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[2015] ZALCPE 71
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Sakhisizwe Municipality v South African Local Government Bargaining Council and Others (PR159/13) [2015] ZALCPE 71 (8 March 2015)
REPUBLIC
OF SOUTH AFRICA
IN
THE LABOUR COURT OF SOUTH AFRICA, PORT ELIZABETH
JUDGMENT
Not
Reportable
Case
no: PR 159/13
In
the matter between
SAKHISIZWE
MUNICIPALITY
Applicant
and
THE
SOUTH AFRICAN LOCAL GOVERNMENT
BARGAINING
COUNCIL
First Respondent
THOBEKA
NCETEZO
N.O
Second Respondent
NOMTHANDAZO
MAZWAYI
Third Respondent
Heard:
7 May 2015
Delivered:
8 March 2016
Summary:
The arbitrator committed a gross irregularity which rendered her
award unreasonable in finding that the
applicant’s failure to
renew the third respondent’s fixed term contract when it had
renewed a similar contract of an
employee holding a different
position constituted inconstency. The principle on consistency was
not relevant in determining the
dispute before the arbitrator.
JUDGMENT
LALLIE,
J
Introduction
[1]
This is an application to review and set aside an arbitration award
of the second respondent (‘the arbitrator’)
in which she
found the non-renewal of the third respondent’s fixed term
contract by the applicant to constitute an unfair
dismissal as
contemplated in section 186(1)(b) of the Labour Relations Act 66 of
1995 (‘the LRA’). She ordered the
applicant to reinstate
the third respondent on 4 November 2013, retrospectively, on the same
terms and conditions which governed
the parties’ employment
relationship at the time of her dismissal. The application is opposed
by the third respondent. The
third respondent applied for condonation
of the late filing of her answering affidavit. The application
is not opposed by
the applicant. The extent of the delay is 9
days and the explanation the third respondent proffered is
reasonable. I am,
in the circumstances, satisfied that the third
respondent has shown good cause.
Factual
background
[2]
The applicant employed the third respondent as Corporate Services
Manager on a five year fixed term contract which commenced
on 1 May
2008 and terminated on 31 May 2013. On 25 February 2013, the
applicant received a notice that of her fixed term contract
would not
be renewed on 31 May 2013. On 10 May 2013, the third respondent
lodged a grievance against her dismissal to which she
received no
response from the applicant. The position was advertised in terms of
the third respondent’s recruitment policy.
The applicant
applied but was unsuccessful. Aggrieved by the non-renewal of her
contract, the applicant referred an unfair dismissal
dispute to the
first respondent (‘the Bargaining Council’). The dispute
was arbitrated by the arbitrator who issued
the arbitration award
which the applicant seeks this court to review and set aside.
The
award
[3]
The arbitrator noted that in order to rely successfully of section
186(1)(b) of the LRA, the third respondent had to establish
that she
subjectively, had an expectation that the applicant would renew her
contract on the same or similar terms, the expectation
was reasonable
and the applicant failed to renew her contract or offered to renew it
on less favourable terms. The arbitrator took
into account that the
five-year fixed term contracts of the applicant’s Municipal
Manager and Chief Finance Officer (‘the
CFO’) were
renewed without being advertised. She noted that the issues in
dispute were the applicant’s inconsistency
and the reasonable
expectation the applicant created that the third respondent’s
contract would be renewed. The arbitrator
considered that the
position of the CFO and that of the applicant were not the same but
their terms of employment were similar.
The applicant’s witness
could not articulate the reason for treating the applicant’s
position differently from that
of the CFO’s except for alleging
that the applicant’s council took the resolution to do so. The
arbitrator found that
the applicant’s failure to advance
reasons for renewing the CFO’s contract of employment and not
to renew the third
respondent’s constituted unjustified
inconsistency. She expressed the view that the third respondent had a
reasonable expectation
that her contract would be renewed because at
the time of the renewal of the CFOs contract, the third respondent
was still employed
by the applicant. She found that the applicant’s
argument that the third respondent stopped reporting for work after
being
notified of the termination of her contract did not affect the
third respondent’s expectation that her contract would be
renewed when she found out about the renewal of the CFO’s
contract.
