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[2015] ZALCCT 58
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City of Cape Town v Independent Municipal And Allied Workers Union and Others (C884/2014) [2015] ZALCCT 58; [2015] 12 BLLR 1197 (LC); (2016) 37 ILJ 147 (LC) (17 September 2015)
The Labour Court of South Africa,
Cape Town
Judgment
Case Number C884/2014
Reportable
17
September 2015
In the matter between:
THE CITY OF CAPE
TOWN
..................................................................................................
Applicant
And
INDEPENDENT MUNICIPAL
AND
ALLIED WORKERS
UNION
.....................................................................................
First
Respondent
SOUTH AFRICAN
MUNICIPAL WORKERS’
UNION
......................................
Second
Respondent
SOUTH AFRICAN
LOCAL GOVERNMENT ASSOCIATION
...........................
Third
Respondent
SOUTH AFRICAN LOCAL
GOVERNMENT BARGAINING
COUNCIL
..................................................................................................................
Fourth
Respondent
Date heard: 16 April
2015
Delivered: 17 September
2015
Summary:
Application for a declarator that the Disciplinary Procedure and Code
Collective Agreement (the DPCCA) was not validly
concluded in terms
of the Constitution of the SALGBC and is not therefore binding on the
City of Cape Town; Conditional counter-application
that in the event
it was not validly concluded, it continues to bind the parties in
terms of section 23 of the LRA.
JUDGMENT
RABKIN-NAICKER
J
[1] The applicant seeks the following relief from this court:
(a) Declaring that the
Disciplinary Procedure and Code Collective Agreement purportedly
entered into between the first, second and
third respondents on 21
April 2010, under the auspices of the fourth respondent on 21 April
2010, (“the DPCCA”)
was not validly concluded in
terms of the fourth respondent’s Constitution and accordingly
did not become binding on the
applicant;
(b) In the alternative, declaring
that the DPCCA lapsed on 30 June 2012 and no longer binds the
applicant;
(c) Further in the alternative,
declaring that the DPCCA lapsed on 31 December 2012 and no longer
binds the applicant.
[2] The first and second respondents have brought a conditional
counter-application. They seek that:
(a) In the event that it is found
that the DPCCA was never validly concluded as required by the Fourth
Respondent’s Constitution,
an order declaring that the DPCCA is
a valid collective agreement within the contemplation of section 23
of the LRA and binds all
the parties to the DPCCA and all their
respective members as contemplated in section 23(1) and (2) of the
LRA;
(b) In the event that it is found
that the DPCCA lapsed on 30 June 2012, alternatively 31 December
2012, an order declaring that
the DPCCA remains part of the
individual contracts of employment of all employees in the local
government sector who had been employed
at the time when the DPCCA
had been in operation, until it is varied by agreement.
[3] Both applications were
opposed. Certain
in limine
issues
were pleaded by the respondents. First, that this court does not have
jurisdiction to grant the declaratory relief sought,
because there is
no specific provision in the LRA giving the court such power i.e. to
declare a collective agreement invalid. It
was submitted on behalf of
the applicant that save in respect of matters which, in terms of the
specific provisions of the LRA
are to be determined by other
institutions like the CCMA or a bargaining council, the whole scheme
of the LRA is that the
Labour Court is empowered to deal with matters
arising from the LRA. The fundamental issue raised by this
application is whether
the applicant is bound by a collective
agreement ostensibly concluded by an employer’s organisation to
which it belongs,
under the auspices of a bargaining council. The
application is in my view quintessentially a matter that the
specialist labour
courts must deal with.
[4] The
second point in limine raised by the respondents, is that of estoppel
i.e. that the applicant has made a factual representation
through its
conduct since 2010 (by initiating disciplinary hearings in terms of
the DPCCA) that in the view of the City that the
agreement is valid.
I must agree with the applicant’s submissions on this point
that the very fact that the alleged representation
is a
representation as to the opinion of the City, is a sufficient basis
to dismiss this defence. Further, that the representation
is a
representation as to the law, namely that the DPCCA is valid and
binding.
[1]
The respondents have also failed to establish that, as a result of
the alleged representation, they have altered their position
to their
prejudice.
