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[2017] ZALCJHB 190
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Global Supply Chain Services (Pty) Ltd t/a Globaltrack v Van Spaendonck and Others (JR2514/13) [2017] ZALCJHB 190 (3 March 2017)

THE
LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Not
reportable
Case
no JR 2514/13
In the matter between:
GLOBAL
SUPPLY CHAIN SERVICES (PTY)
LTD
t/a GLOBALTRACK
Applicant
And
HENDRICUS
VAN SPAENDONCK
COMMISSION
FOR CONCILIATION
MEDIATION AND
ARBITRATION
First
Respondent
Second respondent
RAFFEE,
NASIMA
N.O
Third
Respondent
Heard:
16 February 2017
Delivered:
27 February 2017
Order
Corrected: 3 March 2017
JUDGMENT
VAN
NIEKERK J
Introduction
[1]
This is an application to review and set aside an arbitration award
issued by the third respondent (the arbitrator). In her
award, the
arbitrator found that the first respondent (the employee) had been
unfairly dismissed by the applicant, and ordered
that he be
compensated in an amount equivalent to 12 months’ remuneration,
some R 950 000.
Factual
background
[2]
The material facts are recorded in the award under review and I do
not intend to repeat them here. It is sufficient to state
that the
employee was engaged during 2009 as the applicant’s chief
operating officer. The applicant’s chief executive
officer (and
sole shareholder) is Pieter Smits. In terms of the employee’s
contract of employment, he was entitled to the
use of a company
credit card. The relevant term of the contract assumed some
significance in the arbitration proceedings. It reads
as follows:
3.
Expenses
GSCS undertakes to reimburse Hein for
all expenses necessarily incurred in the course and scope of his
carrying out of his duties
which expenses may include travel, cell
phone accommodation, but not limited thereto. Expenses outside the
normal scope of business
above R5000.00 need to be authorised by the
CEO.
[3]
During February 2013, the employee was required to attend a
disciplinary enquiry to answer to charges of fraud, alternatively,

