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[2015] ZALCPE 18
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Neti v Eberspacher SA (Pty) Ltd (PS 27/13) [2015] ZALCPE 18 (24 March 2015)
REPUBLIC OF SOUTH
AFRICA
THE LABOUR COURT OF
SOUTH AFRICA, PORT ELIZABETH
JUDGMENT
Case no: PS 27/13
DATE: 24 MARCH 2015
Not Reportable
In the matter between:
L
NETI
........................................................................................................................................
Applicant
And
EBERSPACHER SA (PTY)
LTD
.........................................................................................
Respondent
Heard: 11-12 March 2015
Delivered: 24 March 2015
Summary: Retrenchment. Court limited to
issues that parties place before it in the pleadings, as narrowed and
limited in the pre-trial
minute.
Substantive fairness. Not unfair not to
appoint otherwise redundant, longer serving employee to more senior
position for which he
was not qualified.
Procedural fairness. Where employee
abandons or otherwise frustrates the consultation process cannot
complain about procedural unfairness.
JUDGMENT
EUIJEN, AJ
Introduction
[1] This is an unfair dismissal
application, in which the applicant, Mr Neti, claims reinstatement
into his former position as the
employee relations manager of the
respondent, alternatively compensation, based on alleged breaches of
section 189 of the Labour
Relations Act, number 66 of 1995 (the LRA).
[2] Mr Neti was employed by the
respondent company from 8 April 2008 as its employee relations
manager and dismissed on 28 February
2013. The reason given was that
his position had been declared redundant due to the operational
requirements of the respondent.
Some months prior to his
retrenchment, on 1 October 2012, the respondent had appointed Mr
Peter Marriott as its group human resources
manager. In his statement
of case (at para 5.4.1), Mr Neti contended that he ought to have
“bumped” Mr Marriott from
this position, since the latter
was the shorter serving employee, alternatively that the position
should have been combined and
he be appointed to the combined
position.
[3] As far as procedural fairness is
concerned, Mr Neti’s pleaded case is that his retrenchment was
a fait accompli from the
date of issue of the section 189 (3) notice,
on 17 January 2013 and that, in any event, the consultation process
was prematurely
terminated, prior to the submission of
representations from his attorney, which he had advised the
respondent he wished to make.
[4] The respondent, for its part,
denied that Mr Neti had shown any interest in the human resources
manager’s position, or
that he was qualified to fill it, either
in terms of qualifications or experience. As far as the consultative
process is concerned,
the respondent pleaded that Mr Neti showed no
interest in the consultation process and advised the respondent that
it should proceed
with his retrenchment, as he wished to refer the
matter to this Court.
[5] In the pre-trial minute, in answer
to the questions contained in the practice directive on
retrenchments, the applicant admitted,
that in general there was a
need to retrench (paragraph 22.1). He also admitted that:
“respondent embarked upon a
restructuring exercise and that the merit of such processes is not in
dispute; and
“the restructuring exercise
resulted in the redundancy of certain affected positions, including
applicant’s position.”
(paragraph 22.2”)
[6] Consequently, the only issues which
this Court is required to decide are:
[7] “whether Mr Peter Marriott
(the human resources manager) should have been selected for
retrenchment in applicant’s
place, and in particular whether
applicant should have been bumped into Mr Peter Marriott’s
position;
[8] “in respect of procedural
fairness, whether the consultation process ended prematurely and
unfairly.” (paragraph
5.2 of the pre-trial minute)
Evidence
[9] Mr Peter Marriott, the group human
resources manager, who was appointed on 1 October 2012, was the first
person to give evidence
for the respondent. He testified that he
possessed a BA honours degree, and that his predecessor possessed a
BComm degree. In addition,
he had 10 years’ experience in human
resource management. Both were requirements for the position. He
confirmed that at all
times Mr Neti had reported to him, as had been
the case with his predecessor. He said that when he first joined the
respondent
he had enquired whether Mr Neti was interested in being
considered for his position, to which Mr Neti replied that he was
not,
as he preferred his current position in employee relations.
