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[2015] ZALCJHB 391
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Fairway at Randpark Operations (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (JR1471/2011) [2015] ZALCJHB 391; (2016) 37 ILJ 675 (LC) (13 November 2015)
REPUBLIC
OF SOUTH AFRICA
THE LABOUR COURT OF
SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable/
Not
Reportable
Case no: JR 1471/2011
In the matter between:
FAIRWAY AT RANDPARK
OPERATIONS (PTY) LTD
Applicant
and
COMMISSION FOR
CONCILIATION, MEDIATION
AND
ARBITRATION
First Respondent
COMMISSIONER T
NSIBANYONI
Second Respondent
SACCAWU obo MOSHOLE
AND FIVE OTHERS
Third Respondent
Heard:
30 June 2015
Delivered:
13 November 2015
Summary:
Review- Commissioner failing to consider unchallenged facts pointing
to guilt of accused on charges of
gross negligence. Where refusal to
undergo polygraph testing constitutes a breach of the employment
contract Commissioner ought
to take this into account and may in the
appropriate circumstances, draw adverse inference against employee
committing such breach.
Award not justifiable in relation to reasons
given therefor and outcome unreasonable - reviewable and set aside.
Semble
: No clear authority prohibiting a Court
or arbitrator drawing an adverse inference against employee refusing
to undergo polygraph
testing in appropriate circumstances.
JUDGMENT
Bank AJ;
[1]
This is an application
for the review and setting aside of an arbitration award in which the
presiding Commissioner found that the
six respondent employees (“the
individual respondents”) had been unfairly dismissed, both
procedurally and substantively,
and in which he ordered their
reinstatement with back pay.
[2]
At the outset it must
be stated that this matter is handicapped in several ways: Firstly,
it has dragged on for several years since
the individual respondents
were dismissed in early 2011. Secondly, there is no answering
affidavit in the review application. Thirdly,
and most importantly,
there is no transcript of the arbitration proceedings before the
second respondent (“the Commissioner”).
I have therefore
had to make use not only of the reconstructed record of proceedings
but also of the evidence taken at the internal
disciplinary enquiries
held prior to the dismissal of the individual respondents, in order
to arrive at what I believe is a fair
and just decision in this
matter.
[3]
Although there has been
an application to dismiss the review launched by the union on behalf
of the individual employees, and a
subsequent “
explanatory
”
affidavit relating to the inability of the company to provide a
proper record of proceedings, together with an application
in terms
of section 158(1)(c) to enforce the arbitration award, I am satisfied
that the review can proceed on its merits and to
the extent that this
may be necessary, I grant condonation for the late filing of these
affidavits. It is in the interests of justice
and all the parties
that this matter be finalised as it has been dragging on for more
than four years.
Background
[4]
The applicant operates
as a hotel and spa and the six employee respondents were either
waiters or barmen employed by it. At a combined
disciplinary hearing
all six employees were charged with theft, gross negligence and
unlawful use of company property or money
for offences allegedly
occurring during the period December 2010 to January 2011. After a
disciplinary enquiry, they were dismissed
on 9 February 2011. They
subsequently referred an unfair dismissal dispute to the CCMA under
the auspices of their union, SACCAWU.
The disciplinary
enquiries
[5]
At a combined internal
disciplinary enquiry all employees entered pleas of not guilty to all
charges. The only evidence led by the
company was from Ms Charla
Govender, the company’s food and beverage manager (“Govender”).
[6]
Govender explained that
the standard employment contract signed by employees contains a
clause in terms of which employees have
contractually bound
themselves to undergo polygraph testing as well as breathalyser
testing should the employer require them to
do so. It is further
stated that such a refusal to undergo either of these tests may be
recorded as such on their personnel file
and that such refusal
‘…could lead to a breakdown in the employment
relationship and to a breach of trust between
Employer and Employee’.
[7]
Govender testified that
the company had become aware of the irregularities when another
employee had come forward in early December
2010 after an amount of
R800 had gone missing. This employee had provided a statement in the
form of an affidavit to the company
in which he implicated the
present six respondents. This employee had himself been dismissed as
a result of his revelations. It
was this incident that had led to an
investigation and the production of a variance report which Govender
had herself generated
between the period of December 2010 and January
2011. This report was produced to both the disciplinary enquiry and
the subsequent
arbitration proceedings. It was at the next stocktake
that the company’s loss of approximately R28, 000 was
established.
