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[2015] ZALCJHB 357
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National Union of Mine Workers and Another v New Denmark Colliery (JS474/03) [2015] ZALCJHB 357 (16 October 2015)
REPUBLIC
OF SOUTH AFRICA
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Not Reportable
Case
no: JS 474/03
In
the matter between:
NATIONAL
UNION OF MINE
WORKERS
First Applicant
EPHRAIM
MASOMA
Second Applicant
and
NEW
DENMARK COLLIERY
Respondent
Heard:
5 March 2012, 28 May 2012 & 18-20 February 2013
Delivered:
16 October 2015
Summary:
When the respondent has made an undertaking to transfer an applicant
to a vacant position instead
of retrenching him, failure to fulfill
the undertaking renders the applicant’s retrenchment
substantively unfair.
JUDGMENT
LALLIE
J
[1]
The second applicant, Mr Masoma (“Masoma”), was employed
by the respondent
in 1985. At the time of his dismissal on 12
December 2001 for the respondent’s operational requirements, he
was a storekeeper
and a member of the first applicant. He was
remunerated at the monthly rate of R5 755.00. Masoma’s position
fell in the category
of senior skilled employees who are also
referred to as officials. He therefore fell outside the first
applicant’s bargaining
unit which consisted of category 2-8
employees. Aggrieved by the dismissal, the applicants referred an
unfair dismissal dispute
to the Commission for Conciliation Mediation
and Arbitration. The dispute was not resolved at the conciliation
stage and the applicants
escalated it to this Court. The applicants
seek an order reinstating Masoma on the basis that his dismissal was
substantively and
procedurally unfair.
[2]
The respondent conducts business in the coal mining industry. It
supplied Eskom with
coal for purposes of generating electricity. In
2000, Eskom’s demand for coal dropped by two million tonnes
per
annum. The change had a
domino
effect on the respondent’s
production and the number of employees it needed. Consequently, the
respondent embarked on a retrenchment
exercise which claimed Masoma’s
job. The applicants submitted that Masoma’s dismissal for the
respondent’s operational
requirements was substantively unfair
because there was no need to retrench him as at the time of his
retrenchment, Masoma was
a candidate for transfer but his transfer
was scuppered by his supervisor.
[3]
In terms of
section 188
of the
Labour Relations Act 66 of 1995
as
amended (“the LRA”), an employer’s failure to prove
that a dismissal for operational requirements was effected
for a fair
reason and in accordance with a fair procedure renders the dismissal
unfair.
Section 192(2)
of the same Act places the
onus
of
proving the fairness of a dismissal on the employer. In its endeavour
to discharge the
onus
of proof, the respondent, through its
witness, Mr Westermeyer (“Westermeyer”), testified that
it responded to Eskom’s
reduced coal demand by briefing and
consulting with all affected employees. It consulted with all the
trade unions with members
at the respondent in one meeting in July
2001. The trade unions were the first applicant, National Employees
Trade Union (“NETU”),
UASA and the Mine Workers Union.
They had continuous follow-up meetings in which they came to an
agreement that the respondent
would try by all means to relocate
employees to various mines, and transfer them to prevent
retrenchment. A further meeting was
held in December 2001. A
retrenchment agreement was eventually entered into between the
respondent and the trade unions. Between
the meetings, the respondent
liaised with the unions continuously and kept them informed of the
progress, transfers and employees
who took voluntary severance
packages. It updated the unions on the numbers and sent them updated
figures. The information the
respondent furnished the union with
related to all employees affected by the retrenchment. The
respondent’s first option
was to offer voluntary severance
packages and where ever there were vacancies in alternative mines, it
would place employees in
those positions.
[4]
Justifying the economic
rationale
for retrenching Masoma,
Westermeyer testified that Masoma was employed at the finance and
administration department as an assistant
storekeeper. The stores
were a central department which provided services to all the three
shafts the respondent operated. It stored
mining materials, equipment
used underground, spares, protective equipment and clothing which was
issued daily to employees. Before
the retrenchment exercise which led
to Masoma’s dismissal commenced, the respondent operated three
shafts to which three
assistant storekeepers rendered a service. The
effect of the reduction of Eskom’s demand for coal was that two
thirds of
the mine had to stop operations. With the closure of the
Central and North shafts, the services of two thirds of the
storekeepers
became redundant. The respondent was left with a
position of only one storekeeper which was given to the longest
serving storekeeper
on the basis of LIFO.
[5]
After receiving an email informing him that interviews for three
candidates for the
assistant storekeeper position at Bank Colliery
were arranged for 7 August 2001, Westermeyer called Masoma to a
meeting. Masoma
informed Westermeyer that he was not interested in a
transfer. Westermeyer explained to Masoma that his lack of interest
in transfer
could lead to his retrenchment. He further reminded him
that he had to try to allocate employees to vacancies which existed
at
other Anglo mines. He referred to a meeting he held with Masoma
after receiving a letter in which the latter complained about the
retrenchment process and the selection criteria. The meeting was held
around 8 August 2001. Masoma informed Westermeyer in the
meeting that
he did not want to be transferred to other mines and operations. He
preferred a demotion. Mr Luus (“Luus”)
to whom Masoma
reported directly, testified that Masoma attended a job interview for
the position of assistant storekeeper at Bank
Colliers but did not
secure the position. The successful candidate was Ms Van Der Merwe
(“Van Der Merwe”). Masoma was
dismissed for operational
requirements of the respondent in December 2001.
