About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Johannesburg Labour Court, Johannesburg
SAFLII
>>
Databases
>>
South Africa: Johannesburg Labour Court, Johannesburg
>>
2014
>>
[2014] ZALCJHB 204
|
|
City Of Tshwane Metropolitan Municipality v South African Local Government Bargaining Council (SALGBC) and Others (JR2387/2011) [2014] ZALCJHB 204 (11 June 2014)
REPUBLIC
OF SOUTH AFRICA
THE LABOUR COURT OF
SOUTH AFRICA, JOHANNESBURG
JUDGMENT
NOT REPORTABLE
CASE NO: JR 2387/2011
In
the matter between:
CITY OF TSHWANE
METROPOLITAN MUNICIPALITY
First Applicant
And
SOUTH AFRICAN LOCAL
GOVERNMENT BARGAINING COUNCIL (‘SALGBC’)
First Respondent
MARI BEÄN
DANIEL JACOBUS DE
JAGER & 33 OTHERS
Second Respondent
Third and Further
Respondents
Heard:
5 September 2013
Delivered:
11 June 2014
JUDGMENT
TLHOTLHALEMAJE,
AJ
Introduction:
[1]
The Applicant (Municipality) seeks
condonation for the late service and filing of the review
application. In the event that condonation
is granted, the
Municipality further seeks to review and set aside the arbitration
award issued by the Second Respondent (The Arbitrator)
on 25 August
2010 under case number GPD080708, which arbitration was heard under
the auspices of the First Respondent (SALGBC).
Both applications are
opposed by the Third to Further Respondents (The Employees). The
Municipality’s late filing of its
written heads of arguments
was condoned.
Background:
[2]
The Employees were all employed by the now
defunct Kungweni Local Municipality which has since been incorporated
into the Municipality
with effect from 19 May 2011. On 26 July 2007
they referred a dispute to SALGBC pertaining to three main issues,
viz, interpretation/application
of a collective agreement; unfair
labour practice and mutual interests. The Employees complained that
the Municipality had ‘
unilaterally
upgraded all employees on job level 15 and 14 to level 13,
effectively doing away with job levels 14 and 15’.
[3]
The matter was initially set-down for a
con/arb process on 27 November 2007. The same Arbitrator had heard
the matter in default
and made a finding on 11 December 2007 that the
Municipality had committed an unfair labour practice, and had ordered
that the
employees be promoted. Following a successful rescission
application and various postponements, the Arbitrator again heard the
matter in the presence of all the parties and issued an award on 25
August 2010. In her award, the Arbitrator found that;
a)
The Respondent’s
(Municipality) conduct was an unfair labour practice.
b)
That the resolution dated 22/02/2007
should be cascaded to all the employees who were excluded from
promotion.
c)
The employees be promoted from their
current levels to one level up as per the resolution.
d)
The promotion of the employees be
implemented with retrospective effect from 1 July 2007.
e)
The applicant (Municipality) to pay
the costs for 21 June 2010 as its ‘defence and its conduct
during the proceedings were
clearly vexatious and frivolous’.
The
application for condonation:
[4]
In terms of the provisions of section 145
(1) (a) of the Labour Relations Act (The LRA), the review application
ought to have been
filed within six weeks of the date that the award
was received. The applicant for review was filed some 11 months and
one week
outside the 6 weeks period.
[5]
Section
145 (1A) of the LRA provides that the Court may on ‘good cause’
shown, condone the late filing of an application
in terms of
subsection 1. The Court has a discretion whether to grant condonation
or not, and in exercising that discretion, the
Court will take into
account the principles and factors enunciated in
Melane
v Santam Insurance Company Ltd
[1]
,
being the degree of lateness; the explanation for non-compliance with
the time frame; the prospects of success; and the importance
of the
case.
[6]
Other
considerations which other Courts have alluded to include the
convenience of the court and the avoidance of unnecessary delays
in
the administration of justice
[2]
.
It is also accepted that these factors are not individually decisive
but are interrelated and must be weighed against each other.
In
Brummer
v Gorfil Brothers Investments (Pty) Ltd
[3]
,
Jacoob J stated that the interests of justice should be an overall
consideration when dealing with such applications.
[7]
In
weighing these factors against each other, and further in exercising
its discretion, the Labour Appeal Court in
NUM
v Council for Mineral Technology
[4]
held that the court must do so
judicially
upon a consideration of all the facts of the case. The Labour Appeal
Court further added that:
“
A
slight delay and a good explanation may help to compensate for
prospects of success which are not strong. The importance of the
issue and strong prospects of success may tend to compensate for a
long delay. There is a further principle which is applied and
that is
that without a reasonable and acceptable explanation for the delay,
the prospects of success are immaterial, and without
prospects of
success, no matter how good the explanation for the delay, an
application for condonation should be refused”
[8]
Where
condonation is sought within the context of an application for a
review, the Labour Appeal Court in
A
Hardrodt (SA) (Pty) Ltd v Behardien and Others
[5]
with reference to
Queenstown
Fuel Distributors CC v Labuschagne NO and Others
[6]
held that:
‘
The
principles laid down in that case included, firstly that there must
be good cause for condonation in the sense that the reasons
tendered
for the delay had to be convincing. In other words the excuse for
non-compliance with the six-week time period had to
be compelling.