She had then generated a system log report for each of
the six employee respondents and was able to identify specific
transactions
in which each of the six employees had utilised
unauthorised codes whilst on shift. Govender made extensive reference
to a system
log report and specific incidents in which Sambara, an
evening waiter and one of the present respondents, had used a
manager’s
access code in order to transact on the food and
beverage computer system. The evidence was that this specific code
was unauthorised
for transactions in the Balata Restaurant where
Sambara worked. The specific incidents of misuse of this access code
had taken
place on 2 and 11 December 2010. Govender testified that he
had gained access to the system by using what is known as a “
TR
code
” which
is usually only available to the IT consultant and ought never to be
available to a person in Sambara’s position.
The system log
reported that he had also used these codes in an unauthorised manner
on 24 and 28 December 2010 whilst on duty.
[8]
She confirmed that,
during the internal disciplinary hearing, Sambara acknowledged that
he was aware that it was wrong to utilise
another person’s code
and that all codes issued to employees ought to remain confidential.
He, however, went further and
even acknowledged that he had
distributed his own secret code to other members of staff, whilst
knowing this was wrong. It does
not appear from the minutes of the
hearing that Sambara challenged this evidence in any manner.
[9]
Govender had also
requested that each of the accused employees undertake a polygraph
test as had been agreed to in their contracts
of employment. She
emphasized that it was not only the present respondent employees who
had been requested to undergo such testing
but that all employees who
had been able to access the applicant’s food and beverage
computer system had been requested to
undergo such testing. There
were ten such employees, of whom four agreed to undergo polygraph
testing. They were subsequently cleared
by these tests of any misuse
of the computer system. The remaining six employees all refused to
undergo polygraph testing. These
are the present individual
respondents, all of whom were barmen apart from Sambara who was a
waiter. They were subsequently issued
with letters regarding their
refusal to undergo polygraph testing.
[10]
According to the
applicant, none of the employees has ever been able to provide a
reasonable explanation as to why they committed
these irregularities
on the computer system, it not being disputed that they were all
aware of how the system functions and that
they had received adequate
training thereon. After holding disciplinary enquiries, this had led
the applicant to find that, on
a balance of probabilities, they were
all guilty of gross negligence. The company had drawn an adverse
inference against these
employees for their failure to challenge the
evidence against them and also by reason of their failure to undergo
polygraph testing
when they were obliged to do so.
[11]
Govender had explained
how the computer system was abused by referring to “
kicking
the drawer
”
of the cash register without recording any transaction, the
unauthorised use of managers’ codes, the unauthorised
use of TR
codes, all of which overrode the system and permitted employees to
either not record cash deposits or to remove cash
from the system. A
system log for the five barmen is attached as annexure “FAR25”
to the founding affidavit in the
review application.
[12]
With specific reference
to Sambara, Govender testified that he had been employed as a “
PM
waiter
” since
14 June 2010.
[13]
Govender also testified
regarding the breakdown in the trust relationship between employer
and employee that had resulted in this
chain of events. The company
could not trust them any longer.
[14]
The chairman of the
disciplinary enquiries, Andries Johannes Fourie (“Fourie”),
an official of SAATEA, a registered
employers’ organisation,
had found all six employees guilty of gross negligence in the manner
in which they had conducted
transactions on the computerised point of
sale system. It is not explained why he was unable to consider any
findings with regard
to the initial charges of theft and misuse of
company funds. Be that as it may, the dismissed respondents referred
a dispute to
the CCMA which heard evidence
de
novo
regarding the
matter. As mentioned above, the transcript of such evidence is
missing from the record. All document bundles are
however intact, as
are the Commissioner’s notes.
The arbitration
proceedings
[15]
At arbitration,
Govender again testified on behalf of the applicant but only two of
the dismissed employees testified: Brian Sambara
(“Sambara”)
and Juan Ndlovu (“Ndlovu”).
[16]
According to Fourie,
who deposed to the founding affidavit in the review application,
procedural fairness was never in dispute and
this was recorded in a
pre-arbitration minute, which was recorded in a handwritten note. He
also confirms that it was agreed that
the dismissals had been
procedurally fair and that, for this reason, no evidence was led
regarding procedural fairness. Unfortunately,
this minute does not
form part of the record and could not be produced. I do not propose
to repeat the detailed evidence of Govender
as given at the
arbitration hearing as this appears to be essentially the same as
what she had testified to at the disciplinary
hearing.
[17]
Sambara, when
testifying, stated that he had been forced to sign his notice of
disciplinary hearing but did not elaborate further.
He also stated
that when he did present himself for polygraph testing he was told
that he was not obliged to go. He then subsequently
refused to
undertake it and stated that he was suspended from his duties “
at
gun point
”.
He stated that he did report a problem with the system to his
manager, Mr Yugen Naidoo, who was aware of these transactions
which
had implicated him in the system log report. Importantly, he
confirmed under oath that he did provide his code to other members
of
staff in order to get his tips.
