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[2016] ZALCCT 34
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NUMSA and Others v High Goal Investments CC t/a Chuma Security Services (C844/15) [2016] ZALCCT 34 (18 October 2016)
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REPUBLIC
OF SOUTH AFRICA
THE
LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
JUDGMENT
Reportable
Of
interest to other judges
Case
no: C 844/15
In
the matter between:
NUMSA
L E BOTOMANE &
27 OTHERS
First applicant
Second and further
applicants
and
HIGH GOAL
INVESTMENTS CC
t/a CHUMA
SECURITY SERVICES
Respondent
Heard
:
12-15 and 22 September 2016
Delivered
:
18 October 2016
Summary:
Automatically unfair dismissal. Discrimination
based on gender. Female security guards dismissed for operational
requirements. LRA
s 187(1)(f).
JUDGMENT
STEENKAMP
J
Introduction
[1]
The
28 individual applicants are female security guards. They are
represented by their trade union, the National Union of Metalworkers
of South Africa (NUMSA, the first applicant). They were employed by
the respondent, Chuma Security Services. Chuma dismissed them,
ostensibly for operational requirements. The reason was that Chuma’s
client, Metrorail, requested it to employ fewer women
and more men as
security guards. The applicants say their dismissal was automatically
unfair as contemplated in s 187(1)(f) of
the Labour Relations Act
[1]
because the reason for the dismissal was that Chuma unfairly
discriminated against them on the basis of gender. In the
alternative,
they plead that the dismissals were in any event unfair
as it was not for a fair reason and Chuma did not follow a fair
procedure
as contemplated in s189 of the LRA.
The
evidence
[2]
Much of the factual background to the
dispute is common cause. Those facts were further elucidated upon in
evidence by three witnesses
for Chuma and one for the applicants.
Common
cause facts
[3]
The parties agreed in their pre-trial
minute that the following facts are common cause:
3.1
NUMSA forwarded proof of membership forms
to Chuma during June 2014 and requested organisational rights which
included access rights
and stop order deductions for union membership
subscriptions.
3.2
Chuma responded in a letter dated 9 July
2014. It refused to grant the union organisational rights. NUMSA
referred a dispute to
the Commission for Conciliation, Mediation and
Arbitration (the CCMA).
3.3
At the conciliation on 11 July 2014, the
parties came to an agreement requiring the union to provide
verification of its membership
in a meeting scheduled for 23 July
2014. This meeting was convened.
3.4
Further verification meetings were
required; however; these meetings did not take place due to Chuma’s
failure to convene
the meetings.
3.5
NUMSA referred a fresh organisational
rights dispute to the CCMA on 20 October 2014. That dispute was
conciliated on 23 October
2014. At the conciliation meeting, the
parties agreed to convene a meeting to once again verify the stop
order forms.
3.6
The verification meeting was convened on 27
November 2014 at Chuma’s premises. Commissioner Landu of the
CCMA was present.
The parties signed a written agreement which
provided the union with organisational rights in terms of sections
12-16 of the LRA
and for the parties to conclude a recognition
agreement.
3.7
NUMSA applied to the CCMA for the
settlement agreement to be made an arbitration award in terms of
section 142A of the LRA. It
also filed a fresh dispute on matters of
mutual interest and organisational rights on 15 July 2015. At the
conciliation of this
dispute on 4 August 2015, Chuma agreed to
implement the stop order deductions for union fees.
3.8
The deductions for union subscriptions were
finally implemented on 7 September 2015.
3.9
Nineteen of the applicants were issued with
termination letters dated 17 May 2015 on 20 May 2015 and nine were
issued with termination
letters dated 17 April 2015 on 20 April 2015.
3.10
The reasons provided for the dismissal in
the termination letters was that Chuma’s client, Metrorail, had
requested Chuma
to use more male security guards at their sites.
3.11
NUMSA wrote an email to Metrorail on 17
April 2015 with regards to the reasons for the termination, as
alleged by Chuma in its termination
letters. Metrorail responded with
an email dated 21 April 2015 denying that they had issued an
instruction to Chuma to dismiss
female employees. Metrorail had
however requested that females should not be deployed or placed at a
few dangerous hotspots.
3.12
Chuma did not pay the dismissed employees
any severance pay.
3.13
NUMSA referred an unfair dismissal dispute
to the CCMA on 17 June 2015. The dispute was conciliated on 7 July
2015 and remained
unresolved.
[4]
At the commencement of the proceedings in
this Court, Ms
Ralehoko
handed
the Court an agreed schedule (Schedule A) reflecting the date that
each applicant (except applicant 29 whose membership form
could not
be located and applicant 23 whose membership form is undated) joined
the union as well as the severance pay due to each
employee.
Oral
evidence
(a)
Mr Ngcwangu
[5]
Chuma’s first witness was Mr Sithethi
Joseph Ngcwangu (Ngcwangu). He testified that Chuma had a contract
with PRASA, trading
as Metrorail, concluded in 2005, to provide
security services to what is referred to as the Northern Line Area
(the railway line
from Old Mutual all the way up to Wellington and
Strand) in the Western Cape. Chuma deployed security guards to
protect track boxes
and cables. In terms of that contract, Chuma had
to make 200 security officers available, but because of a “new
law”
(apparently a sectoral determination) that required
employees to work a 17 hour shift, Chuma increased its staff
complement to
more than 350 employees. Chuma employs anyone who is
qualified to do the job and has the required certificate. The
contract with
PRASA / Metrorail did not specify the gender of the
employees to be deployed. Staff is deployed as per the deployment
plan drawn
up by Chuma. Chuma had about 60% female security officers
and 40% male security officers. The initial fixed term contract was
changed
to a “month to month” contract in 2011.
[6]
Sometime in October 2014 Metrorail raised
the issue of increased crime on sites serviced by Chuma and surmised
that this was due
to the deployment of mostly female security
officers, who, according to Metrorail, could not arrest crime.
Metrorail suggested
that Chuma reduce the number of female security
officers that it deploys. He testified that there were incidents in
which female
security officers were involved. He referred to a female
security officer who was raped while doing cable patrol, in the
company
of a male security officer; and vandalism on the line. He
also referred to an incident involving Ms K., a female security
officer
who was attacked whilst in a guardroom on Metrorail’s
premises. K. was robbed and sexually assaulted. This occurred after
the dismissal of the applicants.