gross dishonesty. The basis of the charges was an allegation that the
employee had used the company credit card to incur personal
expenses,
and that he had misrepresented to the applicant alternatively failed
to disclose his liability in respect of the purchases
when it was
incumbent on him to do so.
[4]
The disciplinary enquiry was conducted by an independent chair. The
employee was found guilty of the charges and dismissed.
[5]
The employee did not dispute that he had used the company credit card
to incur expenses of a personal nature. These included
expenses
related to renovations that the employee had effected to his home,
treating his girlfriend to theatre productions and
dinner, paying
golf club fees and the like. At his disciplinary enquiry, the
employee contended that in terms of clause 3 of his
employment
contract, he was entitled to incur personal expenses to a value of
less than R 5000 on the applicant’s account.
This contention
was rejected by the chair of the enquiry. In the arbitration hearing,
the employee contended that there was a tacit
agreement between him
and Smits to the effect that that they were both entitled to use the
company credit card to incur personal
expenses within reasonable
limits, and that in terms of this agreement, they both claimed
expenses of a personal nature.
The
award
[6]
In her award, the arbitrator acknowledged the dispute of fact that
served before her. Contrary to the employee’s version,
Smits
had testified that the employee had no right in terms of his contract
of employment or otherwise to use the company credit
card for
personal expenses. He testified that he (Smits) maintained a strict
distinction between business and personal expenditure,
that he did
not use the company credit card to incur the personal expenses and
that no other employee used business credit cards
for personal
expenditure.
[7]
The arbitrator recognised that the dispute stood to be resolved on a
balance of probabilities. Her resolution of the factual
dispute and
her reasoning are apparent from the following paragraphs:
60. In determining the probabilities
of the versions before me I cannot view the events in a vacuum. It is
common cause that the
Applicant and Smits were extremely good friends
and their working relationship emanated from this friendship.
61. I also take cognisance of the fact
that at no stage did the applicant attempt to conceal the fact he had
made private purchases
on the company credit card.  At all times
he was forthright with regard to purchases made on the company credit
card. This
is not indicative of an intention to defraud the company.
62. The applicant justified his use of
the business credit card for private purchases in terms of clause 3
of the contract.
Smits interpreted this clause of the contract.
Smits interpreted this clause to mean that if the applicant was
required to do something
outside of the normal scope of his duties,
for example, purchase a printer which could be more than R5000.00 he
would need to obtain
permission. If the printer was less than
R5000.00 he would not require Smits permission.
63. Clause 3, is clearly ambiguous.
Expenses outside the normal scope of business could well mean
purchases of private nature, and
if, exceeding R5000.00 would have to
be authorised by Smits. There is no doubt that the applicant
interpreted the clause as such,
because all of his private expenses,
save for the coastal hire transaction, were under R5000.00.
64. The applicant explained that he
had hired equipment for a coastal hire and that he was under the
impression that the deposit
on the equipment would be reserved and
not passed through as a sale transaction.
65. Although the applicant was
negligent in not ensuring the whole amount would be debited to the
respondent, I am not convinced
that he intended to defraud the
respondent. The applicant also claimed to have sometimes used the
business credit card in error.
It was noted that if he mixed up
the cards that the reverse situation would happen, that is that he
would use is (sic) personal
credit card for business purchases.
However this was an assumption drawn by the respondent, because no
evidence was presented to
show that the applicant never used his
personal credit card for business purchases.
66. It was pointed out that the
applicant’s private expenditure on the business card became
more frequent. This could be attributed
to the applicant being cash
strapped as a result of the renovations of his house. This might well
be the case. However, it is interesting
to note that the applicant at
no stage attempted to conceal these transactions or make an attempt
to pass them off as business
expenses. He admitted the expenses for
what they were.
67. The applicant cited examples where
Smits had used his business credit card for personal expenditure. One
example was where he
filled his girlfriend’s car with petrol
using the business card, and, the applicant spoke of times they would
go out and
joke about the director was going to pay that night. Smits
was unable to recall these incidents and his responses to it was a
bare
denial, that it never happened. This is improbable.
68. The applicant’s defence was
always that he has from time to time the business card was issued to
him, use it for personal
expenses and he listed transactions dating
to 2010. The nature of some transactions blatantly of a personal
nature.
69. It is highly improbable that it
would have escaped the scrutiny of Kirchner, Smits and Vogel as Smits
described himself meticulous.
70. With regard to charge 2, the
respondent’s evidence was that the applicant committed a
further misconduct by not disclosing
his private expenditure on the
company credit card after having given the opportunity to “come
clean”. The applicant
was asked to disclose “other
deductions”. Why would the applicant disclose his private
expenses? He had never done
so in the past
71. Furthermore the respondent asked
for disclosure in a somewhat surreptitious manner. When the applicant
was directly confronted
with accusations, he was frank about his use
of the company credit card for private expenditure. This indicates
that there was
no interest to defraud the respondent. If there was,
surely he would have attempted to conceal the transactions.
72. On the evidence before me, I find
the dismissal to be substantively unfair.
Grounds
for review
[8]
The grounds for review raised in the founding affidavit broadly
concern the arbitrator’s dealing with the evidence. In

particular, the applicant contends that the arbitrator failed to
apply her mind to the evidence before her and failed to draw rational