[10] Mr Marriott said that he had found
no evidence that Mr Neti had performed any of the functions of the
human resources manager
between July, when his predecessor Robin
Fourie left the respondent’s employ and October 2012, when the
had taken over the
position. When it was put to him that Mr Neti had
performed the same functions as those performed by the previous human
resources
manager, Robin Fourie, his response was that Mr Fourie had
to become involved in Mr Neti’ responsibilities to rectify
deficiencies
in the latter’s performance in dealing with his
responsibilities. This was particularly the case with absenteeism,
which
had been a major problem at the company. They however remained
the function and responsibility of the employee relations manager.
[11] Mr Marriott also testified that he
had dealt exclusively with Mr Neti during the consultation process.
This began with handing
over the section 189 (3) notice dated 17
January 2013; attending both meetings which were held with Mr Neti on
25 January and 5
February 2013; as well as writing all correspondence
addressed to Mr Neti from the respondent.
[12] The first meeting held between Mr
Marriott and Mr Neti took place on 25 January 2013 the Beach hotel in
Port Elizabeth. The
meeting was largely formulaic in that Mr Marriott
went through his prepared written response dated the previous day, to
a list
of questions he had received from Mr Neti, by email on 21
January 2013, in response to the section 189 (3) notice. He confirmed
that Mr Neti proposed at that meeting that he should rather have been
appointed as the human resources manager instead of Mr Marriott.
Mr
Marriott reminded Mr Neti that he had stated previously that he was
not interested in the human resources manager position,
to which Mr
Neti responded that this had not been said in the context of his
pending retrenchment. Instead, Mr Neti was offered
a more junior
position as the industrial relations officer (consultant), which
would result in a salary cut of more than half his
salary. In
response Mr Neti said two or three times “don’t insult my
intelligence”.
[13] There was a further meeting which
took place on the 5th of February 2013, also attended by Mr Neti’s
wife, at which Mr
Marriott went through a further prepared written
response, again dated the previous day, also dealing with the same
questions which
Mr Neti had submitted 21 January 2013 and in
particular the proposal that Mr Neti be appointed as the human
resources manager.
In his response he pointed out that Mr Neti could
not be considered for the position since he did not possess a degree
or sufficient
human resources management experience. Mr Marriott
gained the impression at that meeting that Mr Neti wanted to get the
process
over with as soon as possible so that he could refer this
matter to the Labour court. Mr Neti said that he wanted to get
“everything
behind him” and that he felt a decision had
already been made about his fate, which Mr Marriott denied. Neither
party had
any further proposals to make at the meeting.
[14] The meeting ended with Mr Neti
saying that he would consult his attorney who would communicate his
formal response to the respondent
by the end of the week. It was put
to him that Mr Neti did not and could not have committed himself to
that time-frame, because
he did not know at that stage whether his
insurer’s would appoint attorneys to take on his case. Mr
Marriott was however
adamant that Mr Neti had indeed given such an
undertaking, as is confirmed by the contemporaneous note which he
made at that meeting.
[15] When Mr Marriott heard nothing
further from Mr Neti or his attorneys, by 15 February 2013, he
telephoned Mr Neti to enquire
when that response would be
forthcoming. Mr Neti just said that he was on extended sick leave.
That was the end of the conversation.
Believing the consultation
process to have run its course, he drafted Mr Neti’s dismissal
letter dated 18 February 2013 which
gave him notice that his last
working day would be 28 February 2013. In the event Mr Neti remained
on sick leave until then.
[16] On 18 February 2013, Mr Marriott
also telephoned Mr Neti to ask where the letter should be delivered,
to which Mr Neti replied
that it should be delivered to the FNQ
boardroom (where the 5 February meeting had been held), which was
done. During neither telephone
conversation had Mr Neti protested
that the consultation process had been terminated prematurely, or
that he or his attorney still
wished to make proposals or
representations. He did not interpret the letter subsequently
received from Mr Neti’s attorneys
dated 21 February 2013 as an
invitation to reopen negotiations; particularly since Mr Neti had not
shown much interest during the
consultation process in any event.
