues, in my view, prevented a proper
ventilation
of the dispute between the parties. In the words of the judgment of
the Labour Appeal Court in
Goldfields
, the arbitrator failed
to give the parties an opportunity to have their say, and as a
consequence, he failed to deal with the substantive
issues before him
in a manner in which all relevant evidence was placed before him.
While I appreciate that arbitrators frequently
act under pressure and
that any attempt to resolve a dispute as expeditiously as possible is
to be commended, in this instance,
as I have indicated, the
arbitrator’s conduct frustrated a proper consideration and
determination of the issues. In these
circumstances, it cannot be
said that the decision to which the arbitrator came was a decision to
which a reasonable decision-maker
could come and the award
accordingly stands to be reviewed and set aside.
[16]
I fully appreciate that this matter has been festering for some years
and that ideally, it ought to be brought to conclusion
as soon as
possible. In the light of the decision to which I have come, the only
remedy open to the applicant is for the matter
to be remitted for a
hearing on the issue of authority. The order I intend to make will
limit the proceedings to the determination
of the question of
authority, whether that be actual, implied, or ostensible authority.
Assuming that such authority is established,
it follows that the
individual applicants would be entitled to payment of the allowances
they claim.
I
make the following order:
1. The
arbitration award issued by the first respondent under case no PSHS
671-07/08 dated 22 February 2012 is
reviewed and set aside.
2. The
matter is remitted to the second respondent for determination by an
arbitrator other than the first respondent
of whether any
requirements of authority that might properly be read into the
preamble to clause 3.1 of Resolution 1 of 2002 were
fulfilled prior
to the appointment of the individual applicants into acting posts.
ANDRE
VAN NIEKERK
JUDGE
OF THE LABOUR COURT
REPRESENTATION
For
the applicant: Adv. F Boda, instructed by Hogan Lovells
For
the third respondent: Adv. M Mthombeni, instructed by the state
attorney.