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[2015] ZALCJHB 258
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AUSA and Others v SAA SOC Ltd and Others (J1506/15) [2015] ZALCJHB 258; (2015) 36 ILJ 3030 (LC) (17 August 2015)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Reportable
Case no: J1506/15
AUSA
First
Applicant
NUMSA
SAAT
MANAGEMENT EMPLOYEES
SATAWU
SAAT
SOLIDARITY
and
SAA
SOC LTD
SAA
TECHNICAL SOC LTD
NTM
UASA
SACCA
SAA
MANAGEMENT EMPLOYEES
CCMA
Second
Applicant
Third
Applicant
Fourth
Applicant
Fifth
Applicant
First
Respondent
Second
Respondent
Third
Respondent
Fourth
Respondent
Fifth
Respondent
Sixth
Respondent
Seventh
Respondent
Heard:
6
August 2015
Delivered:
17
August 2015
Summary:
Section
189A(13) application to interdict large-scale retrenchment –
employer concluding collective agreement with unions
representing
majority of employees and extending it in terms of s 23(1)(d) –
agreement binding on non-party employees and
settling any dispute
covered by the agreement – application dismissed
JUDGMENT
MYBURGH,
AJ
Introduction
[1]
This
is an application in terms of section 189A(13) of the LRA
[1]
to,
inter
alia
,
interdict SAA
[2]
and SAAT
[3]
(jointly referred to as “the companies”) from proceeding
with a large-scale retrenchment exercise pending compliance
with a
fair procedure. The matter was heard on 6 August 2015. After the
hearing the applicants delivered supplementary heads of
argument,
which the companies replied to on 11 August 2015.
[2]
The
essential question in this matter is whether a retrenchment agreement
concluded with unions representing the majority of employees
in the
workplace, and extended in terms of section 23(1)(d), serves to, in
effect, settle any dispute that non-union members and
minority union
members have about the retrenchment process.
Essential
facts
[3]
The
companies need little introduction – SAA is the national
carrier, and SAAT (a subsidiary of SAA) provides it with technical
services. SAA’s financial woes are a matter of public record.
In the 2013/14 financial year, it made a loss of R2.6 billion.
The
retrenchment exercise that this application relates to involves an
attempt by SAA to save R350 million per annum in the cost
of
employment, which may involve the cutting of a vast number of jobs.
[4]
Union
membership figures at the companies are as follows. SAA employs 4265
employees, of whom just short of 80% belong to either
NTM,
[4]
SACCA
[5]
or UASA
[6]
(these being the three unions recognised by SAA). The only other
union that has membership at SAA is NUMSA,
[7]
but it only has 78 members (less than 2%) and is unrecognised.
Turning to SAAT, it employs 2485 employees, of whom some 77% belong
to the two recognised unions – AUSA
[8]
and SATAWU.
[9]
The other unions
that have membership at SAAT, but who are unrecognised, are NTM,
NUMSA and Solidarity.
[10]
[5]
With
reference to the above, it stands to be noted at the outset that the
applicants in this matter consist of the union grouping
at SAAT
(excluding NTM) together with SAAT management employees. The only
applicant who has any presence at SAA is NUMSA.
[6]
On
22 April 2015, a notice in terms of section 189(3) was issued. Two
CCMA facilitators were appointed, and a facilitated consultation
process was thereupon undertaken in terms of section 189A(7).
Although a dispute had arisen early on in the process in this regard,
on 2 June 2015, the parties reached agreement that the section 189(3)
notice also applied to SAAT and that a single facilitation
process
(and not a separate process in respect of each company) would be
undertaken involving both SAA and SAAT. Things proceeded
on this
basis.
[7]
During
the consultation process, the companies consulted with the seven
registered unions referred to above, and two management
representative bodies.
[11]
Although the 60-day period provided for in section 189A(7) elapsed on
20 June 2015, the consultation process was extended on a
number of
occasions – first to 9 July 2015, then to 22 July 2015, and
thereupon to 22 August 2015. To date, over the
course of some 3
½ months, the parties have conducted nine facilitated
consultation sessions, and 45 private consultation
sessions.