[6]
The applicants maintained that the respondent’s failure to
relocate, transfer
or demote Masoma to the vacancy created by the
employment of Van Der Merwe at Bank Colliery rendered his dismissal
substantively
unfair. It was argued on behalf of the respondent that
various positions were available within the group of companies which
the
respondent was part of and that the longest serving employees
were given the first opportunity to apply for the positions. The
respondent’s argument that the evidence in relation to the
transfer was, at the end of the day, neither here nor there because
Masoma was given an opportunity to apply for jobs at other companies
and was unsuccessful, is untenable. Westermeyer testified
that the
respondent was going to transfer employees affected by the
retrenchment to alternative mines in order to prevent their
retrenchment. Being assisted to apply for a vacancy in a sister mine
is materially different from being transferred to a suitable
position
instead of being retrenched. Had the respondent kept its word of
transferring employees instead of retrenching them, Masoma
would have
been transferred to the assistant storekeeper vacancy at Bank
Colliery. His employment at Bank Colliery would have been
assured. He
would have been transferred from the position of assistant
storekeeper at the respondent to the same position at Bank
Colliery
without having to compete with other candidates for the position. Van
Der Merwe would not have been eligible to be interviewed
for the
storekeeper position which she was eventually appointed to at Bank
Colliery because her position at the respondent was
not affected by
the retrenchment. She was also not an assistant storekeeper. The
respondent proffered no valid reason for not transferring
Masoma in
terms of its undertaking to the storekeeper position at Bank
Colliery. It therefore had no economic rationale for dismissing
Masoma. Masoma’s dismissal was substantively unfair.
[7]
The respondent’s evidence that Masoma’s dismissal was
procedurally fair
was largely unchallenged. It shows that the
respondent, in keeping with its obligation in
section 189(1)
of the
LRA, consulted with the first applicant who represented Masoma, soon
after receiving notice of the drop in coal demand from
Eskom. It
therefore consulted when it contemplated dismissing a portion of its
employees which included members of the first applicant.
The
consultation was not limited to a meaningful joint consensus seeking
process in an attempt to reach consensus on issues affecting
the
retrenchment of employees as envisaged in
section 189(2)
of the LRA,
it culminated in a retrenchment agreement. The first applicant and
the respondent therefore reached consensus on the
retrenchment
exercise. Masoma’s attempt at painting a picture that his
dismissal came as a surprise in December 2001 was
not supported by
his own evidence. His evidence, including correspondence addressed to
the respondent’s managers expressing
his concerns about the
retrenchment process is consistent with the respondent’s
version that there was consultation and continuous
sharing of
information between the applicants and the respondent. The
applicants’ failure to locate a witness who could have
rebutted
the respondent’s evidence on the procedural fairness of
Masoma’s dismissal cannot be laid at the door of the
respondent. No valid reason was provided for the applicants’
inability to locate the witness. Evidence in favour of the respondent
is overwhelming. The respondent discharged the
onus
of proving
the procedural fairness of Masoma’s dismissal.
[8]
The applicants sought an order reinstating Masoma.
Section 193(2)
of
the LRA makes reinstatement the primary remedy for substantively
unfair dismissal. Security of employment is a core value of
the LRA.
In this regard, see
NUMSA
obo Maifo v Ulrich (Pty) Ltd
[1]
.
However,
section 193(2)(c)
of the LRA provides that reinstatement may
not be granted when it is not reasonably practicable for the employer
to reinstate the
employee. Masoma was dismissed in December 2001 but
the applicants filed their statement of case on 27 August 2003. The
applicants’
substantial delay in the prosecution of this matter
has an impact in determining whether reinstatement is practicable. It
is trite
that when applicants delay in challenging the fairness of a
dismissal, the respondent has a right to assume that the decision
will
not be challenged and pursue its business by,
inter
alia
,
filling the vacancy left by the dismissal. Reinstatement means
restoring the employee’s employment as though he or she had
never been dismissed. It is common cause that the respondent
dismissed Masoma because his position became redundant owing to the
reduction in coal demand by Eskom. It is therefore not reasonably
practicable to reinstate him. Compensation is therefore the
appropriate relief. In determining the amount of compensation due to
Masoma, I have considered Masoma’s length of service
and that
his dismissal was substantively unfair. I find it just and equitable
in all the circumstances of this matter to award
Masoma compensation
equivalent to remuneration he would have earned over a period of 10
months at the rate of R5 755.00 per month,
the rate at which he was
remunerated on dismissal.
[9]
I could find no reason both in law and fairness for costs not to
follow the result.
[10]
In the premises, the following order is made:
10.1
The dismissal of the second applicant for the respondent’s
operational requirements was substantively
unfair but procedurally
fair.
10.2
The respondent pay the second applicant compensation in the amount of
R57 550.00 which is equivalent to remuneration
he would have earned
over a period of 10 months.
10.3
The respondent pay the applicants’ costs.
Lallie J
Judge
of the Labour Court of South Africa
APPEARANCES
FOR
THE APPLICANTS:
Advocate Memani
Instructed
by Makinta Inc
FOR
THE RESPONDENT:
Advocate Snider
Instructed
by Cliffe Dekker Hofmeyr
[1]
(2012) 33 ILJ 20 918 (LC).