[7]
According to Ngcwangu, he initially ignored
the request from Metrorail to reduce female security officers because
he believes that
females are good workers. They do not miss work and
they do not attend work with a hangover. For six months after
Metrorail made
the request, he did not comply with the request
because females are good employees. However, in early March 2015, Mr
Blom from
Metrorail -- who is in charge of the Western Cape region --
insisted that female security officers should be reduced and replaced
by male security officers. Ngcwangu testified that at that point he
relented, to avoid losing the contract. It was agreed that
50 female
security officers would be retrenched and Chuma started the process
of retrenching female security officers.
[8]
Ngcwangu also stated that at that time
Chuma and Metrorail were on a month to month contract and if Chuma
had not complied with
the request to further reduce female security
officers, PRASA / Metrorail would simply have refused to renew the
contract the following
month. He could not refuse to comply with a
request made by a client. Metrorail wanted fewer female security
officers and Chuma
had to do as demanded by the client. As far as he
is concerned, he was to be applauded because he had succeeded in
getting Metrorail
to back down on the big number of female security
officers that they wanted replaced by male security officers.
[9]
In cross-examination Ngcwangu conceded that
there were no consequences for Chuma after it ignored Metrorail’s
initial request
made in October 2015 to get rid of female security
officers. Metrorail did not terminate the contract. He had tried to
dissuade
Metrorail from insisting on the request because he knew it
was against the laws of the country to ask that women be dismissed.
When requested to produce written proof of his communications with
Metrorail in that regard, Ngcwangu said that he did not have
a
written document to that effect.
[10]
Chuma did not investigate the specific
incidents that Metrorail relied upon in support of its demand for
female security officers
to be replaced by male security officers.
Ncgwangu simply accepted what Metrorail alleged. He did not
investigate the incident
about the break-in into the Huguenot train
station ticket office. He is aware of the Goodwood incident and had
in fact attended
at the scene because his offices are not too far
from that station. Their investigation established that the 15 year
old girl involved
had in fact consented to the sexual acts and knew
the alleged perpetrators. He could not dispute the applicants’
version
of events as regards the incidents that Metrorail referred
to. He was however aware that female security officers lock
themselves
up in the guard rooms. He is also aware that guards sleep
on duty but they deny it.
[11]
Ncgwangu alleged that he had sight of the
e-mails between Metrorail and Chuma (in which Metrorail demanded the
replacement of female
security officers) and the pre-trial minute for
the first time in court. The e-mails between Chuma and Metrorail were
annexed to
the respondent’s statement of efence in the matter.
[12]
As regards severance pay, Ncgwangu heard
that the employees had been paid and he did not receive any reports
that they had not been
paid. He thought that the employees had
received their severance pay and he would check. If the employees did
not receive severance
pay, he would ensure that it is sorted out.
[13]
Ncgwangu testified that he spoke to the
Operations Manager, Andile Khambi, to go along with the retrenchment
process. Chumba did
not issue a notice in terms of s 189(3) of the
LRA but simply invited SATAWU to a meeting. The only two unions at
Chuma were SATAWU
and DUSWO. SATAWU was the majority union with 95%
membership and the rest were DUSWO members. There was no other union.
Khambi
informed him that they had invited SATAWU to a meeting and the
shop stewards indicated that they would obtain a mandate from the
employees, which feedback they later brought in the form of a letter.
In the letter, SATAWU agreed to the retrenchment process
and for LIFO
(last in first out) as the selection criterion to be applied. His
niece as well as his fellow Anglican church members
had been affected
by the retrenchments. The affected employees could not be
accommodated elsewhere as Chuma did not have other
sites other than
Metrorail sites. They had however agreed with SATAWU that if Chuma
were to be awarded another contract, the affected
employees would be
given first priority. In his view, females are good employees and he
did not want to let them go.
[14]
When he was challenged on why NUMSA was not
invited to the consultations, Ncgwangu stated that it was because the
employees were
all SATAWU members and that subscriptions were going
off the salaries of these employees in favour of SATAWU. He also
stated that
there were no resignation forms or proof of delivery of
these resignation forms to Chuma by NUMSA.
[15]
He denied that there was anything wrong
with the manner in which the employees had been issued with
termination letters. If this
was an issue, the shop stewards ought to
have raised it but did not.
(b)
Ms Madikase
[16]
Ms Ntombentle Madikase was the respondent’s
second witness. She had nine years’ service with Chuma,
employed as a security
officer. At the time of the retrenchments, she
was a SATAWU shop steward and she resigned from SATAWU at the
beginning of December
2015 to join DITAWU. During the time that she
was a SATAWU shop steward, almost all employees of Chuma were SATAWU
members, because
they all paid subscriptions to SATAWU. A few male
security officers were DUSWO employees.
[17]
She was aware that the employment of 50
female security officers was terminated because there were incidents
that occurred involving
female security officers and Metrorail raised
the issue of the deployment of female security officers. Metrorail
had raised the
issue in October 2014 and again in 2015. As a shop
steward, she received Metrorail’s communication from Mr Blom in
which
Metrorail stated that ‘ladies’ should be gone
within 7 days.
[18]
Her concern was to find out if Chuma was
following the LRA. As shop stewards, they spoke to Mr Willemse of
SATAWU and a general
meeting of all members paying subscriptions was
convened. They explained to the members that Chuma was following the
LRA and the
members agreed to the retrenchments on condition that the
amounts owed to them – like severance pay -- were paid. They
then
held a meeting with Chuma on 17 March 2015 when Willemse took
the decision that Chuma should undertake to re-employ the affected
employees if it was contracted to work on another site other than a
Metrorail site.
[19]
In cross-examination, Madikase persisted
with her view that all employees were SATAWU members because
subscriptions in favour of
SATAWU were being deducted from their
salaries. It turned out that she was oblivious of the agreement
between Chuma and NUMSA concluded
in November 2014. She insisted that
only SATAWU and DUSWO were organising at Chuma.