Secondly, the court held that the prospects of success of the
appellant in the proceedings would need to be strong.
The court
qualified this by stipulating that the exclusion of the appellant's
case had to be very serious, ie of the kind that
resulted in a
miscarriage of justice.’
The extent of
the delay and explanation:
[9]
The review application was filed some 11
months out of time. Whichever way the Municipality wishes to look at
it, the delay is indeed
excessive in the extreme, and requires a
compelling explanation.
[10]
In explaining the delay, it was contended
that after the incorporation of Kungweni, on 19 May 2011, the
Municipality had inherited
the arbitration award issued on 25 August
2010, together with a review application brought under JR418/2011 in
respect of that
award. A Mr. Dalamo, the then Acting Senior Manager
Corporate and Legal Services of Kungweni had deposed to the founding
and supplementary
affidavits in respect of that review application.
At that stage, the Municipality was represented by Mateme-Makgahlele
Attorneys.
That application was opposed by the Employees.
[11]
The Municipality’s current attorneys
of record came on board on 7 July 2011, and were instructed to take
over the review application
under JR418/2011, together with a
contempt application under case number J343/2011. The Municipality’s
attorneys of record
had at some point established that the review
application under JR418/2011 was a nullity on account of a lack of a
mandate on the
part of Dalamo to depose to any affidavits in that
regard. A decision was then taken to withdraw that application,
following negotiations
with the employees’ attorneys of record.
[12]
The Municipality contends that the
Employees’ attorneys of record had given it two days to draft
and finalise the fresh review
application, to which the Municipality
had complied. It further contended that the parties were in agreement
that the review application
under JR418/2011 was a nullity as the
deponent to the founding and replying affidavits had acted
ultra
vires
.
[13]
The Municipality further contended that
part of the delay was attributable to Mateme-Makgahlele
Attorneys, who were not helpful
in furnishing it with the file
pertaining to this matter, and had refused to hand over the file to
the Municipality’s attorneys
of record as there was an
outstanding account for services rendered. Mr Da Silva of the
Municipality’s attorneys of record
had ultimately secured a
copy of the Bargaining Council’s case file under case number
GPD080708, which did not contain the
evidentiary bundle used by the
Employees in the arbitration proceedings.
[14]
It was also submitted that further
difficulties were encountered by the Municipality in obtaining the
necessary and accurate information
about the history of the dispute
that resulted in the arbitration proceedings, moreso in view of the
fact that Kungweni was placed
under administration prior to its
incorporation.
[15]
The Employees’ contention is that
there exists no plausible explanation for the late filing of the
review application, and
further that the delay is excessive. In
addressing the period of lateness, the employees made reference to
various Kungweni Council
meetings between October 2010 and January
2011, and various memoranda issued by officials of Kungweni, where
the Council or its
officials had either recommended that the award of
the Arbitrator be implemented, or that the Employees be promoted.
Reference
was also made to correspondence from Mateme-Makgalele
Attorneys, who had acknowledged and accepted the award, and expressed
intention
not to review the award.
[16]
Based on the above, it was contended that
the Municipality had consistently and intentionally decided not to
review the arbitration
award, and had intentionally done nothing in
terms of that award. It was further submitted that it was only after
contempt proceedings
were launched that the Municipality had filed
the review application under JR418/2011, and that no explanation was
proffered for
the lengthy delay in launching that application. The
Employees had conceded that there was an agreement between the
parties’
attorneys of record that the Municipality would launch
a fresh review application. They however denied that they had agreed
that
condonation should be granted in respect of the late launching
of the review application as it was always their intention to
vigorously
oppose any such application.
[17]
What appears to come out of the reasons
proffered by the Municipality and opposition to the application is
that upon incorporation
on 19 May 2011, the Municipality had
inherited the arbitration award issued on 25 August 2010. It further
came to its attention
that a review application had been filed around
February 2011,
albeit
that application had turned out to be a nullity on account of the
deponent to its founding affidavit having acted
ultra
vires
. That review application was
filed some four months out of time and it had incorporated an
application for condonation.
[18]
The difficulties and problems associated
with the placing of small local municipaIities under administration,
or their incorporation
into other larger metros, are factors which
this court cannot brush aside under the pretext that they are not
real. Given
the constraints when the Municipality took over
Kungweni, it is noted that the latter had at that time, launched an
application
to review the award in question. Granted that the
application was a nullity and out of time, it is my view that it
cannot be correct
that Kungweni had at all material times, evinced an
intention to comply with the award. The resolutions of that Council,
or memorandums
from its officials, let alone correspondence from
Mateme-Makgalele Attorneys cannot in the light of the fact that such
an application
was launched, indicate a clear intention to abide by
the award.
[19]
Furthermore, it has always been the
contention of the Municipality that there was no agreement or
resolution by Kungweni that the
award should be implemented. The
averments of Mpho Kekana, the then Kungweni Acting Municipal manager
in the replying affidavit
also indicated that there was never an
intention to abide by the award. It thus follows that the principles
relating to peremption
as argued on behalf of the Employees cannot
find application in this case, as no positive act was evinced from
the conduct of the
Municipality that it would comply with the award.
[20]
It is further acknowledged that the
Municipality has not accounted in detail for each and every instance
of the delay after incorporation
of Kungweni in May 2011. What is of
relevance is that a replying affidavit in the withdrawn review
application was deposed to also
in May 2011 after incorporation.
