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[2014] ZALCJHB 206
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Air Chefs (Pty) Ltd v South African Transport And Allied Workers Union and Others (J2883/13) [2014] ZALCJHB 206; (2014) 35 ILJ 3088 (LC) (9 June 2014)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, IN JOHANNESBURG
JUDGMENT
REPORTABLE
CASE
NO: J 2883/13
In
the matter between:
AIR CHEFS (PTY) LTD
Applicant
AND
SOUTH AFRICAN
TRANSPORT AND ALLIED WORKERS UNION
First
Respondent
THE
INDVIDUAL RESPONDENTS WHOSE NAMES APPEAR ON ANNEXURE “A”
TO THE NOTICE OF MOTION
Second
to further Respondents
Heard
:
16 May 2014
Delivered
:
09 June 2014
Summary:
(Urgent – strike –
proposals on wage adjustments in consequence of job grading not a
demand for a general wage increase
even thought wages would increase
if the demand was accepted – Clauses in main agreement dealing
with general increases not
regulating implementation of in-house
grading exercise – strike not prohibited on this account –
Clause requiring all
terms and conditions to be negotiated at
bargaining council nonetheless
applicable –
strike unprotected for that reason – rule confirmed - Costs)
JUDGMENT
LAGRANGE, J
Introduction
[1]
This matter concerns an application for a
final interdict to prevent strike action which the respondents’
union and its members
had intended embarking on in December last
year. In October 2013, the union referred a dispute over job grading
to the Bargaining
Council Restaurant Catering and Allied Trades ('
the bargaining council'). The dispute was unsuccessfully conciliated
on 4 December
2013 and on 12 December the union gave the applicant 48
hours and 2 minutes notice of its intention to strike with effect
from
16H00 on Saturday 14 December. The applicant provides catering
services to the airline industry both domestically and
internationally,
24 hours a day and 365 days a year.
[2]
The strike was scheduled for a critical
weekend as it was the weekend of national mourning during which the
former State president
Nelson Mandela was being buried. A shutdown of
the applicant’s catering service to the national airline
carrier, South African
Airways (‘SAA’), which was the
official air carrier for mourners to the funeral, could have caused
significant embarrassment
and adverse publicity for the airline apart
from the other normal consequences of strike action. The applicant is
a subsidiary
SAA.
[3]
The applicant obtained an interim order
preventing the strike action on the basis that it had made out a
prima facie
case that the strike action was unprotected. The matter was set down
for hearing 28 February 2014, being the return date. However
the
parties agreed to extend the interim order to 16 May 2014 to allow
the applicant to file its replying affidavit. The respondents
had
only filed their answering affidavit two days prior to the return
date.
The nature of the
dispute giving rise to the strike
[4]
The central question for the termination is
whether the issue giving rise to the strike is one that the
respondents are entitled
to embark on protected strike action over.
The determination of this question rests fundamentally on whether or
not the matter
is one falling within the scope of the existing main
collective agreement of the bargaining council. The Minister of
Labour declared
the main agreement binding on all employers and
employees falling within the scope of the bargaining council with
effect from 17
October 2011 until 31 August 2014.
[5]
In the answering affidavit it was alleged
by the union that in fact the applicant and its employees did not
fall within the scope
of the bargaining council and consequently did
not fall within the scope of the main agreement. However, the
submission was abandoned
at the hearing of the application and
arguments proceeded on the basis that the respondents did fall within
the scope of the bargaining
council and therefore the main agreement
was applicable to, and binding on, them.
[6]
Clause 3 of the main agreement deals with
industrial action. It reads:
"(1) No person bound
by the provisions of this Agreement entered into by the parties shall
engage in or participate in a strike
or lockout or any conduct in
furtherance of a strike or lockout in respect of any matter regulated
by this Agreement for its duration.
(2) The forum for
negotiation and conclusion of substantive agreements on wages,
benefits and other conditions of employment between
employer and
employer's organisations on the one hand and employees and trade
unions on the other hand, shall be the Bargaining
Council and not at
shopfloor level.
(3) No trade union or
employer's organisation may attempt to induce or compel or to be or
be induced or compelled by any natural
or juristic person or other
organisation, by any form of strike or lockout, to negotiate the
issues referred to in paragraph 1
above, at any level other than this
Bargaining Council."