[20]
She also claimed that she was furnished
with a letter in terms of which Metrorail demanded the removal of
‘ladies’ within
7 days and when it was put to her that
Metrorail had not issued a letter to that effect, she persisted that
the letter existed
but she had not brought it to the hearing because
she had been prepared a few days before the trial. She was unable to
say whether
any of the applicants knew about the general meeting and
whether any of them had attended. Shop stewards sent text messages to
those employees whose telephone numbers they had to inform them about
the meeting. She did not know whether any of the shop stewards
had
the telephone numbers of any of the applicants.
[21]
When asked why SATAWU adopted the view that
Chuma was following the LRA, she stated that Chuma followed the
section 189 process.
She also claimed that a section 189 notice was
issued. When she was challenged to produce the notice, she stated
that she had not
brought it to the trial but insisted that it had
been issued.
(c)
Mr Khambi
[22]
Mr Andile Goodman Khambi testified that he
was the Operations Manager since 2012 but started working for Chuma
in 2005. He is the
second in charge to Ncgwangu. The unions that were
active at Chuma between 2010 and 2015 were SATAWU and DUSWO but Chuma
engaged
with NUMSA sometime in 2014. Initially he stated that NUMSA
commenced recruiting in late 2014 but in cross-examination conceded
that NUMSA commenced recruiting in May 2014. He conceded the
settlement agreement concluded with NUMSA in November 2014 after the
verification process but stated that thereafter he took the list of
NUMSA’S members to Mazandi Mgwigwi in the payroll department
who informed him that the employees on NUMSA’s list people were
paying subscriptions to SATAWU. When he sought to engage
NUMSA on the
issue, they were not co-operative. He did not want to deduct two
subscription fees from the employees’ salaries.
He had been
provided with membership forms but not cancellation forms. Deductions
in favour of SATAWU continued until May 2015
when Chuma received
cancellation forms from NUMSA. When it was put to him that the issue
of whether the employees on the list were
in fact NUMSA members was
resolved during the verification exercise, he insisted that there
were no cancellation forms. NUMSA made
inquiries after the
retrenchments and he did not pay much attention to it because most
employees were still paying subscriptions
to SATAWU.
[23]
Khambi testified that Chuma had embarked on
the retrenchment process because of complaints about increased crime
from Metrorail.
A “deficiency meeting” was held (areas
where Chuma was lacking were set out and it would be penalised in
respect of
those) and Metrorail said it was because of the deployment
of mostly female security officers. Metrorail wanted Chuma to deploy
100 female security officers and 100 male security officers. If Chuma
had other contracts, it would have taken the affected security
officers to these other sites. After discussing the matter with
Ngcwangu, they begged Blom who agreed to reduce the number of
affected female employees to 50. They could not defy Metrorail
because the e-mail from Blom had been copied to senior people within
PRASA, who had the powers to terminate the contract. For that reason
he treated the matter with urgency and responded promptly,
so that
Chuma could not lose the contract. He informed PRASA that 50
employees would be retrenched. He had delayed implementing
Metrorail’s demand in 2014 but in 2015 he could not.
[24]
As he was not sure how to proceed, he
sought guidance from SATAWU. SATAWU agreed to the retrenchments. He
did not involve NUMSA
because they were still knocking on Chuma’s
doors. Notwithstanding the November 2014 agreement, there was no
agreement yet
and subscriptions deductions were still being made in
favour of SATAWU and none in favour of NUMSA.
[25]
Khambi conceded that the employees issued
with termination letters in April were not given a month’s
notice but this was rectified
subsequently.
[26]
He became aware a week before trial that
the retrenched employees were not paid severance pay but is not aware
of the reason. He
had specifically instructed one Amina in accounts
to ensure that the employees are paid all the amounts due to them.
There were
no consultations over what severance pay was to be paid.
[27]
Khambi agreed that the applicants did
nothing wrong and that, but for the fact that they are female, they
would not have lost their
jobs.
(d)
Ms Gcanga
[28]
Andisiwe Gcanga was the only witness called
in support of the applicants’ case. She started working for
Chuma in May 2013.
She was never a SATAWU member and joined NUMSA in
August 2014. She worked at Huguenot station. At that station,
sometimes
there would be three female security officers on duty and
sometimes two female security officers and one male officer. The
break-in
into the Huguenot ticket office occurred when a Metrorail
LPO, Camagu, arrived on site to conduct an inspection. Whilst Camagu
was discussing the contents of the occurrence book (OB) with the
security officers, they heard an alarm. Camagu and the three security
officers on duty (two female and one male) chased after the children
who had broken into the station but could not catch up with
them. The
children gained access into the ticket office through a window which
did not close. She denied Metrorail’s allegations
that the
guards on duty were asleep or sitting in the guard room when the
incident occurred. She also denied that they did not
assist Camagu or
that it was Camagu who heard the alarm go off. This was the first
incident at Huguenot station since she started
working there in 2013.
[29]
As a female security officer, Gcanga had
never been approached by anyone from either Chuma or Metrorail with
allegations that women
were too scared to intervene if they witnessed
a crime.
[30]
Ever since she joined NUMSA in 2014, no
union subscription deductions were made from her salary until she was
dismissed. She heard
NUMSA kept going back to Chuma for verification.
[31]
Her colleague, Lolwethu, informed her about
the general meeting held where the employees were informed that 50
female security officers
would be retrenched. Lolwethu heard about
the meeting on the train.
[32]
The termination letter was handed to her
whilst she was on duty. Thereafter she contacted a NUMSA shop steward
for assistance and
the controller to inquire whether she must still
report for duty. She was informed that she should work the 17 day
shift until
June. She was hurt by the news of the termination of her
employment. She secured alternative employment in January 2016 but
before
that, she was unemployed.
Evaluation
The
applicable legal principles
[33]
Section 187 of the LRA provides as follows:
187.
Automatically unfair dismissals
(1)
A
dismissal is automatically unfair if the employer, in dismissing
the
employee, acts contrary to section 5 or, if the reason for the
dismissal is -
…
(f)
that the employer unfairly discriminated against an employee,
directly or indirectly,
on any arbitrary ground, including, but not
limited to..., gender, ....
[34]
Section 188 deals with dismissals other
than automatically unfair dismissals. It provides as follows:
188.
