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[2017] ZALCJHB 516
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Galesitoe v Commission for Conciliation, Mediation and Arbitration and Others (JR 1402/14) [2017] ZALCJHB 516; [2017] 7 BLLR 690 (LC) (31 January 2017)
THE
LABOUR COURT OF SOUTH AFRICA
HELD
AT JOHANNESBURG
Of
interest to other judges
Case
No: JR 1402/14
In the matter between:
KAGISO
GERALD GALESITOE
First
Applicant
And
COMMISSION FOR
CONCILIATION,
MEDIATION
AND ARBITRATION First
Respondent
PEARL
MBEKWA N.O.
Second
Respondent
DELOITTE
SOUTHERN AFRICA
Third Respondent
Heard:
7 December 2016
Delivered:
31 January 2017
Summary
::
(Review – duty to disclose litigation with former employer -
distinguishable on facts from
Eskom Holdings Ltd v Fipaza
&
others
(2013) 34
ILJ
549 (LAC)
JUDGMENT
LAGRANGE
J
Introduction
[1]
The
crux of this review application is whether the arbitrator applied the
test in
Eskom
Holdings Ltd v Fipaza
&
others
[1]
correctly
when deciding if the applicant ought to have disclosed the fact that
he was litigating with his former employer, the Public
Investment
Corporation ('the PIC'), when he was being considered for employment
by the third respondent ('Deloittes').
[2]
The employee had been essentially dismissed for withholding or
not disclosing material information to the applicant at the earliest
opportunity which information would have resulted in the applicant
not employing him. The applicant was also charged with
misrepresenting
his ability to attend all his employment obligations
knowing that this would be impossible given the ongoing litigation
between
himself and information about his relationship with his
former employer is encapsulated in part of the conclusion of his
internal
appeal where it was stated:
"The
evidence establishes that the ongoing litigation with the PlC has a
material impact on your employment obligations and
ability to fulfil
the position that was created for you in the Corporate Finance
division. The evidence support that you were appointed
to be involved
not only in National, Provincial and Local Government work, but also
specifically assisting and being involved in
approaching and winning
business with the PIC due to your past work experience with the PRC.
During both interviews the intention
for you to assist Corporate
Finance to grow business and obtain traction with the PIC was raised.
The ongoing litigation would
not only materially impact on any
ability for you to win business with the PIC, but would negatively
affect your ability to work
with other Public Sector clients due to
the significant role the PIC plays in the Public Sector.
[3]
The arbitrator's key
findings and reasoning in determining that the applicant had been
fairly dismissed are set out in her award,
in particular in
paragraphs 35 to 48 thereof which are set out below:
"35.
In the case of the applicant, the evidence that the applicant
accepted the respondent during the interview stage, mentioned
its
embarking on restructuring and a business strategy to get
work/business from the public sector. It was public knowledge that
PIC had a major command in the public sector business domain.
36.
The applicant was not coherent and consistent on the issue whether
during the August 2013 interview, PIC was specifically referred
to as
a target and that his employment would be linked to sourcing business
from the PIC. During the opening statements of the
parties it was
submitted on behalf of the applicant that in the interviews held with
the applicant no mention was made of the PIC
which was placed in
dispute by the respondent. The applicant proceeded with the stance in
absolute terms until under cross-examination
covering a summary of
his case when the applicant gave evidence to the effect that in the
interviews PIC was discussed and that
was not with regard to the
litigation.
37
on the other hand, the evidence of the three respondents witnesses
Larbi-Odam, Tabane and Daramlall was that in the interview,
PIC was
mentioned as a target and his appointment would be specifically
attached to winning business from it. I find support for
this piece
of evidence in the fact that in the meeting since held on 3 October
2013, is name was recorded as specifically linked
to the PIC in the
respondents key areas” for action. The meeting was held very
shortly after his appointment on 1 October
2013. This also
demonstrated the special purpose in considering the applicant for
appointment and pointing [him] to the position.