Thereafter, and following a contempt application brought by the
Employees, and further in an effort
to ascertain the status of the
withdrawn application, correspondence and engagement was entered into
between the Municipality’s
current attorneys of record and the
Employees’ attorneys of record from May 2011. The
Municipality’s problems were
further compounded by a lack of
cooperation from Mateme-Makgalele attorneys who declined to hand over
the file in respect of the
withdrawn application. It is accepted that
the Municipality’s current attorneys of record could have done
more than merely
requesting the file from Mateme-Makgale attorneys.
However on the whole, the difficulties the Municipality had
encountered upon
the incorporation of Kungweni cannot be overlooked.
To this end, I am satisfied that given these constraints, and
subsequent endeavours
by the Municipality in dealing with matters it
had inherited, a compelling explanation for the delay in launching
the main application
has been proffered.
Prospects
of success:
[21]
In
regards to the approach in dealing with the aspect of prospects of
success, this Court in
Gaoshubelwe
and Others v Pieman's Pantry (Pty) Ltd
[7]
stated the following:
‘
The
prospects of success or bona fide defence on the other hand mean that
all what needs to be determined is the likelihood or chance
of
success when the main case is heard. See
Saraiva
Construction (Pty) Ltd v Zululand Electrical and Engineering
Wholesalers
(Pty) Ltd
1975 (1) SA 612
(D) and
Chetty v Law Society, Transvaal
1985 (2) SA 756
(A) at 765 (A-C).’
[22]
The Municipality submitted that its
prospects of success compensates for the protracted delay in bringing
this application. In this
regard, it was contended that the award of
the Arbitrator was reviewable for reasons set out in the review
application, which were
incorporated in this application. For the
sake of convenience, and in order not to burden this judgment with
repetition, the considerations
surrounding the parties’
prospects of success will be dealt with in detail within the context
of the review application itself.
For now, it is sufficient to
indicate that a reading of the pleadings indicates that the
Municipality has established prospects
of success in the main
application, and this factor in my view, compensates for the extreme
delay as discussed above.
Prejudice
and other considerations:
[23]
The
Labour Appeal Court in
Kerradam
Properties (PTY) LTD t/a Cabanga Conference Centre v Sonica
Matthee
[8]
further
emphasised that the factor of prejudice plays a role only when the
delay is substantial. The Employees’ contention
was that if the
award was not implemented, they will be deprived of their right to
promotion in terms of the award to a higher
level, and as a result,
will be denied the salary increases and increase in pension benefits
which are attached to the post. It
was further submitted that some of
the Employees would have been entitled to travel allowances.
[24]
The Municipality’s contention was
that it stood to suffer prejudice should condonation not be granted,
since it would be forced
to compensate the Employees in the amount of
millions of rands in retrospective salary increases based on
promotions that they
were not entitled to, together with millions of
rands in future earnings calculated on their respective salaries. It
was submitted
that ultimately, it would be the ratepayers of the
Municipality that will be footing this bill.
[25]
It cannot be doubted that the Employees
having referred a dispute, are entitled to a speedy resolution of
that matter. In their
view, that matter was resolved with the
delivery of an award which was in their favour. It is accepted that
the delay was indeed
prejudicial to them in that they were deprived
of a speedy resolution of the dispute. However, once that award was
taken on review,
any rights emanating from that award remained in
abeyance, and the Employees cannot claim to be prejudiced simply on
account of
the award not being implemented as they had expected. They
cannot lay claim to rights and privileges emanating from an award
which
is still the subject matter of litigation.
[26]
On the other hand, the prejudice to the
Municipality is real and substantial if condonation is not granted.
If the application fails,
the Employees would then be entitled to
promotions and the consequent monetary benefits that accompany those
promotions. As it
is apparent from their submissions, the prejudice
to them is more in respect of the financial benefits emanating from,
and expectations
which the award created.
[27]
The financial implications of the award are
clearly far-reaching, and for all intents and purposes, the issue
remains whether the
Employees are indeed entitled to the relief
obtained. This question can only be answered within the context of
determining the
review application. Thus the interests of justice in
the circumstances, more particularly in view of the financial
implications
of the award sought to be reviewed, require that the
Municipality be afforded an opportunity to state its case in respect
of the
review application. As was correctly pointed out on behalf of
the Municipality, any prejudice suffered by the Employees will be
cured by an unsuccessful review application, with the consequent
retrospective back pay and other benefits pertaining to their
promotion. In the light of these and other factors as stated in
consideration of this application, it is determined that the
Municipality
has shown good cause, and that its late filing of the
review application should be condoned.
The
review application:
[28]
The
Municipality contended that the Arbitrator’s award was
reviewable on at least 21 (twenty one grounds). It is accepted
that
the
role of the reviewing court is limited to deciding issues that are
raised in the review proceedings, and that the court may
not on its
own raise issues which were not raised by the party who seeks to
review an arbitral award
[9]
.
It
is common cause that the award sought to be reviewed was issued
against Kungweni Local Municipality whilst the Employees were
employed by that Municipality. In obtaining that award, the
Employees’ main contention was that Kungweni had unilaterally
upgraded all employees on job levels 14 and 15 to job level 13. In
the Employees’ view, job levels 14 and 15 were phased
out and
as a result thereof, they should have been promoted and renumerated
accordingly.
