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[2015] ZALCPE 63
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Sawyer and Others v 4Q Fishing (Pty) Ltd (PS45/13) [2015] ZALCPE 63 (23 October 2015)
REPUBLIC OF SOUTH
AFRICA
IN THE LABOUR COURT OF
SOUTH AFRICA, PORT ELIZABETH
JUDGMENT
Not Reportable
Case no: PS 45/13
In the matter between
LEONARD CLIFFORD
SAWYER
First Applicant
PHILLIPUS
ENGELBRECHT
Second Applicant
BENJAMIN LOURENS
ESTERHUIZEN
Third Applicant
and
4Q FISHING (PTY)
LTD
Respondent
Heard:
8 September 2014
Delivered:
23 October 2015
Summary:
Applicants on fixed terms contracts are not entitled
to compensation
in excess of the remainder of their contracts when dismissed for
operational requirements of the respondent before
the termination
date of their contracts.
JUDGMENT
LALLIE J
[1] The respondent
conducts business in the fishing industry. The applicants alleged
that they were employed by the respondent on
one of its fishing
vessels, the MFV Amalia (“the Amalia”) as skipper, mate
and driver respectively. They were employed
on fixed term contracts
pursuant to a discussion between the first applicant and Mr Van
Heerden (“Van Heerden”) a Director
and shareholder of the
respondent in June 2013. They had to catch 200 tonnes of fish by 31
December 2013. The first applicant was
to be paid a commission of
R1500.00 per tonne of fish landed plus VAT while the second and third
applicants were to earn a monthly
basic salary of R4500.00 plus
R320.00 per tonne of fish landed. On 20 September 2013, the
respondent through Van Heerden informed
the first applicant that it
had decided, for its operational reasons, to tie the Amalia up. The
consequences of the decision were
that the Amalia would not be going
to sea and the applicants’ contracts would be terminated. The
first applicant conveyed
the decision to the other applicants. The
applicants seek an order declaring the termination of their services
to constitute an
unfair dismissal. They seek compensation.
[2] The respondent denied
having employed the first applicant and submitted that he was an
independent contractor. It however, conceded
having employed the
second and third applicants but denied having dismissed them.
Section
192(1)
of the
Labour Relations Act 66 of 1995
as amended (“the
LRA”) places the onus of proving the existence of a dismissal
on employees. In an effort to discharge
the onus, the first applicant
testified that on his arrival at home after returning from sea on
Friday 20 September 2013, Van Heerden
phoned him and told him that he
was tying the Amalia for financial reasons. He added that they no
longer had jobs. The first applicant
conveyed the message to the
second and third applicant. The following Monday, the applicants went
to the Amalia to collect their
personal belongings. They found Louis,
a new skipper, his mate, driver and crew ready to go to sea on the
Amalia. When the first
applicant made enquiries from the respondent
about the changes, he was informed that the decision was based on
economics.
[3] Van Heerden conceded
having told the first applicant that the Amalia had been tied up for
economic reasons. He alleged that
owing to the first applicant’s
non-performance, the respondent could not sustain the Amalia. He
explained that Louis was
employed on another vessel and joined the
respondent when it bought the Amalia. He had known Louis for 20 years
and considered
him the best skipper. He had no driver and no mate but
the second and third applicants refused to work with him. They walked
out
on their jobs without being dismissed.
[4] I
have considered the mutually exclusive versions presented by the
parties against the background of the test laid down in
Stellenbosch
Farmers’ Winery Group Ltd and Another v Mertell Et Cie and
Others
[1]
.
I am of the view that the applicants presented a more probable
version because the respondent did not tell the second and third
applicants either directly or through the first applicant that they
had to work with Louis. Engelbrecht’s evidence that the
Amalia
is a grade four vessel which can only take one mate and one driver
was unchallenged. The first and second applicants’
evidence
that they found Louis, his mate and driver ready to go to sea with
their crew is consistent with the respondent’s
omission to tell
them to join Louis on his first trip. By informing the second and
third applicants that the Amalia would be tied
up and employing a
different mate and driver to work with Louis, the respondent
terminated the contracts of employment of the second
and third
applicant. As the respondent terminated the second and third
applicants’ fixed term contracts of employment before
the
agreed date, the termination, in the circumstances, constituted
dismissal.
[5] The respondent denied
having employed the first applicant and submitted that he was an
independent contractor. As the applicants
approached this court in
terms of the LRA the relevant definition of an employee is the one in
section 213
of the LRA which is:
‘
(a)
any person, excluding an independent contractor, who works for
another person or for the State and who receives,
or is entitled to
receive, any remuneration; and
(b) any other
person who in any manner assists in carrying on or conducting the
business of an employer’.
