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[2016] ZALCPE 25
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Edcon Ltd v Commission for Conciliation, Mediation and Arbitration and Others (PR09/15) [2016] ZALCPE 25; [2017] 4 BLLR 391 (LC); (2017) 38 ILJ 1660 (LC) (9 December 2016)
THE
LABOUR COURT OF SOUTH AFRICA, PORT ELIZABETH
JUDGMENT
Not reportable
Case no: PR 09/15
In
the matter between
EDCON
LTD
Applicant
and
COMMISSION
FOR CONCILIATION,
First Respondent
MEDIATION
AND ARBITRATION
F
FATAAR N.O
Second Respondent
RANLEY
PRINCE
Third
Respondent
Heard:
17 November 2016
Judgment:
9 December 2016
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
This is an application to review and set aside an arbitration award
issued by the second respondent (the arbitrator) on 10 December
2014.
Also before the court is anapplication to condone the late filing of
the review application, an application by the third
respondent to
dismiss the review application and an application to enforce the
award brought up by the third respondent under s
158(1)(c) of the
LRA. The latter application was previously postponed and set down for
hearing simultaneously with the review application.
Preliminary
issues
[2]
Turning first to the condonation application, the primary reason for
the failure to comply with the statutory time limit established
by
s145 is some initial confusion on the part of the applicant as to who
was representing the third respondent which led to delays
in the
service of some documents. The review application ought to have been
served and filed by 23 January 2015. It was filed on
that day, but
not served on the third respondent until 27 January 2015. The record
and the Rule 7A (6) were served on the third
respondent’s
erstwhileattorneys of record 16 days late, but for reasons unknown to
the applicant, filed about four months
late. The Rule7A (8) notice
and supplementary affidavit were served on the third respondent’s
erstwhile attorneys two days
late, and filed 3 ½ months late
because the applicant only then discovered that they were not in the
court file. The application
for condonation was filed on 4 September
2015. The third respondent’s main complaint is that the
application for condonation
was filed only in September 2015, in
circumstances where the applicant had been aware of the delays and
the need to seek condonation
well before that date. While the third
respondent is correct to note that parties are generally required to
file applications for
condonation as soon as possible after becoming
aware of the need for condonation, this is an inflexible rule. In
accordance with
the relevant authorities, the applicant’s
prospects of success must necessarily be taken into account, and, as
would appear
hereunder, these are good. In my view, the applicant’s
conduct is not such that it warrants the refusal of the application
for condonation. The delays are not excessive and the applicant has
provided a reasonable explanation for each period of the delay.
For
these reasons, the application for condonation is granted.
[3]
Turning next to the application to dismiss, the application is
predicated primarily on the assertion that the record of the
proceedings under review is incomplete. This is not disputed, but the
applicant contends that in terms of both the rules and the
practice
manual, it has elected to file those parts of the record that it
regards as relevant to the matter. Indeed, paragraph
11.2.6 of the
practice manual reminds applicants that rule 7A (6) requires an
applicant to copy and deliver only those parts of
the record
necessary for the purposes of the review and that the filing of
unnecessary portions of the record may well have consequences
in
relation to an order for costs. The applicant’s view is that
the matter can be heard on the papers before the court because
the
defects of which it complains appear from the face of the
arbitrator’s award. In my view, there is nothing inherently
wrong with this approach. The applicant must stand or fall by the
election it has made. If the matter proves incapable of determination
on the papers that the applicant avers are sufficient, then it must
fail. It is not open to the third respondent to contend, as
he does,
that merely because certain parts of the record were not filed by the
applicant in support of its application, he is inherently
prejudiced
and that the court ought to dismiss the application on that basis
alone. In my view, there is no merit in the application
to dismiss.
Factual
background
[4]
The material facts are not in dispute and are set out in some detail
in the award under review. The arbitrator records that
the applicant
is a retailer and has a store at the Greenacres centre in Port
Elizabeth, as well as a warehouse located in Kensington
in the same
city. There is also a stockroom in the Greenacres store from which
goods are dispatched to the shop floor.
[5]
The third respondent was employed by the applicant for some eight
years as a store assistant. He was employed on what was termed
a
‘casual contract’ (referred to in some jurisdictions as a
‘zero-hours contract’), an integral term of
which was
that the third respondent could be placed at any site as operational
needs dictated. The relevant term of the contract
reads as follows:
Due
to the inherent flexible nature of this type of employment contract,
Edcon reserves the right to schedule you in accordance
with business
requirements. This may mean that you may be required to work in
different departments within the store. You will
also be asked to
fulfil the tasks of the different positions that you are competent
in. This means that you will be expected to
work in any department
for which you are competent as business needs require.
[6]
In other words, the contract permitted the applicant to hire the
third respondent with no guarantee of work, other than when
needed by
the applicant. The third respondent had rendered services on this
basis for some 8 years, mostly at the warehouse, but
now and then at
the Greenacres store. During his employment, the third respondent was
dismissed on two occasions. The first was
in May 2012 when the third
respondent was dismissed for gross insubordination. The third
respondent disputed the fairness of his
dismissal and referred the
matter to the CCMA. After an arbitration hearing, the presiding
commissioner directed as follows:
The
respondent must reinstate the applicant on the same terms and
conditions as governed at the date of dismissal. The applicant,
Ranley Prince must report for duty on 25 September 2012.