conclusions from that evidence; that she arrived at conclusions not
supported by the evidence before her; that she misconstrued
the
incident of onus; and that she failed to take into account the
totality of the circumstances in determining the matter. As
a
consequence, the applicant contends that the arbitrator reached a
decision which no reasonable decision-maker could have reached
on the
available evidence. The applicant’s grounds were amplified in
argument when applicant’s counsel submitted that
the arbitrator
failed to appreciate that the employee stood in a fiduciary
relationship to the applicant, and that he was not entitled
to use
the applicant’s funds for his own purpose. This failure had the
consequence that the arbitrator applied ‘wrong
principles’
and that she sought to justify and give credence to what amounted to
unlawful conduct.
The
applicable legal principles
[9]
The applicable legal principles are not in dispute. The test
established by the Constitutional Court in
Sidumo & another v
Rustenburg Platinum Mines Ltd & others
[2007] 12 BLLR 1097
(CC)  and affirmed by the Supreme Court Of Appeal in
Herholdt
v Nedbank Ltd (Congress of South African Trade Unions as
amicus
curiae
[2013] 11 BLLR 1074
(SCA) empowers this court to interfere
with an award made by an arbitrator if and only if the arbitrator
misconceived the nature
of the enquiry (and thus denied the parties a
fair hearing) or committed a reviewable irregularity which had the
consequence of
an unreasonable result. What this amounts to is an
outcomes-based enquiry. The Labour Appeal Court has made clear that
reasonableness
does not equate to correctness and that a decision
made by an arbitrator that is wrong will pass muster provided it is
not so wrong
as to be unreasonable (see
Bestel v Astral Operations
Ltd & others
[2011] 2 BLLR 129
(LAC) per Davis JA, who at
paragraph 18 of the judgment emphasised the need to distinguish
between reviews and appeals).
[10]
The manner in which the review court should assess the evidence that
served before an arbitrator to determine the reasonableness
of the
result was the subject of a judgment by the Labour appeal Court in
Goldfields Mining South Africa (Pty) Ltd (Kloof Gold Mine) v
Commission for Conciliation, Mediation and Arbitration and others
[2014] 1 BLLR 197
(LAC). The LAC (per Waglay JP) held as follows:
In a review conducted under section
145(2) (a) (ii) of the LRA, the reviewing court is not required to
take into account every factor
individually, consider how the
arbitrator treated and dealt with each of those factors and then
determine whether a failure by
the arbitrator to deal with one or
some of the factors amounts to a process-related irregularity
sufficient to set aside the award.
This piecemeal approach of dealing
with the arbitrator’s award as improper as the reviewing court
must necessarily consider
the totality of the evidence and then
decide whether the decision made by the arbitrator is one that a
reasonable decision maker
could make.
[11]
In other words, even if an applicant in a review application is able
to identify some misdirection on the part of the arbitrator
(for
example, as in the present instance, a failure to consider material
facts or to attach weight to relevant evidence or attach
weight to
irrelevant evidence and the like), that is not in itself a basis for
a review for want of reasonableness; the resultant
decision must fall
outside of a band of decisions to which a reasonable decision-maker
could come on the same material.
[12]
The LAC more recently affirmed that while the failure of an
arbitrator to apply his or her mind to issues which are material
to
the determination of a case will usually be held to be an
irregularity, before the irregularity will result in the setting
aside of the award, it must in addition reveal a misconception of the
true enquiry or result in an unreasonable outcome (see
Head of
Dept. of Education v Mofokeng
[2015] 1 BLLR 50
(LAC), at
paragraph 30). In
Head of Department of Education v Mofokeng and
Others
[reference] Murphy AJA said the following:
[30] The failure by an arbitrator to
apply his or her mind to issues which are material to the
determination of a case will usually
be an irregularity. However, the
Supreme Court of Appeal (the SCA) in
Herholdt v Nedbank Ltd
(Congress of SA Trade Unions as Amicus Curiae)
[(2013) 34
ILJ
2795 (SCA)]and this court in
Gold Fields Mining SA (Pty) Ltd
(Kloof Gold Mine) v Commission for Conciliation, Mediation &
Arbitration & others
[(2014) 35
ILJ
943 (LAC)]; have
held that before such an irregularity will result in the setting
aside of the award, it must in addition reveal
a misconception of the
true enquiry or result in an unreasonable outcome.
[31] The determination of whether a
decision is unreasonable in its result is an exercise inherently
dependent on variable considerations
and circumstantial factors. A
finding of unreasonableness usually implies that some other ground is
present, either latently or
comprising manifest unlawfulness.
Accordingly, the process of judicial review on grounds of
unreasonableness often entails examination
of inter-related questions
of rationality, lawfulness and proportionality, pertaining to the
purpose, basis, reasoning or effect
of the decision, corresponding to
the scrutiny envisioned in the distinctive review grounds developed
casuistically at common law,
now codified and mostly specified in s 6
of the Promotion of Administrative Justice Act (PAJA); such as
failing to apply the mind,
taking into account irrelevant
considerations, ignoring relevant considerations, acting for an
ulterior purpose, in bad faith,
arbitrarily or capriciously, etc. The
court must nonetheless still consider whether, apart from the flawed
