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[2014] ZALCJHB 172
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Charlies v South African Social Security Agency and Others (JR1272/2011) [2014] ZALCJHB 172 (13 May 2014)
REPUBLIC
OF SOUTH AFRICA
THE LABOUR COURT OF
SOUTH AFRICA, JOHANNESBURG
JUDGMENT
NOT REPORTABLE
CASE
NO: JR 1272/2011
In
the matter between:
CHARLIES,
HEINZ CONALD
Applicant
and
THE
SOUTH AFRICAN SOCIAL SECURITY
AGENCY
First
Respondent
WABILE,
KATLKOLO N.O.
Second
Respondent
COMMISSION
FOR CONCILIATION
MEDIATION
AND ARBITRATION
Third
Respondent
Heard:
09 January 2014
Delivered:
13 May 2014
Summary:
JUDGMENT
NAIDOO
AJ
Introduction
[
1]
This is an application to review and set aside a jurisdictional
ruling under case number GAJB 31691-10, delivered on 28 April
2011wherein the second respondent (the “Arbitrator”)
found the Commission for Conciliation Mediation and Arbitration
(the
“CCMA”) lacked jurisdiction to hear the applicant’s
dispute.
[2]
The first respondent sought condonation for the late filing of its
answering affidavit. Although initially opposed, the applicant
did
not persist in opposing condonation. Having regard to the relevant
legal principles, I am of the view that it would be in the
interest
of justice that condonation under these circumstances be granted.
Background
[3]
On or about 6 November 2010, the applicant referred an unfair labour
practice dispute to the third respondent.
[4]
The matter came before the arbitrator on 28 April 2011. On a pro
forma document, the arbitrator described the dispute as one
involving
a claim for pay progression and bonus and on this basis found the
CCMA lacked jurisdiction to hear the matter. The arbitrator
further
directed the applicant to refer his dispute to this Court for relief.
It is noteworthy that the arbitrator does not provide
any reasons as
to how or why he arrives at the decision he took.
[5]
The applicable test when reviewing jurisdictional rulings is an
objective test and as such, I shall set out the parties respective
arguments as presented to this court.
Applicant’s
argument
[6]
The applicant’s claim centres on the alleged failure of the
first respondent to follow its own performance appraisal policy
as
set out in a document titled ‘Performance Management Policy for
Employees’
.
In terms of this policy an employee’s
performance would be assessed four (4) times a year by their
supervisor and an average
rating would be calculated at the end of
the financial year. The policy set out the various possible ratings
an employee could
score and the associated bonus and pay increment
employees who received specific ratings would be eligible for. The
applicant scored
a rating that made him eligible for a bonus of 11%
his annual remuneration and a two notch pay increase.
[7]
Despite this, the first respondent advised the applicant that he
would receive a single notch increase in his remuneration.
According
to the applicant he was of the view other employees who had obtained
a similar rating as what he did, were given their
bonus and salary
increase in accordance with the first respondent’s policy. The
applicant lodged a grievance which to date
had not been addressed,
thereafter he referred an unfair labour practice dispute to the third
respondent seeking his bonus and
further that his remuneration be
increased by one (1) salary notch.
First
Respondent’s argument
[8]
The first respondent raised 3 arguments.
The
first was that in terms of its grievance policy any grievance
associated with the implementation of anyone of its policies must
first be brought before a senior manager, who having heard both
parties must resolve the dispute within 30 working days from date
the
grievance was lodged. Thereafter, should the party initiating the
process be dissatisfied with the senior manager’s decision,
he
or she must follow the grievance procedure applicable to employees
working in the Public Service Sector. The applicant, as argued
by the
first respondent, did not follow this prescribed process in that he
failed to lodge any grievance before referring the matter
to the
third respondent.
The
second argument goes to the heart of the ruling. The first respondent
argued that for purposes of s186, a benefit is excluded
from the
definition and scope of what can be defined as remuneration and
following this, the applicant is precluded from relying
on section
186(1)(b), more particularly that relating to benefits for the simple
reason that his dispute is in fact a claim for
remuneration.