[29]
The Employees’ contentions were
premised on the Resolution passed by Kungweni on 22 February 2007
prior to incorporation to
the effect that ‘…
.the
starting Post level for the Kungweni Local Municipality employees
will be post level 13 as from 1 July 2007 and all employees
will
enjoy the benefits of housing and medical aid, with effect from 1
July 2007’.
In their answering
affidavit in respect of the review application, the Employees denied
that they wanted to be cascaded to a higher
job level, and contended
that their main dispute pertained to ‘promotion’. Their
concern was that they were not given
reasons why they were excluded
from the promotions as a result of the passing of that resolution.
The Municipality had submitted
that although none of the Employees
were on post levels 14 and 15 when the resolution was passed, the
Arbitrator had nevertheless
found that they should be promoted from
their current levels to one level up as per that resolution.
[30]
It was further contended on behalf of the
Municipality that the wording and clear intention of the resolution
was to abolish post
levels 14 and 15. Thus all the employees that
occupied those post levels when the resolution took effect, were to
be automatically
elevated to post level 13 for the purposes of
enjoying housing and medical aid benefits. In the light of the
dispute referred by
the Employees, and the effect of the Resolution,
the main issue in considering the review of the award is whether the
Arbitrator,
in the light of the material placed before her, or in
respect of the issues she was required to determine,
misconceived the nature of the enquiry or arrived at an unreasonable
result.
The
award:
[31]
In her award, the Arbitrator referred to the resolution and
pointed out that those employees on levels 14 and 15 were promoted to
level 13 except the Employees. On that basis, she had to determine
whether the Municipality had committed an unfair labour practice.
The
Arbitrator however went further and stated that the issue for
determination was whether the failure and/or refusal by the
Municipality to effect promotion had
prejudiced
the Employees.
This second part of the enquiry was clearly not a matter before her
,
moreso since by its nature it is not an arbitrable issue. On this
issue alone, the Arbitrator clearly misconceived the nature of
the
enquiry, and this issue will be addressed later in the judgment.
[32]
The Arbitrator did not deem it necessary to traverse the
evidence except for what she deemed to be key issues adduced by the
witness
‘on behalf of the other applicants’. She
referred to the resolution, the promotion of other employees to level
13; the fact that there was a list of employees that were to be
promoted; the financial implications thereof, and the fact that
the
Employees in
casu
were not informed why they were excluded.
[33]
In the light of that summary, the Arbitrator under the heading
“Legal Position” then proceeded to state that there was
no substantive reason given by the Municipality for
excluding
the Employees, and that the documents presented by IMATU were
unchallenged or undisputed. In this regard, the Arbitrator proceeded
to refer to various authorities in regards to the failure to dispute
evidence. She further stated that ‘
honesty was never an
issue throughout cross-examination’
even though it was not
clear in what context the issue of ‘honesty’ came about,
and further since the sole witness
called by the Employees was hardly
cross-examined, let alone on the issue of ‘dishonesty. The
Arbitrator further pointed
out that the Municipality did not call
witnesses and had not produced any documents. She further attacked
the Municipality’s
representative for merely presenting hearsay
evidence which she had rejected, and concluded that it had failed to
justify the
exclusion
of the Employees.
[34]
It is accepted that the provisions of
section 138 (7) (a) of the LRA require a commissioner to issue an
arbitration award with brief
reasons. ‘Brief reasons’ in
my view does not imply scant reference to evidence presented or
material referred to. It
requires at least an attempt by the
arbitrator to deal with the substantive merits of the matter by
setting out in his/her award,
the issues for determination in clear
terms, a concise summary of the evidence led by identified witnesses,
a coherent analysis
of that evidence, the conclusions reached based
on that evidence, a consideration and justification of relief ordered
if any, and
conclusions in this regard. In many respects, the award
is found wanting in this regard.
[35]
From the Arbitrator’s summation of
the evidence and conclusions reached in the award, it is difficult to
discern what had
transpired in the arbitration hearing, what evidence
if any, was led, which documents were presented and not disputed, and
further
the basis upon which a conclusion was reached that the
Employees were unfairly excluded from the list for the purposes of
the issues
that were to be determined. There was further no basis
laid for the relief granted or the justification thereof. This
omission
necessitates an examination of the entire record of the
arbitration proceedings.
The
arbitration proceedings as gleaned from the record;
[36]
At the commencement of the proceedings, the
Municipality’s representative, Mr. Kekana had requested a
bundle of documents
from the Employee’s representative, Mr.
Modisha. In his opening address, Mr. Modisha had identified the issue
for determination
as relating to the failure of the Municipality to
promote
the Employees in the light of the promotion of other employees to
level 13, which he considered to be unfair in that the decision
(resolution) was
cascaded
to all employees. In the light of what Mr. Modisha had proclaimed to
be what the Employees’ case was at the time, I fail
to
appreciate the reason they would deny in their answering affidavit
for the purposes of this application that their case was
never about
being cascaded. Flowing upon what Mr. Modisha had said, the
Arbitrator had curiously asked him the number of the employees
involved and whether they were ‘misled’, to which Mr.