It follows that as
early as August 2013, respondent considered the appointment of the
applicant for the special key area of focus
on PIC and that this was
communicated in the this was maintained as a trend in its interaction
with the applicant. Basedon this
analysis and the evidence as a
whole, in the particular case of the applicant there was a need to
disclose the litigation in the
interviews and in his subsequent
interaction with the respondent before he disclosed it on 4 October
2013.
38.
In the Eskom case, the employee had been previously employed by Eskom
as the Court stated. The applicant in that case by disclosing
her
previous dismissal from Eskom, the applicant would be reminding Eskom
if Eskom had not asked her during the interviews. In
the applicant's
case the special factors which existed before his appointment should
be balanced with the evidence that his responsibilities
after
appointment demanded constant interaction with PIC for achieving the
standards set by the respondent and managing the PIC
account. It can
hardly be said that he would be able to meet the standard as in my
view with the ongoing litigation the applicant
posed a situation of
conflict with this objective.
39.
Unlike the ability to establish the information of the nondisclosure
in the Eskom case, the applicant was not previously employed
by the
respondent. As it turned up while the respondent could [have] done
pre-employment checks on the applicant, in the publication
of the
court case with the PIC, the applicant was only referred to as
Bodigelo and not the name recorded in his CV which he used
in his
interaction with the respondent. I am therefore not convinced that
the respondent would without his disclosure be successful
in knowing
that he was the person involved in the litigation.
40.
I find Tabane's knowledge Ltd as he stated that he knew the
litigation as a finalised matter. Tabane had the status of senior
partner in another firm. Larbi-Odam was Head of corporate finance at
the respondent and the final decision in appointing the applicant
lay
with him. Even though the firm operated with close ties with the
respondent Tabane’s dealings with the applicant could
not be
turned into those of the applicant’s employer whether
prospective or not. Arguing that Tabane should have been disciplined
was clutching at straws on the part of the applicant. It was the
applicant not Tabane who aspired to work at the respondent and
the
fact that Tabane introduced him to the respondent did not the track
from the fact of his status and that of the applicant in
the matter
is related to the applicant’s employment.
41.
Before appointment, the applicant interacted with Omaruaye, who was a
custodian of processes which were used for his appointment.
Though he
did not come clean regarding his queries to Omaruaye, before he
signed the contract of employment I find the explanation
by Omaruaye
prompted disclosure and that the applicant deliberately omitted to
consider disclosing the litigation with a view to
secure his
employment.
42.
The applicant admitted disclosing the litigation to Nisha considering
the allocation of his name and Nisha’s linking it
to PIC as
stated under summary of key actions in the meeting of the 3 October
2013.
43.
The applicant's evidence that in, approaching Nisha Daramlall, he was
seeking to take leave to attend to his matters and only
when he was
prompted to state the reason he disclosed the fact of the litigation
shows that the applicant did not forthrightly
approach her to
disclose the litigation and that the applicant treated disclosing the
litigation as a secondary issue even at that
stage.
44.
I find from the factors discussed above, that the fact the respondent
considered appointing the applicant with the focus which
of the
evolving in working in the public sector with specific focus on the
PIC, was communicated to the applicant in the August
2013 interview.
I'm convinced from the undisputed evidence that the litigation was on
going at the time of the interview the applicant
was reasonably
expected to disclose it. Informing the respondent about the
litigation was material at that stage applicant aspiring
to work at
the respondent as his employer. I do not agree with the argument
advanced by the applicant and his team, that the respondent
had to
put a [clause] in his contract concerning the focus.
45.
In omitting to disclose the litigation in the background of the
discussions at the interview, at the time in September 2013
during
the interaction with Omaruaye and in the section's meeting held on 3
October 2013, the applicant deliberately concealed
it. His conduct
had a negative impact on the respondent. Larbi-odam also testified
that he could no longer trust the applicant
based on the omission.
