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[2015] ZALCJHB 331
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ERM Southern Africa (Pty) Ltd v Nkobi (J1393/14) [2015] ZALCJHB 331 (30 September 2015)
THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Not
Reportable
Case No: J1393/14
In
the matter between:
ERM
SOUTHERN AFRICA (PTY)
LTD
Applicant
and
NKOBI,
N
Respondent
Date
heard: 21 April 2015
Delivered:
30 September 2015
JUDGMENT
RABKIN-NAICKER
J
[1]
This is an unopposed application for default judgment in which the
applicant claims:
“
Payment
of the amount of R52 546.40 (together with interest on the
amount claimed at the rate of 15,5%, per annum calculated
from 6
January 2014 to date of payment).
Payment of the amount of
R72 340.00 (together with interest on the amount claimed at the
rate of 15,5% per annum calculated
from 6 January 2014 to date of
payment)”
[2]
The aforesaid damages are claimed on the basis of an obligation
contained in a bursary contract (which amount to the monies
paid out
by the applicant to assist him in completing his studies).The
material terms of the said contract (as well as a further
bursary
contract signed for 2013) are set out in the statement of claim are
as follows:
“
1.
The bursary was awarded for an uninterrupted study period towards the
Respondent’s post graduate
studies tenable at the University of
the Witwatersrand for registration to study during 2012.
2.
The bursary covered the registration fees, accommodation plus tuition
fees up to a maximum
of R52 546.40 which was payable to the
University of the Witwatersrand.
3.
It was a term of the bursary contact that should the Respondent fail
the year of study or
failed to obtain an average of 55% in respect of
the subjects covered by the degree, then the Respondent shall
automatically forfeit
the bursary and will be obliged to repay the
Applicant the full cost of the bursary in terms of Clause 3 of the
bursary contract
for 2012, unless otherwise agreed by the Applicant.
4.
The contract further provided that should the bursary be discontinued
in terms of clause
5 of that contract or should the Applicant cancel
the contract for any reason whatsoever, then the total bursary amount
advanced
shall become due and payable to the Applicant.
5.
The bursary contract further provided that the Respondent (at that
time the bursary holder)
will be expected to do vacation practical
work laid down by the University of Witwatersrand and that such
vacation work will have
to be done with the Applicant.”
[3] The contract
expressly provided as follows:
“
11.1
On successful completion of your degree, ERM may offer you
employment. It is a condition of the award of a Bursary that you
will
accept the offer of employment within 10(ten) days of the offer and
will remain in the service of the company for a period
of at least 12
(twelve) months from the date of the commencement of the employment.”
[4]
The parties entered into the above contract and a further similar one
on about March 2013, in terms of which the amount to be
paid for fees
and accommodation was an amount of R72 340.00
[5]
In January 2014, the parties entered into a fixed term contract of
employment with effect from 6 January 2014 in terms of which
the
respondent was to be paid as an intern for a period of approximately
2 years. It is this contract which the respondent has
breached and
the applicant avers that this breach is the direct causal link to the
damages claimed. The Applicant submits that
the aim and intention of
the fixed term contract of employment is to ensure that the
financial investment made by it results
in the amounts
being “worked off” by the respondent whilst in the
service of the applicant for the period of two years.
[6]
The claim is pleaded in terms of section 77(3) of the BCEA i.e. that:
“
(3)
The Labour Court has concurrent jurisdiction with the
civil courts to hear and determine any matter concerning
a contract
of employment, irrespective of whether any basic condition of
employment constitutes a term of that contract.”
[7]
In
Rand
Water v Stoop & another
[1]
the LAC was concerned with the question as to whether the Labour
Court had jurisdiction to entertain a counterclaim by an employer
for
damages for breach of contract by dismissed employees in terms of
section 77(3) read with section 77A(e) of
Basic Conditions of
Employment Act 75 of 1997
. It found that it did have concurrent
jurisdiction with civil courts in any matter concerning a contract of
employment and that
the court was empowered to order specific
performance or award damages.
[8]
In as for as the meaning to be imputed to the phrase “any
matter concerning a contract of employment” the LAC per
Waglay
JP held as follows:
“
[38]
A teleological approach to interpretation of the BCEA is clearly
appropriate, but this approach does not and cannot licence
an Alice
in Wonderland interpretation. Words must mean what they ordinarily
mean not what we want them to mean:
S v
Zuma & others; National Coalition for Gay & Lesbian Equality
& others v Minister of Home Affairs & others;
Daniels v
Campbell & others; Investigating Directorate: Serious
Economic Offences & others v Hyundai Motor
Distributors (Pty) Ltd
& others: In re Hyundai Motor Distributors (Pty) Ltd & others
v Smit NO & others; and
Hoffmann v SA Airways.