[8]
On
24 July 2015, SAA entered into a collective agreement with NTM, UASA
and SACCA (who jointly represent some 80% of employees in
the SAA
workplace) and SAA management employees (through their
representatives) (“the retrenchment agreement”). The
agreement relates only to SAA, and not to SAAT. In terms of the
agreement, the parties reached consensus on: the existence of an
economic rationale for the retrenchment (and recorded that the issue
had been consulted over); selection criteria; the termination
date of
effected employees (recorded as being either 30 September 2015
or 30 November 2015); severance pay; the timing
of dismissals
and notice months; assistance and support for retrenched employees;
the issue of re-employment; an e
x
gratia
payment; training; vacancies; and the engagement by SAA with various
bodies to provide further assistance or support to retrenched
employees. The retrenchment agreement also records that the parties
would continue to consult over the proposed organisational
structure.
[9]
Importantly,
the retrenchment agreement reflects that it is extended to non-party
employees
[12]
in terms of
section 23(1)(d) – this on the basis that the unions who are
party to the agreement jointly have majority representation
throughout the SAA workplace. In addition to making reference to
section 23(1)(d), the agreement also records that the agreement
is
one contemplated in terms of regulation 10 of the Facilitation
Regulations (“regulation 10”).
[13]
[10]
On
5 August 2015, the parties to the retrenchment agreement concluded a
further collective agreement, which deals with the one outstanding
issue that the parties had reserved for consultation in the
retrenchment agreement, namely the organisational structure (“the
OS agreement”). Again, the agreement does not relate to SAAT.
The agreement records that consensus has been reached on most
of the
organisational structures (which appear to be designed on a
divisional / departmental basis). As with the retrenchment agreement,
this agreement was also extended to non-party employees in terms of
section 23(1)(d), with the agreement also making reference
to the
fact that the agreement was one contemplated in regulation 10.
[11]
As
things stand, SAA is now in the process of undertaking a
spill-and-fill exercise provided for in the retrenchment and OS
agreements,
which will result in unsuccessful applicants ultimately
being retrenched. Consultations in relation to SAAT are apparently
ongoing.
[12]
The
above by way of overview, it is necessary to focus on certain events
relied upon by the applicants that occurred in the immediate
run up
to the conclusion of the retrenchment agreement, and on the related
chronology of events.
a.
On
7 July 2015, the applicants brought a formal application for the
disclosure of information in the CCMA. (The application was
not
supported by any of the consulting parties at SAA, save for NUMSA.)
b.
On
10 July 2015, the parties met with the CEO of SAA (“the CEO”),
with his counterpart at SAAT also having been present.
According to
the applicants: (i) the CEO expressed a commitment to provide all
required information (subject to the signature of
an appropriate
non-disclosure agreement); and (ii) the upshot of the meeting was
that it was agreed that the facilitation session
scheduled for the
following day would be utilised for the purposes of engaging over the
economic rationale for the retrenchment
and alternatives to
dismissal. (Up to this point, the parties appear to have been engaged
in a parallel process of consultation
concerning the consequences of
any decision to retrench, i.e. selection criteria, timing, severance
pay, etc.)
c.
On
11 July 2015, the facilitation session was undertaken (this having
been the eighth such session). According to the applicants,
the
companies reneged on the agreement reached at the meeting with the
CEO. This by insisting that the application for disclosure
(which
relates predominantly to information relating to the economic
rationale) be dealt with formally on an opposed basis, and
that the
parties proceed in the interim to consult on a parallel basis over
issues relating to the consequences of a decision to
retrench. The
session adjourned on the basis that the companies would file their
answering affidavit in the disclosure application
by 15 July 2015.
(Although there is a dispute of fact (or at least interpretation)
about what transpired at the meeting with the
CEO and at this
facilitation session, it is not necessary to resolve it for present
purposes.)
d.
On
22 July 2015, the companies filed their answering affidavit in the
disclosure application (although the annexures were only filed
the
following day). The applicants are critical of the position adopted
by the companies in this affidavit – it being to
the effect
that the companies are not prepared to provide all the requested
information (this, according to the applicants, being
contrary to
what was agreed with the CEO) and that the applicants have failed to
sign non-disclosure agreements.
e.
On
23 July 2015, the companies agreed to extend the consultation process
to 22 August 2015, and proposed five further consultation
sessions.
f.
Also
on 23 July 2015, the companies advised the applicants of a further
consultation meeting scheduled for the following day from
14h00-16h00, with the agenda being the companies’ “economic
and structural needs” and “proposed structures”.