[6] The first applicant
testified that Van Heerden offered him the job, on exactly the same
terms he had been working. He had been
working as an employee and not
an independent contractor. Van Heerden testified that when the first
applicant told him that he
was looking for a job, he further told him
that he worked for a commission which he used for his farming
business. He then introduced
him to the big shareholders who made
decisions. It was never his intention to employ the first applicant
as he did not even promise
to pay him remuneration. For purposes of
his payment, the first applicant submitted an invoice and charged the
respondent VAT.
[7] A
number of tests may be applied to determine whether the first
applicant was an employee. I, however, have considered the
submissions on behalf of both parties on whether the first applicant
was an employee including the authority they sought to rely
on and
found the decision in
Denel
(Pty) Ltd v Gerber
[2]
relied on by both parties apposite. The court found that the true
relationship between the parties needs to be established objectively.
The dominant impression test is applicable in determining the
existence of an employment relationship. It requires an enquiry into
whether the employer had the right to supervise and control the
employee, whether the employee forms an integral part of the
organisation,
and the extent to which the employee was economically
dependent upon the employer.
[8] Van Heerden denied
that the first applicant worked under his supervision and control.
His version could not stand against the
first applicant’s
evidence that he did not take the decision when to go and return from
sea. He had no unconditional right
to refuse to go to sea. He did not
refuse to go back to sea immediately after offloading. The first
applicant formed an integral
part of the respondent in that the
respondent provided everything that he needed to fish. At sea he was
a manager of all the respondent’s
employees in the Amalia.
[9] Van Heerden testified
that the first applicant was not economically dependent on the
respondent in that he used the money generated
from fishing to pursue
his farming operations and engineering work. The first applicant’s
version to the contrary is more
probable judging by the amount of
time he spent at sea, he could not have had time to do other
business. The Amalia generally went
to sea on Sundays and returned on
Fridays. The first applicant did not refuse to make a turnaround in
that when required by the
respondent he would offload immediately and
return to sea. The single income generating job he did for the
respondent outside his
work as a skipper is insufficient to base the
decision that the first applicant was not economically dependent on
the respondent.
Charging VAT does not on its own disqualify a person
from being an employee. See
Denel (supra
). When the dominant
impression test is applied, it supports the version that the first
applicant was an employee of the respondent.
The termination of his
employment on 20 September 2013 when he was told that the Amalia
would be tied up constituted a dismissal.
[10] The respondent’s
evidence that the applicants were dismissed for its operational
requirements was not refuted. The respondent
conceded that it did not
follow a fair procedure in effecting the dismissals. It was argued on
behalf of the first applicant that
he should be awarded compensation
equivalent to remuneration he would have earned for fishing 160
tonnes of fish, the outstanding
amount in terms of his contract. The
second and third applicants argued that the respondent should be
ordered to pay them compensation
equivalent to remuneration they
would have earned over a period of 12 months. The respondent argued
that there was no legal basis
for the applicant to be awarded
compensation in excess of remuneration they would have earned had
their fixed term contracts ran
their course.
[11]
The applicants were employed on fixed term contracts which would have
expired either after they had fished 200 tonnes of fish
or at the end
of December 2013. It is important to maintain the distinction between
limited and unlimited duration contracts of
employment.
Section 194
(1) of the LRA requires compensation to be just and equitable.
Compensation for employees on fixed term contracts therefore may
not
exceed remuneration for the balance of their fixed term contracts. In
this regard see
Tshongweni
v Ekurhuleni Metropolitan Municipality
[3]
.
The applicants presented no evidence justifying awarding them
compensation in excess of the remainder of their fixed term contract.
The applicants on the average earned monthly remuneration of R 17
063.20, 8 931.05 and R9 216.05 respectively.
[12] I could find no
reason both in law and fairness for costs not to follow the result.
[13] In the premises the
following order is made:
13.1 The applicants
were employees of the respondent.
13.2 The
applicants’ dismissal for operational requirements of the
respondent was substantively fair but procedurally
unfair.
13.3 The respondent
is ordered to pay each applicant compensation equivalent to
remuneration he would have earned over a period
of three months which
represents the remainder of his fixed term contract.
13.4
The respondent pay the applicant’s costs.
___________________________
Lallie J
Judge of the Labour Court
of South Africa
Appearances
For
the Applicant:
Mr
Portgieter of Portgiter Attorney
For
the Respondent: Mr Unwin of Chris Unwin Attorneys
[1]
2003 (1) SA 11
[2]
[2005] 9 BLLR 849
[LAC]
[3]
[2010]10 BLLR1105
(LC).