Other unfair dismissals
(1)
A dismissal that is not automatically unfair, is unfair if the
employer fails to prove -
(a)
that the reason for dismissal is a fair reason -
(i)
related to the employee’s conduct or capacity; or
(ii)
based on the employer’s operational requirements; and
(b)
that the dismissal was effected in accordance with a fair procedure.
[35]
The dismissals of the applicants were
effected at the behest of a third party, Metrorail. The issue of
dismissals at the behest
of a third party is not new in our law.
[36]
In
East
Rand Proprietary Mines Ltd v United People’s Union of SA
[2]
the employer dismissed Zulu speaking employees who were the target of
ethnic hostility from the other employees and whose
safety the
employer could not guarantee. The employer argued that the dismissal
was for operational reasons and as such, the decision
to dismiss lay
within the managerial prerogative. The Labour Appeal Court commented
as follows:
[3]
“
The
argument regarding the scope of managerial responsibility to direct
and reshape an enterprise in response to operational necessities
cannot be faulted. That ‘the ultimate decision to retrench is
one which falls squarely within the competence and responsibility
of
management’, where operational reasons for dismissal in fact
exist, has been authoritatively established. See
Atlantis
Diesel Engines (Pty) Ltd v National Union of Metalworkers of SA
[1995] ZASCA 30
;
1995 (3) SA 22
(A) at 28I; (1994) 15 ILJ 1247 (A) at 1253H-I.
These
dismissals were not, however, as in
Atlantis Diesel Engines
,
the product of operational reasons arising from serious financial
difficulties in consequence of a declining market-share. Nor
were
they retrenchments arising from ‘outsourcing’ of a
portion of the enterprise’s business. Nor, again, were
they the
product of reorganization or technological developments or electronic
supercession of previous employee functions. There
was in fact work
for these workers to do. It was urgent that they should return to it.
The company could, at least in the foreseeable
short term, pay them
to do it. They were not dismissed because their jobs disappeared.
They were dismissed because the company
was unable to guarantee their
safety at its premises because of ethnic hostility in the workplace.
The
Industrial Court judgment proceeds on the assumption that the
applicable principle was that management was entitled to decide
regarding an operational reasons termination, but that it did so
prematurely. The argument of both parties proceeded upon the same
premise. But, in my view, the case sits uneasily within the
operational reasons framework. It is necessary to be very clear on
what occurred here. At the causal root of the dismissal of these
workers was ethnic hostility to them. As their representatives
said
in the meeting of Tuesday 12 April, before the ‘home stay’
period was agreed on, ‘because we are minority,
we must go’.
On that same day, the Zulus addressed a letter to the general manager
of ERPM. It was signed by ‘concerned
Zulu employees’. It
asked of management an answer to the following question: ‘Are
the employees have right to dismiss
other employees just because they
don’t want them?’ No amount of verbal elaboration or
supposed legal sophistication
can express more powerfully the
question this appeal raises.
The
question, therefore, is not whether the court should defer to the
reasonable ambit of management’s prerogative to dismiss
for
operational reasons. The question is in what circumstances the court
should countenance a dismissal which has its origins in
ethnic
victimization of the dismissed employees.”
[37]
The
court continued:
[4]
“
But
the court, in examining what is fair in the circumstances, must draw
a distinction between management’s motives (which
were not
impure) and the actuating causes which formed the background to its
action. The court must distinguish between the forces
of the market
and the advances of electronics or technology (which may render a
decision to dismiss within the competence and responsibility
of
management), and operational reasons which have their roots in
opprobrious social conflict. There can be no doubt that, for
management itself to dismiss a worker merely because he is Zulu, or
because she is Jewish, or because he or she has HIV, would
be
reprehensible. For management to dismiss not directly for that
reason, but because the rest of its workforce hold that reason,
places management only at one remove from the opprobrious
consideration. That remove is of course not without significance. It
means that management will ultimately, when it truly has no
alternative, be permitted to dismiss when it cannot guarantee the
safety of employees whom the rest of its workforce, for reprehensible
reasons of ethnic hostility, threaten with injury or death.
But it
also means, in my view, that management truly must have no
alternative, and that no discretionary ‘band of reasonableness’
can be granted it.
Where
a dismissal is actuated by operational reasons which arise from
ethnic or racial hostility, the court will in my view countenance
the
dismissal only where it is satisfied that management not only acted
reasonably, but that it had no alternative to the dismissal.”
[38]
It
is apparent from this judgment that an employer may dismiss at the
behest of a third party, but it truly must have no alternative
to the
dismissal. In the context of that dispute about ethnic hostility, the
court also stated as follows:
[5]
“
In
a country that consists of linguistic, ethnic and other minorities,
public policy in my view requires that a test of necessity,
and not
reasonableness, should be applied in scrutinising management’s
action in dismissing workers in such circumstances.
In my view,
management does not in the present case pass that test.”
[39]
The court acknowledged that at some point
management would have been entitled to draw the line that mediation
was taking too long
to resolve the matter but that management
terminated the process prematurely. For that reason the court
concluded that management
was not entitled to dismiss the Zulu
speaking employees.
[40]
Commenting
on the
East
Rand Proprietary Mines
decision, in
Lebowa
Platinum Mines Ltd v Hill
[6]
the LAC stated that in
East
Rand Proprietary Mines
the court favoured the strict test of necessity where a demand by a
third party leads to the dismissal of an employee in circumstances
where the dismissal amounts to discrimination. The court went further
and stated that such an approach would have to be examined
to
ascertain whether it is in harmony with the equality and
discrimination jurisprudence of the Constitutional Court.
[41]
In
Lebowa
Platinum Mines
the employees demanded the dismissal of a white employee who occupied
a senior position and had used abusive language towards a
black
co-worker. The chairperson of a disciplinary inquiry imposed the
sanction of a verbal warning on the employee. The employees
were
dissatisfied with the sanction imposed which they regarded as lenient
and demanded a second disciplinary inquiry. In the face
of pressure
from the employees and because the employee refused a transfer, the
employer dismissed the employee. In deciding what
an employer must do
when faced with a demand for the dismissal of an employee, the court
set out the applicable principles as follows:
[7]
“
The
question whether, in the result, the employer’s ultimate
decision to dismiss an employee in response to a demand therefor
from
a third party may be said to be a fair or unfair one, would have to
depend on the facts of each case. In general, however,
the principles
set out below will be applicable. The principles have largely been
extracted from cases cited later.