[7]
The third respondent did not report for work on 25 September 2012. At
the end of October 2012 the third respondent was contacted
and
informed that he was required to report to the Greenacres store and
that he would be working in the stockroom. This decision,
according
to the applicant, wars driven by its current operational needs. The
third respondent did not report for work. He formed
the view that the
terms of the award issued in his favour required him to be placed at
the warehouse, we he had been working at
the time of his dismissal.
He was also concerned that there would be fewer hours of work
available to him at the store. Various
discussions took place between
the parties, but on 30 May 2013, the applicant wrote a letter to the
third respondent instructing
him to report to the store. The
applicant did not report for duty. On 15 June 2013, the applicant
wrote another letter requiring
the third respondent to report at the
store on 20 June 2013, and that a failure to do so many result in
disciplinary action being
taken against him. It is not disputed that
the third respondent again failed to report for duty.
[8]
The third respondent was then called to attend a disciplinary hearing
on a charge that he was grossly insubordinate when on
25 September
2012 and 20 June 2013 he refused to comply with an instruction to
report for duty. The third respondent was found
guilty of this charge
and dismissed on 23 August 2013.
The
award
[9]
The arbitrator commenced his analysis of the evidence by noting that
it is trite that an instruction given by an employer must
be
reasonable and lawful. In his view, the charger gross insubordination
was not a reasonable, for two reasons. The first is ‘
whether
an employer can charge and employee for gross insubordination if he
fails to attend work on a certain day after instruction
was given to
him to do so
(sic).’ In the arbitrator’s view, the
charge of insubordination in the present instance was unfair. The
arbitrator sought
to draw an analogy was a dismissal for
insubordination for refusing to attend a disciplinary hearing after
being instructed to
do so and held that similarly, ‘
an
employee has an inherent right to decide whether he\she wants attend
work or not
(sic)’. This was particularly so in a case such
as the present where the relationship is of a casual nature. The
arbitrator
noted that:
‘
The
days of slavery are long gone when people are forced to work without
any direction given. If an employee has this right, it
cannot
therefore be said that any instruction to report for duty is
reasonable and lawful. If the employee does not attend work,
he will
have to face the consequences thereof, one of which is absence
without leave for desertion.
[10]
The second issue identified by the arbitrator related to the third
respondent’s compliance to otherwise with the award
issued in
his favour on 2 September 2012. The arbitrator observed that in terms
of the award, the third respondent was to be reinstated
on the same
terms and conditions. In regard to the meaning of the word
‘reinstate’, the arbitrator took the view that
it was a
term and condition of the third respondent’s employment that he
work at the warehouse, and not the store. In the
arbitrator’s
reasoning is apparent from the following paragraph (para 31 of the
award):
If
we observe the evidence relating to the applicant’s employment,
he had been working at the Warehouse for 8 years, even
though he was
classified as a casual. In my view, even though the applicant had
signed the casual contract, by custom and practice,
the respondent
had created a situation where the applicant was permanently is placed
and stationed the applicant to work at the
Warehouse. Though this
practice in custom, working at the Warehouse had become part of the
applicant’s conditions of service
(sic).
Grounds
for review
[11]
The applicant contends that the arbitrator committed misconduct in
relation to his duties alternatively, that he committed
a gross
irregularity rendering the award reviewable. The applicant relies on
two principal grounds – the first is that the
commissioner
committed a material error and exceeded his powers when he decided
that the applicant had not complied with the arbitration
award issued
in September 2012. In particular, the applicant contends that the
arbitrator ignored the formal agreement between
the parties to the
effect that the third respondent could be placed on any site
depending on the applicant’s operational
needs. Secondly, the
applicant contends that it was unreasonable for the arbitrator to
conclude that the third respondent was permanently
placed at the
warehouse and and that the applicant was not entitled to require the
third respondent to report for duty at the store.
Analysis
[12]
I deal first with the arbitrator’s conclusions regarding the
place of work and in particular, the conclusion that the
applicant
failed to comply with the September 2012 award by failing to
reinstate the third respondent on the same terms and conditions.
It
is clear to me from the third respondent’s affidavit that his
perceived right to refuse the instruction to work at the
Greenacres
store room arose from the first award given in his favour. The
arbitrator accepted the submission on the basis of a
finding that the
third respondent working in the warehouse had become a term and
condition of his employment by custom and practice.
There was no
basis on the evidence before the arbitrator to come to this
conclusion. Although there is authority to support the
proposition
that a long-standing practice can give rise to a desert term of the
contract of employment, the regularity of an occurrence
(for example,
the provision of the benefit) does not in itself constitute or give
rise to a contractual term, unless the parties
are becoming intention
of creating a contractual right (see
CEPPWAWU
obo Konstable & others v Safcol
[2003] 3 BLLR 250
(LC)).
