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[2014] ZALCCT 60
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Abraham v Oceana Group Ltd and Others (C863/2013) [2014] ZALCCT 60 (29 September 2014)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
JUDGMENT
CASE
NO C 863/2013
Not
reportable
In
the matter between:
ANTHEA
GRACE
ABRAHAM
APPLICANT
and
THE
OCEANA GROUP
LTD
1
ST
RESPONDENT
DIK
WILSON
NO
2
ND
RESPONDENT
COMMISSION
FOR CONCILIATION, MEDIATION
AND
ARBITRATION
3
RD
RESPONDENT
Application
heard: 10 September 2014
Judgment
delivered: 29 September 2014
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
This is an application to review and set aside an arbitration award
issued by the
second respondent (the commissioner). In his award, the
commissioner held that the applicant’s dismissal by the first
respondent
(Oceana) was substantively and procedurally fair.
The
award
[2]
The material facts relevant to this dispute are captured in the
commissioner’s
award, and there is no need to repeat them here.
The applicant was employed by Oceana in November 2010 as a
communications manager.
She was dismissed on 9 April 2013 for
incapacity in the form of a failure to meet required performance
standards, after a performance
review held on 12 March 2013 and an
incapacity hearing chaired by an independent third party on 22 March.
[3]
The applicant challenged both the substantive and procedural fairness
of her dismissal.
After an arbitration hearing that took some six
days to complete, the commissioner concluded, as I have indicated,
that the applicant’s
dismissal was both substantively and
procedurally fair.
[4]
The award, some 23 pages long, comprises a commendable summary of the
evidence and
the applicable legal principles. The commissioner’s
conclusions and his reasoning in relation to the substantive fairness
of the applicant’s dismissal appear from paragraphs 122 of the
award onward. He says the following:
122.
With regard to substantive fairness, there were a number of instances
of alleged poor performance put
forward by the respondent. It was
confirmed by almost all of the witnesses that the company has a focus
on high performance, and
that targets arew challenging and deadlines
are tight. The high-performance focus appears to have been applied
particularly within
the GSS Department, which was a relatively new
Department intent on establishing its value to the business. It was
also not disputed
that the applicant's role was an important one, and
that the scope of her job was extensive and demanding. Applicant was
a senior
employee is evidenced by the remuneration package as well as
the fact that she led the communications function and reported
directly
to a company director…
126.
The Respondent in this matter has adduced plentiful evidence of
shortcomings in the applicant's performance.
Applicant was counselled
concerning these shortcomings over a lengthy period of time; she was
eventually given an ultimatum to
improve within four weeks (which
became five weeks), and thereafter she was given an opportunity to
state her case. I have already
determined that this process was a
fair one.
127
Applicant led evidence as to the good work she had done. It was not
disputed that she had performed
well in 2011, although Respondent
noted that she was measured on a lower standard due to her recent
appointment in a position which
was still being developed. It was
also not disputed that she had been complemented from time to time by
various managers, including
this year, and aspects of work however,
this is not the issue; the question is whether the applicant's
performance
as a whole
was sufficiently good warrant the
retention in the position.
128.
I have no reason to question the standards applied by the Respondent…
Essentially the Respondent
expected the applicant to do things right
and within the allocated time, in line with Respondent’s high
performance expectation.
It is clear that the applicant did not meet
these expectations in several respects.
[5]
The commissioner goes on to summarise the particular respects in
which the applicant
did not meet the required performance standards.
These include expectations in regard to the co-ordinating role in
producing the
integrated report, the drafting of the stakeholder
engagement plan, which was eventually outsourced. The commissioner
referred
to the evidence that suggested that the applicant did not
enjoy a good relationship with service providers – indeed, the
evidence of a particular service provider was that she had never
before been required to change account managers so frequently.
The
commissioner observed further that the applicant appeared to be prone
to blaming others for the shortcomings, and to deny any
culpability.
The applicant's refusal to accept that her performance was deficient
in any way, observed the commissioner, appears
to have made it more
difficult for the respondent to encourage her to improve.