(1)
The mere fact that a third party demands the dismissal of an employee
would not render such dismissal fair. Such an approach
would indeed
open a veritable Pandora’s box of injustices.
(2)
The demand for the employee’s dismissal must usually enjoy a
good and sufficient foundation. Where it impinges upon
the
fundamental rights of the employee in terms of the Constitution
special considerations need to be taken into account in determining
whether it enjoys such a foundation.
(3)
It need hardly be stated that the threat by the third party to impose
a sanction must be a real one. The employer should, therefore,
initially, assess the reality of the threat. If the prospects of the
threat being implemented are not real, the employer should
ignore the
demand, subject thereto that circumstances may change as matters
develop.
(4)
The employer, should, secondly, assess the probable effect of the
sanction threatened by the third party. Thus, that effect
may be of
such relatively minor proportions that there is no call for the
employer to consider taking any steps in respect of the
employee’s
position, whether in the form of a dismissal or, indeed, in the form
of an alternative thereto. In what follows
in subparas (6)
et seq
it will be assumed that the sanction threatened by the third party is
sufficiently cognizable to lead the employer to take such
steps.
(5)
It must be borne in mind, however, that the mere fact that dismissal
of the employee would ensure continued smooth commercial
operation is
not sufficient to justify termination of employment. Something more
is required. In short, that something is the objectively
sound
conclusion that dismissal is the only option that is fair to both the
employer and the employee.
(6)
The employer should make reasonable endeavours to dissuade the party
making the demand for the dismissal of the employee from
persisting
therein.
(7)
The employer should properly investigate and consider all
alternatives to the dismissal with a view to determining whether one
or more of them constitutes a reasonable alternative to dismissal.
(8)
In the process of reaching a determination whether or not there is a
reasonable alternative to the dismissal the employer must
consult
fully and properly with the employee, afford him a proper opportunity
to make an input thereanent and properly take his
representations
into account before arriving at a decision.
(9)
It is incumbent on the employer to ensure that the employee is aware
that non-acceptance by him of an identified reasonable
alternative or
alternatives would, or could, result in his dismissal.
(10)
In all its deliberations the employer must properly consider the
extent of the injustice to the employee that would be occasioned
by a
dismissal.
(11)
Relevant to the consideration of injustice to the employee would be
the question whether any objectively blameworthy conduct
on his part
gave rise to the demand for his dismissal.”
[42]
The court in
Lebowa
Platinum Mines
further stated that
because the employee was at fault, the issue had changed from one of
misconduct to whether the employee’s
further employment was
compatible with the employer’s commercial operations, an issue
of incapacity. The court stated
that the test was that of
fairness and that fairness demands that recourse to the dismissal be
had where there is no other alternative
thereto. The court then
conducted on evaluation of whether the employees’ threat to
embark on industrial action if the employee
was not dismissed was
real, whether the employer did what could reasonably have been
expected of it to persuade the employees to
drop its demand for the
employee’s dismissal, whether the employer investigated all the
alternatives to the dismissal of
the employee, and the potential
injustice to the employee consequent upon his dismissal.
[43]
The
significance of the requirement to dissuade a third party from
persisting with a demand as well as the threat of harm were also
dealt with in
Govender
v Mondi Kraft Richards Bay
[8]
where the employees demanded the dismissal of an Indian employee who
had assaulted a black employee.
[44]
In
Mnguni
v Imperial Truck Systems (Pty) Ltd t/a Imperial Distribution
[9]
, an employee of Imperial
Distribution was stationed at a client’s site. The client
demanded that the employee be removed
from its site because he had
instituted a defamation claim against the client, following his
exoneration on charges of theft. As
there were no other alternative
positions, the employee was retrenched. As in
Lebowa
Platinum Mines
,
the court found that this was not a classical retrenchment and
applied the principles set out in
Lebowa
Platinum Mines
.
In dealing with the question whether the dismissal was substantively
fair, the court found that the client’s stance in demanding
the
removal of the employee was unjustified, the demand did not enjoy a
sufficient foundation and in fact impinged upon the employee’s
fundamental rights in terms of the Constitution; that there was no
threat issued by client on what it would do if the employee
was not
removed; no evidence was led about what would have happened had the
employer refused to accede to the client’s demand;
the threat
must be real; and the employer ought to have assessed the reality of
the threat. The court continued as follows:
[10]
“
It
must be borne in mind, however, that the mere fact that dismissal of
the employee would ensure continued smooth commercial operation
is
not sufficient to justify termination of employment. Something more
is required. In short, that something is the objectively
sound
conclusion that dismissal is the only option that is fair to both the
employer and the employee.”
[45]
Considering whether the employer did what
could reasonably have been expected of it to persuade the client to
drop its request that
the employee be removed from its premises, the
court found that a single meeting held with the client was
insufficient. The
court also emphasized the importance of
properly considering the extent of the injustice to the employee that
would be occasioned
by the dismissal.
[46]
The
issue of the dismissal of an employee at the instance of a third
party who is a labour broker arose in
Nape
v INTCS Corporate Solutions (Pty) Ltd
[11]
. The employee had sent an
e-mail containing offensive material at the client’s premises
and the client demanded the removal
of the employee. It was a term of
the contract between the client and the labour broker that the client
could demand the removal
of an employee for any reason whatsoever. In
defending an unfair dismissal claim brought by the employee, the
employer relied on
Lebowa
Platinum Mines
and argued that there was nothing it could do after the client
demanded the removal of the employee. It also argued that in those
circumstances it could legitimately invoke the provisions of s189 of
the LRA as it had very little bargaining power with the client.
