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[2015] ZALCCT 18
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Cape Penisula University of Technology (CPUT) v Commission for Conciliation, Mediation and Arbitration and Others (C890/2013) [2015] ZALCCT 18 (18 February 2015)
REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
JUDGMENT
Case
No: C 890/2013
DATE:
18 FEBRUARY 2015
Not
Reportable
In
the matter between:
CAPE
PENISULA UNIVERSITY OF TECHOLOGY
(CPUT)
.......................................................................................................................................
Applicant
And
THE
COMMISSION FOR CONCILIATION
MEDIATIONA
AND
ARBITRATION
.......................................................................
First
Respondent
S
H
CHRISTIE
.........................................................................................................
Second
Respondent
H
DEEDAT
..................................................................................................................
Third
Respondent
Heard:
2 September 2014
Delivered:
18 February 2015
Summary:
The CCMA lacks jurisdiction to arbitrate a dispute arising from a
dismissal in terms of section 186(1)(b) of the LRA if
the applicant
fails to establish that he/she had reasonable expectation that
his/her fixed term contract would be renewed on the
same or terms.
Expectation of a renewal of the fixed term contract on its own is
insufficient to prove dismissal.
JUDGMENT
LALLIE,
J
Introduction
[1]
This is an application to review and set aside an arbitration award
of the second respondent (‘the commissioner’)
including
the verification award, in which she found the applicant’s
non-renewal of the third respondent’s fixed term
contract to
constitute a dismissal within the meaning of section 186 (i)(b) of
the Labour Relations Act 66 of 1995 (‘the
LRA’). She
further found the dismissal substantively and procedurally unfair and
ordered the applicant to pay her compensation.
It is opposed by the
third respondent.
Factual
background
[2]
On 1 July 2010, the third respondent was employed by the applicant as
a project co-ordinator in its Centre for Water and Sanitation
Research (the Centre) on a fixed term contract which was renewable
subject to the continuation of contract WP 10327 and a satisfactory
performance review. During the subsistence of the contract, her
duties were not limited to working in the WP10327 contract but
she
was assigned to perform other functions including sourcing other
contracts for the Centre. However, on 24 May 2013, Professor
Lagardien (Lagardien) addressed a letter to the applicant reminding
her that her appointment was specific to contract WP 10327
which
terminated on 30 June 2013. He further advised her that her contract
which was linked to contract WP10329 would not be renewed.
Aggrieved
by the decision not to renew her contract, the third respondent
referred a dispute to the first respondent (‘the
CCMA’)
on the basis that the non-renewal of her fixed term contract
constituted an unfair dismissal as envisaged in section
186 (1)(b) of
the Labour Relations Act 66 of 1995 (‘the LRA’). The
dispute was arbitrated by the commissioner who found
in the third
respondent’s favour and ordered the applicant to pay her
compensation equivalent to remuneration that she would
have earned
over a period of six months. As the commissioner had miscalculated
the amount of compensation due to the third respondent,
she issued a
verification award in which she corrected her error. It is the
arbitration and the verification awards that the applicant
seeks this
Court to review and set aside.
The award
[3]
The commissioner pointed out that the onus to show a reasonable
expectation of the renewal of the fixed term contract was on
the
third respondent. She noted that the applicant’s argument was
based on two grounds, namely, the terms of the third respondent’s
contract of employment and that the work that she did outside
contract WP 10327 was ancillary and could, therefore, not amount
to
stand alone continuing work. The commissioner took into account the
centre’s practice that as one project came on line
staff
members needed to be on the lookout for further contacts for funding
for the continuation of their work.
[4]
All the centre’s researchers are dependent on securing funding
for the continuation of the centre and their viability
as its
employees. The centre had a practice of accommodating its employees
on fixed term contracts when they were between projects.
The
applicant denied that the third respondent was between projects when
her contract expired and submitted that the need to accommodate
her,
therefore, did not arise. The commissioner made a finding that the
facts did not support the applicant’s version because
the third
respondent was involved in the Nuffic Gender Equity Project and the
WRC Project.
[5]
The commissioner accepted the third respondent’s version that
she had a role in the centre outside the WP10327 contact
and beyond
its expiry, funding permitting. Her finding is based on the
applicant’s reaction to the third respondent’s
grievance
against Lagardien. The grievance meeting was held on 29 April 2013.
Its outcome was a recommendation that a facilitated
workshop be held
with a view to improve staff relations and improve efficiencies. No
mention was made of the expiry of the third
respondent’s
contract. The commissioner expressed the view that the applicant
would have advised the third respondent to
get through the next few
weeks as she would be leaving at the end of June had the real reason
for the non-renewal of her contract
been the one proffered by the
applicant. No mention was made that the third respondent would not
participate in the prospective
project proposal that Mr Muanda wrote
weeks before the third respondent received the letter advising her of
the expiry of her contract.