[6]
The commissioner concluded as follows:
133.
It must be acknowledged that the Applicant worked hard and appeared
to be committed to the job; however
it appears that the work expected
of her was simply beyond her abilities. This is a hallmark of the
true incapacity dismissal,
where the employee is not at fault, but is
simply incapable of meeting the requirements of the position. It
would seem that the
position was more demanding than the Applicant
realised when she applied, or possibly that she over estimated her
ability to do
what was expected of her.
On
this basis, the commissioner concluded that the applicant's dismissal
was fair.
Grounds
for review
[7]
The applicant has raised numerous, detailed grounds for review, the
vast majority
of which are more appropriate to an appeal. She has
supplemented her grounds for review in her heads of argument. An
applicant
seeking to review and set aside an arbitration award under
s 145 of the LRA must articulate all of the grounds for review in the
founding and supplementary affidavits and may not expand the basis of
the review application in a replying affidavit or heads of
argument.
[8]
Be that as it may, the grounds for review on which the applicant
relies in her founding
papers are, in essence, that the commissioner
failed to consider and identify what the applicant is required
performance standards
were, that he failed to apply his mind to
whether the applicant could reasonably have been aware of the
required standards and
whether those standards were realistic and
achievable. In intend to deal with the application on this basis.
Applicable
principles
[9]
The test to be applied in an application such as the present 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
(ZASCA 97, 5 September 2013). 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.’
[10]
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.
[11]
In
Goldfields Mining South Africa (Pty) Ltd v
CCMA
[2007] ZALC 66
;
[2014] 1 BLLR 20
(LAC) 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.
[12]
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.
[13]
More recently, in
Shatterprufe (Pty) Ltd v Sesani NO & others
(unreported, PA 4/13 10 September 2014) the Labour Appeal Court
summarised the approach as follows:
A review of a CCMA award
is permissible only 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 their effect is to render the outcome
unreasonable.
[14]
The applicable test thus clearly maintains the distinction
between a review and an appeal. The correctness of the commissioner’s
decision is not in issue; this court is not entitled to
interfere if it would have come to a different conclusion on the
same
material.
Analysis
[15]
The applicant does not call into question that the commissioner
identified the dispute that he
was required to arbitrate and that he
understood the nature of that dispute. Nor does the applicant dispute
that the commissioner
gave the parties an opportunity to state their
respective cases, or that he dealt with the substantive merits of the
dispute. What
is at issue in these proceedings is the reasonableness
of the outcome of the arbitration hearing - in essence, the
applicant’s
contention is that the commissioner’s award
is not one to which a reasonable person could have come on the
available evidence.
[16]
At the outset, it is worth recording the proper approach to be
adopted in the matter concerning
the dismissal of an employee engaged
at managerial level, with the reason for the dismissal is a failure
to meet the required performance
standards. While the provisions of
item 9 of the Code of Good Practice: Dismissal remains applicable,
the courts have consistently
recognised that employers are entitled
to set performance standards and that an arbitrator ought to be slow
to interfere with them,
unless of course the standards are shown to
be patently irrational or unreasonable. The courts have also
recognised that the general
requirements reflected in item 9 may not
apply to the same degree to an employee who is a manager or senior
employee and whose
knowledge and experience qualifies her to judge
for herself whether she is meeting the required performance
standards. The same
consideration applies with the degree of
professional skill required of the employee is so high and the
departure from the standard
so serious that a failure to perform in
accordance with the standard is sufficient to justify dismissal, even
for a single lapse
on the part of the employee. These qualifications
to the general rule are obviously relevant in the present context;
the applicant's
position- she was a senior employee engaged in the
Paterson D band and required to play a managerial role. The nature of
her work
and its relevance to the strategic importance of Oceana’s
business are obviously also relevant.