NUMSA declined to attend the meeting (on the basis that it was
unavailable at short notice), and objected to the meeting being
held
in its absence and in the absence of the facilitators. For its part,
AUSA undertook to attend the meeting (on a without prejudice
basis).
But it took up the position, which NUMSA supported, that it did not
make sense to engage over the agenda items, until such
time as the
disclosure application had been decided (as the requested information
was required in order for the unions to engage
in meaningful
consultations).
g.
On
the morning of 24 July 2015, a consultation was conducted in the
absence of the applicants over the conclusion of the retrenchment
agreement.
h.
Although
the scheduled afternoon session took place, and was attended by AUSA,
no mention was made of the conclusion of the retrenchment
agreement.
i.
At
16h44 on 24 July 2015, the applicants were emailed a copy of the
retrenchment agreement. (The applicants describe it as “a
purported collective agreement between the respondents resolving all
issues relevant to [SAA’s] workplace and restructuring
initiatives”.)
j.
On
29 July 2015, the applicants launched the application herein –
the conclusion of the retrenchment agreement having been
the catalyst
therefor.
k.
At
the time of hearing this application, the CCMA had yet to rule on the
disclosure application.
The
relief sought by the applicants
[13]
At
the hearing of this matter, the applicants handed up an amended
notice of motion, and during the course of argument pared-down
the
relief sought to the following:
a.
a
declarator that the companies “did not comply with a fair
procedure pursuant to the issuing of the section [189(3)] notice
dated 22 April 2015” (prayer 2 of the amended notice of
motion);
b.
an
order that SAA “not give effect to the purported [retrenchment]
agreement … and that to the extent necessary the
said …
agreement be set aside” (prayer 3.1 of the amended notice of
motion);
c.
an
order that the companies “engage with the applicants in
meaningful joint-consensus seeking consultations, at least
until 22
August 2015 as per the undertaking previously given … but in
any event until such time as the objectives of the
[LRA] have
reasonably been obtained” (prayer 3.3 of the amended notice of
motion); and
d.
an
order that pending compliance with the aforesaid orders, the
companies “be interdicted and restrained from terminating
any
contracts of employment pursuant to the section [189(3)] notice
issued on 22 April 2015 and that [they] be interdicted and
restrained
from implementing any steps towards attaining the dismissal of
employees” (prayer 4 of the amended notice of motion).
[14]
It
will be noted from the above that while the relief described in para
(b) above relates to SAA alone, the balance of the relief
sought is
sought against both SAA and SAAT.
The
issue of urgency and other preliminary points raised by the
companies
[15]
Mr
Sibeko SC (who appeared for the companies) contested the issue of
urgency in oral argument and contended that there had been
an undue
delay in instituting this application. In circumstances where the
applicants are impliedly entitled in terms of section
189A(13) to
bring this application on an urgent basis, and where they did so
within five days of the conclusion of the retrenchment
agreement, I
am of the view that this matter is urgent, and that it ought to be
enrolled and determined as one of urgency.
[16]
In
addition to the issue of urgency, the companies raised a series of
preliminary points, some of which fell away as a result of
the
applicants having pared-down the relief that they seek in this
matter. There are two points which remain.
[17]
The
first is that, according to the companies, it is not competent for
this court, in terms of section 189A(13), to grant the relief
sought
in prayer 3.1 of the amended notice of motion, and that the issue
stands to be determined by the CCMA in terms of section
24(2). I do
not consider there to be merit in this point. The CCMA does not have
the jurisdiction in terms of section 24(2) to
pronounce on the
legality (i.e. validity) or otherwise of a collective agreement,
[14]
and cannot thus set aside a collective agreement. This court, on the
other hand, has the power to do so, in terms of its wide-ranging
powers set out in section 158(1)(a). Significantly, although section
189A(13) does not expressly provide for the granting of such
relief,
section 189A(14) provides that “[s]ubject to this section, the
Labour Court may make any appropriate order referred
to in section
158(1)(a)”. If an order setting aside a collective agreement is
required in order to give effect to one of
the orders that this court
is expressly empowered to grant in terms of section 189A(13), then it
would seem to me that this court
is empowered to grant such an order.
(This is, of course, not to say that such an order should be granted
in the circumstances
of this matter, with this being an issue going
to the merits, which is dealt with below.)