[2]
[5] The
background facts pertaining to the conclusion of the DPCCA are
recorded in the LAC judgment of
South
African Local Government Association v Independent Municipal Allied
Trade Union and Others
[3]
which dealt with the Wage Curve
Agreement, purportedly concluded together with the DPCCA are as
follows:
5.1 On 26
March 2012, SAMWU issued a strike notice. On 12 April 2010, its
members embarked on
a strike in furtherance of its demand for a Wage
Curve Agreement and the conclusion of a new disciplinary code
agreement i.e. the
DPCCA.
5.2 During the
strike the parties resumed negotiations. Draft collective agreements
relating
to the above were written.
5.3 The
parties met formally under the auspices of the Council, on 19 and 20
April 2010, in
order to conclude collective agreements relating to
the wage curves and disciplinary code. They met as a Bargaining
Committee of
the Council.
5.4 After
members of the Bargaining Committee and others had considered the
draft agreements
and sufficient consensus had been achieved, the
parties decided that a team would refine the agreements reached in
the Bargaining
Committee and draft the final agreements, for
consideration by the principal decision-makers of the parties.
5.5 The
Bargaining Committee adjourned when the drafting team consisting of
Messrs Koen (IMATU),
Forbes (SAMWU), Lebello (SALGA), Yawa (SALGA)
and Van Zyl (SALGA) started its work.
5.6 The
drafting committee concluded its deliberations, whereafter Adams (the
deputy General
Secretary for Legal Matters of IMATU) was requested to
print hardcopies of the “agreements”. Adams gave Yawa a
copy
of the two agreements. The unions indicated that they and SALGA
discussed the contents of the agreements with their principals who
were satisfied therewith and prepared to sign their agreements.
5.7
The DPCCA was signed by the parties’ principals at a signing
ceremony on 21 April
2010.
[6] Clause 7.2 of the Constitution of the Council is headed
‘Bargaining Committee’ and
provides
as follows:
“
7.2.1 The Bargaining
Committee shall consist of 20 (twenty) seats divided equally between
the Employer Parties and the Trade
Union Parties.
7.2.2 The allocation of
Representatives among the Employer Parties shall be determined
mutatis mutandis by the formula in sub-clause
5.4.
7.2.3 The allocation of
representatives amongst the Trade Union Parties shall be determined
by the formula in sub-clause 5.4.
7.2.4 The delegates shall, at the
first meeting of the year, appoint a chairperson from amongst the
delegates to the Bargaining
Committee. The Bargaining Committee may
appoint a chairperson from outside the delegates of the parties’
representatives.
7.2.5 The Bargaining
Committee shall meet as such place, date and time it or the Executive
Committee may determine.
7.2.6 The Bargaining
Committee shall have the power to conclude any collective agreement
relating to terms and conditions
of service or any other matter
referred to it by the Executive Committee.
7.2.7 A dispute that
arises in the Bargaining Committee shall be resolved in terms of
Clause 11.”
[7] Clause 16 of the Constitution is headed ‘Decisions’
and reads as follows:
“
16.1 All
decisions of the Central Council, Division or any Committee
concerning substantive matters shall require a
two-thirds concurrent
majority of the Employer Representatives on the one hand and a
two-thirds concurrent majority of the Trade
Union representatives to
the Council on the other hand.
16.2
No decision of the Central Council, Division or any Committee
concerning substantive matters shall be binding
on the Parties
unless-
16.2.1
the subject matter of the decision has been reduced to writing before
the decision is taken; or
16.2.2 If not reduced to writing
before the decision is taken, the subject matter of the decision is
reduced to writing and adopted
by a subsequent decision of the
Council.
16.3 Decisions
of the Central Council, Division or any Committee concerning
administrative matters shall require
a simple majority of those
Representatives present.
16.4 The
Central Council shall determine from time to time which matters are
substantive and which are administrative
in terms of the process as
is set out in clause 16.1 above.”
[8] A further clause of the
Constitution is cited by the applicant as relevant to the issue of
whether the DPCC was validly concluded,
and that is clause 17, which
is headed ‘Procedure for the Negotiation of Collective
Agreements’. It reads as follows:
“
17.1
A procedure, forum and level for negotiations shall be determined by
the Parties to the Central Council.
17.2
Any Party to the Council may introduce proposals for the conclusion
of a Collective Agreement on appropriate
subject matter and at the
appropriate level.