The
court found that the employer and the client could not structure
their contractual relationship in a way that would effectively
treat
employees as commodities to be passed and traded at the whims and
fancies of the client and that the contractual relationship
should
not be structured in a way that undermines the employee’s
constitutionally guaranteed rights. On the important
question
of a client’s demand, the court stated as follows:
[12]
“
An
illegal demand can never found the basis to justify a dismissal based
on operational requirements just as it cannot form the
basis of a
lawful strike. (
TSI Holdings (Pty) Ltd &
Others v NUMSA & Others
(2006) 27
ILJ
1483
(LAC))…By the same token s189 cannot be used to disguise the
true reason for dismissal…
It
is axiomatic, however, that where the demand of the client is lawful
and fair the employer labour broker may properly rely upon
the
provisions of section 189 of the Act.”
[47]
According
to the court in
Nape
[13]
,
the recourse available to a labour broker when a client demands the
unlawful removal of an employee is:
“
…
the
labour broker is in fact not powerless to resist its client’s
attempt to wield its bargaining power in a way which undermines
the
fundamental rights of employees. The labour broker is entitled to
approach a court of law to compel the client not to insist
upon the
removal of an employee where no fair grounds exist for that employee
to be removed…”
[48]
In
conclusion, the court stated as follows:
[14]
“
The
respondent labour broker could have accordingly resisted the client’s
attempts to invoke clauses in its contract with
the client which
undermined the applicant’s rights. It was unfair of it not to
do so before invoking its right to terminate
the contract of
employment for operational requirements and also because the demand
of the client was unlawful and unfair.”
[49]
The court found that in fact its findings
were consistent with the
Lebowa Platinum
Mines
decision, where it was stated
that the mere fact that a third party demands the dismissal of an
employee would not render such a
dismissal fair.
Dismissal
automatically unfair ?
[50]
Chuma conceded that, but for the fact that
the applicants were women, their employment would not have been
terminated. They were
dismissed to make way for male security
officers.
[51]
It
is so that the dismissal was effected at the instance of a third
party. That does not make it fair. I agree with Ms
Ralehoko
that
dismissing the applicants merely because they are female is akin to
the “reprehensible conduct” that the court
referred to in
East
Rand Proprietary Mines Ltd
.
[15]
[52]
Section 187(1)(f) of the LRA makes it clear
that, if the reason for dismissal is that an employer unfairly
discriminated against
an employee, directly or indirectly, on the
grounds of gender, then such a dismissal is automatically unfair.
[53]
Chuma (through Ngcwangu) was alive to the
fact that the demand by Metrorail which resulted in the dismissal of
the applicants was
unlawful and in fact contravenes equality laws.
Yet the company made no effort to persuade Metrorail to drop its
demand; neither
did it conduct its own investigation to establish
whether it was a fair demand; nor did it try to secure alternative
positions
for the applicants.
[54]
The dismissal of the applicants was simply
and directly on the grounds of gender. There is no reasonable
justification for it. The
dismissals were automatically unfair.
[55]
And even if I am wrong, the dismissals were
in any event unfair, both substantively and procedurally.
Substantive
fairness
[56]
Chuma bears the onus to prove that the
dismissals were fair, both substantively and procedurally.
[57]
Against the legal principles set out above,
the respondent’s conduct in this matter falls far short of what
it was required
to do before dismissing the applicants to make the
dismissals fair.
[58]
Whether a dismissal at the instance of a
third party is effected for operational reasons or incapacity reasons
is not an issue that
arises in this matter. The principles remain the
same.
[59]
As
Mr
Van
Wyk
submitted, the principles dealing with s 189 dismissals were set out
by the LAC in
Super
Group Supply Chain Partners v Dlamini
[16]
:
“
It
is trite that an employer is permitted to dismiss an employee for
operational requirements. However, for the employer to do so
successfully, it is obliged to have a
bona
fide
economic rationale for the
dismissal and to comply with the provisions of s 189… Section
189 imposes an obligation on the
employer to consult the employee or
its representative on the matters listed in subsection (2). There is
a duty on the employer
not only to consult the affected employee(s)
but to take appropriate measures on its own initiative to avoid and
minimise the effect
of the dismissal. The consultation envisaged by
the Act is a ‘meaningful joint consensus-seeking process’
in which
parties to the process should attempt to reach some
agreement on a range of issues that may best avoid the dismissal and,
where
not possible, to ameliorate the effects of the dismissal for
operational requirements.”
[60]
The starting point in this case is the fact
that Metrorail demanded the reduction of female security officers.
That is where the
rationale for the dismissals originates. But simply
contending that Metrorail made the demand is not a defence to an
unfair dismissal
claim. The demand for the dismissal of the female
security officers must have had a good and sufficient foundation.
Chuma was obliged
to investigate the allegations by Metrorail that
crime was on the increase due to the deployment of mostly female
security officers
to establish whether there was any truth to them.
Had it investigated the claims made by PRASA / Metrorail as it was
obliged to
do, Chuma would have discovered that there was no truth or
substance to those allegations.
[61]
Metrorail raised only three incidents in
support of its demand that female security officers should be removed
as they were not
effective. Gcanga’s evidence about the
circumstances in which the Huguenot ticket station was broken into
was not challenged
at all. Contrary to what Metrorail alleged, there
was a male security officer on duty when the incident occurred. The
allegations
that the guards had slept on duty were also not proven.
As regards the Goodwood incident, Ngwcangu confirmed that the 15 year
old
girl involved had consensual sex. And with regard to the rape of
a female security officer whilst doing cable patrol, the incident
occurred in the presence of a male security officer.
[62]
Ms Gcanga controverted Metrorail’s
claims that crimes were committed at stations manned by female
security officers because
they were too scared to do anything about
it. She testified that crimes occurred regardless of the gender of
the officers manning
a station. Her evidence was that Huguenot
station was always manned by one male and two female security
officers and that the break
in into the ticket office was the first
incident at that station since she commenced working there. She also
denied that she had
ever been confronted by anyone about claims that
female security officers allowed crimes to occur in their presence.
[63]
At the very least Chuma ought to have
confronted Metrorail with the facts and persuaded it to drop its
demand which had no basis.
Without testing the correctness of these
allegations, Chuma simply decided to retrench the applicants.
[64]
Ngcwangu was aware that Metrorail’s
demand would cause Chuma to flout the equality laws of the country.
Yet he did not demand
of Metrorail to drop its demand.