There were meetings which were attended
by the third respondent on behalf of the centre which Lagardien did
not attend, which proved
that she had a role outside project WP 10327
and beyond its expiry. The commissioner made a finding that the
Nuffic proposal which
the third respondent sought to rely on did not
support her case.
She
also found that the third respondent was at least a co-author of the
WRC proposal and at that time, in February 2013, reasonably
concluded
that she was an integral part of the project proposal which would
have participate in its fulfilment, had it been awarded
to the
centre.
[6]
The commissioner expressed the view that evidence suggested that the
third respondent’s contract of employment did not
end on its
own terms. It was terminated by Lagardien as an act of retaliation.
The commissioner’s decision that the applicant
had been
dismissed was informed, to a great extent, by her finding that there
was both funding and work to be done in contract
WP10329. She found
that the applicant was entitled to be protected by section 186(1)(b)
of the LRA whose purpose is to guard against
an employer artificially
relying on the expiry of a fixed term contract with an employee to
terminate the employment relationship
when there is no legitimate
business reason for doing so. She found that the applicant had been
dismissed in terms of section 186(1)(b)
of the LRA. She ordered the
applicant to pay the third respondent compensation in the amount of R
172, 117.50 for dismissing the
third respondent in a manner that was
both substantively and procedurally unfair.
[7]
The applicant submitted that the commissioner’s decision that
its conduct of not renewing the third respondent’s
fixed term
contract of employment constituted a dismissal within the meaning of
section 186(1)(b) of the LRA was unreasonable given
the evidence
tendered at the arbitration. As the third respondent’s fixed
term contract was linked to the duration of contract
WP 10327, when
the contract was terminated on 30 June 2013, the applicant correctly
declined to renew the third respondent’s
fixed term contract.
As the applicant’s evidence of the date of the termination of
project WP 10327 was not disputed, the
commissioner ought to have
found that the third respondent had failed to establish the existence
of dismissal and dismissed her
claim. The commissioner committed a
reviewable irregularity by granting an award in favour of the third
respondent when the third
respondent had failed to prove that she had
a reasonable expectation that her contract would be renewed on the
same or similar
terms. A further attack on the award is based on the
commissioner’s finding, which is not supported by evidence that
the
non-renewal of the third respondent’s contract was due to
her poor relationship with Lagardien. The conclusion is based on
the
incorrect commissioner’s view that the applicant would have
resolved the grievance that the third respondent had filed
against
Lagardien by telling her to get through the next few weeks because
her contract would end at the end of June 2013 instead
of holding a
workshop to improve both staff relations and efficiencies.
[8]
In its supplementary affidavit the applicant denied having created
any expectation of the renewal of the applicant’s fixed
term
contract beyond contract WP10327. It submitted that the
commissioner’s conclusion that the expectation was based on
past practice was not supported by evidence. So was the conclusion of
the expectation to renew the third respondent’s contract
based
on the WRC 2013 project as its duration and terms and conditions were
not disclosed.
Test for review
[9]
The thrust of the applicant’s case is that the commissioner
erred in not dismissing the third respondent’s case
for lack of
jurisdiction in that she failed to prove her dismissal as envisaged
in section 186(1)(b) of the LRA. When an applicant
has failed to
prove a dismissal in terms of section 186(1)(b) of the LRA, the CCMA
will lack jurisdiction to arbitrate a dismissal
dispute arising from
an employer’s failure to renew a fixed term contract. A
decision whether the CCMA has or lacks jurisdiction
to arbitrate a
dispute needs to be correct. If it is incorrect, it is susceptible to
review. The test whether the CCMA has the
necessary jurisdiction to
arbitrate a dispute is expressed thus in
SA
Rugby Players Association (SA RPA) and Others v SA Rugby (Pty) Ltd
and Others; SA Rugby (Pty) Ltd v SARPU and Another
[1]
‘
The
issue was simply whether objectively speaking, the facts which would
give the CCMA jurisdiction to entertain the dispute existed.
If such
facts did not exist, the CCMA had no jurisdiction irrespective of its
finding to the contrary.’
The
Court explained the operative terms of section 186 (i) (b) of the LRA
to be that the employee should have reasonable expectation,
and the
employer must have failed to renew a fixed term contract or renewed
it on less favourable terms.