17.3
At least two-thirds of the Employer representatives on the one hand
and two-thirds of the trade Union representatives
on the other hand
must vote in favour of a Collective Agreement for it to be binding on
the Parties.
17.4
In the event of a dispute arising from the proposals for the
conclusion of a Collective Agreement the Parties
shall have the
rights prescribed in the Act.”
[9] The above clauses were considered
by the LAC in
South African Local Government Association v
Independent Municipal Allied Trade Union and Others
(supra). In
the judgment the court made , the court made findings (of direct
relevance to this matter), as to the failure of the
parties’
representatives to send back the Wage Curve Agreement to the
Bargaining Committee in compliance with the terms of
the Council’s
Constitution. The LAC found that:
“
[30]
In
Cape United Sick Fund Society v
Forrest,
it was said that:
‘
It
is of prime importance to decide in the first instance how to
approach the problem raised in this appeal. The Society’s
Constitution is in writing and to use the words of Stratford, JA, in
Wilken v Brebner and Others
1935 AD 175
at 187:
‘
We
have only to solve the question submitted to us by ascertaining the
meaning of a written document according to the well-established
rules
of the construction.’
This
dictum is in consonance with a long line of cases in which emphasis
is laid on the necessity of adhering to the terms of the
Constitution
of a body like a society.’
[4]
[31] In my view, the same should apply to the Constitution of the
third respondent. The three parties embroiled in litigation in
this
matter are the parties who drafted and signed the Constitution of the
third respondent. They decided how decisions taken under
the auspices
of the third respondent should be taken and what body should have the
power to conclude collective agreements.
[32] The problem with the entire procedure followed in this matter is
that the Constitution does not make provision for a drafting
team. If
the parties decide to refer an administrative or substantive matter
to an unrecognised sub-committee, it is incumbent
on them to refer
the matter back to the recognised Council, Division or Committee so
that a resolution or decision can be taken
in terms of the
Constitution.
[33] In this matter, it is common cause that the Bargaining Committee
did not reconvene after the drafting team was requested to
refine the
agreement....
[34] The union’s case was that the practice has also been that
after the drafting team had settled an agreement it is then
taken to
the principals, for vetting and signature. The court
a quo
found that the practice had been established and that the Wage Curve
Agreement and the Disciplinary Code Agreement were validly
inferred
into in terms of the practice. I disagree.
[35] Firstly, the practice itself has not been properly established.
There is no evidence as to when this practice was started;
how many
collective agreements have been adopted by following this practice or
whether this practice was only followed in respect
of administrative
matters or both administrative and substantive matters. Even if one
assumes that in some circumstances a practice
by parties can override
what they specifically agreed to in their Constitution, there must be
sufficient evidence establishing
that the practice or custom is
well-entrenched. Such evidence is lacking in this matter. The
existence of this practice was never
put to the appellant’s
witnesses. Mashilo, who was the facilitator and senior member of
SALGA and the third respondent, was
not asked a single question
relating to the existence of this practice. George, who signed
agreements on behalf of SALGA, was not
asked about the practice.
Lebello, a member of SALGA and the Bargaining Committee, was also not
asked about its existence.
[36] Secondly a practice cannot trump the express and unambiguous
terms of a Constitution. The decisions taken by the drafting
team
clearly have far-reaching implications, financial and otherwise. If
this degree of deviation from the express provisions of
the
Constitution is tolerated it would effectively write the
decision-making requirements set out in clause 16 out of existence.
The Constitution of the third respondent should not, without
justification, be frittered away by practice or judicial decree. This
would indeed be a dangerous path to take because the parties
testified that the intention was always to request the Minister of
Labour to extend the agreement to non-parties to the agreement that
are within the registered scope of the third respondent.
[37] The decision of the drafting team is not a decision of the
Bargaining Committee. The reason why two thirds concurrent majority
of the employer representatives on the one hand and two-thirds
concurrent majority of the Trade Union Representatives on the other
hand is needed for a decision is very important. Trade Union
Representatives to the council are there with a mandate but as
individuals.
They have individual votes. If for an example three
members of SAMWU who had six votes decided to agree with IMATU in
favour of
a proposal that would be seven Trade Union Representatives
voting in favour of a proposal and if all the employer
representatives
also voted in favour; that decision would be a legal
decision of the Bargaining Committee, irrespective of the mandate of
the SAMWU
delegation. The purported agreement was therefore not a
binding agreement in terms of the third respondent’s
constitution.