[7]
Further, section 25 (7) (i) provides:
"(7)
Peace
obligation
: Neither an employer or a trade union or its members
shall cause, sanction or participate in any strike or lockout
directed against
the other party:
(i) concerning any issue
which is the subject matter of a substantive agreement during the
period of such agreement and, in particular,
where the issue has been
negotiated at the council and the collective agreement has been
concluded in this regard;"
[8]
The applicant contends that the strike
called by the respondents is in breach of the provisions of
sub-clauses 3(1) and (2) and
25 (7) (i) above and accordingly is
contrary to the provisions of section 65 (1) (a) of the Labour
Relations Act, 66 of 1995 ('
of the LRA') which states:
"(1) No person may
take part in a strike or a lock-out or in any conduct in
contemplation or furtherance of a strike or a lock-out
if-
(a)
that person is bound by a collective agreement that prohibits a
strike or lock-out in respect
of the issue in dispute."
[9]
The applicant contends that the
respondents’ demand for implementation of the job grading
amounts to a demand for a wage increase
and nothing more. As such it
amounts to a demand concerning something regulated in the main
agreement and cannot be the subject
matter of protected strike
action. In effect, the applicant argues that any demand which has the
consequence of revising wages
upwards falls within the ambit of the
main agreement and therefore cannot be negotiated at company level.
[10]
The respondents retort that the main
agreement does not deal with job grading systems and that even if it
did, it would be of little
assistance because the job categories in
the main agreement do not correspond with the job categories of the
applicant’s
business, which is part of the reason the applicant
engaged the expertise of independent consultants to grade jobs. In
reply, the
applicant baldly denies this and claims that the job
grading exercise was undertaken to remedy disparities created by the
job grading
which took place in 2009. The allegations of both parties
on this issue are broadly stated and for the purposes of this
judgement
it remains indeterminate what correspondence there is, if
any, between the job categories and commensurate salaries in the main
agreement and the job grading undertaken by the applicant. Notably,
there is only one reference to the term ‘grade’
in the
main agreement, namely clause 5 (5) which states:
"...nothing
in this agreement shall be so construed as to preclude an employer
from requiring his employee to perform work
of another grade."
However, there is no other reference to
job grades in the wage schedule of the main agreement to suggest the
jobs and associated
minimum wages described there had actually been
graded, rather than simply being the result of negotiations. It is
apparent also
that not all jobs at the applicant's workplace are
described in the main agreement, but the extent of this lack of
correspondence
is not clear.
[11]
The portion devoted by both parties in
their respective pleadings to the actual issue in dispute does not
provide much elucidation
and at the hearing of the matter I was
unable to obtain any greater clarity from either of the parties
representatives about the
details of the implementation of the job
grading system, which the applicant claims to have done, or of the
respective demands
or proposals of the parties relating to the issue
of implementation. The pertinent aspects of what can be gleaned from
the limited
information made available in the founding, answering and
replying affidavits is summarised below.
A
job grading exercise had been conducted in 2012 and the parties have
been engaged with each other on implementing it. This is
also not the
first job grading exercise conducted by the applicant as there was a
previous one done in 2009. The parties are at
odds about the reason
for the 2009 exercise, save that they agree it was intended to remedy
‘disparities’ which existed.
The applicant also does not
dispute that the flaws in the 2009 grading exercise led to its Human
Resources General Manager approaching
the union shop stewards and
advising them that he had done a payroll audit which led him to
conclude that another job grading exercise
was required and the
services of PE Corporate Services were engaged for this. On the
applicant's version, which I must accept in
terms of the rule in
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1]
,
the report was presented to the union and the outcome of the grading
exercise was discussed. Although the union does not admit
having seen
the report, in the answering affidavit it is stated:
"What SATAWU has
gathered in discussing with Air Chefs is that the outcome of the
grading exercise is that the workers are
in low, average and higher
wage bands. Air Chefs must bring all the workers to the average
band."
[12]
It appears to be common cause that the
report recommended certain salary bands be adopted which would result
in upward wage adjustments.