46.
I do not agree with the argument advanced by the applicant and his
legal team, that the respondent had to record the focus
on the PRC
expected of him, in his contract of employment.
47.
The applicant by his conduct, and in more than one respect, breached
rules which was reasonable and which were well known to
him. Bearing
in mind his background, he did not have to know the standards
expected of him in the rule. I conclude from the evidence,
judged as
a whole, that the rules were consistently applied by the respondent.
I therefore find that he committed the misconduct
for which he was
disciplined. I also find the conduct as that of a serious nature and
dismissal was appropriate.
48.
I also noted that the applicant was under probation when the
respondent disciplined him making it possible for the respondent
to
dismiss him in lawful is compelling reasons. The respondent by
engaging him on 10 October 2013, in its attempt to resolve the
problems emanating from his omission to disclose, did not act
irregularly and was not unfair towards him as it was undisputed that
it made an attempted mutual separation from the relationship which
the parties had at the time."
The review application
Grounds
of review
[4]
The applicant raises four grounds of review, namely:
4.1
As a matter
of public policy the applicant was not obliged to disclose his
litigation with the PIC because Section 5 (c) of the
Labour Relations
Act 66 of 1995 (‘the LRA’) prohibits an applicant for
employment from being prejudiced on account
of exercising any right
conferred by the LRA or engaging in proceedings under the Act.
[2]
4.2
The arbitrator failed to appreciate on the common cause facts that a
member of the interview panel (Tabane) was aware of the
litigation
and the litigation was in the public domain. Consequently, as in the
Fipaza
’s case,the employer could not require the
applicant to disclose the information.
4.3 The arbitrator failed
to consider that the HR manager of corporate finance of the applicant
conceded that the applicant did
not do its usual background checks on
the applicant. Had these checks been conducted, the applicant would
have learnt of the PIC
litigation.
4.
The arbitrator misconstrued the evidence relating to the significance
of the applicant’s ability to secure business from
the PIC when
she decided that it was significant that during his interview, it was
pointed out to him that his appointment would
be designed to win
business in the public sector with a specific focus on the PIC
experience and that securing business from the
PIC itself was not his
primary focus. By misconstruing the evidence and attributing
importance to it, the arbitrator arrived at
an unreasonable finding.
[5]
In evaluating the application it is important to re-emphasise
that the court is not deciding whether the arbitrator came to the
correct conclusion on the evidence but whether, in applying the
relevant legal test, the arbitrator arrived at findings which no
reasonable arbitrator could have reached on the evidence before her.
In this regard, it is important to bear in mind that an applicant
wishing to challenge the factual evaluation of an arbitrator has a
difficult burden to discharge, as the leading decisions on reviews
demonstrate. See in this regard
Herholdt v Nedbank Ltd (Congress
of SA Trade Unions as Amicus Curiae)
where the SCA stated:
"[25]
In
summary,
the
position
regarding the
review of
CCMA awards
is
this:
A review of a CCMA award is permissible if the defect in the
proceedings falls within one of the grounds in s 145(2)(a) of
the 8
LRA. For a defect in the conduct of the proceedings to amount to a
gross irregularity
as
contemplated by
s
145(2)(a)(ii),
the
arbitrator must have
misconceived
the nature of the enquiry or arrived at an
unreasonable
result. A
result will
only be unreasonable if
it
is one that
a reasonable arbitrator could not reach on all
the
material
that
was
before
the
arbitrator.
Material errors of
fact,
as
well as
the
weight and
relevance
to
be
attached
to
particular
facts,
are
not
in
and of
themselves sufficient for an award to be set aside, but are only of
any consequence if
their
effect is to render the outcome unreasonable
[3]
."
and
Head of the Department of Education v Mofokeng and others
in
which the LAC held:
"[32]
However, sight may not be lost of the intention of the legislature to
restrict the scope of review when it enacted section
145 of the LRA,
confining review to "defects" as defined in section
145(2) being misconduct, gross irregularity,
exceeding powers
and improperly obtaining the award. Review is not permissible on the
same grounds that apply under PAJA.