[65]
Both Ngcwangu and Khambi testified that
they had to comply with Metrorail’s demand or else Metrorail
would terminate the contract
with Chuma. However, at no point did
Metrorail threaten to terminate the contract with Chuma if it did not
comply with its demand/request.
The e-mail of 2 March 2015 from Blom
simply stated that “I want an action plan together with the
risk assessment on how you
will correct the deployment within seven
working days”.
[66]
A similar request was made of Chuma in
October 2014 and Ngcwangu ignored it without any consequences. At
that time Chuma was on
a month to month contract with Metrorail.
There was nothing to suggest that in March 2015, when Metrorail
renewed its request for
the replacement of female security officers,
this time around it would react differently if Chuma ignored the
request.
[67]
The fact that the e-mail from Blom had been
copied to senior people within PRASA as testified to by Khambi was of
no consequence.
Chuma was required to first assess what actions
Metrorail was likely to take if its demand was not acceded to. It did
not do such
assessment. Instead, it decided to retrench the employees
in the absence of any threat to terminate the contract.
[68]
Ngcwangu’s claim that he had
succeeded in persuading Metrorail to reduce the number of affected
employees to only 50 is to
be acknowledged and applauded, as Ms
Ralehoko
readily
acknowledged. But his efforts were simply inadequate. He was required
to dissuade Metrorail from persisting with a demand
which would have
resulted in discrimination against female employees.
[69]
Even though Ngcwangu claimed that he did
persuade Metrorial that fewer women should be dismissed, there was no
evidence placed before
court that he had in fact done so. He could
have produced his communications to Metrorail to that effect or even
the minutes of
the meetings held with Metrorail where he had raised
these issues. He produced no such document. The more probable version
is that
he did not raise these issues, fearing risking the contract
with Metrorail. Because Ngcwangu did not raise these issues, it is
impossible to know whether Metrorail would have dropped its demand
and the retrenchment of the employees could have been avoided
altogether.
[70]
Even though a copy of the contract between
PRASA/Metrorail and Chuma was not placed before the court (a legible
copy was not discovered),
Ngcwangu conceded that the contract with
PRASA did not require the deployment of male security officers. Even
though such a contractual
term would arguably not have been
enforceable, that the contract was silent on the issue would have
provided Chuma with further
ammunition in resisting the unlawful,
unjustified and discriminatory demand made by Metrorail.
[71]
There can be no debate that termination of
the employment of the applicant caused injustice to these employees,
who were not at
fault. They had done nothing wrong. Chuma ought to
have considered this factor. There is no evidence that the factor was
considered
and if it was, what weight, if any, it had on the
decisions ultimately made by the respondent. Against those
facts, the test
of necessity or fairness has not been passed by the
respondent. Chuma did not have a fair reason for dismissing the
applicants.
Procedural
fairness
[72]
The main issue concerning procedural
fairness – whether there was any consultation as prescribed by
s 189 with the employees’
trade union, NUMSA – brings to
the fore the fraternal fights for membership between COSATU trade
unions that has come to
characterise our labour relations landscape
of late.
[73]
Chuma
argues that it followed a section 189 consultation process and
consulted with SATAWU because all the affected employees were
SATAWU
members. The only reason to substantiate its claim that all affected
employees were SATAWU members is that it was deducting
subscriptions
from the salaries of these employees and paying these over to SATAWU.
This despite the common cause fact that, in
November 2014, Chuma was
party to a settlement agreement in terms of which it was agreed that
NUMSA had 49.5% membership at its
workplace and it undertook to
ensure that subscriptions in favour of NUMSA are implemented with
effect from January 2015.
[17]
[74]
Despite the agreement, Chuma did not
implement subscription deductions against the salaries of those of
its employees who had been
found to be NUMSA members at the
verification exercise which took place in November 2014. It is common
cause that NUMSA took steps
to enforce compliance with the settlement
agreement and referred disputes to the CCMA pursuant to the signature
of the settlement
agreement because Chuma refused to comply. On those
facts, when Chuma decided to retrench the employees in April and May
2015,
it was aware that NUMSA was a representative union at its
workplace.
[75]
In terms of section 189 of the LRA, Chuma
was obliged to consult “any registered trade union whose
members are likely to be
affected by the proposed retrenchments.”
Yet Chuma inexplicably avoided NUMSA, which it did not want to
recognise and
grant organisational rights despite the fact that the
verification process had established that NUMSA had 49.5% membership.
It
is apparent from the schedule prepared by the applicants that the
majority of them (16) joined NUMSA before April 2015 when the
retrenchments were effected.
[76]
Because
NUMSA was not afforded an opportunity to put proposals on the table
on possible measures to avoid the dismissals, it is
not possible to
conclude that the dismissals could not be avoided. Where no
consultations take place over the topics set out in
section 189 of
the LRA, procedural and substantive fairness become inextricably
linked.
[18]
[77]
The dismissals are also procedurally unfair
for the further reason that the decision to retrench was a
fait
accompli
. Metrorail sent Chuma an email
on 2 March 2015 demanding the reduction of female security officers.
The next day, on 3 March 2015
-- and even before SATAWU could be
consulted – Chuma informed Metrorail that it would retrench 50
female employees. The engagement
with SATAWU was therefore done as a
formality. A decision had already been taken to retrench the
employees.
[78]
Chuma did not even issue a notice as
required by section 189 (3). And Khambi conceded that there were no
consultations on the severance
pay to be paid to the employees (which
was not even paid).
[79]
The affected employees were unaware of the
decisions being taken. Because they were not SATAWU members, they did
not hear about
the general meeting where the news of the impending
retrenchments was communicated to the employees and therefore they
did not
attend the meeting. Matikase could not say whether she had
informed the applicants about the meeting. The affected employees
discovered
that their employment had been terminated only when they
were issued with termination letters. The nine employees issued with
terminated
letters in April 2015 were given a day or two days’
notice of termination of employment. Prior to that, no one from Chuma
spoke to them about what was about to happen. Whilst at home, they
then received telephone calls from Chuma to return and serve
a
month’s notice. The group issued with termination letters in
May were informed that they would serve a month’s notice.