Modisha responded in the affirmative. It is not clear from the
record
as to in what material respects the Employees were ‘misled’,
or the purpose the Arbitrator had asked that leading
question.
[37]
Mr. Kekana on behalf of the Municipality
had commenced his opening address by saying that he conceded to what
Mr. Modisha had said,
and went on to explain the purpose of the
resolution, which was to bring the basic salary level acceptable to
all employees and
to comply with the provisions of SALGA. He had
further stated that the effect of the resolution was not to promote
employees and
that the Employees were not excluded from that process.
[38]
Mr. Modisha had then proceeded to present
his case on the basis of documents, and had referred to the
composition of the “Personnel
Local Labour Forum’ as per
clause 2.8.1 which provides that “
At
every employer, a local labour forum shall be established with equal
representation from trade unions and the employer…”.
It
is not clear from the record as to which document these provisions
are to be found. Be that as it may, flowing from these provisions,
Mr. Modisha submitted that the resolution was taken and implemented
without IMATU being informed, more specifically in respect
of its 38
members who were excluded. In the light of not being informed of that
decision and its implementation, IMATU held the
view that the
exclusion of its members was unfair. To that end, Mr. Modisha had
submitted that all 38 members were excluded and
prejudiced as they
should have been promoted (cascaded) to a level up in terms of that
resolution.
[39]
Mr. Modisha had then proceeded to call one
witness, Mr. Daniel Jacobus De Jager, the Third Respondent and the
Chairperson
of IMATU at Kungweni. It is not clear from the record as
to what the testimony of this witness was all about as that part of
the
record was indistinct. It however appears that he testified on
the issue of salaries and adjustments even though it is not clear
in
what context the issue was raised.
[40]
When it was Mr. Kekana’s turn to
cross-examine Mr. De Jager about his participation in the LLF, an
objection was raised by
Mr. Modisha. This question was pertinent
since Mr. Modisha had complained that IMATU was excluded from the
decisions taken at the
level of the LLF and the implementation of
those decisions. It was further relevant since Mr. Kekana had in his
opening address,
denied that the Employees were excluded from the
process surrounding the decision to abolish levels 14 and 15. Even
more pertinent
was that the witness as an IMATU representative, and
he was in a position to respond to that question.
[41]
The Arbitrator had however prevented Mr.
Kekana from asking that pertinent question, on the basis that Mr.
Modisha had called that
witness solely to testify on the issue of
salaries. Mr. Modisha had then closed his case by submitting that the
decision of the
Municipality to promote employees at level 14 and 15
to level 13 had excluded the 38 IMATU members, which was unfair. He
had submitted
that the Employees should thus be ‘promoted in
terms of the resolution’.
[42]
Mr. Kekana on behalf of the Municipality
submitted that levels 14 and 15 were abolished through the resolution
on the basis that
employees at those levels did not qualify for
benefits such as housing and medical aid. Those employees were then
moved to level
13 in order to enjoy these benefits. That decision or
resolution was taken through the LLF structure in terms of the
collective
agreement where both the unions and management sat in
equal representation. The intention of the resolution was to focus on
housing
and medical aid benefits, and the Employees in the dispute
had already qualified for those benefits by virtue of their positions
and levels as managers. Mr. Kekana had pointed out that IMATU was
part of that process, and it was wrong and misleading for IMATU
to
contend that it was not consulted.
[43]
Notwithstanding the fact that the parties
had closed their respective cases and presented arguments, the
Arbitrator had then specifically
asked Mr. Modisha to set out the
relief that the Employees seek in writing and to e-mail her a ‘
few
lines’
. The significance of this
request will be highlighted later. Mr. Modisha had responded that he
will do so as part of his closing
arguments. Mr. Kekana had objected
that the request was unprocedural as the parties had closed their
respective cases. Mr. Modisha
had nevertheless undertaken to provide
the nature of the relief the Employees seek in writing. The
Municipality in its founding
papers contended that the Arbitrator
when considering relief had merely cut and pasted into her award,
what Mr. Modisha had sent
her. This issue will be dealt with later in
this judgment.
The
legal framework surrounding review applications:
[44]
It
is now settled law that an award of a commissioner would not be
reviewed and set aside if it is one which a reasonable commissioner
would have made
[10]
. A recent
and more decisive explication of the review test as enunciated in
Sidumo
and as applicable to awards was given in
Herholdt
v Nedbank Ltd
[11]
,
where the Supreme Court of Appeal,
per
Cachalia JA summarized it as follows
:
‘
A review of a CCMA
award is permissible if the defect in the proceedings falls within
one of the grounds in section 145(2)(a) of
the LRA. For a defect in
the conduct of the proceedings to amount to a gross irregularity as
contemplated by section 145(2) (a)(ii),
the arbitrator must have
misconceived the nature of the enquiry 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 particular facts, are not in
and of themselves sufficient
for an award to be set aside, but are
only of any consequence if the effect is to render the outcome
unreasonable.’
[44]
In
Goldfields
Mining South Africa (Pty) Ltd v
CCMA
and Others
[12]
the Labour
Appeal Court confirmed that the applicable test does not admit what
has been referred to as a “process-related
review”. Thus
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. Pertinent questions to be asked by the reviewing
court were spelt out as follows:
‘
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?’