[18]
The
second preliminary point that remains is that the relief sought by
the applicants in prayers 2 and 3.3 involves the grant of
a blanket
order and lacks specificity. As this point is bound up with the
merits, it is dealt with below in that context.
The
parties’ submissions on the merits: a summary
[19]
Mr
Ngcukaitobi (who appeared for the applicants) submitted that the
retrenchment exercise suffered from the following main procedural
flaws warranting the intervention of this court:
a.
Firstly,
the companies had failed to disclose a considerable amount of
relevant information (pertaining particularly to the economic
rationale issue), with their refusal to provide the information on
the grounds of it allegedly being irrelevant or confidential
being
incorrect or unwarranted. In the absence of the information requested
by the applicants, the companies had prevented them
from engaging in
a meaningful process of consultation, and had violated the legal duty
to follow a fair process.
b.
Secondly,
further to the meeting with the CEO the previous day, the companies
“changed the rules of the game” at the
facilitated
consultation session held on 11 July 2015, in that they refused to
consider the issue of the economic rationale by
providing the
information relevant to that issue. This violated the duty to consult
in good faith.
c.
Thirdly,
the manner in which the companies conducted themselves with regard to
the disclosure application also violated the duty
to consult. The
retrenchment agreement was entered into a day or two after the
companies filed their answering affidavit in the
disclosure
application, and at a time when the applicants were still due to file
a replying affidavit and when the determination
of the application by
the facilitators was pending. To conclude the retrenchment agreement
in these circumstances was an act of
bad faith.
d.
Fourthly,
the retrenchment agreement was concluded in violation of the
agreement that there would be a single facilitation process
involving
all the unions (and representative bodies) and both companies. The
contention thus being that it was impermissible and
“cavalier”
for an agreement to have been reached with SAA alone (and without
involving the applicants), and that a
change of tack resulted in
procedural unfairness.
[20]
Regarding
the issue of the extension of the retrenchment agreement, according
to Mr Ngcukaitobi, section 23(1)(d) (or regulation
10) could not
serve as a basis to bind non-party employees to the retrenchment
agreement in this matter, for the following reasons:
a.
Where
an all-comers consultation model had been agreed to, an employer
cannot change tack when it suits it to a majoritarian model.
The
companies were bound by their own election in respect of the model
(or method) of consultation.
b.
The
retrenchment agreement impermissibly served to: (i) deprive non-party
employees of the individual rights afforded them by the
LRA to a fair
procedure;
[15]
(ii) deprive
minority unions of their statutory entitlement to consultation in
terms of section 189(1)(b)(ii) and thus frustrate
their ability to
engage in meaningful consultations; and (iii) “obliterate”
the right to access to information.
[16]
Put differently, the purpose of the retrenchment agreement was to
evade the operation of sections 189 and 189A, which cannot be
countenanced.
c.
The
only rights that are expressly afforded to majority unions (or
coalitions) under section 189A is the right to request facilitation
by the CCMA in terms of section 189A(3), with the section (overall)
not contemplating the conclusion of a retrenchment agreement
with the
majority and extension of it to the minority.
d.
While
the right to strike can be limited by a collective agreement extended
to non-parties,
[17]
there
exists no comparative section binding non-parties to a retrenchment
agreement.
e.
Regarding
regulation 10, it could not be used as a legal basis for the
extension of the retrenchment agreement, because it only
allows an
employer and a union/s representing the majority to enter into an
agreement “for the purposes of section 189A(2)”,
which
does not extend to the conclusion of a retrenchment agreement.
What it means (so it was argued) is no more than that
the majority
may agree to vary the time periods for facilitation or consultation,
as per section 189A(2)(c).
[21]
Turning
now to Mr Sibeko’s submissions, predictably he placed reliance
on the leading judgment of this court on section 23(1)(d),
Chamber
of Mines of South Africa v Association of Mineworkers and
Construction Union and others
[2014] 9 BLLR 895
(LC) (per Van Niekerk J). According to Mr Sibeko,
the retrenchment agreement was validly entered into by the parties
and extended,
with the result that the retrenchment at SAA has, in
effect, been settled. The applicants thus have no cause of action in
relation
thereto.