[18]
Ndlovu was the only
other respondent to testify at the arbitration hearing. Govender had
confirmed that Ndlovu had previously acknowledged
his responsibility
for a loss by reason of the bar shortage whilst he was on duty as per
annexures “FAR41” and “FAR42”.
In his
evidence-in-chief, Ndlovu denied that he had distributed his code to
anyone else as he was aware this is wrong and criticised
the company
for providing only system log audit reports for the afternoon shifts
but not for the morning shifts. He acknowledged
that he had refused
to undergo polygraph testing and that he was aware in a clause in his
employment contract obliging him to do
so.
[19]
The remaining
employees, Peterson Madondo, Sammy Moshole, Julius Zulu and John
Sibanda all failed to testify at the arbitration
hearing. Govender
confirmed that Zulu also had previous warnings for stock losses
whilst on duty at the bar, as per annexure “FAR43”.
The Arbitration Award
[20]
The company submits
that although it was agreed that written closing arguments would be
submitted on behalf of both sides, it is
clear from the arbitration
award that the Commissioner had failed to consider any of the written
submissions filed on behalf of
the company on 20 May 2011. It is also
argued that the employees’ union representative had failed to
supply a copy of his
written argument to the company.
[21]
As mentioned above
there are no answering affidavits in this matter.
[22]
In heads of argument
filed on behalf of the individual employees, much is made of the
apparent weakness of the company’s case
in relying on evidence
that was simply not before the presiding Commissioner. According to
this argument, the computer printouts
showing that the codes were
used don’t show anything at all and that there is no nexus
between any loss on the part of the
company and the conduct of the
individual employees.
[23]
When one has regard to
the arbitration award, one is struck by the relatively detailed
survey of evidence and argument but a relative
paucity of analysis of
the evidence and argument. This analysis amounts to nine short
subparagraphs. What is notable about the
Commissioner’s
analysis of the evidence is the following:
23.1.
There is no reasoning
or justification for his finding of procedural unfairness. There is
in fact no evidence of any procedural
unfairness apart from some
half-hearted challenged to the applicant’s refusal of an appeal
hearing. This however, cannot
be of any weight or significance, given
the right of the employees to challenge their dismissal under the
auspices of the CCMA.
They have fully utilised that right;
23.2.
There
is no consideration whatsoever of the appropriate inferences to be
drawn (if any) from the individual respondents’ refusals
to
undergo polygraph testing. Although it is trite that employees can
never be compelled to do so, in light of the facts of the
matter (and
in particular, in light of the fact that four co-employees
volunteered to undergo such tests and were cleared of any
wrongdoing)
the Commissioner cannot be said to have properly applied his mind to
this matter without at the very least considering
whether such
inferences could be drawn or whether the applicant was entitled to
draw the adverse inference against the respondents
that it did.
Although the refusal to undergo polygraph testing was, in the case of
the individual respondents, a clear breach of
their employment
contracts, it is well-settled that an adverse inference of guilt
should not be drawn by mere dint of such refusal.
[1]
In this matter, however, alternative evidence was available to the
Commissioner;
23.3.
He failed to consider
the fact that the computer reports did not simply speak for
themselves. Govender, as food and beverage manager,
had produced
these computer reports, had personal knowledge of how and what they
purported to show and was in the best position
to testify as to their
interpretation and how they effectively implicated the individual
respondents in guilt. There was, however,
no credible evidence led to
gainsay what she had said other than blanket denials from the two
respondents who chose to testify;
23.4.
He failed to take into
account the complete absence of testimony from the four remaining
respondents apart from Sambara and Ndlovu;
23.5.
He found that ‘the
[respondents] were not given all the information to prove their
innocence’ which was found to be
of importance. It is not
stated what this information might have been. This completely glosses
over the fact that the respondents
did not meaningfully challenge the
compelling evidence against their guilt;
23.6.
He made an order of
reinstatement after finding that there was “
no
proof of a broken relationship.
”
This despite the company’s insistence that it could no longer
trust the individual employees in the face of their
steadfast refusal
to undergo polygraph testing (and concomitant breach of contract) and
without taking into consideration the position
of trust that these
employees find themselves in having to work with cash monies on a
regular basis.
[24]
As mentioned above, I
am mindful that a full analysis of this matter is severely hampered
by the complete absence of any transcript
from the arbitration
proceedings owing to these records having got lost. Despite my
misgivings regarding the arbitration award
I am also well aware of
the temptation that others might feel to simply remit this matter
back for a
de novo
hearing before another commissioner. However, for the reasons
mentioned at the outset of this judgment such a solution will prove
wholly unsatisfactory by reason of the inordinately long period that
has transpired between the dismissals and the hearing of this
review
application, some four and a half years later.