[13]
And
‘
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
actually
defeat the constitutional imperative that the award must be rational
and reasonable - there is no room for conjecture and
guesswork.’
[14]
The
grounds for review and analysis:
[45]
Section 138 (1) of the LRA provides that:
‘
A
commissioner may conduct the arbitration in a manner that the
commissioner considers appropriate in order to determine the dispute
fairly and quickly, but must deal with the substantial merits of the
dispute with the minimum of legal formalities’
In
CUSA
[15]
,
Ngcobo J having considered the above provisions had stated the
following;
‘
Consistent with
the objectives of the LRA, commissioners are required to “deal
with the substantial merits of the dispute
with the minimum of legal
formalities (Citation omitted). This requires commissioners to deal
with the substance of a dispute between
the parties. They must cut
through all the claims and counter-claims and reach for the real
dispute between the parties. In order
to perform this task
effectively, commissioners must be allowed a significant measure of
latitude in the performance of their functions.
Thus the LRA permits
commissioners to “conduct the arbitration in a manner that the
commissioner considers appropriate”.
(Citation omitted) But in
doing so, commissioners must be guided by at least three
considerations. The first is that they must
resolve the real dispute
between the parties. Second, they must do so expeditiously. And, in
resolving the labour dispute, they
must act fairly to all the parties
as the LRA enjoins them to do. (Citation omitted)
[16]
And,
‘
A commissioner
must, as the LRA requires, “deal with the substantial merits of
the dispute”. This can only be done by
ascertaining the real
dispute between the parties. (Citation omitted) In deciding what the
real dispute between the parties is,
a commissioner is not
necessarily bound by what the legal representatives say the dispute
is. The labels that parties attach to
a dispute cannot change its
underlying nature. A commissioner is required to take all the facts
into consideration including the
description of the nature of the
dispute, the outcome requested by the union and the evidence
presented during the arbitration.
What must be borne in mind is that
there is no provision for pleadings in the arbitration process which
helps to define disputes
in civil litigation. Indeed, the material
that a commissioner will have prior to a hearing will consist of
standard forms which
record the nature of the dispute and the desired
outcome. The informal nature of the arbitration process permits a
commissioner
to determine what the real dispute between the parties
is on a consideration of all the facts. The dispute between the
parties
may only emerge once all the evidence is in.’
[17]
[46]
In applying the above principles to the facts of this case, and
further having taken regard to those enunciated in
Herholdt
and
Goldfields
,
which are in effect on all fours with what Ncgobo J stated in
CUSA
,
the issue is whether firstly, the Arbitrator within the powers
conferred on her in terms of the provisions of s138 (1) of the
LRA,
had identified and determined what the
real dispute between
the parties was. It follows that if she did not, the outcome she had
arrived at would not be a reasonable one.
[47]
The identification of the real dispute between the parties can
obviously not be determined from the certificate of outcome
or the
referral forms alone. It is not uncommon for the applicant parties in
their referral forms to make allegations as to the
nature of their
dispute, and yet during the arbitration process, their claim turns
out to be something completely different. In
such instances, the
process of narrowing down of issues ultimately assists the arbitrator
in properly identifying the nature of
the dispute, and it is
incumbent upon the arbitrator to properly record what the dispute is
understood to be and to confirm that
it is indeed that particular
dispute that is being pursued, which should be the subject of
determination.
[48]
The nature of the Employees’ claim as per their referral took
three forms, viz, interpretation or application of a collective
agreement, matters of mutual interests, and an alleged unfair labour
practice. Once Mr. Modisha on behalf of the Employees had
identified
the Employees’ dispute as pertaining to ‘promotion’,
the Arbitrator was compelled to determine whether
indeed the dispute
pertained to promotion and then applied the relevant principles
applicable to unfair labour practice relating
to promotion. In
essence, what was required of the Arbitrator was a determination as
to whether any conduct on the part of the
Municipality constituted an
unfair labour practice relating to promotion as contemplated in
section 186 (2) (a) of the LRA.
[49]
The Municipality’s main contention was that the Arbitrator had
misconstrued what was required of her in finding that
the Employees
were excluded from promotion for no apparent reason. The Employees’
contention on the other hand was that the
Arbitrator had relied on
undisputed and unchallenged evidence that was before her in coming to
her conclusion.
[50]
From the record of proceedings, it is apparent that what the
Employees had placed before the Arbitrator in arguing that they
were
entitled to a promotion or be cascaded to the next level was the
resolution and the evidence of Mr. De Jager. The resolution
merely
abolished levels 14 and 15 and all employees below those levels
automatically moved to level 13. The wording and interpretation
of
the resolution was to enable employees below level 13 to qualify for
medical aid and housing benefits. It follows then that
in order for
the Employees to be granted any mobility upwards or promoted in terms
of the resolution, or to have been entitled
to the benefits of
medical aid and housing in terms of that resolution, they ought to
have occupied positions below levels 14 and
15. The Employees in
their answering affidavit did not dispute the Municipality’s
contentions that none of them occupied
levels below 14 and 15. The
resolution did not make any reference to cascading of employees at
other levels, and to this end, since
the Employees already occupied
levels where they were entitled to the benefits which the resolution
intended to address in respect
of other low level employees, it
follows that there could not have been a ‘promotion’ in
the true sense.