Considerations of equity cannot, when the provisions of
the Constitution of the third respondent are clear and unambiguous,
affect
the interpretation to be placed on it.”
[10]
Given the above findings,(against which the respondents were
unsuccessful in seeking leave to appeal to the Constitutional
Court
[5]
),
on precisely the clauses of the Council’s Constitution which
are the focus of this application, and their trumping of the
practice
of allowing a drafting committee to finalise collective agreements
for signature, I grant Prayer One of the applicant’s
notice of motion. This means that the following part of the counter
application before me is now at issue i.e.:
“
(a) In the event that it
is found that the DPCCA was never validly concluded as required by
the Fourth Respondent’s Constitution,
an order declaring that
the DPCCA is a valid collective agreement within the contemplation of
section 23 of the LRA and binds all
the parties to the DPCCA and all
their respective members as contemplated in section 23(1) and (2) of
the LRA;”
[11] The question that must be
posed is whether a ‘collective agreement’ which is not
binding in terms of the bargaining
council’s constitution, can
nevertheless be considered binding on the parties to it, in terms of
the provisions of section
23 of the LRA which reads as follows:
“
23
Legal effect of collective agreement
(1) A
collective agreement binds-
(a) the
parties to the collective agreement;
(b)
each party to the collective agreement and the members of every other
party to the collective agreement, in so far as the provisions
are
applicable between them;
(c)
the members of a registered trade union and the employers who are
members of a registered employers' organisation that are party
to the
collective agreement if the collective agreement regulates-
(i) terms and
conditions of employment; or
(ii)
the conduct of the employers in relation to their employees or the
conduct of the employees in relation to their employers;
(d) employees
who are not members of the registered trade union or trade unions
party to the agreement if-
(i) the
employees are identified in the agreement;
(ii) the
agreement expressly binds the employees; and
(iii)
that trade union or those trade unions have as their members the
majority of employees employed by the employer in the workplace.
(2)
A collective agreement binds for the whole period of the collective
agreement every person bound in terms of subsection (1)
(c) who was a
member at the time it became binding, or who becomes a member after
it became binding, whether or not that person
continues to be a
member of the registered trade union or registered employers'
organisation for the duration of the collective
agreement.
(3)
Where applicable, a collective agreement varies any contract of
employment between an employee and employer who are both bound
by the
collective agreement.
(4)
Unless the collective agreement provides otherwise, any party to a
collective agreement that is concluded for an indefinite
period may
terminate the agreement by giving reasonable notice in writing to the
other parties.”
(my
emphasis)
[12]
Can a
collective agreement entered
into by parties to a bargaining council be governed by both sections
31/32 and section 23 of the LRA?
The very purpose of the
establishment of bargaining councils and the conclusion of collective
agreements within them, is to regulate
sectoral bargaining. For that
reason, the binding nature of collective agreements concluded by
parties to those councils is governed
by specific provisions in the
LRA, set out in Part C of Chapter 3 headed “Bargaining
Councils”. Section 31 and 32 of
the LRA deal specifically with
the binding nature of collective agreements concluded in a bargaining
council:
“
31
Binding nature of collective agreement concluded in bargaining
council
Subject
to the provisions of section 32 and the constitution of the
bargaining council, a collective agreement concluded in a bargaining
council binds-
(a)
the parties to the bargaining council who are also parties to the
collective agreement;
(b)
each party to the collective agreement and the members of every other
party to the collective agreement in so far as the provisions
thereof
apply to the relationship between such a party and the members of
such other party; and
(c)
the members of a registered trade union that is a party to the
collective agreement and the employers who are members of a
registered employers' organisation that is such a party, if the
collective agreement regulates-
(i) terms and
conditions of employment; or
(ii)
the conduct of the employers in relation to their employees or the
conduct of the employees in relation to their employers.