[4]
The arbitrator found that even though the applicant was not promised
by anyone in authority that her contract would be renewed,
the
applicant’s conduct of renewing the contract of employment of
another employee in a similar employment contract as the
third
respondent created a reasonable expectation that hers would be
renewed too. She concluded that the third respondent had shown
that
the termination of her fixed term contract of employment constituted
an unfair dismissal as contemplated in section 186(1)(b)
of the LRA.
She ordered her retrospective reinstatement, on 4 November 2013, on
the same terms and conditions which governed her
employment on
dismissal and payment of remuneration the third respondent would have
earned but for the non-renewal of her fixed
term contract from 1 June
2013 to the date of the award.
Grounds
for review
[5]
The applicant submitted that the arbitrator’s finding that the
third respondent had been treated “inconsistently”
and
that the conduct of the applicant of renewing the contract of
employment of another employee in a similar employment contract
created a reasonable expectation that hers would be renewed
constituted an error of law so elementary and material as to
constitute
a gross irregularity in the conduct of the arbitration
proceedings rendering the award defective. The applicant further
submitted
that the arbitrator confused the notion of inconsistency
with that of reasonable expectation. It denied that inconsistency
creates
reasonable expectation. In assuming that there was a
connection between the inconsistency and the renewal of the contracts
of the
CFO and a Municipal Manager, the arbitrator failed to take
into account material facts which include the reason for the renewal
of the contract, the third respondent took no steps after she was
given three months’ notice of the non-renewal of her contract
and the third respondent conceded that she was not aware of the
reasons which influenced the renewal of this CFO’s contract.
She further failed to consider that the third respondent’s
contract specified that she had no expectation or legal right
to its
renewal and that the third respondent, at the advice of the
applicant, applied for her post when it was advertised but was
unsuccessful.
[6]
The applicant also attacked the reasonableness of the award on the
basis that it is inconsistent with relevant authority. The
applicant
further submitted that the arbitrator erred in confusing the question
whether the third respondent was dismissed or whether
her dismissal
was fair. She further erred in reinstating the third respondent
indefinitely to a position which had been filled
by the applicant in
terms of its policies. Lastly, the applicant submitted that the
Bargaining Council lacked jurisdiction to determine
the third
respondent’s real dispute.
[7]
The third respondent opposed the application mainly on the grounds
that the arbitrator’s decision that the applicant acted
inconsistently in renewing the CFO’s fixed term contract and
not renewing hers while their contracts were similar was
unassailable.
She denied that the arbitrator confused the notion of
consistency with reasonable expectation. The third respondent
submitted that
inconsistency arises from the failure to justify
different treatment of employees whose terms of employment are
similar although
they hold different positions. She added that the
applicant’s inconsistency was unjustified. The third respondent
further
submitted that considerations and deliberations that led to
the renewal of the Municipal Manager and CFO’s contracts were
not presented at the arbitration. It was argued, on behalf of the
third respondent, that it is notorious that, within the context
of
disciplinary proceedings and hearings, the use of language is often
imprecise particularly with the parties who are not English
speaking
and the use of an interpreter was not provided. It was further argued
that a proper reading of the word “inconsistency”
in the
context of the evidence given in the arbitrator’s ruling
elicits a sense that the applicant failed to treat the third
respondent on the same basis as it treated other contractual
employees.
[8]
Although the views of the applicant and the third respondent on the
arbitration award are different, the common thread which
runs through
their arguments is that the arbitrator did not use the term
“inconsistency” correctly. The applicant attributed
the
arbitrator’s imprecision to confusion but the third respondent
attributed it to the use of language by the arbitrator
who is not an
English-speaking person. Notwithstanding the reason for the use of
the word “inconsistency”, it is common
cause that the
arbitrator should not have used it. The arbitration award is based
solely on inconsistency. The arbitrator was enjoined
by section 138
of the LRA to conduct the arbitration fairly. Part of that fairness
includes a reasonable decision on the issue
before her.