In
keeping with the issue of jurisdiction, the first respondent further
argued that in his referral to the CCMA, the applicant described
his
dispute as a refusal by the first respondent to comply with the
Reward Recommendation Policy. However, at arbitration the applicant
claimed an unfair labour practice in terms of benefits and in doing
so, changed the nature of the dispute as originally referred
and
conciliated.
The
third argument rested on the fact that the applicant had, subsequent
to the ruling under review being delivered, referred the
same dispute
to the CCMA whereby another commissioner ruled the CCMA had no
jurisdiction to hear his claim. This argument was abandoned
once the
first respondent conceded that the second referral to the CCMA
pertained to a different cycle i.e. the 2009/2010 period
whereas
in
casu
the applicant’s dispute centred on a cycle prior to
that mentioned.
Evaluation
[9]
For convenience, I shall address the argument that benefits must be
mutually exclusive from remuneration as raised by the first
respondent. The Labour Appeal Court in
Apollo
Tyres SA (Pty) Ltd v Commission for Conciliation, Mediation &
Arbitration and Others
[1]
put to rest the debate as to whether a benefit is excluded in the
definition of remuneration. On this point the Court held;
‘
The
distinction that the courts sought to draw between salaries or wages
as remuneration and benefits is not laudable but artificial
and
unsustainable. The definition of remuneration in the Act is wide
enough to include wages, salaries and most, if not all extras
or
benefits. Remuneration is defined as:
“
[R]emuneration"
means any payment in money or in kind made or owing to any person in
return for that person working for any
other person, including the
State, and "remunerate" has a corresponding meaning.'
Many benefits that are
payment in kind form part of the essentialia of practically all
contemporary employment contracts. Many extras
are given to employees
as a quid pro quo for services rendered just as much as a wage is
given as a quid pro quo for services rendered..;.
With
regard to the CCMA ‘s jurisdiction to hear disputes of this
nature, the LAC went on to say;
‘
In
my view, the better approach would be to interpret the term benefit
to include a right or entitlement to which the employee is
entitled
(ex contractu or ex lege including rights judicially created) as well
as an advantage or privilege which has been offered
or granted to an
employee in terms of a policy or practice subject to the employer’s
discretion. In my judgment “benefit”
in section 186
(2)(a) of the Act means existing advantages or privileges to which an
employee is entitled as a right or granted
in terms of a policy or
practice subject to the employer’s discretion.’
[10]
Around the same time as the Labour Appeal Court handed down judgment
in
Apollo
(supra),
the Labour Court in
Trans-Caledon
Tunnel Authority v Commission for Conciliation, Mediation &
Arbitration and Others
[2]
held the following when faced with a similar argument as that raised
by the first respondent in
casu;
‘
I
respectfully associate myself with the views expressed by my brother
judges in
Protekon
and
IMATU
differing from the court's approach in
Samsung
Electronics
that remuneration as
defined in the LRA does not include benefits contemplated in s
186(2)(a) which were held in that case to be
'something extra', apart
from remuneration. Thus, whilst I accept that employee's claim to
entitlement to the full bonus falls
under the head of remuneration in
the employment contract and in terms of the LRA definition, this does
not, in my view, serve
to bar him from referring a ULP claim relating
to benefits to arbitration in terms of the section.’
The
Court went on to affirm the view that the CCMA has the jurisdiction
to call upon any employer to justify the fairness of exercising
his
or her discretion, emanating from either a policy or practice and
under circumstances where an employee is denied a benefit
.
[11]
More recently the court in
SA
Revenue Services v Ntshintshi and Others
[3]
in following the decision of
Apollo
found that a travel allowance falls within the broad definition of
benefits and as such, the CCMA had the necessary jurisdiction
to hear
a dispute where the employee lays claim to this allowance.