32 Extension
of collective agreement concluded in bargaining council
(1)
A bargaining council may ask the Minister in writing to extend a
collective agreement concluded in the bargaining council to
any
non-parties to the collective agreement that are within its
registered scope and are identified in the request, if at a meeting
of the bargaining council-
(a)
one or more registered trade unions whose members constitute the
majority of the members of the trade unions that are party
to the
bargaining council vote in favour of the extension; and
(b)
one or more registered employers' organisations, whose members employ
the majority of the employees employed by the members
of the
employers' organisations that are party to the bargaining council,
vote in favour of the extension.
(2)
Within 60 days of receiving the request, the Minister must extend the
collective agreement, as requested, by publishing a notice
in the
Government Gazette declaring that, from a specified date and for a
specified period, the collective agreement will be binding
on the
non-parties specified in the notice.
(my emphasis)
(3) A
collective agreement may not be extended in terms of subsection (2)
unless the Minister is satisfied that-
(a)
the decision by the bargaining council to request the extension of
the collective agreement complies with the provisions of
subsection
(1);
(b)
the majority of all the employees who, upon extension of the
collective agreement, will fall within the scope of the agreement,
are members of the trade unions that are parties to the bargaining
council;”
[13]
The use of the words:
“subject
to section 32”
in section 31 of
the LRA, is best understood as meaning: “except as curtailed
by”.
[6]
In particular, I note that Section 32(2) of LRA thus curtails the
period of the binding nature of a collective agreement entered
into
by the parties to a bargaining council to one
“from a specified date and for a specified period”.
In
contrast, collective agreements governed by section 23 may bind the
parties for an indefinite period in terms of section 23(4).
[14] A
reading of the DPCCA reveals that it was drafted as a bargaining
council agreement with the clear intention that it should
be in
conformity with section 31 and 32 of the LRA. The DPCCA records in
Clause 3.4:
“
This portion of the Main
Collective Agreement shall come into operation in respect of
non-parties (which includes but is not limited
to, municipal entities
as defined in the Municipal Systems Act, 32 of 2000), on a date to be
determined by the Minister of Labour
and
shall
remain of force and effect until 30 June 2012 and after 30 June 2012
for such further period as determined by the Minister
of Labour at
the request of the Parties.”.
[15] A further indication of the
distinction between bargaining council collective agreements and
those collective agreements governed
by section 23 of the LRA is that
the former are clothed with statutory enforcement mechanisms, as
provided for in section 33A.
In my judgment therefore, a bargaining
council collective agreement is a collective agreement of a special
type, which cannot ‘morph’
into a section 23 collective
agreement when the agreement in question is found to be non-compliant
with the bargaining council’s
constitution. In that scenario
the parties to such an agreement would have no powers to enforce it
across a sector invalidating
the inherent purpose of the conclusion
of a collective agreement in a bargaining council.
[16] In view of the above
evaluation, I dismiss the first conditional counter claim. The second
counter-claim therefore falls away.
Given the relationship between
the parties a cost order is not appropriate.
[17] In all the above circumstances, I make the following order:
Order
1.
The Disciplinary Procedure and Code Collective Agreement (2010) was
not validly concluded in terms of the SALGBC and accordingly
did not
become binding upon the applicant.
H.
Rabkin-Naicker
Judge
of the Labour Court
Appearances
:
For the Applicant: AJ Freund SC with
GA Leslie instructed by Norton Rose Fullbright South Africa
For the First and Second
Respondents: JG van der Riet SC with U Dayanand-Jugroop instructed by
Cheadle Thompson & Haysom INC
[1]
LAWSA (2
nd
edition) Vol. 9, para 657
[2]
LAWSA para 663.
[3]
[2014] 6 BLLR 569 (LAC)
[4]
1956 (4) SA 519
at 527H to 528A. See also
Absa
Bank Ltd v South African Commercial Catering and Allied Workers
Union National Provident Fund
(under
curatorship) 2012 (3) SA 585 (SCA).
[5]
The Constitutional Court has refused leave to
appeal against inter alia these findings, under Case CCT 44/14
[6]
the
words
'subject to' in statutory interpretation —
'has
no a priori meaning. . . . While the phrase is often used in
statutory contexts to establish what is dominant and what is
subservient, its meaning in a statutory context is not confined
thereto and it frequently means no more than that a qualification
or
limitation is introduced so that it can be read as meaning ''except
as curtailed by''.' (see Competition Commission of South
Africa v
Pioneer Hi-Bred International Inc and Others
2014 (2) SA 480
at
paragraph 35.