The applicant maintains that it is not
bound by the recommendations of the report and that even though it
has adopted the job grading
during 2013, it has not implemented any
wage increases. Although, the applicant does not explain how it was
able to implement the
new job grades without adjusting any salaries
or amending existing salary bands, it maintains that implementing the
job grading
system and adopting certain salary bands in relation to
the job grades are two "mutually exclusive processes", and
the
implementation of wage increases is something within its own
discretion. According to the applicant, recommendations in the report
for salary increases did not create an entitlement to those
recommended increases. The union, for its part, accuses the applicant
of walking away from the job grading process because of the
recommendations that upward adjustments had to be made for some
employees.
The applicant argues that the union’s demand is no
different from relying on the consumer price index to demand an
increase
in salaries.
[13]
The applicant does admit approaching the
union to discuss salary increases but claims it only did so as a
desperate effort to avoid
the strike action. This was something it
did not reveal in its original application and only deals with in its
reply because the
union attached the applicant's proposed settlement
of the dispute. The material content of the applicant’s last
minute proposal
to avert the impending strike reads:
"2.1 The company
will increase the salaries of employees below the average salary for
the grade over the next years in order
to address the salary
anomalies related [to] the previous job grading system as follows:
2.1.1 The
salaries of employees who are below the average salary for the grade
will receive the salary increase affected
to the bargaining council
from April 2014 +70% of that increase over the next year as until the
employee salaries equal to the
average of the grade.
2.2 The salaries of
employees were above the average salary for the grade will receive a
salary increase affected to the bargaining
council from April
2014minus 70% of that increase over the next years until the employee
salaries equal to the average of the grade.”
[14]
No explanation is provided by the applicant
why it failed to mention this in its founding papers, which it ought
to have in circumstances
where the interim application was determined
solely on its version. In any event, the union says it rejected this
proposal because
it would mean it would take eight years to complete
the upward adjustment. In respect of those employees earning above
the average,
the union maintains that they should at least
receive inflation related increases and where possible be
accommodated into
positions paying the remuneration that they already
earn, for which they are competent or could become competent in with
minimal
training.
Evaluation
[15]
The provisions of clause 5 (1) of the main
agreement determine minimum wages payable to certain categories of
employees identified
by job titles. Clause 5 (9) of the main
agreement also provides for minimum percentage increases payable to
all employees other
than certain classes of waiter. These are the
only provisions in the main agreement, which was attached to the
founding papers,that
deal with wage increases.
[16]
The applicant has adopted its own grading
system for its employee’s jobs. It maintains that any
adjustment of salaries or
salary bands arising from the job grading
system is an entirely separate exercise and within its sole
discretion to determine.
On the one hand it contends that it lies
within its power to determine the associated salary bands and
adjustments, if any, which
could include upward adjustments. On the
other hand, it maintains that when upward adjustments are proposed by
the union in relation
to the graded jobs such proposals simply
amounts to a proposal for wage increases, which is a matter that has
been, and can only
be, determined at the bargaining council. Thus, it
seeks to reserve to itself an exclusive right to implement whatever
salary adjustments
it deems necessary without reference to the
bargaining council negotiations, but insists that if the union wants
to resort to industrial
action over its counterproposals, it may not
do so because wage increases are a matter dealt with in that forum.
The first point
that must be made in this regard that, apart from the
apparent duality in the employer’s stance, the mere fact that
an employer
regards a matter as falling within its discretion, does
not mean that the subject over which it seeks to exercise that
discretion
cannot, as a matter of principle, also be a matter of
mutual interest susceptible to negotiations.
[17]
In any event, the employer’s main
contention is that the demand is simply a disguised demand for a wage
increase. It is true
that, the union’s proposal would have the
effect of increasing the wages of those employees earning below the
average salary
for a grade. It also patently clear that the main
agreement does not deal with increases relating to the adjustment of
salaries
of employees to align them with their job grades as
determined in a company level job grading exercise. It is telling
that, the
applicant's own proposal, albeit made as a desperate
measure to avoid a strike, implicitly recognises that the general
increases
determined at the level of the bargaining council
negotiations will not address the adjustment process relating to the
job grading
exercise. The 70% premium on the bargaining council
increase, which it proposed, plainly recognises that the minimum
annual increases
determined at the council do not have a direct
bearing on any realignment of salary bands and actual salaries
intended to iron
out disparities, which the job grading exercise was
intended to address.
[18]
I
agree there may be instances when, for instance, a demand is made for
the establishment of a previously non-existent allowance
where the
payment of such an allowance is without any pre-conditions being met
which make it indistinguishable from a demand for
a general wage
increase.
