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[2015] ZALCCT 14
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South African Revenue Service v Commission for Conciliation, Mediation And Arbitration and Others (C683/11) [2015] ZALCCT 14; [2015] 5 BLLR 531 (LC) (10 February 2015)
REPUBLIC
OF SOUTH AFRICA
Of
Interest to other Judges
The
Labour Court of South Africa,
In
CAPE TOWN
Case
no: C683/11
DATE:
10 FEBRUARY 2015
In
the matter between:
South
African Revenue
Service
.............................................................................
First
Applicant
And
Commission
for Conciliation, Mediation And
Arbitration
.............................
First
Respondent
J J
Kitshoff
(N.O.)
...........................................................................................
Second
Respondent
Solidarity
Obo Botha F N
J
..............................................................................
Third
Respondent
Delivered:
10 February 2015
Summary:
(Review – employer altering recommendation of chairperson of
disciplinary enquiry – ultra vires collective
agreement –
unjustified subjection of employee to double jeopardy –
procedurally unfair – Substantive fairness
– unreasonable
for arbitrator not to have made an adverse finding on trust
relationship – dismissal substantively fair).
Judgment
LAGRANGE,
J
Introduction
[1]
This matter concerns an application to
review and set aside an arbitration award in which the arbitrator
found that the dismissal
of the employee concerned, Mr F N J Botha
(‘Botha’) was procedurally and substantively unfair and
reinstated him.
[2]
Botha was found guilty by the chairperson
of the internal disciplinary enquiry breaching the policy of SARS
prohibiting the downloading
and, or alternatively viewing,
pornographic material on the Internet. The chairperson found that
there was no evidence that Botha’s
activity had impacted
negatively on colleagues or on the work of SARS, or on Botha’s
performance. Even though Botha was evasive
in dealing with the
so-called business-related reasons for downloading the material, the
chairperson did not think that the misconduct
was of a dishonest
nature, but simply that he took a chance of using the unrestricted
access he had been granted to look at such
sites as a licence to
search any material. The chairperson further noted that SARS had
dismissed some employees for downloading
pornographic material at
work, but there was no evidence that this had been communicated to
other members of staff to make them
aware of the severity with which
such misconduct would be treated. Botha had a clean disciplinary
record and she did not think
that the conduct was such that it
prevented the continued employment relationship intolerable.
Accordingly, the chairperson decided
to issue Botha with a final
written warning for violating the policy.
[3]
SARS did not agree with the sanction
determined by the chairperson and after giving Botha an opportunity
to make representations
why the sanction decided by the chairperson
should not be substituted with the sanction of dismissal, dismissed
Botha. Botha’s
union referred two disputes to arbitration
arising from his dismissal. The first was an interpretation and
application of the collective
agreement which embodied to the
disciplinary procedure. The second was an unfair dismissal dispute.
[4]
In an award issued by a CCMA Commissioner
in April 2011, the Commissioner declared that SARS had acted in
breach of the collective
agreement concluded on 7 June 2007 when it
reviewed and altered the sanction imposed by the chairperson. Despite
this finding,
he declined to award any consequential relief, which he
was entitled to, because the fairness of the dismissal would be
determined
by the arbitrator hearing that dispute. The applicant did
not review this declaratory award, but only seeks to set aside the
latter
award which decided Botha’s dismissal was unfair.
The
award
[5]
The arbitrator concurred with the decision
of the previous arbitrator that SARS had acted in breach of the
collective agreement
and added that merely because the collective
agreement was silent on the question of whether or not SARS could
change the sanction
of the chairperson, in the absence of a provision
permitting such a variation by the employer and in the light of
clause 10.6.6
of the agreement which obliged it to implement the
chairperson’s decision, there was no scope for an
interpretation which
would allow the employer to do something which
was not contemplated by the parties to the agreement.
[6]
The arbitrator also decided that the
opportunity afforded to Botha to make representations why the
sanction of the chairperson should
not be substituted with the
sanction of dismissal did qualify as a pre-dismissal hearing. At this
point, it should be mentioned
that the representations made by Botha
understandably concerned the impropriety of the ‘review’
process unilaterally
adopted by SARS. Taking account also of the
employer’s complete disregard of the collective agreement, the
arbitrator was
satisfied that the dismissal was procedurally unfair.