[22]
In
relation to the position at SAAT, Mr Sibeko submitted that the
process of consultation there was ongoing. The disclosure application
should run its course, and matters should be taken from there (this
in circumstances where the section 189A process has been extended
to
22 August 2015). Although Mr Sibeko did not wish to be drawn into the
issue, he did not discount the possibility of a retrenchment
agreement being entered into, and extended at SAAT. (Indeed, in the
“headcount rationalisation update” issued by the
companies on 6 August 2015, it is recorded that management was
“hopeful” that a similar agreement could be concluded
in
respect of SAAT shortly.)
[23]
In
the companies’ supplementary heads of argument, it is submitted
that SAAT was entitled to bring the consultation process
to an end,
but that, in any event, the parties are still due to consult on the
economic rationale, alternatives to dismissal and
the selection
criteria. Judged holistically, SAAT submitted that the process
followed was fair.
SAA:
evaluation and findings
[24]
As
a point of departure, it warrants mention that the applicants
themselves accept (subject to their challenge to the validity of
the
extension) that the retrenchment agreement (read with the OS
agreement) effectively resolves the entire retrenchment at SAA,
and
that the agreement is legally binding on the parties thereto.
[25]
In
the light of this and the parties’ submissions, three questions
stand to be determined. The first question is whether,
as a matter of
legal principle, a retrenchment agreement can validly be extended to
non-party employees in terms of section 23(1)(d).
If the answer is in
the affirmative, then the second question is whether, on the peculiar
facts of this matter, it was permissible
to do so. If the answer is
also in the affirmative, then the third and final question is whether
this puts paid to the applicants’
claim in relation to SAA.
[26]
To
begin with
the
first question
,
in two judgments this court has answered it in the affirmative. The
first is
Tsetsana
v Blyvooruitzicht Gold Mining Co Ltd
[1999] 4 BLLR 404
(LC), where Jammy AJ held:
“
The
applicant’s contention that he is not bound by the terms of
agreements concluded by a trade union of which he is not a
member, is
without substance or foundation. The retrenchment agreement of August
1997 is unquestionably a collective agreement
which binds,
inter
alia
,
employees who, although not members of a registered trade union which
is a party to it, are employed in the workplace to which
it applies
and in which that trade union enjoys majority representation of the
employees there employed.”
[18]
[27]
The
second is
Sigwali
& others v Libanon (A division of Kloof Gold Mine Ltd)
[2000] 2 BLLR 216
(LC), where Ngwenya AJ held:
“
In
casu
,
it is common cause that NUM represented the majority of the employees
in respondent’s business. It is not disputed that
the agreement
identifies the employees affected by it with sufficient
particularity. Even if it was disputed, it is my view that
the
agreement clearly identifies the employees as set out in section
23(1)(d)(i). Consequently in my view the agreement concluded
between
the NUM and respondent binds not only those employees who are members
of the NUM but also non-members as contemplated above.”
[19]
[28]
While
it may appear objectionable that section 23(1)(d) can be used in this
way, so as to deprive individuals (and thus their unions)
of the
right to challenge the fairness of a retrenchment process, the
section permits
all
collective agreements to be extended in terms thereof – and is
not limited in its scope to only agreements that do not involve
a
deprivation of rights. Indeed, most collective agreements extended in
terms of section 23(1)(d) involve depriving non-party employees
of
some or other right – for example, the right to strike.
[29]
The
fact that this is permissible is underscored by section 189(1)(a),
which has been interpreted as meaning that an employer and
a majority
union can enter into a collective agreement upfront to the effect
that, in the case of a retrenchment exercise, the
employer will only
consult with the majority union.
[20]
Where it then does so, any retrenchment agreement concluded with the
majority union will then bind non-union and minority union
members.
The LAC put this as follows in
Aunde
South Africa (Pty) Ltd v NUMSA
[2011] 10 BLLR 945
(LAC):
“
Where
an employer consults in terms of agreed procedures with the
recognised representative trade union
[21]
in terms of a collective agreement which requires the employer to
consult with it over retrenchment, such an employer has no obligation
in law to consult with any other union or any individual employee
over the retrenchment. If such a consultation exercise culminated
in
a collective agreement that complies with the requirements of a valid
collective agreement, all employees including those who
are not
members of the representative trade union that consulted with the
employer are bound by the terms of such collective agreement
irrespective of whether they were party to the consultation process
or not.”
[22]
[30]
The
conclusion of a retrenchment agreement further to a process of
consultation and its extension in terms of section 23(1)(d) has
the
same effect, and is unobjectionable. As held in
Chamber
of Mines (supra)
,
section 23(1)(d) is amongst numerous sections in the LRA which
encapsulate the legislative policy choice of majoritarianism.