Mere errors of fact or law may
not be enough to vitiate the award. Something more is required. To
repeat: flaws in the reasoning
of the arbitrator, evidenced in the
failure to apply the mind, reliance on irrelevant considerations or
the ignoring of material
factors etc must be assessed with the
purpose of establishing whether the arbitrator has undertaken the
wrong enquiry, undertaken
the enquiry in the wrong manner or arrived
at an unreasonable result. Lapses in lawfulness, latent or patent
irregularities and
instances of dialectical unreasonableness should
be of such an order (singularly or cumulatively) as to result in a
misconceived
inquiry or a decision which no reasonable decision-maker
could reach on all the material that was before him or her.
[33]
Irregularities
or
errors
in
relation
to
the
facts
or
issues,
therefore,
may
or may not
produce an unreasonable outcome or provide a compelling indication
that
the
arbitrator
misconceived
the
inquiry.
In
the
final
analysis,
it will
depend
on
the
materiality
of
the
error
or
irregularity
and
its
relation
to
the result.
Whether the irregularity or error is material must be assessed and
determined
with
reference
to
the
distorting
effect
it
may
or
may
not
have
had upon
the
arbitrator's
conception of
the
inquiry,
the
delimitation
of
the
issues to
be
determined
and
the
ultimate
outcome. If
but for
an
error or
irregularity
a different outcome would have resulted, it will
ex
hypothesi be material to the
determination
of
the
dispute.
A
material
error
of
this
order
would
point
to at least
a prima facie unreasonable result. The reviewing judge must then have
regard to the general nature of the decision in
issue; the range of
relevant
factors
informing
the
decision;
the
nature
of
the
competing
interests
impacted upon by the decision; and then ask whether a reasonable
equilibrium has been struck in accordance with the objects
of the
LRA. Provided the right question was asked and answered by the
arbitrator, a wrong answer will not necessarily be unreasonable.
By
the same token, an irregularity
or
error
material
to
the
determination
of
the
dispute
ma
constitute
a misconception of the nature of the enquiry so as to lead to no fair
trial of the issues, with the result that the award
may be set as·
alone. The arbitrator however must be shown to have diverted from the
correct path in the conduct of the
arbitration and as a result failed
to address the question raised for determination."
[4]
(footnotes omitted)
Evaluation
[6]
As regards the first ground, I agree with the third respondent that
the litigation the applicant was pursuing with the PIC was
not
litigation pursuant to the exercise of any of his rights under the
LRA. The applicant had sued his former employer for director’s
fees and bonuses amounting R 2, 3 million which he claimed he was
entitled to by virtue of having sat on the boards of those companies
owned by the PIC. This was not litigation relating to the exercise of
any of his rights under the LRA. Accordingly, he was not
entitled to
claim that on-going civil litigation against the PIC could not be
legitimately considered a material factor affecting
his eligibility
for employment.
[7]
As far as the claim that Tabane's prior knowledge of the
litigation should have been ascribed to Deloitte, I do not think that
the
arbitrator's findings in this regard are ones that are incapable
of being reasonably drawn on the evidence before her. It is important
to stress that to the extent that Tabane had prior personal knowledge
of the litigation, it was limited and as far as he knew it
had
already been concluded. Given that he believed it was water under the
bridge, it would not have obviously been information
it was necessary
to raise in the interview process. Moreover, although the applicant's
CV was sourced by him in his capacity as
an employee of a related
company, Deloitte's consulting, he was not employed by Deloitte's and
his knowledge could not simply be
ascribed to it. In any event,
unlike in Fipaza's case where Eskom had correct information in its
personnel records of the circumstances
of her termination, in the
applicant's case such knowledge which Tabane had was not even
accurate in any event.