[17] Mr Nikolaas Zerbst also gave
evidence via Skype link up from Germany, by agreement between the
parties. He was the managing
director of the respondent at the time
of Mr Neti’s retrenchment. He testified that after the
resignation of Mr Robin Fourie
as the human resources manager during
July 2012, he had taken over the more essential tasks allotted to
that position and the remainder
had gone unfulfilled until the
appointment of Mr. Marriott. It was put to him that he had asked Mr
Neti to “run with the
positon of human resources manager”,
which he denied. He was adamant that none of the functions of the
human resources manager
were performed by Mr Neti in the interim. He
confirmed the previous testimony of Mr Marriott that where there were
instances of
Mr Fourie performing the same functions as those also
performed by Mr Neti, particularly those relating to absenteeism,
this was
because of deficiencies in Mr Neti’s performance which
necessitated this intervention. However these functions and
particularly
those relating to absenteeism, remained the functions
and responsibility of the employee relations manager.
[18] Mr Zerbst confirmed that the
position of human resources manager was a more senior position to
that of the employee relations
manager, with the latter reporting to
the former. Mr Neti could not be considered for appointment as the
human resources manager
because he did not possess the requisite
tertiary qualification, nor the requisite 10 years’ experience
in a similar post.
It was not possible to relax either of these
requirements as it was a senior managerial position which would not
have been permitted
by the parent company in Germany. He added that
Mr Neti had never shown any interest in the human resources managers
job as that
was the function he had left at his previous employment
with Rocklands Poultry to take up the position with the respondent in
employee
relations, which he said he preferred.
[19] Mr Neti testified in support of
his case. He stated that he was shocked to receive the section 189(3)
notice on or about 20
January 2013 as there had been no prior
discussions at which any possible retrenchment was raised at any
management meeting of
which he was a part. He did not see any need to
retrench him and that was the thrust of the questions directed to the
respondent
in his email of 21 January 2013. He viewed the process as
a fait accompli from the outset as his position was already
identified
as redundant in the section 189(3) notice.
[20] He confirmed that at the meeting
at the Beach hotel on 25 January 2013, Mr Marriott went through the
contents of the respondent’s
letter dated 24 January 2013. He
also confirmed that he was offered the junior position of an
industrial relations officer which
he rejected. To everyone’s
surprise, he denied that he made the proposal that he be placed into
the human resources manager’s
position rather than Mr Marriott.
In support of his denial, he stated that this proposal would have
been premature as the respondent
had not yet satisfied him on the
need to declare his position redundant and did not do so throughout
the consultation process.
Therefore the discussion never moved from
this point.
[21] Mr Neti testified further that at
the meeting of 5 February 2013, held at the FNQ boardroom, it became
clear to him that the
required legal assistance in the matter.
Therefore he told Mr Marriott that he would be contacting his legal
insurers to apply
for an attorney to assist him in the matter. He
would not and could not have undertaken to do so by the end of the
week. Thereafter
he was booked off on sick leave.
[22] Mr Neti confirmed that Mr Marriott
telephoned him on 15 February asking when he would provide feedback
to the company’s
letter of 4 February 2013, as discussed at
meeting of 5. He told Mr Marriott that he was still waiting to hear
whether an attorney
would be appointed on his behalf and so was not
in a position to commit to a date by when this would be done. He was
again shocked
to receive his dismissal letter dated 18 February 2013
which he immediately handed over to his insurers. The attorneys were
appointed
on his behalf shortly thereafter and after an after-hours
consultation, they drafted the letter dated 21 February 2013 which
was
sent to the respondent. By then it was too late to make further
representations as he had already been dismissed.
[23] Mr Neti was asked repeatedly by
his counsel what in particular he regarded as unfair about his
retrenchment and he repeatedly
answered that he did not believe that
his position as the employee relations manager with the respondent
had genuinely become redundant.
He felt that there was no need to
have retrenched him from his position and that his retrenchment was a
sham. He also stated repeatedly
that he wanted to continue as the
employee relations manager and denied expressing any interest in the
human resources manager’s
job; save that at the end of his
evidence in chief he stated that he felt he should have taken over
the position after Robin Fourie
left in July 2012.
[24] Mr Neti also testified that after
the resignation of Mr Robin Fourie, he was requested by Mr Zerbst to
“run with the
position”, which he did. Despite not having
the requisite tertiary qualification, he was well able to perform the
tasks associated
with this position. In addition to his experience as
a human resources manager of Rocklands poultry, he had gained
extensive human
resources management experience at the respondent,
since he was often required to assist Robin Fourie with the
performance of his
tasks, since it was in fact Mr Fourie’s
deficient performance which needed assistance, and which he provided.