reasons of or any irregularity
by the arbitrator, the result could be
reasonably reached in the light of the issues and the evidence.
Moreover, judges of the
Labour Court should keep in mind that it is
not only the reasonableness of the outcome which is subject to
scrutiny. As the SCA
held in
Herholdt
, the arbitrator must not
misconceive the enquiry or undertake the enquiry in a misconceived
manner. There must be a fair trial
of the issues.
[32] However, sight may not be lost of
the intention of the legislature to restrict the scope of review when
it enacted s 145 of
the LRA, confining review to 'defects' as defined
in s 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 enquiry 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 may 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 aside on that ground 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.
Analysis
[13]
Turning then to the merits of the application, as I have indicated,
the applicant attacks the outcome of the arbitration proceedings
as
unreasonable primarily on account of the arbitrator’s failure
properly to assess the evidence before her. It should be
recalled
that during the arbitration proceedings (and indeed throughout the
disciplinary hearing), the employee did not dispute
having incurred
personal expenses on the company credit card. In essence, the issue
that the arbitrator was required to decide
was whether the employee,
as he contended, was entitled to do so or whether his use of the card
was dishonest. It is also not in
dispute that the employee’s
defences to the charge of dishonest conduct were variously that the
terms of his contract entitled
him to incur personal expenses on the
company credit card, that there was a tacit agreement between him and
Smits that he could
do so, and that he had on occasion used the
company credit card in error.
[14]
The extract from the arbitration award quoted above suggests that the
arbitrator upheld all of these defences. She did so first
by
concluding that the terms of clause 3 of the employment contract were
‘ambiguous’ and that subjectively, the employee
had
interpreted the clause to mean that he was entitled to incur personal
expenses on the company’s account provided the
amounts were
less than R5 000. This interpretation was sustained on the basis that
but for one transaction, the admitted personal
expenses did not
exceed that limit.  The arbitrator also appears to have found
that that there was a tacit agreement between
the first respondent
and Smits to the effect that the first respondent was permitted to
incur reasonable personal expenses on the
card. Although there is no
express finding of a tacit agreement, the arbitrator finds that the
employee had not concealed the affected
transactions or passed them
off as business expenses, that Smits had used his own card for
personal expenses and that the nature
of the employee’s claims
could not have escaped the attention of Smits and the applicant’s
bookkeeper. On this basis,
it would appear, the arbitrator suggests
that there was an agreement to the effect that the employee was
entitled to incur reasonable
personal expenses on the card.
Thirdly, the arbitrator found that although the first respondent’s
conduct in using
the company credit card could amount to negligence
on his part, he had not been dishonest because he could have ‘mixed
up’
the cards.
[15]
The reviewability of factual findings is all the more difficult to
assess when the arbitrator fails to adopt the correct approach
to the
determination of factual disputes. The manner in which factual
disputes are to be determined is set out in
SFW Group Ltd &
another v Martell et Cie & others
2003 (1) SA 11
(SCA), where
the Supreme Court of Appeal said the following:
The technique generally employed by
courts in resolving factual disputes of this nature may conveniently
be summarized as follows.
To come to a conclusion on the disputed
issues a court must make findings on (a) the credibility of the
various factual witnesses;
(b) their reliability; (c) the
probabilities. As to (a), the court’s finding on the
credibility of a particular witness will
depend on its impression
about the veracity of the witness. That in turn will depend on a
variety of subsidiary factors not necessarily
in order of importance,
such as (i) the witness’ candour and demeanour in the
witness-box, (ii) his bias, latent and blatant,
(iii) internal
contradictions in his evidence, (iv) external contradictions with
what was pleaded or put on his behalf, or with
established fact or
with his own extra curial statements or actions, (v) the probability
or improbability of particular aspects
of his version, (vi) the
calibre and cogency of his performance compared to that of other
witnesses testifying about the same incident
or events. As to (b), a
witness’ reliability will depend, apart from the factors
mentioned under (a) (ii), (iv) and (v) above,
on (i) the
opportunities he had to experience or observe the event in question
and (ii) the quality, integrity and independence
of his recall
thereof. As to (c), this necessitates an analysis and evaluation of
the probability or improbability of each party’s
version on
each of the disputed issues. In the light of its assessment of (a),
(b) and (c) the court will then, as a final step,
determine whether
the party burdened with the onus of proof has succeeded in
discharging it. The hard case, which will doubtless
be the rare one,
occurs when a court’s credibility findings compel it in one
direction and it evaluation of the general probabilities
in the
other. The more convincing the former, the less convincing will be
the latter. But when all factors are equipoised probabilities