[23]
That choice is based on the legislature’s assumption that it
would best serve the primary objects of the LRA of labour peace
and
orderly collective bargaining. The conclusion of a retrenchment
agreement with a majority union (or coalition) and extension
to
non-party employees accords with this.
[31]
Regarding
the applicants’ submissions that section 189A does not
contemplate the extension of a retrenchment agreement concluded
with
the majority consulting party, and that while the right to strike can
be limited by a collective agreement extended to non-parties,
there
exists no comparative section binding non-parties to retrenchment
agreements, I do not agree with either of them. Sections
189 and 189A
constitute a legislative process designed to get the parties to
attempt to reach consensus, which will, if successful,
typically
result in the conclusion of a collective agreement. Such a collective
agreement – like all collective agreements
– is then
capable of being extended in terms of section 23(1)(d) (if the
requirements are met). If the employees covered
by the retrenchment
agreement sought to strike over the retrenchment, the collective
agreement would (like any other comparable
one) serve as a basis for
the strike being unprotected in terms of (at least) section
65(3)(a)(i).
[32]
Regarding
the applicants’ attack on SAA’s reliance on regulation
10, this is not an issue that I need decide. Irrespective
of the
scope of the regulation, I have found that, as a matter of legal
principle, a retrenchment agreement can be extended to
non-party
employees in terms of section 23(1)(d).
[33]
Turning
to
the
second question
,
the main thrust of the applicants’ case on this issue is that
the companies were bound by their election to follow an all-comers
model of consultation involving a single facilitation process, and
could not change tack. In support of this contention, the applicants
rely on a judgment of this court in which it was found that where the
employer elects to consult with a union and separately with
non-union
members (on an individual basis), it is obliged to do so.
[24]
The applicants also rely on judgments of the LAC, in which the
retrenchment of NUMSA members was found unfair where the employer
stopped consulting with NUMSA over the retrenchment in circumstances
where UASA had obtained majority representation, but where
the
employer failed to conclude either a section 189(1)(a) agreement or a
retrenchment agreement with UASA (that might then have
been extended
to NUMSA members).
[25]
To my
mind, these judgments are of no assistance to the applicants. Amongst
other things, neither of them dealt with the conclusion
of a
retrenchment agreement, and an extension of the agreement in terms of
section 23(1)(d).
[34]
The
applicants also rely on this finding by the Constitutional Court:
“When exercising an election, the law does not allow
a party to
blow hot and cold. A right of election, once exercised, is
irrevocable particularly when the
volte
face
is prejudicial or is unfair to another.”
[26]
In my view, this again fails to take account of what transpired in
this matter. While it is so that the parties agreed that there
would
be a single facilitation process involving all-comers, I can find no
evidence to suggest that the companies (or the unions
for that
matter) thereby waived their rights to conclude a retrenchment
agreement on a per company basis, and to extend any such
agreement in
terms of section 23(1)(d). It would also be difficult to infer this,
because notwithstanding the single facilitation
process, the
obligation to comply with sections 189 and 189A rests with each
separate (statutory) employer, and any retrenchment
agreement and
extension thereof would have to be in the name of that employer.
[35]
The
parties thereupon engaged in a dynamic process of consultation over a
period of some 3 ½ months. The process did not
produce an
agreement at both SAA and SAAT, but it did produce consensus within
SAA over the retrenchment with everyone, except
NUMSA. Different to
NUMSA, the consenting employee parties were not in dispute with SAA
over the disclosure of information. The
consenting parties then
concluded the retrenchment agreement on 24 July 2015, which was
extended in terms of section 23(1)(d),
in circumstances where the
three recognised unions had 80% representation within the SAA
workplace. Amongst other things, this
served to settle the disclosure
dispute
vis-à-vis
SAA, as is typically the case with any extension to a dissenting
minority. Seen thus, this was not a case of SAA having undergone
a
volte
face
to the prejudice of NUMSA and the employee consulting parties at
SAAT. Instead, it is a case of labour law at work.