[25] Mr Neti gave extensive evidence of
the various tasks which he performed during that 3 month period,
which he stated were the
functions of the human resources manager.
This, in its turn, attracted an inordinate amount of
cross-examination. However, in the
light of the unchallenged evidence
that Mr Neti could not be considered for the position because he was
not qualified for it and
his steadfast disavowal of any suggestion at
any stage of the consultation process that he take over this
position, I do not deem
it necessary to traverse this evidence in any
detail. Suffice to say that it does not appear that Mr Neti performed
any different
tasks during that three month period to those which he
had performed during Mr Fourie’s tenure. This was not the case
advanced
on his behalf during the cross-examination of the
respondent’s witnesses; that was specifically limited to the
three month
period during which the human resources manager’s
post was vacant.
Substantive Fairness
[26] A stated at the outset of this
judgment, the parties have in the pleadings and in particular, the
pre-trial minute, limited
the issue which this Court is required to
decide in regard to substantive fairness, to the single issue of
whether Mr Marriott
ought to have been bumped out of the position of
human resources manager to make way for Mr Neti or not.
[27] In NUMSA v Driveline Technologies
(Pty) Ltd & another
[2007] ZALC 66
;
[2000] 1 BLLR 20
(LAC), Conradie JA said the
following about the binding effect of admissions made in the
pre-trial minute: (at p 26, para [16])
“It is true, of course, that a
pre-trial agreement is a consensual document which binds the parties
thereto and obliges the
court (in the same way as the parties’
pleadings do) to decide only the issues set out therein. In
particular, a party who
agrees to claim only limited relief would be
bound by his agreement (Shoredits Construction (Pty) Ltd v Pienaar NO
& others
[1995] 4 BLLR 32
(LAC) at 34C–F). The agreement in
Reunert Industries (Pty) Ltd t/a Reutech Defence Industries v Naicker
& others
[1997] 12 BLLR 1632
(LC) was not a pre-trial agreement
which served to further define issues in a set of pleadings; it was
an agreement that the fairness
of the sanction imposed on an employee
would not be challenged before a CCMA commissioner. It was, quite
correctly, held that the
commissioner exceeded her powers in then
redetermining the sanction. It was an agreement limiting the issues
which is usually binding
(Filta-Matix (Pty) Ltd v Freudenberg and
others
[1997] ZASCA 110
;
1998 (1) SA 606
(SCA) at 614B–D).”
[28] In the present case too, the
applicant expressly abandoned, in the pre-trial minute, any reliance
on challenging the need for
his redundancy and instead limited his
challenge under the heading of substantive fairness to the issue of
whether he should have
bumped the incumbent from the human resources
manager’s position, Mr Marriott. Admissions can be withdrawn
and pleadings
amended, but this would require an application in each
case and no such application was made here. (Driveline at p 42, paras
[93-94]).
[29] This renders it unnecessary to
consider Mr Neti’s complaint in his evidence about the
necessity for his retrenchment.
[30] On the bumping issue, there is no
evidence to gainsay that given by both of the respondent’s
witnesses that Mr Neti could
not be considered for the position,
since he was possessed of neither the requisite qualifications nor
experience; and that any
attempt to relax such qualifications would
not have been allowed by the respondent’s parent company in
Germany. In addition
there is Mr Neti’s disavowal of this as
his proposal during the consultation process. (See. Kock v
Enviroserve Waste Management
[2001] 7 BLLR 765
(LC))
[31] This renders it unnecessary to
consider respondent’s counsel’s additional argument that
bumping can only apply
horizontally and vertically (downwards) and
cannot apply to what amounts to a promotion as in this case. (Cf.
Unilever S.A. (Pty)
Ltd v Salence
[1996] 5 BLLR 547
(LAC); Associated
Biscuits (a division of National Brands Ltd) v Munsamy
[1997] 9 BLLR
1121
(LAC) at 1124)
[32] For these reasons, I conclude that
the respondent has proved that the dismissal of Mr Neti for
operational requirements was
substantively fair.