[39] I am
satisfied that
s 77(3)
read with
s 77A(e)
favours an interpretation
bringing within its ambit the type of claim instituted by the
appellant in this matter as:
39.1 The word
'concurrent' in
s 77(3)
places the Labour Court in exactly the same
position as the High Court with the same powers and authority in
relation to matters
concerning a contract of employment.
39.2 The last
part of
s 77(3)
provides the Labour Court with jurisdiction
irrespective of whether any basic condition of employment constitutes
a term of the
employment contract. This demonstrates that the Labour
Court has jurisdiction over any claim as long as it involves a
contract
of employment.
39.3 The
words 'concerning a contract of employment' mean about or
in connection with an employment contract.
The pleaded claim clearly
falls within this categorization.
39.4 The
words 'any matter' in
s 77(3)
are broad and the literal
interpretation does not limit the claims, in relation to a contract
of employment, to a specific category.
Damages, both liquid and
illiquid, are included.”
[9]
The claim as pleaded in the default application before me, is in
respect of a breach of the fixed term contract of employment,
and
not
of the bursary agreements. Applicant pleads as follows:
“
DAMAGES
AND BREACH CAUSED BY THE RESPONDENT
42 The Respondent was
paid a bursary in terms of the first bursary contract dated 4 April
2012 which covered the fees averred herein
in the amount of
R52 546.40 which is due and owing to the Applicant.
43
The similar obligation attaches itself to the bursary contract dated
5 March 2013 where the Respondent
was advanced fees in the amount of
R72 340.00.
44
The aim and intention of the fixed term contract of employment is to
ensure that the financial
investment made by the Applicant towards
the Respondent, which amounts are reflected in paragraphs 42 and 43
above, results in
the amounts being “worked off” by the
Respondent whilst in the service of the Applicant for the period of
two years.
45
Differently put, the Applicant would in the ordinary sense of bursary
funding, pay for the tuition
an associated ancillary study costs of
the Respondent where after the Respondent contractually agrees to
work back, so to speak,
the amount provided in this manner.
46
On the Respondent’s version, he does not have intention to
perform in terms of the subsequent
fixed term contract of employment.
Accordingly the Applicant has suffered damages in perpetuity in the
amount of 124 886.40
(one hundred and twenty four thousand eight
hundred and eighty six rand and forty cents).
47
Further general damages are caused by the Respondent which damages
entail financial prejudice of
the Applicant as the Applicant is now
forced to incur unnecessary and additional administrative expenses,
including expenses of
employing legal assistance to assert its right
in terms of the wilful breach of contract committed by the
Respondent.
48
Had the Respondent not perpetrated a material breach in terms of his
fixed term contract of employment,
the Applicant would not have
incurred and accrued unnecessary expenses.
49
The Applicant accordingly seeks to hold the Respondent liable to the
amount of R124 885.40.
50.
As indicated above, despite proper demand being made, alternatively a
demand made hereby, the Respondent
has failed and/or refused to
either:
(1)
comply with the express provisions of his fixed term contract of
employment and report for
duty, in the alternative
(ii)
to pay the amount to the applicant.”
[10]
A look at the fixed term contract of employment, on which this claim
is based reveals no mention at all of the bursary agreements.
In
addition, it provides that either party can terminate the employment
contract on notice i.e. in the following clause:
“
in
the event that the (sic) either party wishes to terminate this
contract for reasons other than the completion of the project
or
termination of the contract between ERM and the client, that party
shall give the other party 4 (weeks) written notice of such
termination”`
[11]
In terms of their drafting, there is a total disjuncture between the
bursary contracts and the fixed term contract of employment.
One
presumes that applicant has not pleaded the breach of the bursary
contracts in an effort to bring this matter under
section 77(3)
of
the BCEA without facing the hurdle of whether the bursary agreements
‘concern a contract of employment’. In these
circumstances, I cannot find a nexus between the breach of the fixed
term employment contract and the damages claimed herein. For
the
above reasons, the application cannot be granted.
[12]
I therefore make the following order:
Order
1.
The application for default judgment is dismissed.
________________________
H.
Rabkin-Naicker
Judge
of the Labour Court of South Africa
Appearances
:
For the Applicant:
Advocate F. Venter
Instructed
by: Celeste Allan Attorney
[1]
(2013)
34 ILJ 576 (LAC)