[36]
Allied
to the above, insofar as the applicants contend that where an
employer commences consultations with a number of unions (as
occurred
in this matter), it is bound by that election and cannot “change
tack” by concluding an agreement with a majority
union
coalition (as occurred in this matter), this is clearly wrong. The
fallacy, of course, lies in the fact that section 189(1)(c)
[27]
compels the employer to consult with all unions whose members are
likely to be affected by the retrenchment, with it not being
a matter
in respect of which the employer makes an election. If the applicants
were correct in their contention, this would mean
that an employer
could never settle a retrenchment, unless all the unions agreed,
which is at odds with the legislative policy
choice of
majoritarianism (and section 23(1)(d)).
[37]
As
mentioned above, the applicants also contend that the retrenchment
agreement ought not to be upheld beyond the parties thereto,
because
the companies consulted in bad faith in: not disclosing information;
breaching the agreement reached with the CEO; entering
into the
retrenchment agreement while the disclosure application was pending;
and concluding the retrenchment agreement in a “cavalier”
fashion. In my view, the short answer to all of this is that the
retrenchment agreement, and its extension to non-party employees,
constitutes, in effect, a settlement of any and all such complaints
(which have thus been extinguished).
[38]
Another
answer lies in the acknowledgement of the fact that consultations
over large-scale retrenchment, which may culminate in
strike action
in terms of section 189A, overlap with a process of collective
bargaining. Where that process produces a collective
agreement (which
is then extended to non-party employees), provided the agreement is
lawful, this court will not intervene to scrutinise
the bargaining
conduct of the parties or the terms of the agreement, any more than
it would intervene in the case of a protected
strike to pass judgment
on the merits of a demand.
[28]
This is so because when it comes to the regulation of collective
bargaining, the LRA has adopted a voluntarist system.
[29]
[39]
A
final point relates to the legal construction that the applicants
advance in seeking to avoid the operation of the retrenchment
agreement, and the relief that they seek. As set out above, the
applicants seek an order that the companies should “not …
give effect to” the retrenchment agreement and that to “the
extent necessary”, the agreement should be “set
aside”.
However, having accepted that the retrenchment agreement is valid
inter
partes
,
the best that the applicants can hope to achieve is an order that no
effect should be given to the retrenchment agreement in relation
to
them, and that the agreement be set aside in relation to them. For
the reasons set out above, to my mind, there exists no basis
for the
grant of any such relief.
[40]
Turning
finally to
the
third question
,
once it is accepted that as a matter of legal principle a
retrenchment agreement can be extended in terms of section 23(1)(d)
to non-party employees, and that there exist no unique facts in this
matter that somehow causes a different result, this, in my
view, puts
paid to the applicants’ claim in relation to the retrenchment
at SAA. As stated above, the retrenchment agreement
(as extended)
constitutes, in effect, a settlement of any dispute falling within
the scope of the agreement that non-party employees
(and thus their
unions) may have had.
[41]
In
the result, the application as against SAA fails.
SAAT:
evaluation and findings
[42]
As
mentioned above, the catalyst for the bringing of this application
was the conclusion of the retrenchment agreement at SAA. The
issue
consumes the majority of the papers, and was the focus of the written
and oral argument. The position at SAAT was, by way
of comparison, a
side issue.
[43]
Different
to SAA, the consultation process at SAAT is ongoing. According to
SAAT, the parties are still due to consult on the economic
rationale,
alternatives to dismissal, and the selection criteria (including the
proposed organisational structure). Another distinguishing
feature is
that the disclosure application remains alive in relation to SAAT (at
least at the time of the hearing of this application).
Further to the
ruling of the facilitators on the application, consultations over the
economic rationale and alternatives to retrenchment
can proceed. As
set out above, the issue of the disclosure of information has been a
major stumbling block to date, but it will
now be resolved (one way
or the other) by the facilitators’ ruling. As things stand, the
section 189A process has been extended
to 22 August 2015.
[44]
In
circumstances where the parties have, to date, engaged in nine
facilitated consultation sessions and 45 private consultation
sessions, and where the consultation process is due to continue at
SAAT, I am unable to detect any substantial procedural failure
in
relation to SAAT that would warrant the intervention of this court in
terms of section 189A(13) at this stage.
[30]
[45]
In
any event, to my mind, there is merit in the point taken by the
companies that the relief sought in relation to SAAT (in prayers
2
and 3.3 of the amended notice of motion) is overly broad and
ill-defined. As this court has made it clear in the past, open-ended
orders will not be granted in terms of section 189A(13), and relief
should be crafted to address specific defects in the process.