[8]
Secondly, even if the applicant had been suing PIC under the same
name he used in his job application and therefore the litigation
might have been detectable by a thorough search of pending
litigation, I do not think that an employer has any duty to research
what litigation, if any, a job applicant might be engaged in. It
might be prudent to do so, and many employers do follow such a
practice, but an applicant for employment cannot assume that a
prospective employer has done this. It would also be perverse if
a
prospective employee could say, in effect, to a prospective employer
“I am entitled to assume that you have done diligent
research
into my history of litigation with my previous employers, to the
extent it may be relevant to my engagement, and consequently,
I do
not need to mention the fact that I have a significant civil claim
against my last employer with whom you seem to be expecting
I will
assist you to engage with in a fruitful business relationship if I am
employed.” Further, it is not disputed that
even Deloitte had
done such research, it would not necessarily have learnt of the
litigation because the applicant was litigating
under a different
name.
[9]
In
Fipaza’s
case, a
distinctive feature of that matter was that, it was common cause that
the information she was accused of withholding was
known to the
employer and she had disclosed her former employment with Eskom,
which could easily have checked her employment record
with it.
[5]
Eskom did not have to conduct research in the public domain to obtain
it. It is also worth mentioning that in that case, when Ms
Fipaza
applied for a new appointment it was barely a year and a half since
het previous relatively lengthy employment of approximately
twelve
years with Eskom had been terminated. Moreover, at the same time
Eskom had communicated to her that it was satisfied it
complied with
all its procedures in terminating her services, it simultaneously
advised her that she could apply for future vacancies.
[6]
In this instance, the information that there was still pending
litigation between the applicant and the PIC was not known to anyone
at Deloitte’s and not even known to Tabane. Further, it was not
information ascertainable from Deloitte’s own records
as it was
in Fipaza’s case.
[10]
Regarding the arbitrator’s conclusions on the applicant’s
obligation to mention his pending litigation, the arbitrator’s
assessment of the evidence was essentially to the effect that the
applicant ought to have realised during the interview process
that
Deloitte saw his previous employment with PIC as an added advantage
in securing work in the public sector and that this made
him more
attractive as an employment prospect. In considering the conflicting
evidence about what transpired in the interviews,
the arbitrator
carefully weighed up the evidence for and against the probability
that the applicant’s prior relationship
with the PIC was seen
as a significant factor in offering him the position and was
understood as such. It is possible another arbitrator
might have read
the evidence differently, but the inferences she drew in this regard
are not implausible ones.
[11]
Accordingly, it was not
unreasonable
to
infer
that
a
person
applying
for
the senior
level of post in question would have realised that the nature of
his
relationship with
his former
employer was a material consideration for
his
prospective new employer and could affect his employment prospects.
That would have given rise to the obligation to disclose
having
regard to the principle enunciated in
Absa
Bank Ltd v Fouche
[7]
which the LAC and
the LC
followed in the
Fipaza
case.
It is important in this regard to distinguish the applicant's own
obligation and that of Tabane. The issue is whether the
applicant
ought to
have
realised he
had an
obligation to disclose his ongoing litigation with the PIC in the
circumstances. Fipaza knew as a certainty that her former
employer
ought to
have known
the circumstances of her
previous
termination. She reminded Eskom of her previous employment and it had
the relevant to records pertaining to the termination
of that
relationship. She did not have to rely on speculating what a member
of the interviewing panel might have known and might
have disclosed
to the other members of the panel. It is true that if Tabane had been
more diligent he might have sought confirmation
from the applicant
that his understanding of the status of the litigation was correct,
but there was no basis for the applicant
assuming that Tabane and by
extension Deloitte’s itself knew that the litigation was still
ongoing. In this regard it is
also important to mention that it was
never put to Tabane under cross-examination that the applicant had
informed him of the state
of the litigation.
[12].