[12]
In light of these authorities, the first respondent’s argument
that benefits and remuneration are mutually exclusive
stands to fall
and with that, the arbitrator’s findings on jurisdiction must
further fall away.
[13]
It is worth mentioning that in finding the CCMA does have
jurisdiction to hear the applicant’s claim, specifically
relating
to whether the applicant is entitled to a further notch
increase in his salary, does not imply, nor should it be interpreted
to
imply, that if successful in his claim, the applicant has
established a right to further increases in salary. As pointed out in
Apollo
the
focal point at arbitration would be limited to whether or not the
employer’s decision not to award the employee the benefit
claimed, if fair or not. Should an arbitrator find the first
respondent has failed to provide adequate and just reasons as to why
it did not give the applicant a salary increase and on the strength
of this order it to increase the applicant’s remuneration
by a
further notches, does not mean the applicant has established a future
right to the same increase in the years to come. If
the applicant
does not meet the required performance standard in the future, the
first respondent would be justified in not increasing
his
remuneration, likewise if the applicant did meet such standard in the
future and the first respondent does on that occasion
provide a fair
reason why it has not rewarded the applicant with the structured
increase, an arbitrator could do little but to
find the applicant did
has not suffer an unfair labour practice.
It
is also worth mentioning that on the merits before me, the salary
increase sought is intrinsically linked to the first respondent’s
performance policy. If this were not the case, the applicant would be
prevented from referring his dispute to arbitration.
[14]
With regard to the argument that the applicant has changed the nature
of the dispute, I fail to see any merit in this argument.
The first
respondent alleges that the applicant, in his referral forms,
categorised the dispute as the first respondent’s
failure to
follow its own policy and that the applicant sought the first
respondent to comply with the said procedure.
In
my view the nature of the dispute has not changed in any material
manner. The applicant referred an unfair labour practice dispute
to
the CCMA claiming his bonus and pay increase; it was the very same
dispute that came before the second respondent. On a reading
of
National
Union of Metalworkers of SA and Others v Driveline Technologies (Pty)
Ltd and Another
[4]
,
the first respondent’s argument on this point bears no merit.
[15]
The last issue deals with whether or not the applicant, by not
following a prescribed grievance procedure, was premature in
referring his dispute to the CCMA. The first respondent alleged that
the applicant did not file a grievance as required of him
before
referring the matter to the CCMA. This is factually incorrect –
annexed to the applicant’s supplementary affidavit
is a copy of
the grievance he lodged on 9 August 2010. The applicant thereafter
referred his dispute to the CCMA on 6 November
2010, this well after
the 30 day period afforded to the first respondent to address any
grievance. On these facts alone, I accept
the applicant did file a
grievance and in the absence of the first respondent addressing his
issues raised, his referral to the
CCMA was not premature.
[16]
In the absence of any reasons forwarded by the first respondent as to
why it did not reward the applicant in terms of its own
policy, this
Court is not in a position to make any finding as to whether the
first respondent’s conduct was fair or not.
Order
[17]
In the premises the following order is made:
17.1
The first respondent’s late filing of its answering affidavit
is condoned.
17.2
The second respondent ruling under GAJB 31691-10 is set aside and
replaced with a finding that the third
respondent does have
jurisdiction to hear the applicant’s dispute.
17.3
The third respondent is directed to set the matter down for
arbitration.
17.3
There is no order as to costs.
_____________________________
Moksha Naidoo
Acting
Judge of the Labour Court of South Africa
APPEARANCES
For the
Applicant:
Advocate Hitchings: Instructed by Martins Weir-Smith Inc.
For
the Third Respondent:
Advocate MW Dlamini: Instructed
by The State Attorney
[1]
(2013)
34 ILJ 1120 (LAC) at paras 25 to 26.
[2]
(2013)
34 ILJ 2643 (LC) at para 30.
[3]
(2014)
35 ILJ 255 (LC)
[4]
2000
(4) SA 645
(LAC); (2000) 21 ILJ 142 (LAC).