Procedural Fairness
[33] The consultation process has, with
the authority of the Labour Appeal Court, been described as a “joint
consensus-seeking
process”, during which a mechanical or
‘check-list’ approach is to be avoided. (Johnson &
Johnson (Pty) Ltd
v CWIU
[1998] 12 BLLR 1209
(LAC) at 1216, para
[29])
[34] Mr Marriott’s approach at
both meetings can, possibly, be criticised as falling into the
check-list category. What is
clear however is that Mr Neti had no
proposal’s to offer at either meeting, including, on his own
version, the bumping proposal,
which Mr Marriott said he had made at
the meeting on 25 January 2013 and which is dealt with in the letter
of 4 February 2013.
[35] What is equally clear is that at
the end of the meeting on 5 February 2013, the consultation process
was still in progress
and was adjourned for the purpose of Mr Neti
seeking legal advice and assistance. Whether Mr Neti had undertaken
to do so by the
end of the week or not, it was at the very least
incumbent upon him, at that stage, to keep the respondent informed of
his intentions
and by when these would be communicated. On either
version, he took sick leave and did not communicate with the
respondent until
telephoned by Mr Marriott on 15 February 2013. At no
point was either his absence from work or his illness offered as
reasons why
he could not do so.
[36] Mr Neti’s version of that
telephone call was not put to Mr Marriott when he gave evidence. It
is also improbable in my
view, that Mr Marriott, expecting to have
heard from Mr Neti by the end of the week of 5 February; not having
heard from Mr Neti
for ten days after the last meeting; and
specifically telephoning him to enquire by when he would be
submitting representations
or proposals if any, would have been
satisfied with an indefinite answer that Mr Neti was still waiting to
be told whether an attorney
would be appointed on his behalf. In the
circumstances, I find that it is more probable that Mr Neti was
merely mute when asked
this question, as Mr Marriott testified.
[37] Although an employer bears the
onus of proving that the consultation process is fair, this requires
co-operation from both
sides. Where one party withdraws from the
process, or otherwise frustrates its purpose, then the other party is
not expected to
persevere beyond what is reasonably expected in the
circumstances. (Johnson & Johnson at 1221, para [47]).
[38] In these circumstances, it seems
to me that Mr Marriott cannot be faulted for issuing Mr Neti’s
termination letter on
18 February 2013, in the belief that Mr Neti
was making good on his earlier threats to refer the matter to the
Labour Court and
that the consultation process had effectively ended.
It was put to Mr Marriott and argued at the end of the hearing on the
applicant’s
behalf, that even if this was so, then his
attorney’s letter of 21 February 2013 ought to have dispelled
that perception
and persuaded the respondent to withdraw its
dismissal letter and reopen the consultation process.
[39] I do not read the applicant’s
attorney’s letter of 21 February 2013 as an invitation to
re-open the consultation
process at all. The letter itself says that
it is pointless for the applicant to make any proposals in the light
of his dismissal
and that the matter is to be referred to the Labour
Court. Thereafter the letter goes on to make 6 points which were
styled as
“proposals” in cross examination of Mr Marriott
and in argument. In truth, they are no more than a list of reasons
why the retrenchment of Mr Neti is considered unfair. It is the sort
of pointless sabre rattling that often accompanies a letter
of
demand. At no point does the letter call for the reversal of the
dismissal or the re-opening of the consultation process.
[40] In my judgment, whatever
deficiencies that may have existed in the consultation process were
vitiated by Mr Neti’s abandonment
of it, or at least conveying
that impression, after the respondent had done what could reasonably
be expected of it to secure Mr
Neti's engagement in the process until
its proper conclusion. In these circumstances, it does not seem to me
to lie in the mouth
of Mr Neti to complain about whatever procedural
unfairness may exist, since he was instrumental in the process’s
termination
at that point.
[41] For these reasons, I find that the
dismissal of Mr Neti was also procedurally fair.
Order
[42] Mr Partington did not seek any
costs of these proceedings on behalf of the respondent. In the
result, I make the following
order:
a. The application is dismissed.
b. There is no order as to costs.
Euijen AJ
Acting Judge of the Labour Court of
South Africa
APPEARANCES:
For the Applicant: Mr M Grobler
Instructed by: Lessing, Heyns,
Keyter & van der Bank Inc
For the Respondent: Mr J Partington
Instructed by: Chris Baker and
Associates