[10]
In
University
of Pretoria v Commission for Conciliation Mediation and Arbitration
and Others,
[2]
the Court expressed the view that section 186 envisages that two
requirements must be met in order for any employer’s action
to
constitute dismissal. Firstly, reasonable expectation, on the part of
the employee, that a fixed term contract will be renewed
on the same
or similar terms. Secondly, there must be a failure by the employer
to renew the contract on the same terms or failure
to renew it at
all.
[11]
Both parties sought to rely on the following
dictum
of the
University
of Cape Town v Auf der Heyde:
[3]
‘
In
order to determine whether the respondent had a reasonable
expectation, it is first necessary to determine whether he in fact
expected his contract to be renewed or converted into a permanent
appointment. If he did have such an expectation, the expectation
was
reasonable.’
[12]
The essence of the third respondent’s opposition is that she
had an expectation that her contract would be renewed. She
sought to
rely on Lagardien’s failure to tell her that her contract would
not be renewed. This argument overlooks the undisputed
terms of the
third respondent’s contract of employment which provide that
the contract was of limited duration and linked
to contract WP10327.
When the third respondent assumed her duties, she was aware of the
duration of her contract and the evidence
that contract WP10327
expired on 30 June 2013 was not challenged. The argument that Mr
Moandla was not aware that the third respondent’s
contract
would be terminated and Lagardien’s report, that the third
respondent would focus on the river health project whose
training had
not been done, did not assist the third respondent. Similarly, her
arguments that renewable fixed term contracts were
based on funding
that was raised and the participation in the work of other projects
only confirm the correctness of the commissioner’s
finding that
the third respondent’s contract would be renewed. They exclude
essential parts of the test for dismissal. They
do not address the
issue whether the expectation was for a renewal of the third
respondent’s fixed term contract on the same
or similar terms.
[13]
A correct reading of the award reveals that the third respondent
failed to establish that she had an exaptation that her fixed
term
contract would be renewed on the same of similar terms. The
commissioner based her finding on the availability of work and
funds
in project WP 10327. The availability of funds and work in the
project on its own is insufficient to base a decision of a
renewal on
the same or similar terms in the absence of evidence to the effect
that such work and funds were sufficient to have
the third
respondent’s contract renewed on the same or similar terms.
[14]
The commissioner’s finding that the third respondent had
established her dismissal based on the centre’s practice
that
if staff members, all employed on fixed term contracts, were ‘between
projects’, efforts would be made to accommodate
them. No
evidence was led that at the time of the expiry of her fixed term
contract, the third respondent was between projects.
Even the
commissioner did not disclose the projects which the third respondent
was between when her contract expired. Even when
the applicant’s
practice is considered, it discloses no basis for the conclusion that
the third respondent was dismissed.
The fact that the third
respondent was finalising a proposal on 25 February 2013 did not
place her between projects in the absence
of evidence that the
contract which was the subject of the proposal got awarded to the
applicant.
[15]
The commissioner’s finding that the third respondent had a
reasonable expectation that with the appropriate changes,
she would
have been appointed to perform project management work in fulfilment
of secured project, funding available at the centre
and if there was
a delay between project proposal and securing funding; the centre
should have consulted with her about the possible
shortfall in
funding is based on conjecture. Further, in
SA
Rugby
(
supra
),
[4]
it was held that anticipation of negotiation of a new contract
without the certainty that its terms would be the same or similar
is
not protected by section 186(1) (b) of the LRA. The commissioner’s
decision that the third respondent proved dismissal
is incorrect. The
evidence before the commissioner reflects that the third respondent
failed to prove her dismissal as envisaged
in section 186(1) (b) of
the LRA. In the absence of dismissal, the CCMA lacked jurisdiction to
arbitrate the dispute before the
commissioner.
[16]
The third respondent opposed this application armed with an award in
her favour in an attempt to assert her right not to be
unfairly
dismissed. Granting a costs order against her will not be
appropriate.
[17]
In the premises, the following order is made:
17.1 The arbitration
award dated 7 October 2013 and the variation award dated 17 October
2013 are reviewed and set aside and substituted
with the following:
17.2.1
The first respondent lacked jurisdiction to arbitrate the dispute
under case number WECT 10383-13.
Lallie
J
Judge of the
Labour Court of South Africa
Appearances
For the
Applicant: Advocate De Koch
Instructed by
Carelse Khan Attorneys
For
the third respondent: Advocate Banderker
Instructed
by Halday Attorneys
[1]
[2008] ZALAC 3
;
[2008] 9 BLLR 845
(LAC) at para 41.
[2]
(2012) 33
ILJ
183 (LAC) at para 18.
[3]
(2001) 22 ILJ 2647 (LAC) at 21.
[4]
SA
Rugby
(
supra
)
at paras 48-53.