[17]
It should also be recalled that ‘softer’ qualities such
as leadership, resolve, business
acumen, judgment and effective
administration are legitimate factors that may be brought into
account in any assessment of the
performance of a senior employee,
and that it is largely within the employer's province to assess
whether these standards have
been met unless, of course, the
assessment is grossly reasonable. In short: where an employer comes
to the conclusion that a senior
or managerial employee has failed to
meet the required standards or exhibit the qualities necessary for
effective performance,
the scope for having that conclusion
overturned in an arbitration proceeding is narrower than it
ordinarily might be.
[18]
In his award, and the commissioner recognised that the applicant had
knowledge of the applicable standards
through the contract of
employment, her role profile and individual performance agreement.
[19]
No substantive evidence was led before the commissioner to
corroborate the applicant's view that
the standards expected and
required of her were unrealistic and unachievable. The evidence
before the commissioner, presented through
Oceana’s witnesses
(which included the CEO, HR manager and the applicant’s
immediate superior) was that the relevant
IPA targets did not broaden
the scope and responsibilities of the applicant's role, given that
the core competencies in key areas
of responsibility remained
unchanged. It was not disputed that the department of which the
applicant was a member was a ‘high
performance’
department or that the applicant, as a senior employee heading a
function could reasonably be expected to be
held to demanding
standards rationally arrived it. Insofar as the applicant contended
that she had been afforded no assistance
and support in performing
her role, this is not a contention that is corroborated by the
evidence. There was sufficient evidence
adduced before the arbitrator
for him reasonably to draw a conclusion that the applicant had access
to resources and service providers
to ensure that the relevant
standards were met, that she had failed to make a concerted effort to
ensure that these resources will
effectively utilised and that she
had been counselled in an effort to assist her to meet the required
standards. What the commissioner
was required to do was to have
regard to a conspectus of all of the available evidence and to make a
value judgment as to the reasonableness
of the relevant performance
standards. This he did. The test was not, as the applicant appears to
suggest, whether she subjectively
regarded the standards as being too
high or unreasonable. In my view, having regard to the evidence
before the arbitrator, his
conclusion that the required performance
standards were reasonable and that the they did not constitute a
barrier to the applicant
performing at the required standard is a
decision to which a reasonable decision-maker could come on the
available evidence. In
so far as the applicant submits that the award
is reviewable because the commissioner derived performance standards
from four different
documents but failed to articulate them with any
clarity, that she was assessed only on stretch targets and that there
was no formal
evaluation of her performance, this submission ignores
the nature of the enquiry in a matter such as the present. The
parameters
of the enquiry are those referred to above and reflected
in the judgment of the Labour Appeal Court cited by the commissioner,
JDG Trading (Pty) Ltd t/a Price ‘n Pride v Brunston
(2000) 21
ILJ
501 (LAC):
I would think that where
an employer unreasonable grounds comes to the conclusion that a
senior management employee is unsuited
to the position which he
holds, the scope for having such a conclusion overturned in court of
law small. It is in the highest degree
desirable that an employee
should, in the interests of efficiency, be entitled to choose because
much freedom as is compatible
with the most exercise of discretion,
who it wants at or near the helm of its enterprise. Qualities like
leadership, resolve, business
acumen, judgement and effective
administration are not readily provable in a court. A deficiency in
such qualities is not readily
provable however… It is
important that the employer's business should not have to suffer, to
the detriment of all concerned,
through the ineptitude or
inefficiency of a particular employee.
In
other words, the applicant cannot be heard to complain that the
commissioner failed to treat her as one might treat and unskilled
or
semiskilled employee who is alleged to have failed to meet the
required performance standards. The mechanical approach which
the
applicant appears to suggest that the commissioner ought to have
applied is more suited to those instances. In the present
case, the
commissioner was obliged to take a holistic view of the evidence
before him and by applying the factors referred to above,
decide
whether the applicant's performance fell short of what was required
of her.