[31]
[46]
In
the result, the application as against SAAT fails.
Order
[47]
In
the premises, the following order is made:
a.
the
application is dismissed;
b.
there
is no order as to costs.
________________________________
Myburgh, AJ
Acting
Judge of the Labour Court of South Africa
APPEARANCES:
On
behalf of the Applicants: T Ngcukaitobi
Instructed
by: Minnaar Niehaus Attorneys
On
behalf of the First and Second Respondents: L Sibeko SC (main heads
of argument drawn together with V September)
Instructed
by: Cliffe Dekker Hofmeyr
[1]
Labour Relations
Act 66 of 1995
. All references to sections herein are to the LRA.
[2]
The first
respondent.
[3]
The second
respondent.
[4]
The third
respondent.
[5]
The fifth
respondent.
[6]
The fourth
respondent.
[7]
The second
applicant.
[8]
The first
applicant.
[9]
The fourth
applicant.
[10]
The fifth
applicant.
[11]
SAAT management
employees (the third applicant) and SAA management employees (the
sixth respondent).
[12]
A term which I use
as shorthand herein for non-union and minority union members.
[13]
Regulation 10
reads as follows under the heading “agreement”: “If
employees who are likely to be affected by the proposed
dismissal
are represented in a facilitation by more than one consulting party,
an agreement must be concluded by the consulting
parties
representing the majority of the employees concerned, for purposes
of
section 189A(2)
of the Act and these Regulations.”
[14]
NUMSA &
Others v Highveld Steel & Vanadium Corporation Ltd
[2002] 1 BLLR 13
(LAC) at paras 19-20. See also Brassey
Commentary
on the
Labour Relations Act
(RS
2, 2006) at A3-44, who says this about the reach of the phrase
“interpretation of application” in
section 24(2):
“…
its compass is very wide. What is not covered, however, is a dispute
over the existence of the agreement as a
legal instrument –
over whether, in other words, the agreement was concluded and is
legal and valid.”
[15]
See
sections
185(a)
and
188
(1)(b), read with
sections 189
and
189A
.
[16]
This insofar as
the settlement agreement, in effect, settles the disclosure dispute
vis-à-vis
SAA.
[17]
See
sections
65(1)(a)
and
65
(3)(a)(i).
[18]
At para 22.
[19]
At para 15.
[20]
Sikhosana &
others v Sasol Synthetic Fuels
[2000] 1 BLLR 101
(LC) at 108A-G.
[21]
Although the LAC
did not say as much, it is clear that it had in mind a majority
union.
[22]
At para 32.
[23]
See also
Kem-Lin
Fashions CC v Brunton & another
[2001] 1 BLLR 25
(LAC) at para 19, and
Mzeku
v Volkswagen SA (Pty) Ltd & others
[2001] 8 BLLR 857
(LAC) at paras 55 and 67.
[24]
SACCAWU &
Another v Amalgamated Retailers (Pty) Limited
[2002] 1 BLLR 95
(LC) at para 26 (cited with approval in
Oosthuizen
v Telkom SA Ltd
[2007] 11 BLLR 1013
(LAC) at paras 31-32 of the judgment of McCall
AJA).
[25]
Aunde South
Africa (Pty) Ltd v NUMSA
[2011] 10 BLLR 945 (LAC).
[26]
Equity Aviation
Services (Pty) Ltd v CCMA & others
[2008] 12 BLLR 1129
(CC) at para 54.
[27]
Absent the
existence of an agreement in terms of
section 189(1)(a).
[28]
See
Vanachem
Vanadium Products (Pty) Ltd v National Union of Metalworkers of SA &
others
(2014) 35
ILJ
3241 (LC) at para 19.
[29]
Under this system,
as held in
National
Union of Public Service & Allied Workers on behalf of Mani &
others v National Lotteries Board
(2014) 35
ILJ
1885 (CC) at paras 193-194, an employer has “the right to
determine its own strategies and tactics in dealing with …
collective bargaining”, and “[p]rovided that [it] does
not act unlawfully, it may adopt a confrontational stance”.
Of
course, the same applies to unions.
[30]
RAWUSA v Schuurman Metal Pressing
(Pty) Ltd
[2005] 1
BLLR 78
(LC) at para 32.
[31]
SA Society of
Bank Officials v Standard Bank of SA
(2011) 32
ILJ
1236 (LC) at para 29.