[7]
The arbitrator considered evidence given by
Van der Westhuizen to the effect that the standard operating
procedures of SARS required
that investigations concerning alleged
non-payment of tax were not supposed to commence without written
confirmation of the information
provided by an informant. In this
case, the information provided concerned the website addresses of two
pornographic material sites,
which supposedly would have revealed the
identity of a business that was not paying tax. The arbitrator was
not persuaded that
the information in the tipoff was important enough
to justify Botha obtaining permission for special Internet privileges
(SIP)
to view such websites and was clearly sceptical about whether
the tipoff was genuine. He noted that Botha had failed to keep his
superior, Mr Van der Westhuizen informed of the progress of the
investigation and to justify the need for continued access to such
websites. Ultimately Botha had obtained no evidence as a result of
this access and even when he had ceased accessing such websites
by
the end of March 2010 he did not advise Van der Westhuizen that he
could remove the authorisation. He found the applicant was
guilty of
breaching the policy governing access to such material.
[8]
Turning
to the question of the appropriate sanction, the arbitrator found it
strange that when Van der Westhuizen became aware that
Botha was
accessing the prohibited material he did not take immediate steps to
stop the SIP access nor did he discuss it with Botha,
despite
supposedly viewing Botha’s misconduct as offensive and serious
and as a breach of trust. SARS also allowed
Botha to continue
working in his position as an investigator for 10 months after it
knew of his misconduct but did not suspend
him. Further, Botha also
had a clean disciplinary record. The arbitrator concluded that SARS
had not made out a case that there
had been irretrievable breakdown
in the relationship as required by the judgement in
Edcon
Ltd v Pillemer NO & Others
.
[1]
[9]
The arbitrator also took account of the
employer’s own policy guidelines for determining an appropriate
sanction and noted
that the guidelines distinguish between
downloading images of nudity for which a final written warning was
deemed appropriate and
the downloading of pornographic images for
which dismissal was the recommended sanction. The guidelines also
required the chairperson
to consider the nature of the case, the
seriousness of the misconduct, the previous record of the employee
and sanctions imposed
in similar cases. In his evidence, Botha had
referred to the case of another employee who had been found guilty of
viewing pornographic
material whilst on overtime duty and had been
given a final warning. The arbitrator was persuaded by arguments of
the employer
that the cases were based on different merits and found
that it had acted inconsistently in dismissing Botha. In summary, the
arbitrator
found that the nature of Botha’s misconduct was not
so offensive that his continued employment could not be justified.
The
arbitrator reaffirmed the decision and sanction of the
chairperson of the disciplinary enquiry as the appropriate outcome.
Grounds
of review and evaluation
[10]
During argument at the review application
hearing, the applicant emphasised that the issue in the arbitration
was whether or not
the collective agreement concluded between SARS
and the Public Servants Association of South Africa (‘PSA’)
committed
SARS to substitute the sanction imposed by the disciplinary
enquiry chairperson with the sanction of dismissal.
First
ground of review-imputation of an overriding requirement of trust and
confidence in the employment relationship into the collective
agreement
[11]
Firstly, the applicant attacked the
arbitrator’s interpretation of the collective agreement and
submitted that he had applied
the wrong test when he interpreted it
to mean that the parties to the agreement did not intend to give SARS
the power to alter
the sanction. The applicant claimed that the
arbitrator applied the test for assessing evidence and not a test
that would be applied
in the interpretation and application of
collective agreements. It formulated this in the following terms: “Do
the words
of the collective agreement read in context and against the
objects of the agreement had been giving effect to the objects of the
labour relations act, preclude SARS from dismissing Botha, despite a
breakdown of trust and confidence in the employment relationship
such
that SARS finds its continuation is intolerable?”
[12]
After
this matter was heard, the same argument in relation to the same
collective agreement was later advanced by SARS before the
LAC in
SA
Revenue Service v Commission for Conciliation, Mediation &
Arbitration & others
.