[51]
In typical promotion disputes, it is trite that it is not the task of
an arbitrator when considering such dispute to decide
who should be
promoted. The role of the arbitrator within his or her powers as
envisaged in section 138 (1) of the LRA is to oversee
that the
employer did not act unfairly towards the employee complaining of not
being promoted. In that role, the arbitrator is
required to determine
whether the employee was given a fair hearing or opportunity to be
promoted, in relation to the requirements
of the post.
[52]
In
De
Nysschen v General Public Service Sectoral Bargaining Council &
Others
[18]
,
this Court confirmed the principle that an employee does not have an
automatic right to promotion. In this case however, the Employees
and
the Arbitrator based the right to automatic promotion on a clearly
incorrect reading and interpretation of the resolution.
The
Employees’ case in essence is that whether anyone of them
deserves it not, by virtue of the resolution passed by Kungweni,
they
should automatically be cascaded or pushed a level up. The Arbitrator
incorrectly agreed with the Employees’ proposition
when there
was clearly no basis or reasoning to do so. By misconceiving the
nature of the enquiry, it follows that she failed to
properly
determine the dispute that was before her. As a consequence, the
Arbitrator failed to deal with the substantial merits
of the dispute,
and her decision was not one that another decision-maker could
reasonably have arrived at based on the material
before her.
[53]
The Municipality had also lamented the fact that Mr. Kekana was
prevented from cross-examining Mr. De Jager. The relevance
of the
question surrounding Mr. De Jager’s participation in the LLF
has been pointed out. The Arbitrator’s conduct
in this regard
clearly constituted misconduct in relation to her duties as she was
obliged to deal with the objection to the question
and then determine
whether the question was relevant or not. She committed a gross
irregularity in the conduct of the proceedings
by merely agreeing
with Mr. Modisha that the witness could not be asked questions
outside the scope of those asked in examination
in chief. The process
that the Arbitrator employed clearly did not give the Municipality a
full opportunity to have its say in
respect of the dispute, as it was
important for Mr. De Jager to confirm or deny whether he was part of
the forum where the resolution
was taken since the Employees had
complained about not being consulted. A core principle of
cross-examination is that the
cross-examiner should be afforded an
opportunity to put questions to a witness, put a version to that
witness and be afforded latitude
with that witness, irrespective of
the purpose for which that witness was called. In this case, the
Arbitrator deprived Mr. Kekana
of this right, thus depriving him of a
fair hearing.
[54]
The Municipality had contended that despite the fact that the parties
at arbitration had agreed that the matter would be argued
with
reference to documentation, and the calling of the one witness, the
Arbitrator attached much weight to the Municipality’s
alleged
failure to challenge the evidence of the Employees. As already
pointed out from the record, the only oral evidence presented
was by
Mr. De Jager on behalf of the Employees. His testimony appeared to be
in respect of adjustment of salaries. The Employees’
contention
was that even if a matter is argued on the papers, there was still a
duty on a party to introduce evidence in order
to prove its case or
to dispute the other party’s case. On the grounds that Mr.
Kekana had not produced any documentary evidence
of his own, it was
contended the Arbitrator had no option but to rely on the evidence of
the Employees.
[55]
It is trite that in any legal proceedings, the only evidence led or
presented may not necessarily be the most probable or determinative.
It is not clear from the Arbitrator’s reasoning, if any, in
what material respects any evidence was not challenged by the
Municipality. This also appeared to the Employees’ main
contention throughout their opposition to the review application.
In
my view, and as gleaned from the record, the only relevant evidence
before the Arbitrator, and upon which she was required to
determine
the dispute was the resolution passed by Kungweni and the submissions
and arguments of the representatives. In the light
of the conclusions
made in regards to Mr. De Jager’s evidence and its relevance to
the issues to be determined, it follows
that a determination had to
be based on the resolution itself and the arguments and submissions
made on behalf of the parties.
[56]
In my view, there is no basis for a conclusion to be reached that
there was other relevant evidence, which the Municipality
failed to
dispute or challenge. Thus, to the extent that no evidence was led in
regard to the alleged ‘exclusion’ of
the Employees, as
Mr. De Jager did not give testimony in that regard, there was no
basis for the Arbitrator to conclude that the
Employees were excluded
from any process relating to the resolution or its implementation.
Furthermore, even if there was merit
in the Employees’
contention that they were excluded from the process, it is my view
that since there is no automatic right,
to let alone an entitlement
to a promotion, an exclusion from a decision making process relating
to the taking of a municipality
resolution cannot give rise to an
automatic right to a promotion as the Arbitrator had found.
[57]
It was further contended that the Arbitrator was unable to grasp what
was required of her during the arbitration process. In
this regard,
an example was made of her reference to section 186 (2) (b) of the
LRA which had nothing to do with the matter. In
my view, nothing much
turned on this submission, even though the Arbitrator had made
reference to an incorrect provision of the
LRA in the light of the
issue she had to determine.
[58]
Furthermore, it was contended that the Arbitrator went down the wrong
path by stating that what she had to decide was whether
the failure
and/or refusal by the Municipality to effect promotion had
prejudiced
the Employees. Within the context of section 186 (2) (a) of the LRA,
the issue for consideration was whether there was an unfair
labour
practice committed by the Municipality. Prejudice as correctly
pointed out on behalf of the Municipality is not an arbitrable
issue.