[80]
Chuma
did not pay even the statutory minimum severance pay
[19]
,
much less consult about the amount of severance. That severance pay
was not paid was conceded when the pre-trial minute was filed
in
March 2016 and yet no steps were taken to rectify it before the
trial. During the trial, Ngcwangu undertook to ensure the issue
is
rectified but by the end of the trial – and up to the date of
judgment -- there has been no tender from Chuma to pay it.
It is
liable to pay interest on the severance pay, calculated from May 2015
and June 2015 respectively, depending on when an employee
ought to
have been paid the severance pay.
Conclusion
[81]
The dismissals were automatically unfair;
and in any event also substantively and procedurally unfair.
Relief
[82]
The applicants are no longer seeking
re-instatement but only compensation.
[83]
The
principles which apply regarding compensation were set out in
Kemp
t/a Centralmed v Rawlins
[20]
:
“
There
are many factors that are relevant to the question whether the court
should or should not order the employer to pay compensation.
It would
be both impractical as well as undesirable to attempt an exhaustive
list of such factors. However, some of the relevant
factors may be
given. They are:
(a)
The nature of the reason for dismissal; where the reason for the
dismissal is one that renders the dismissal automatically unfair
such
as race, colour, union membership, that reason would count more in
favour of compensation being awarded than would be the
case with a
reason for dismissal that does not render the dismissal automatically
unfair; accordingly, it would be more difficult
to interfere with the
decision to award compensation in such case than otherwise would be
the case.
(b)
Whether the unfairness of the dismissal is on substantive or
procedural grounds or both substantive and procedural grounds;
obviously it counts more in favour of awarding compensation as
against not awarding compensation at all that the dismissal is both
substantively and procedurally unfair than is the case it is only
substantively unfair, or, even lesser, if it is only procedurally
unfair.
(c)
Insofar as the dismissal is procedurally unfair, the nature and
extent of the deviation from the procedural requirements; the
less
the employer’s deviation from what was procedurally required,
the greater the chances are that the court or arbitrator
may
justifiably refuse to award compensation; obviously, the more serious
the employer’s deviation from what was procedurally
required,
the stronger the case is for the awarding of compensation.
(d)
....
(e)
The consequences to the parties if compensation is awarded and the
consequences to the parties if compensation is not awarded.
(f)
The need for the courts, generally speaking, to provide a remedy
where a wrong has been committed against a party to litigation
but
also the need to acknowledge that there are cases where no remedy
should be provided despite a wrong having been committed
even though
these should not be frequent.
(g)
....
(h)
Any conduct by either party that promotes or undermines any of the
objects of the Act, for example, effective resolution disputes.”
[84]
In considering the amount of compensation,
take into account that the respondent discriminated against female
employees; and its
deplorable conduct of not paying the
dismissed employees severance pay due to them.
[85]
Section 194(3) provides as follows:
“
The
compensation awarded to an employee whose dismissal is automatically
unfair must be just and equitable in all the circumstances,
but not
more than the equivalent of 24 months’ remuneration calculated
at the employee’s rate of remuneration on the
date of
dismissal.”
[86]
The
applicants seek the maximum compensation permissible of 24 months’
remuneration. In
CEPPWAWU
v Glass and Aluminium 2000 CC
[21]
the court laid down the principle that compensation for automatically
unfair dismissals should not be less than the amount
that an employee
would have received if re-instatement had been sought and should
penalise the employer for dismissing an employee
for a prohibited
reason.
Conclusion
[87]
The dismissal was automatically unfair. But
for their gender, the employees would not have been dismissed. And
the employer has
not shown any justification for the direct
discrimination against them.
[88]
In any event, the employer has also not
shown that the dismissal was for a fair reason related to its
operational requirements;
nor did it follow a fair procedure as
contemplated in s 189 of the LRA.
[89]
Mr
Van Wyk
has conceded that Chuma is liable for severance pay, and that that
payment should attract interest from the date of payment to
the date
of judgment.
[90]
As Ms
Ralehoko
argued, Chuma’s attitude has been deplorable. It conceded early
on that it did not pay the employees any severance pay; yet
it still
has not done so to date. That is but one of the reasons that costs
should follow the result. It is also one of the reasons
why I agree
with Ms
Ralehoko
that
the Court should award the applicants the maximum compensation
contemplated by s 194(3).
Order
[91]
I therefore make the following order:
91.1
The dismissal of the second and further
applicants by the respondent was automatically unfair as contemplated
by s 187(1)(f) of
the Labour Relations Act.
91.2
The respondent is ordered to pay each of
the applicants compensation equivalent to 24 months’
remuneration, calculated at
R3 200, 00 per month as set out in
Schedule A.
91.3
The respondent is ordered to pay each of
the applicants severance pay as set out in Schedule A, together with
interest calculated
at 9% per year from their respective dates of
dismissal until the date of payment.
91.4
The respondent is ordered to pay the
applicants’ costs.
_______________________
Anton
Steenkamp
Judge
of the Labour Court of South Africa
APPEARANCES
APPLICANTS:
Tapiwa Ralehoko
of Cheadle Thompson
& Haysom Inc.
RESPONDENT:
Pedro van Wyk
Instructed by
Swartz Hess attorneys.
[1]
Act 66 of 1995 (the LRA).
[2]
(1996) 17
ILJ
1134 (LAC).
[3]
at 1149 H [per Cameron J].
[4]
At 1150H.
[5]
at 1151F.
[6]
(1998) 19
ILJ
1112
(LAC).
[7]
at para [22].
[8]
(1999) 20
ILJ
2881 (LC).
[9]
(2002) 23
ILJ
492 (LC).
[10]
at para [25].
[11]
(2010) 31
ILJ
2120 (LC).
[12]
Para [72].
[13]
Above para [77].
[14]
[14]
Para [86].
[15]
Above at 1150H.
[16]
(2013) 34
ILJ
108 (LAC) para [24].
[17]
The agreement actually reflects “January 2014” but that
appears to be a typographical error.
[18]
Cf Thompson & Benjamin
South
African Labour Law
(Juta, service no 66, 2016) AA1-504.
[19]
Basic Conditions of Employment Act s 41.
[20]
(2009) 30
ILJ
2677 (LAC) para [20].
[21]
[2002] 5 BLLR 399
(LAC).