[9]
The term “consistency” has a particular meaning in labour
law. It is used to promote equality by ensuring that employees
who
have committed similar misconduct are not treated differently without
valid reason. It is only fair and proper that it retains
its meaning.
The arbitrator erred in relying on inconsistency when the unfair
dismissal dispute before her was not based on misconduct.
The unfair
dismissal dispute the arbitrator had to determine is based on section
186(1)(b) of the LRA because the third respondent
alleged that she
was unfairly dismissed because the applicant failed to renew her
fixed term contract when she had reasonable expectation
that her
contract would be renewed on similar terms. The arbitrator was
required to establish whether the third respondent had
established
the relevant factors which would have led her to conclude that she
had been dismissed.
[10]
The arbitrator expressed the view that the third respondent had
reasonable expectation that her contract would be renewed because
at
the time that the applicant renewed the CFO’s contract, the
third respondent was still employed by the applicant. The
arbitrator
further expressed the view that the third respondent’s
expectation of the renewal of her contract arose when she
found out
about the renewal of the CFO’s contract. The finding that the
third respondent had a reasonable expectation that
her fixed term
contract would be renewed had to be based on the evidence which
served at the arbitration. It is common cause that
the third
respondent received the notice of the non-renewal of her contract on
25 February 2013, thereafter her position was advertised
and she
applied for it. The CFO’s contract was renewed in May 2013 and
the third respondent’s contract was terminated
on 31 May 2013.
By advertising the third respondent’s position, the applicant
eliminated any expectation of the renewal of
the third respondent’s
contract before it arose. When the third respondent applied for the
advertised position, she was only
left with the hope that she would
be the successful candidate and be re-employed by the applicant. When
the applicant subsequently
renewed the CFO’s position, the
third respondent had no expectation that her contract would equally
be renewed as steps had
already been taken to fulfil the position.
Her subjective expectation of a renewal was, in the circumstances,
unreasonable. The
arbitrator’s finding that the third
respondent had reasonable expectation of the renewal of her contract
is not supported
by evidence.
[11]
The court, in
Goldfields
Mining SA (Pty) Ltd (Kloof Gold Mine) v Commission for Conciliation
Mediation and Arbitration and Others,
[1]
found that a commissioner’s error of approaching a dismissal
for misconduct as one of poor performance had rendered the
commissioner’s decision unreasonable. Similarly, the arbitrator
rendered her award reviewable by approaching a section 186
(1)(b)
unfair dismissal dispute as an unfair dismissal dispute based on
misconduct. In
Herholdt
v Nedbank Ltd (Congress of SA Trade Unions as Amicus Curiae),
[2]
it was found that when the error committed by a commissioner in the
conduct of an arbitration affects the reasonableness of the
commissioner’s award, the award becomes reviewable. The
arbitrator committed a gross irregularity in finding that the
applicant
committed unjustified inconsistency and by concluding that
the termination of the third respondent’s contract constituted
an unfair dismissal. Evidence tendered at the arbitration
proved that the third respondent failed to prove her dismissal.
Absent dismissal, the first respondent lacked jurisdiction to
arbitrate the dispute.
[12]
In the premises, the following order is made:
12.1
The late filing of the answering affidavit is condoned.
12.2
The arbitration award issued by the Second Respondent under case
number ECDO71304 and dated 21 October 2013
is reviewed and set aside
and substituted with the following:
12.3
The First Respondent lacked jurisdiction to arbitrate the dispute
referred by the Third Respondent against
the Applicant.
_______________
Lallie,
J
Judge
of the Labour Court of South Africa
Appearances
:
For
the Applicant: Advocate Grogan
Instructed
by Wesley Pretorius and Associates
For
the Third Respondent: Advocate Dyke
Instructed
by Nosindwa Attorneys
[1]
[
[2007] ZALC 66
;
2014]
1 BLLR 20
(LAC) at para 31.
[2]
(2013) 34
ILJ
2795 (SCA) at para 16.