On the basis of the analysis above, I am satisfied that the
arbitrator’s award is not reviewable on the grounds raised.
There is also no reason in this instance in my view why cost should
not follow the cause.
Order
[13]
The review application is dismissed.
[14]
The applicant must pay the third respondent’s costs.
Lagrange
J
Judge
of the labour Court of South Africa
APPEARANCES
APPLICANT:
S
L
Shangisa
assisted
by
M
C
Nthangase
Instructed
by
Mabuza
Attorneys Inc.
THIRD
RESPONDENT: A Myburgh SC instructed by Bowman
Gilfillan
Attorneys
[1]
(2013) 34
ILJ
549
(LAC)
[2]
Section 5 states:
“
5.
Protection of employees and persons seeking employment
(1)
No person may discriminate against an employee for exercising any
right conferred by this Act.
(2)
Without limiting the general protection conferred by subsection (1),
no person may do, or threaten to do, any of the following-
(a)
require an employee or a person seeking employment
(i)
not to be a member of a trade union or workplace forum;
(ii)
not to become a member of a trade union or workplace, forum; or
(iii)
to give up membership of a trade union or workplace forum;
(b)
prevent an employee or a person seeking employment from exercising
any right conferred by this Act or from participating in
any
proceedings in terms of this Act; or
(c)
prejudice an employee or a person seeking employment because of
past, present or anticipated-
(i)
membership of a trade union or workplace forum;
(ii)
participation in forming a trade union or federation of trade unions
or establishing a workplace forum;
(iii)
participation in the lawful activities of a trade union, federation
of trade unions or workplace forum;
(iv)
failure or refusal to do something that an employed may not lawfully
permit or require an employee to do;
(v)
disclosure of information that the employee is lawfully entitled or
required to give to another person;
(vi)
exercise of any right conferred by this Act; or
(vii)
participation in any proceedings in terms of this Act.
(3)
No person may advantage, or promise to advantage, an employee or a
person seeking employment in exchange for that person not
exercising
any right conferred by this Act or not participating in any
proceedings in terms of this Act.
However,
nothing in this section precludes the parties to a dispute from
concluding an agreement to settle that dispute.
(4)
A provision in any contract, whether entered into before or after
the commencement of this Act, that directly or indirectly
contradicts or limits any provision of section 4, or this section,
is invalid, unless the contractual provision is permitted
by this
Act."
[3]
(2013) 34
ILJ
2795
(SCA) at 2806
[4]
[2015] 1 BLLR 50
(LAC) at 60-61.
[5]
Eskom
Holdings Ltd v Fipaza
&
others
(2013)
34
ILJ
549
(LAC) at 566-7, paras [60]-[65]
[6]
As set out in the labour court judgment in
Fipaza
v Eskom Holdings Ltd
(2010)
31
ILJ
2903
(LC) at 2906-7, paras [4] - [9].
[7]
2003 (1) SA 176
(SCA) at para [5],
viz:
'"The
policy considerations appertaining to the unlawfulness of a failure
to speak in a contractual context - a non-disclosure
- have been
synthesised into a general test for liability. The test takes
account of the fact that it is not the norm that one
contracting
party need tell the other all he knows about anything that may be
material (Speight
v
Glass and Another
1961 (1) SA 778
(D) at
781H-7838). That accords with the general rule that where conduct
takes the form of an omission, such conduct is prima
facie lawful
(BOE Bank Ltd
v
Ries
2002 (2) SA 39
(SCA) at 46G-H). A party
is expected to speak when the information he has to impart falls
within his exclusive knowledge (so
that in a practical business
sense the other party has him as his only source) and the
information,
moreover,
is such that the right to have it
communicated to him "would be mutually recognised by honest men
in the circumstances"
(Pretorius and Another
v
Natal
South Sea Investment Trust Ltd (under Judicial Management)
1965 (3)
SA 410
(W) at 418E-F"