prevail’ (at 14 I -15 D).
[16]
The arbitrator failed to make any findings as to the credibility of
the parties’ respective witnesses, or their reliability.

Instead, the arbitrator omitted these steps and went directly to
consider what she regarded as the probabilities of the respective

versions before her. There are a number of indications on the record
that have a direct bearing on the employee’s credibility.
The
employee stated on a number of occasions that he intended to call
particular witnesses to corroborate his evidence - he failed
to call
a single one. The arbitrator ought to have drawn an adverse
inference, or at least factored this into the assessment of

credibility. Further, the arbitrator did not have regard to the
employee’s admitted changing and mutually contradictory
versions relating to the basis for his entitlement to incur personal
expenses on the company credit card. This too was relevant
to a
credibility enquiry.
[17]
In short - the first respondent’s defence to the effect that
clause 3 authorised him to incur personal expenses on the
company
credit card was not a primary defence at the arbitration hearing –
it was a defence at the disciplinary hearing and
appears to have been
abandoned by the first respondent. Yet the arbitrator put great store
by it. While clause 3 of the first respondent’s
contract of
employment is not a model of concise drafting or clarity and may even
be ambiguous, that is no basis for the finding
that the clause either
entitled the first respondent to incur personal expenses on the
applicant’s account, or that the first
respondent subjectively
believed on that basis that he was entitled to do so. While the
arbitrator notes that this was a version
advanced by the applicant
during his disciplinary enquiry, it was, as I have indicated, not the
primary defence advanced at the
arbitration hearing. In fact, it was
a version that emerged for the first time when the first respondent
gave evidence, after the
applicant had closed its case and in the
face of a concession by the employee that Smits would not be aware of
any tacit agreement
or the terms of any such agreement. In effect
therefore, the arbitrator made a factual finding on the basis of
untested evidence,
a misdirection that inevitably renders an award
reviewable.
[18]
In any event, the arbitrator simply fails to deal with any competing
interpretations of clause 3, or to scrutinise the first
respondent’s
evidence in the light of an interpretation that is more consistent
with upholding the fiduciary relationship
owed by the first
respondent to the applicant, and with generally applicable standards
of ethics and corporate governance.
That interpretation is
perfectly discernible from the terms of the clause – i.e. that
business expenses incurred in the normal
course (travel, cell phone,
accommodation and the like would be for the applicant’s account
as would other business expenses
outside of that particular scope,
but for expenses exceeding R 5000, which Smits would need to approve.
[19]
Further, there was no evidence before the arbitrator to justify the
conclusion that there was a tacit agreement between the
first
respondent and Smits to the effect that the first respondent was
entitled to incur reasonable personal expenses on the card.
The first
respondent’s evidence was vague – he was unable to
recount any details of the agreement that he contended
for. Further,
as I have indicated, he conceded in cross-examination that it was
possible that Smits was not aware of the terms
of the agreement.
Contrary to what the arbitrator found, it is highly improbable that a
corporate entity would permit a director
to use a company credit card
for personal expenses without having to account for those expenses or
repay them which in essence,
was the content of the tacit agreement
the first respondent alleged.  The first respondent conceded
under cross-examination
that appropriate checks and balances were
required, including the keeping of a proper record and accountability
for reimbursement.
The first respondent went on to testify that no
checks and balances were in place. The arbitrator does not deal with
these issues,
and without any cogent reasons, dismissed the versions
of Smits and the bookkeeper to the effect that a strict line was
maintained
between business and personal expenses and that the use of
the company credit card was limited strictly to business expenses.
[20]
In so far as the arbitrator found it more probable that the first
respondent’s personal expenses would not have escaped
the
scrutiny of Smits, the bookkeeper and the auditors, this finding
overlooks the clear evidence of Smits and the bookkeeper was
that
they were unaware of the first respondent’s private purchases.
There is no cogent reason to have rejected that evidence.
The first
respondent conceded during cross-examination that neither Smits nor
the bookkeeper would be able to assess, merely by
looking at the bank
statements, whether the expenses were business or personal. Smits and
the bookkeeper emphatically stated that
they were unaware that the
first respondent was uing the company credit card for personal
expenses. Again, there is no cogent reason
to have rejected this
evidence, not does the arbitrator proffer one. Further, the employee
conceded under cross-examination that
there was no evidence to
suggest that Smits had abused the company credit card issued to him,
or that he was aware of the employee’s
personal expenditure on
the card issued to the employee.
[21]
In so far as the first respondent admitted to making mistakes in
respect of purchases including those at Builder’s Warehouse,