[2]
In cases like that,
couching the demand as an allowance, does not disguise the true
import of the demand. However, it is overly
simplistic to argue that
simply because the effect of a demand would be to increase the wages
of some employees, that the demand
is simply a disguised attempt to
achieve a general wage increase of the kind that is negotiated at the
bargaining council. In this
instance, I am satisfied that the nature
of the demand is one that is directly related to an in-house grading
exercise and the
adjustment process to eliminate disparities
identified in that exercise, is not a matter which is currently
regulated by the main
agreement. The wage increases dealt with in the
main agreement are general annual increases which are not related to
the adjustment
process arising from an in-house grading exercise.
Consequently, I am satisfied that the union’s demand does not
relate to
a matter regulated by the main agreement in terms of clause
3(1) thereof.
[19]
However, clause 3 (2) of the main agreement
goes further and dictates that the only forum for the negotiation of
substantive conditions
of employment is the bargaining council. Even
though the union proposal does not amount to a disguised attempt to
negotiate a general
increase, the effect of any adjustments or
realignment of salaries with new job gradings is obviously a matter
affecting wages
and conditions of service of those employees. As
such, the main agreement prescribes that such a matter should be
negotiated at
the bargaining council, and clause 3 (3) prohibits
strike action for the purpose of compelling negotiation at any other
level other
than the bargaining council. This provision presents a
bar to the union pursuing its demands in relation to the
implementation
of the grading system at company level. How workable
this is given that neither the union nor the applicant are parties to
the
bargaining council is another matter but as the agreement stands
it is binding on both parties and in the absence of an exemption
to
allow the negotiations to proceed, the union is bound by this
provision and accordingly cannot embark on strike action in pursuit
of its proposals on the job grading implementation in so far as it
affects salaries. The wisdom of the prohibition in clause 3(3)
of the
main agreement when applied to a case like this which pre-eminently
concerns a matter pertaining to only one employer and
its employees
may appear doubtful, but collective agreements are a consequence of
negotiations and will not always provide solutions
for all
situations. Anomalies can only be addressed through the exemption
process.
[20]
In the circumstances, the rule must be
confirmed.
Costs
[21]
The prohibition of the respondents’
right to strike over the wage adjustment process pursuant to the job
grading exercise
was plainly not a simple matter to determine as the
applicant suggests it was and in the result it cannot be said that
the union's
opposition was frivolous or that it was pursuing a demand
that concerned a matter regulated by the main agreement. The union
can
be criticised for its late filing of its answering affidavit two
days before the return date of the matter, but equally the
applicant’s
conduct in failing to disclose its own proposal to
deal with the dispute was improper in circumstances where the interim
application
was determined on its papers alone. Consequently, I think
there is good reason in this instance that the parties must bear
their
own costs.
Order
[22]
Accordingly, it is ordered that:
22.1
the intended strike of the Second to
Further respondents in respect of the dispute, which was referred to
the bargaining council
on or about 10 October 2013, is unprotected
and unlawful;
22.2
the Second to Further Respondents are
interdicted and restrained from participating in the said strike at
the applicant’s
premises;
22.3
the Second to Further Respondents are
interdicted and restrained from participating in any conduct in
pursuance of the said strike;
22.4
the Second to Further Respondents are
interdicted and restrained from encouraging, participating in, or
promoting the said strike;
22.5
the First Respondent is to publicly call
upon the Second to Further Respondents not to participate in the said
strike or any conduct
in furtherance of such strike.
[23]
Further, the parties are to pay their own
costs.
_______________________
R LAGRANGE, J
Judge
of the Labour Court of South Africa
APPEARANCES
APPLICANT:
J Botesof Cliff Dekker Hofmeyr Inc.
FIRST
RESPONDENT:
S Mabaso of Mabaso Attorneys
[1]
1984
(3) SA 623 (A)
[2]
See,
for example, the consideration of a potentially disguised demand in
BMW
SA (Pty) Ltd v National Union of Metalworkers of SA on behalf of
Members
(2012)
33
ILJ
140 (LAC)
at
146-147, paras [24] – [27], though in that instance the demand
for a transport allowance was found not to be a disguised
demand for
a wage increase.