[2]
The argument was dismissed in that forum in the following terms:
“
[28] The
wording of the collective agreement does not only make it abundantly
clear that the chairperson's pronouncement on penalty
is a final
sanction, but, in my view, it also leaves no room for interpretation
in favour of the parties having intended to provide
in the collective
agreement a term granting a right to SARS to substitute its own
sanction for a sanction imposed by its chairperson
. Whilst it is
trite that the duty of trust and confidence on the part of an
employee is a term implied by law in an employment
contract, I do not
think that such implied term extends to include the right of an
employer to substitute its own sanction for
that of the chairperson,
particularly in a situation such as the present where the parties in
a collective agreement elected expressly
to confer on the
disciplinary chairperson the sole power to impose the final
sanction.”
[3]
[13]
In light of this pronouncement, the
applicants cannot succeed on this ground, quite apart from the fact
that in this case there
is also the previous arbitration award, which
had already determined that the collective agreement did not allow
SARS to substitute
its own decision for that of the chairperson of
the disciplinary enquiry. The applicant had also not set aside that
decision, which
effectively rendered the concurrence of the
arbitrator in the award which is the subject of this review merely
obiter. The LAC
decision effectively confirms the correctness of the
arbitrators’ concordant interpretations of the collective
agreement
and puts that issue to rest.
Second
ground of review - the rationality of the arbitrator’s finding
that there was no irretrievable breakdown in the trust
relationship.
[14]
The essence of the applicant’s
criticism of the arbitrator’s reasoning in arriving at the
conclusion he did, is that
because of certain evidence presented in
the arbitration hearing his conclusion was not one that a rational
arbitrator could have
reached. The factors identified by the
applicant which it identifies and submits render the arbitrator’s
findings irrational
are the following:
14.1
Van der Westhuizen gave evidence that he
had authorised Botha’s special internet access to pornographic
sites because of a
representation made by Botha that he needed such
access to investigate potential tax evasion, but he was shocked when
he learnt
that Botha had lied about this.
14.2
Both the chairperson and the arbitrator
were clearly not persuaded that Botha had made the application for
special access for a
bona fide
purpose.
14.3
Botha was a criminal investigator, whose
position required him to be beyond reproach.
[15]
When Botha requested special internet
access in September 2009, the motivation he gave for the privilege
was “Required in
criminal investigation as well as shop steward
duties.” In a further request for such access made by Botha in
October 2009,
his motivation was that, “for investigation
purposes access to all areas are required”. The items in the
restricted
categories he sought access to, were websites containing
amongst other things sexually related material, gambling, interactive
content, entertainment, advocacy and drug-related content. The file
types associated with this material in the
pro
forma
request for special Internet
privileges were described as falling into the categories of
entertainment, legal and criminal. Van
der Westhuizen accepted that
Botha, who was a shop steward, might need to visit sites with legal
content, but when Van der Westhuizen
was alerted to the fact that
Botha was accessing websites with pornographic content, he could not
find any evidence of a matter
that Botha was involved in as a shop
steward that might require him to visit such sites. Van der
Westhuizen also said that he had
seen no evidence of any criminal
investigation being conducted by Botha.
[16]
When he was asked why he had seen it
necessary to act against Botha, Van der Westhuizen said that he felt
that Botha had broken
the trust relationship when he had not used the
special internet access he had granted him for the reason it was
given. When Botha’s
transgression was revealed, Van der
Westhuizen felt that it required close scrutiny of his actions.
[17]
In terms of a future working relationship,
Van der Westhuizen also expressed the view that he had been offended
by Botha’s
claim in the disciplinary enquiry that Van der
Westhuizen had tried to entrap him, whereas Van der Westhuizen had
only come to
know about Botha’s conduct when it was reported to
him by head office. Van der Westhuizen was challenged under
cross-examination
about why he had not alerted Botha to stop him
visiting such sites, at the time he had notified the Human Resources
Department
about Botha’s apparent misconduct. He said he had
refrained from speaking to him directly because Botha was a shop
steward
and the policy was that the issue should be channelled
through the HR Department. Van der Westhuizen emphasised that the
allegation
by Botha that he had tried to entrap him would affect
their working relationship because in future every time Botha did
something
he would say that Van der Westhuizen was ‘looking
over his shoulder’ again. Later under cross-examination, Van
der
Westhuizen said that he was disappointed when he learnt that
Botha had been visiting sites he should not have been going to.