[13]
There was no evidence before the arbitrator that the applicant had
agreed or intended to agree to a term that would afford
the third
respondent the right to be employed only at the warehouse, or that it
ever waived the right to transfer the third respondent
from the
warehouse to the store should the need have risen. What the
commissioner did by finding that the third respondent had
a
contractual right to work in the warehouse, was effectively to
rewrite the contract between the parties, now making it mandatory
for
the applicant to continue to employ the third respondent in the
warehouse. In doing so, the arbitrator not only made a material
error
of law (by misconceived the nature on which custom and practice may
give rise to contractual terms), but he exceeded his
powers. The
terms of the contract, which were before the arbitrator, were clearly
to the effect that the applicant was entitled
to place the third
respondent on any site if there was an operational need to do so.
Despite the September 2012 arbitration award,
the third respondent
remained employed on the initial contract – the award did not
give him a right that extended beyond
the terms of that contract; it
merely confirmed that he was entitled to be reinstated in terms of
that contract. The arbitrator
did not reject evidence proffered on
behalf of the applicant that the operational needs at the time of the
third respondent’s
reinstatement were to the effect that there
was a need for an employee to work in the Greenacres store, since the
staff complement
at the warehouse was full.
[14]
The second ground for review in which the applicant relies is that of
the arbitrator’s analysis of the nature of gross
insubordination. Even if I grant that the commissioner was correct in
his view that in the circumstances of the present case, the
third
respondent had an inherent right to decide whether he wished to
attend work or not, it does not follow that any instruction
to report
for duty is unreasonable or unlawful, or both. The commissioner’s
view that if an employee does not attend work
(which he or she is
entitled to do) that the consequences are limited to charges of
absence without leave or desertion, this is
a fundamental
misunderstanding of the nature of the contract of employment. The
primary obligation of an employee is to work. A
refusal to work might
will result in a charge of desertion and/or absenteeism, but there is
no reason were it ought not, particularly
where an instruction to
report for duty is given in clear terms and understood by the
employee, do constitute an act of insubordination.
The analogy was
slavery is entirely in apposite – in the present instance, the
third respondent was not being forced to work.
He wished to work, but
only on his terms and without consideration for his contractual
obligation to render work according to the
applicant’s
operational needs.
[15]
What the arbitrator ignored was the fact that the September 2012
arbitration award required the first respondent to restore
the
employment relationship. Had it not been for the award, the applicant
could merely have retained the third respondent in the
casual pool if
he had refused to work as requested. But the effect of the award was
to require the applicant to provide the third
respondent with
employment provided that he reported for duty as directed. It is not
in dispute that of the third respondent breached
a term of the award
by not reporting for duty on the stipulated date. That breach was
aggravated by the passage of time. By the
time the final instruction
to report for duty was given, the third respondent had not reported
for duty for some 10 months. The
applicant elected in these
circumstances to charge the third respondent was gross
insubordination for refusing to comply with an
instruction to report
for duty. The third respondent stubbornly refused to continue
employment on the applicant’s terms and
on the terms that he
had agreed to in terms of his contract with the applicant. To the
extent that this evidence was ignored by
the arbitrator and to the
extent that he mistakenly concluded that even in the face of an
arbitration award requiring him to report
for duty, it was not
insubordinate for the third respondent to refuse to do so on account
of an inherent right to refuse to work,
the outcome of the
proceedings under review (i.e. that the charge of gross
insubordination was not reasonable, that it was unfair
and that it
warranted the third respondent’s reinstatement, in my view, the
arbitrator’s decision fails to meet the
threshold requirement
of reasonableness.
[16]
In summary, the third respondent was contractually bound to render
services as required by the applicant in accordance with
its
operational needs. The arbitration award issued in September 2012
required him to report for duty on these terms. It was not
open to
the third respondent to elect not to work simply because he preferred
to work at the warehouse rather than the store. The
commissioner’s
findings that a refusal to work in the circumstances could not
constitute an act of gross insubordination
ignored basic legal
principles and the evidence that served before him, and that the
consequence of an unreasonable outcome. The
award under review
therefore stands to be set aside.
[17]
Given that the award under review is to be set aside, it follows that
the s 158(1) (c) application falls to be dismissed.
Costs
[18]
Finally, in relation to costs, the court is a broad discretion in
terms of s 162 to make orders for costs according to the
requirements
of the law and fairness. In the present instance, the third
respondent has argued the case on his own behalf and remains
unemployed. In the circumstances, notwithstanding the applicant’s
success in the application, it seems to me that the appropriate
order
is one in terms of which each party should bear its own costs.
I
make the following order:
1.
The arbitration award issued by the second
respondent on 10 December 2014 under case number ECPE 4486-13 is
reviewed and set aside.
2.
The matter is remitted to the first
respondent for rehearing before a different commissioner.
3.
The s 158(1) (c) application is dismissed.
ANDRÉ
VAN NIEKERK
JUDGE
OF THE LABOUR COURT
REPRESENTATION
For
the applicant: Adv. J Grogan, instructed by Norton Rose Fulbright
For
the third respondent: In person