[20]
Insofar as the applicant's failure to meet the performance standards
is concerned, this is the
question that was at the core of the
proceedings under review. The record discloses that the overwhelming
evidence before the commissioner
was that the applicant had failed to
meet the performance standards required of her. I do not intend to
repeat that evidence here
– it is summarised by the
commissioner in his summary of the evidence and the paragraphs from
the award quoted above. It
is sufficient to say in a number of
material respects, including communication concerning the Oceana
Empowerment Trust, the integrated
plan, the stakeholder engagement
plan, the applicant's inability to follow through on instructions and
delegate tasks effectively,
the applicant's lack of initiative and
failure to be proactive, and the applicant's failure to meet
deadlines and manage resources,
the evidence discloses that inability
to meet the required performance standards. At the hearing of the
present application, the
issue of the assessment of the applicant’s
IPA during May 2012 assumed some significance. It is not disputed
that the assessment
yielded a score of 33%. Although the commissioner
does not deal specifically with this issue in his analysis of the
evidence, he
correctly records the evidence to the effect that this
was a self-assessment, and the applicant’s version that she
accepted
the assessment only to avoid conflict with her immediate
superior. Again, nothing terms on this for present purposes –
the
applicant does not deny accepting the score as valid and to that
extent, it was reflective of her performance at the time and is
relevant to the issue of whether the applicant had meet the required
performance standards.
[21]
To the extent that the applicant contends that the evidence before
the commissioner does not
support the reasonableness of a conclusion
that her performance was appraised regularly during her employment,
this is simply not
the case. I did not understand the applicant to
dispute the evidence before the commissioner that from as early as
February 2012,
she was afforded an opportunity to improve her
performance and that she understood the potential consequences of a
failure to do
so. Specifically, prior to the incapacity hearing, the
applicant was afforded a period in excess of the month to improve her
performance.
In these circumstances, there is no reason to call into
question the reasonableness of the commissioner’s conclusion
that
the applicant had been afforded an adequate opportunity and a
reasonable time within which to improve her performance.
[22]
Finally, in relation to the appropriateness of dismissal as a
sanction, the approach adopted
by the Constitutional Court in
Sidumo
leaves very little scope for this court to interfere with a value
judgement made by a commissioner in regard to sanction. The LRA
places a responsibility on commissioners to assess all of the
relevant facts and circumstances and in particular, those that serve
to mitigate or aggravate a disciplinary sanction. Again, it is not
for this court to interfere only on the basis that it would
have
imposed some lesser sanction. It is for the applicant to demonstrate
that the sanction of dismissal was, in the circumstances,
so
unreasonable that no reasonable arbitrator could have come to that
decision. In the present instance, the commissioner had before
him
irrefutable evidence that there were no appropriate alternatives or
sanctions short of dismissal. On a totality of the evidence,
the
reasonableness of his decision cannot be called into question.
[23]
For the above reasons, in my view, the applicant has failed to
establish that the commissioner’s
award falls outside of a band
of decisions to which reasonable people could come on the available
evidence, and the application
before stands to be dismissed.
Costs
[24]
In relation to costs, this court has a discretion in terms of section
162 to make orders for
costs on the basis of the requirements of law
and fairness. This court traditionally is reluctant to make orders
for costs in cases
where individual employees pursue genuinely felt
grievances against their employers. As the Labour Appeal Court has
pointed out,
the court should be slow to close its doors are to those
who genuinely feel aggrieved and seek to pursue their grievances in
this
forum. On the other hand, in the present instance, the conduct
of this matter borders on an abuse of the process of this court.
The
papers run into thousands of pages, and no attempt has been made to
identify those portions of the record that are relevant
for the
purposes of the review. Further, as I have indicated, the applicant's
heads of argument (some 35 pages) contain much that
serves to
introduce new material. For these reasons, I had seriously considered
ordering the applicant to pay the first respondent’s
costs in
this matter. However, I will give her the benefit of the doubt and
take into account particularly that this litigation
was conducted,
for the most part, by her erstwhile attorneys of record. For that
reason, she may not be solely or entirely to blame
for a lamentable
state of affairs, and I intend therefore to make no order as to
costs.
I
make the following order:
1. The
application is dismissed
ANDRÉ
VAN NIEKERK
JUDGE
OF THE LABOUR COURT
Representation:
For
the applicant: In person
For
the first respondent: Mr. S Harrison, ENS Inc