[18]
The cross examination of Van der Westhuizen
focused on the relative seriousness of Botha’s misconduct. At
no stage was it
put to Van der Westhuizen that Botha had visited such
sites for
bona fide
purposes relating to an investigation or his duties as a shop
steward, nor was he asked if that would change his attitude towards
Botha if that had been the case. It was also never put to Van der
Westhuizen that the first form requesting privileged access,
in which
Botha had said that he needed it for a criminal investigation as well
as shop steward duties, was never approved. Botha
seemed to believe
it was relevant that he did not need special access to the internet
for his shop steward duties because he already
had access to legal
material on his computer and because of this Van der Westhuizen ought
to have realised that his motivation
for privileged access on the
basis of shop steward duties was not a significant part of his
motivation. Insofar as this was relevant,
Van der Westhuizen was not
questioned about it.. Likewise Botha’s version that he had
ticked the box asking for access to
certain restricted categories of
website rather than for specific website addresses purely for the
purposes of accessing pornographic
sites whereas he would have
specified a website address if he wanted to do legal research to
assist him in his shop steward duties,
was also not put to Van der
Westhuizen. In passing it is worth mentioning that it was a curious
feature of Botha’s defence
that he should not be blamed if
others granted him privileged access under a misapprehension about
what he needed it for.
[19]
Botha testified in his evidence in chief
that he had received an anonymous telephone call from someone who
claimed that some entity
had placed advertisements promoting a
pornography business on two websites, but the entity was not
registered for income tax purposes.
His first request for privileged
access was not granted, but when he received another call from the
complainant asking what had
been done about the complaint, he made a
further application for special access. Once he had obtained access,
he claimed it was
necessary for him to monitor the websites on an
ongoing basis in case the advertisements in question came up, because
he did not
have the name of the company he was trying to investigate.
He claimed this was also the reason he had not filled in the usual
form
required when initiating an investigation in terms of the
standard operating procedures, about which Van der Westhuizen had
testified.
Botha testified that the standard operating procedures
were not followed and were chaotic, but this was not tested with Van
der
Westhuizen. When he was asked why there was no paper trail of the
conduct of his investigation, his response was simply that it
was one
of those cases where the paper trail had not been kept.
[20]
The chairperson of the disciplinary enquiry
expressly found that Botha had no business related reason for
accessing the sites in
question, and noted that in all but one of the
cases which SARS relied on to justify the dismissal, there was an
element of dishonesty
or improper conduct in addition to the
downloading of pornographic material. Nonetheless, it seems that the
chairperson felt that
the impact of Botha improperly accessing such
material was minimal and given his prior disciplinary record,
corrective measures
would be sufficient. The arbitrator did not go so
far as to make a finding that Botha had been dishonest, but clearly
expressed
profound scepticism about Botha’s justification for
proceeding with the investigation without following the prescribed
operating
procedures, and noted that the only evidence in support of
Botha’s version was a single entry in his desktop diary.
[21]
Botha sought to trivialise Van der
Westhuizen’s feeling that he had been misled by the
representation that the special access
was required partly for
performing his duties as a shop steward. This still does not explain
why Botha made that representation,
even if the application form on
which it was made was not approved. It also seems that the evidence
of the existence of a
bona fide
tax investigation was slender indeed.
[22]
In the circumstances, it is difficult to
understand how the arbitrator could have determined on the evidence
that the trust relationship
was not impaired by the element of
dishonesty in Botha’s conduct both in representing that he
needed the access partly for
shop steward duties and the absence of
any meaningful evidence to support the probable existence of a
bona
fide
investigation.
The
third ground of review-the finding of procedural unfairness
[23]
In essence, the applicant argues that the
opportunity provided Botha to make representations why he should not
be dismissed and
the fact that he had been afforded an appeal was
sufficient to satisfy the requirement that the dismissal was
procedurally fair
and it was irrational of the arbitrator to decide
otherwise. An ancillary leg of this argument is that there was no
need for another
enquiry because all the evidence had been led in the
first enquiry.