As also correctly pointed out on behalf of the Employees, prejudice
is merely a consequence of unfairness, where it is proven.
Even
though the Arbitrator did not specifically mention the issue of
prejudice in her remedy, to have nevertheless identified it
as an
issue for determination was clearly to misconceive her mandate.
[59]
The Municipality had also contended that the relief granted by the
Arbitrator as stated in the award, was merely a cut and
paste of the
submissions made by Mr. Modisha in writing as requested by the
Arbitrator, without applying her mind to the issue.
Firstly, the
Arbitrator found that the Municipality’s conduct constituted an
unfair labour practice. As already indicated
elsewhere in this
judgment, there was no basis for this conclusion to be reached.
Secondly, the Arbitrator had found that the resolution
should be
cascaded to all the Employees who were excluded from promotion. A
conclusion has also been made that there is no basis
for that finding
to be made as the resolution did not make reference to cascading of
employees, and furthermore, the Employees
had already in any event,
benefitted from medical aid and housing benefits, which benefits
employees below levels 14 and 15 had
not enjoyed.
[60]
Even more curious from the award was a cost order made against the
Municipality on the basis that its conduct was ‘clearly
vexatious and frivolous’. It is trite that costs generally
pertain to legal costs. Where costs are ordered on account of
a
party’s unacceptable conduct, including vexatiousness and
frivolity, such conduct must be identified and specified in the
award
in clear terms rather than a mere general statement being made. In
this case, there is no indication as to how the Arbitrator
arrived at
a conclusion that the Municipality had conducted itself in a
frivolous or vexatious manner. In the absence of a basis
for that
conclusion, it follows that the order of Arbitrator constitutes gross
irregularity.
[61]
Furthermore, IMATU, which represented the Employees in the
Arbitration proceedings, is not entitled to costs in the ordinary
sense. Any reference to costs in arbitration proceedings held under
the auspices of the Bargaining Council could only have been
arbitration costs determined by the Council’s own rules, and
which costs would ordinarily be payable to that Council. If
ever
there was anything payable to IMATU, it would purely have been
limited to disbursements, which even then had to be quantified.
To
this end, it is found that there was no basis for the Arbitrator to
make a cost order against the Municipality.
Conclusions:
[62]
In the light of the conclusions reached that the Arbitrator’s
decision was not one that another decision-maker could
reasonably
have arrived at based on the material before her, the only issues to
be determined pertain to the appropriate relief
and the costs of this
application. The Municipality’s contention was that this Court
was in a position to adjudicate on the
merits of the matter, and in
the interests of justice, to hold that the Employees are not entitled
to promotion, rather than remitting
the matter back to the Bargaining
Council for arbitration
de novo,
taking into account the
protracted history of the matter.
[63]
The Arbitrator came to a decision, which a reasonable arbitrator
would not have come to in the light of the material placed
before
her. That material has been gleaned from the record, and since the
award must be reviewed and set aside, and
little purpose would be served by remitting the matter back to the
First Respondent (Council) in the light of the conclusions reached
by
this court.
[64]
In regards to costs, section 162 of the LRA enjoins the court with a
discretion to order costs having had regard to considerations
of law
and fairness. Given the protracted history of this matter, and the
fact that most of the Employees are still employed by
the
Municipality, it is not deemed to be in the interests of fairness to
make any cost order.
Order:
i.
The Applicant’s late filing of the
review application is condoned
ii.
The arbitration award issued by the Second
Respondent under case number GPD080708, and acting under the auspices
of the First Respondent
is reviewed and set aside.
iii.
The award is substituted with one that
reads:
a)
“
The Employees’ referral of an
alleged unfair labour practice relating to promotion is dismissed.
b)
There is no order as to costs”
iv.
There is no order as to costs.
____________________
TLHOTLHALEMAJE, AJ
Acting
Judge of the Labour Court of South Africa
APPEARANCES:
For the
Applicant:
Adv. W Bekker
Instructed by
:
Gildenhuys Lessing Malatji INC
For the FThird and
Further Respondents: Adv. F Venter
Instructed
by:
DP Du Plessis Inc
[1]
1962
(4) SA 531 (A).
[2]
Foster
v Stewart Scott Inc
(199
7)
18 ILJ 367(LAC)
[3]
[2000] ZACC 3
;
[2000]
(2) SA 837
(CC) at 839 F
[4]
[1999]
3 BLLR 209
(LAC) at para 10.
[5]
(2002)
23 ILJ 1229 (LAC) at 1231C
[6]
(2000)
21 ILJ 166 (LAC).
[7]
2009
30 ILJ 347 (LC) at para 27.
[8]
Case
no: JA 72/2010 at para 5
[9]
CUSA v
Tao Ying Metal Industries and Others
[2008] ZACC 15
;
2009 (2) SA 204
(CC)
at
para 66
[10]
Sidumo
and Another v Rustenburg Platinum Mines and Others Ltd
2008
(2) SA 24 (CC)
[11]
[2013] 11 BLLR 1074
(SCA) par 25 at 1084.
[12]
2014] 1 BLLR 20 (LAC)
[13]
At para 20
[14]
At para 21
[15]
2009 (2) SA 204 (CC)
[16]
At para 62
[17]
At para 63
[18]
[2007]
5 BLLR 461
(LC)