Ster Kinekor, Jade Lee Electric and Computicket. These ‘mistakes’
were not explained in any detail by the first respondent,
a factor
ignored by the arbitrator except to the extent that she observed that
the first respondent’s more frequent use of
the company credit
card ‘
could be attributed to the Applicant being cash
strapped as a result of the renovations of his house. This might well
be the case’
. However, the arbitrator went on to justify
these purchases on the basis that the first respondent did not
attempt to conceal them.
This begs the question – if the first
respondent did not attempt to conceal personal expenses, why did he
not disclose them?
Disclosure was made only after the first
respondent was directly confronted with the allegation of abusing the
company credit card.
[22]
In regard to the incident of onus, it should be recalled that the
arbitrator found that the first respondent had, at most,
been
negligent in the transaction involving Coastal Hire and the hiring of
equipment, and that his use of the company credit card
could be
attributed to error on his part. Although the arbitrator appears to
accept this, she dismissed any suggestion of dishonesty
on the basis
the applicant had drawn an assumption and failed to present evidence
to show that the employee never used his personal
credit card for
business expenses. What the arbitrator overlooks is the fact that it
was the employee who had raised the defence
of the mistaken use of
the company credit card – it was not for the applicant to show
that the employee’s personal
credit card had been used for
company expenses. This is clearly evidence that was peculiarly within
the knowledge of the employee
and ought to have been forthcoming from
him.
[24]
To the extent that procedural fairness is an issue in the present
proceedings, the arbitrator found there to the conduct of
the
disciplinary hearing, the applicant’s dismissal was
procedurally unfair because the chair of the disciplinary hearing

ought to have postponed the hearing to afford the first respondent an
opportunity to call a witness, and that the proceedings had
been
‘rushed’ so that the applicant could escape the payment
of the first respondent’s bonus. What the commissioner’s

finding overlooks is the nature and extent of the right to procedural
fairness. This was fully considered in this court in
Avril
Elizabeth Home of the Mentally Handicapped v CCMA
& others
[2006] 9 BLLR 833
(LC), where the court held that the Code of Good
Practice: Dismissal required no more than that the employer
investigate any alleged
misconduct, provide the employee with an
opportunity to respond to any allegation of misconduct with the
assistance of a representative
where requested and that the employer
make a decision and communicate it to the employee. The enquiry
conducted by the applicant
met this standard, and to the extent that
the arbitrator’s finding demanded more of the applicant, the
arbitrator misdirected
herself in making the finding that she did.
It  also warrants mention that the applicant ‘rushed’
the hearing
to avoid paying the first respondent a bonus is not one
that can be sustained by reference to the evidence – this is an
issue
raised by the first respondent in his opening address and then
obliquely raised by the applicant’s representative referred
to
in his cross-examination of the first respondent.
[25]
In summary, the arbitrator failed to apply her mind to the evidence
before her and failed properly to deal with and resolve
the dispute
of fact and failed properly to have regard to the probabilities of
the competing versions that served before her. The
first respondent’s
version was improbable, and the arbitrator ought to have made a
finding to that effect. Further, the arbitrator
misconceived the
nature of the enquiry into procedural fairness. Her misdirection and
misconception had the result that the outcome
of the arbitration
proceedings (her decision that the first respondent’s dismissal
was substantively and procedurally unfair)
falls outside of a band of
decisions to which a reasonable decision-maker could come on the
available evidence.
[26]
The court has a discretion to remit the matter for rehearing or to
substitute the arbitrator’s order. In my view, little
purpose
would be served by remitting the matter to the second respondent. All
of the relevant evidence has been placed before the
court, and the
court is as good a position as any commissioner to make a decision.
The record discloses that the first respondent,
on his own version,
used his company credit card to make purchases of a personal nature.
The evidence does not support the conclusion
that either his contract
of employment entitled the first respondent to do so, or that he had
a tacit agreement with Smits to make
such purchases. That being so,
and given particularly the fiduciary relationship on which the first
respondent stood in relation
to the applicant and the standard of
ethics and governance that applied to him as a director of the
applicant, his conduct comprised
an act of serious misconduct that
warranted his dismissal. The arbitrator’s award therefore
stands to be substituted with
a finding that the first respondent’s
dismissal was substantively and procedurally fair.
[27]
In relation to costs, both parties submitted that costs ought
properly to follow the result. I see no reason to differ –
the
requirements of the law and fairness referred to in s 162 of the LRA
do not dictate otherwise. I intend to exclude from the
costs order
the costs of the Rule 11 application that was withdrawn on 10 August
2016. It also follows that I need not consider
the first respondent’s
application in terms of s 158(1) (c).
For
the above reasons, I make the following order:
1.    The arbitration
award issued by the third respondent on 11 November 2013 is reviewed
and set aside.
2.    The third
respondent’s award is substituted by the following:
‘
The
applicant’s dismissal was substantively and procedurally fair’.
3.    The first
respondent is to pay the costs of the review application.
ANDRÉ
VAN NIEKERK
JUDGE
OF THE LABOUR COURT
REPRESENTATION
For
the applicant: Adv. N Cassim SC, with him Adv. M Lennox, instructed
by Eversheds.
For
the first respondent: Adv. W Bekker, instructed by Moni Attorneys.