[24]
In the LAC matter cited above, the LAC
effectively found that SARS was abrogating to itself a right to alter
the decision of the
disciplinary enquiry chairperson even though the
procedure only provided a right of appeal to the employee. The avenue
open to
SARS was to review the decision of the chairperson which it
did not make use of. In that matter, there had been no attempt to
afford
the employee an opportunity to make representations before
SARS altered the chairperson’s decision. In this case, SARS did
invite Botha to make submissions why he should not be dismissed, but
without explaining beforehand why SARS disagreed with the
sanction
imposed by the chairperson of the enquiry. On the evidence, it
appears that the employer’s specific reasons for
not accepting
the chairperson’s findings and for imposing a more severe
sanction were not provided despite Botha asking
for such
detail. The specific justification for SARS’s decision was only
provided afterwards when it notified him of its
decision to dismiss
him. Be that as it may, the evidence in my mind can reasonably
support the arbitrator’s conclusion that
the dismissal was
procedurally unfair on these grounds alone.
[25]
Further,
even if Botha had been given an opportunity to make representations
relying on his own speculation about what the employer
might
ultimately wish to rely on to justify his dismissal, the employer
high-handedly accorded to itself the opportunity to force
him to
undergo a second round of deliberation about his sanction by someone
who, unlike the chairperson of his enquiry was not
an independent
practitioner, in circumstances where it had made plain its view that
it was intent on overturning the chairperson’s
decision, unless
he could persuade it otherwise. SARS did so without advancing any
reason why it would be fair to expose Botha
twice to the risk of
disciplinary sanction
[4]
, simply
because it did not like the outcome is not a justification for acting
in this way, not to mention that it was completely
contrary to a
binding collective agreement displaying contempt for the terms of the
agreement. This was more than enough reason
to find that the
employer’s action was procedurally unfair. The egregious
character of SARS’ conduct warrants a maximum
award of
compensation for procedural unfairness in my view.
Conclusion
[26]
In light of the above, I am satisfied that
the arbitrator’s finding that the dismissal of Botha was
substantively unfair warrants
reconsideration in the light of his
unreasonable finding about his honesty. However, his finding that the
process leading to Botha’s
dismissal was unfair was more than
justified.
[27]
In revisiting the substantive fairness of
the dismissal, I would agree that it was not the most egregious
infraction of the acceptable
use policy of SARS relating to the
internet. The material was not distributed and was not
downloaded. There was no demonstrable
negative impact on Botha’s
workload. Botha also had a clean disciplinary record and some
impressive performance achievements.
There was also the undisputed
evidence that another employee who had accessed pornographic material
whilst working overtime had
merely been issued with a final warning,
though it is important that the employee in question had pleaded
guilty to the misconduct,
unlike Botha.
[28]
On the other hand, the probabilities very
strongly favour an interpretation of the evidence that Botha had not
been accessing the
websites for
bona
fide
work purposes. His request for
access was stated in the broadest terms. His visits to the sites were
relatively frequent over some
period of time. No explanation was
forthcoming why such a prolonged investigation of a vague tip-off
about alleged advertising
by an unidentified pornography business
would have taken so long before he decided it was fruitless. The fact
that the names of
two of the websites were written in his desk diary
is hardly corroboration that they were part of an official
investigation. Even
if the approved request for access was motivated
in the broadest terms, why did he feel the need to add his shop
steward duties
in the first motivation? Likewise even if he felt he
could not mention the name of the business, for reasons of
confidentiality
why not at least mention the nature of his
investigation in his written motivation? The fact that the permission
was granted without
obtaining such detail, did not mean that any use
he made of that permission was excused. The real issue is that
permission was
granted on the basis that he had a
bona
fide
reason for making the request. The
chairperson of the enquiry was clearly of the view that, having
obtained wide ranging permission
to surf the internet, Botha may have
been tempted to abuse that access. But Botha never admitted that this
was the case, because
he maintained his version that all the searches
he conducted were pursuant to his investigation.