[25]
I have, however, also
had regard to the copious documentary evidence and system log audit
reports which were produced in evidence
and explained by Govender. It
is also important to bear in mind that none of the allegations set
out in the founding affidavit
in the review application have been
challenged in an answering affidavit. More than that, however, I find
no reason not to accept
their veracity as they are, on a balance of
probabilities, wholly plausible and in line with the evidence led
both in the disciplinary
proceedings and at arbitration.
[26]
There does not ever
appear to have been any substantive challenge to the substance of the
applicant’s allegations apart from
bare denials. One cannot
simply sit back and challenge the authenticity of a
computer-generated report that has been produced by
a system in the
ordinary course of business, especially where this has been commented
on, explained and confirmed by a witness,
such as Govender, with no
substantial challenge being offered to counter such evidence. This
cannot be said to be a case of a document
speaking for itself. Even
if the Commissioner refused to draw any adverse inference from the
failure of the individual respondents
to undergo polygraph testing he
ought at the very least to have considered that this refusal
constituted a breach of each of their
employment contracts. There is
no reason why this clear and conscious breach of employment contract
ought not to have been taken
into account as an additional factor
when considering whether their guilt had been proven on a
preponderance of probabilities.
As an aside I pause to point out that
I do not view the authorities to which I have referred above as
suggesting that a Court (or
arbitrator) may not draw an adverse
inference against an employee for a conscious breach of contract,
even if it involves the refusal
to undergo polygraph testing. I would
even go further to suggest that there does not, to my mind, appear to
be any authority which
prohibits an adverse inference being drawn
against an employee who simply refuses to undergo polygraph testing,
under the appropriate
circumstances.
[27]
It is incorrect of the
respondents to argue that the affidavit that had been handed in at
the outset of the investigation by a fellow
employee who implicated
all of them was taken into account by the company in their
dismissals. What really happened was that this
affidavit and its
contents were simply one of the main factors that led to the
investigation conducted by Govender and the subsequent
stock-take.
This in turn revealed that the employees in question were guilty of
gross negligence if not complicity in dishonest
dealings. This
affidavit is of course not evidence in these proceedings and could
never in itself have been taken into account
in making any findings
against the individual respondents.
[28]
I note that I am
enjoined by the Labour Relations Act (“LRA”) as well as
by my oath of office to administer justice
and to advance the nature
and objects of the LRA in accordance with the Constitution. This
sometimes means having to take difficult
decisions. This case is one
of those situations.
[29]
In light of all the
evidential material before me I find that the evidence at both the
original disciplinary enquiry as well as
at the arbitration points
strongly in favour of the guilt of the individual respondents. This
must of course include the fact that
an adverse inference ought to
have been drawn against them by reason of their manifest breach of
contract in refusing to undergo
polygraph testing without any reasons
having been given for this.
[30]
This finding does not
in itself mean that the award is in itself reviewable. However, I
also find that, faced with the evidence
before him, the presiding
Commissioner nevertheless came to a result and handed down an award
which is not justifiable in relation
to the reasons given for it and
is not an outcome which a reasonable commissioner could or should
have come to. The Commissioner’s
failure to take into account
the abovementioned factors together with his unsubstantiated finding
of procedural unfairness lead
me to the inescapable conclusion that
this is an award which is vitiated by material irregularities. The
result arrived at, as
well as the arbitration awards itself, is
unreasonable. It falls to be set aside and reviewed. I accordingly do
so.
[31]
In the result, I make
the following order:
1.
The arbitration award
under case number GAJB3836-11 dated 6 June 2011 is hereby reviewed
and set aside.
2.
The abovementioned
award is replaced with the following order:
‘
The
dismissal of the six employees represented by the third respondent
herein was substantively and procedurally fair’.
3.
There is no order as to
costs.
________________
Bank AJ
Acting Judge of the Labour Court of
South Africa
For
the Applicant:
Mrs FW
Moyses
Instructed
by:
Ren Oosthuzien Attorneys
For
the Respondent:
Ms K Walker
Instructed
by:
Snyman Attorneys
[1]
Sedibeng
District Municipality v SA Local Government Bargaining Council and
Others
(2013)
34
ILJ
166
(LC) at para 37;
Truworths
Ltd v Commission for Conciliation, Mediation and Arbitration and
Others
(2009)
30
ILJ
677 (LC) at para 36 citing
Kroutz
v Distillers Corporation Ltd
[1999]
8 CCMA 8.8.16 (CCMA).