[29]
Van der Westhuizen clearly felt that Botha
was someone he could trust previously but now he would have to regard
with much more
circumspection. Moreover, Botha had not merely
defended himself but had impugned Van der Westhuizen’s
character by suggesting
he had sought to entrap him by not informing
him of the report received from head office. Van der Westhuizen felt
he had to follow
the protocol applied by SARS when dealing with
disciplinary matters relating to shop stewards and referred the
matter to HR. Van
der Westhuizen would have to work with someone who
had accused him of deviously trying to wrongly incriminate him. It
also should
not be lost sight of that Botha, as a special
investigator was a person who had to be trustworthy.
[30]
Based
on the decision of Pillay J in
SARS
v Commission for Conciliation, Mediation & Arbitration &
others
[5]
, the applicant argued that
the dismissal was substantively unfair because SARS was in breach of
the collective agreement. In that
judgment, which also concerned a
matter in which SARS had yet again ignored the provisions of the
collective agreement and substituted
its own decision for that of the
disciplinary enquiry chairperson, the Court had held:
“
[52]
The
dismissal of the employee was substantively unfair because the
decision to dismiss was not one that SARS could validly make
;
the collective agreement barred it from substituting the decision of
the disciplinary chairperson. Procedurally, the dismissal
was also
unfair because the process of dismissing the employee was not
available to SARS; if it was available, then SARS should
have
afforded the employee a pre-dismissal hearing. That it did not
do.”
[6]
(emphasis
added)
[31]
However,
in the LAC matter previously referred to, even though the LAC held
that the decision of SARS to dismiss the employee contrary
to the
decision of the enquiry chairperson was
ultra
vires,
it
proceeded to separately consider the reasonableness of the
arbitrator’s finding that the employee should be reinstated,
taking into account the fact that the employee was remorseful and had
acted with
bona
fide
motives, as well as the fact that he could be accommodated elsewhere
in the organisation. After doing so, the LAC concluded that
the
arbitrator’s award met the standard of reasonableness
[7]
.
Consequently, it appears that the LAC’s approach was that the
fact that the decision of SARS to override the chairperson’s
decision was
ultra
vires
did
not dispose of the need to evaluate the reasonableness of
arbitrator’s findings on the substantive merits of the
dismissal.
[32]
Because of the importance of the LAC
decision, which was decided after this application was heard, I gave
both parties an opportunity
to file further submissions in the
matter. Solidarity, representing Botha, advised it did not wish to
make any submissions. No
response was received from SARS. The court
did receive a copy of a newspaper article on the LAC decision,
apparently submitted
by Botha himself, but this obviously added
nothing to the LAC decision itself.
[33]
In conclusion, I am satisfied in the light
of the discussion above that a reasonable arbitrator would have found
that Botha’s
conduct did warrant his dismissal.
Order
[34]
The finding of the arbitrator in his award
dated 21 July 2011 under case number WECT 3729/11 that the dismissal
of the third respondent,
F N J Botha, was substantively unfair is
reviewed and set aside and substituted with a finding that his
dismissal was substantively
fair.
[35]
The consequent relief awarded pursuant to
that finding set out in paragraphs [75] to [76] is substituted with
an order that the
applicant must pay the third respondent twelve
months’ remuneration as compensation for his procedurally
unfair dismissal
amounting to R 455,170.20 based on a monthly
remuneration of R 37,930-75 at the time of his dismissal.
[36]
The compensation payable in terms of the
previous paragraph must be paid within 15 days of the date of this
judgment.
[37]
Each party is to pay their own costs.
R
LAGRANGE, J
Judge
of the Labour Court of South Africa
APPEARANCES
For
the Applicant: T Bruinders, SC instructed by Routledge Modise in
association with Hogan Lovells
For
the First Respondent: E M Pio of Solidarity
[1]
(2008) 29
ILJ
614
(LAC)
[2]
(2014) 35
ILJ
656 (LAC)
[3]
Per Ndlovo, JA at 665.
[4]
See
Branford
v Metrorail Services (Durban) & others
(2003)
24
ILJ
2269 (LAC)
at 2277-8, paras [14] – [15].
[5]
(2010) 31 ILJ 1238 (LC). It must be mentioned that this was not the
labour court case heard on appeal in the LAC matter previously
referred to.
[6]
At 1247.
[7]
At 366, paras [37] – [38].