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[2017] ZALCJHB 145
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Sampson v South African Post Office SOC Limited (J2106/15) [2017] ZALCJHB 145; (2017) 38 ILJ 2368 (LC) (10 May 2017)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
JUDGMENT
Reportable
Case no: J2106-15
In
the matter between:
DARREN
SAMPSON
Applicant
And
SOUTH
AFRICAN POST OFFICE SOC LIMITED
Respondent
Heard:
24 November 2016
Delivered:
10 May 2017
Summary:
Section 188A of
Labour Relations Act, 1995
– consequence of a
court order setting aside a dismissal award and ordering a rehearing
of the disciplinary matter -
status
quo ante
restored
-
order
revives retrospectively the contract of employment - employee
reverts
to his status as an employee on precautionary suspension -
once
the dismissal is reviewed and set aside, it cannot result in a
dismissal remaining in force - the new arbitrator is not asked
to
confirm or set aside any existing dismissal – employee entitled
to
backpay
.
JUDGMENT
WHITCHER
J
Introduction
[1] This application
concerns the impact and effect of a successful review by an employee
against a pre-dismissal arbitration award
in circumstances where the
review court ordered that the matter is remitted to the arbitration
tribunal for a rehearing. Does this
order revive retrospectively the
contract of employment, so that the employee continues to be employed
as if he had never been
dismissed?
[2] The Applicant was
employed by the Respondent from 1 April 2011 as Manager: Legal
Services. In terms of his contract of employment,
he was remunerated
at an all-inclusive remuneration package of R520 000.00 per annum. An
amount of 62.5% of the contracted remuneration
package was
pensionable. The contract remuneration package included all company
contributions such as pension, medical aid, car
insurance, and fuel
and maintenance allowances.
[3] On 3 November 2011 he
was suspended with pay pending an investigation into allegations of
misconduct. In January 2012 he was
charged with breaching his
fiduciary duty. The allegation was that he had access to confidential
information, discussed such information
with unauthorised personnel
and indicated an intention to copy, save or print such confidential
information for the purposes of
using it to the detriment of the
Respondent. He was further charged with gross insubordination. The
allegation was that he refused
to obey an instruction to hand over a
hard disk drive, or provide access to same, on which the Respondent
suspected him to have
copied its confidential information. This was
followed by a pre-dismissal arbitration in terms of
section 188A
of
the
Labour Relations Act, 1995
. On 4 June 2012, the Arbitrator found
the Applicant guilty of the said charges and handed down the sanction
of dismissal with immediate
effect.
[4] On 13 July 2012, the
Applicant applied for the arbitration award to be reviewed and set
aside. There was no appearance on behalf
of the Respondent at the
review hearing on 3 September 2015, and the Labour Court in effect
granted a default order (there is no
judgment or reasons for the
order) in the following terms: the award is reviewed and set aside
and the matter is remitted to Tokiso
for a rehearing of the matter
before a different arbitrator.
[5] On 8 September 2015,
the Applicant’s attorney wrote to the Respondent submitting
that, in light of the court order, the
Applicant’s dismissal
has been reviewed and set aside with the result that the employment
relationship that existed between
the parties before the dismissal
had been re-established. The court order had effectively reverted the
relationship to where it
was immediately prior to the Applicant’s
dismissal. Prior to his dismissal, the Applicant was on suspension
with full pay
pending the finalisation of the arbitration, and this
was the situation the parties must revert to.
[6] The letter went on to
say that the Respondent must arrange for a disciplinary hearing
(arbitration) on the original charges
to be held
de novo
in
terms of the court order.
[7] It was further
submitted in the letter that since the Applicant was dismissed on 4
June 2012 and the court in effect re-instated
the employment
relationship effective from 4 June 2012, Applicant must be
compensated
for this period being 3 years and 3 months. In
addition, since he was now an employee of the Respondent, the
Applicant must be paid
monthly the salary he was paid while still an
employee commencing from September 2015.
[8] On 9 September 2015,
the Respondent confirmed receipt of the above letter. On 18 September
2015, the Respondent informed the
Applicant’s attorneys that it
required a copy of the court order before it could respond to the
Applicant’s demands.
A copy of the court order was provided on
22 September 2015.
[9] On 25 September 2015,
the Respondent denied the Applicant’s claims and submitted that
the effect of the court order was
that the “dismissal still
stands until the outcome of the arbitration”. The Respondent
stated that it will not be arranging
a disciplinary
hearing/arbitration: the matter was remitted back to Tokiso Dispute
Settlement (Pty) Ltd for a fresh hearing before
a different
arbitrator.
[10] In this latter
statement, the Respondent was evidently submitting to the Applicant
that it personally had no obligation to
organise another arbitration
and that the court ordered Tokiso to do same on service of the order
by the Applicant. The Applicant
submitted in this hearing that the
Respondent’s view on the matter was wrong and that the
Respondent was obliged to arrange
for a new pre-dismissal
arbitration. The Applicant did not however express this view in a
responding letter to the Respondent.
[11] On 26 October 2015,
the Applicant launched this application, submitting that the court
order in effect revived retrospectively
the contract of employment as
if he had never been dismissed
Analysis
[12]
The Respondent contended that the status of an arbitrator in a
section 188A
process is
sui
generis
in
that the arbitrator stands in the role of a chairperson of an
internal disciplinary hearing and also as an arbitrator. In this
regard, when a pre-dismissal arbitration award is reviewed and set
aside, the dismissal ruling remains as the court generally does
not
review and set aside outcomes of internal disciplinary hearings. If,
in law, the setting aside of the award automatically revived
retrospectively
the contract of employment, such that the employee continues to be
employed as if he had never been dismissed, the
court
would
have expressly ordered the retrospective reinstatement of the
Applicant, albeit on suspension with pay, pending the outcome
of the
new arbitration. The court, in the review application, did not
substitute the award of the Arbitrator nor did it reinstate
the
Applicant. It simply reviewed and set aside the award and ordered the
matter to be arbitrated afresh, and this cannot be equated
to
retrospective reinstatement. When matters are remitted for a
rehearing by the review court, employees do not become reinstated.
[13]
The short answer to the Respondent’s first submission is that
section 188A
(8) provides that:
“
The
ruling of the arbitrator in an inquiry
has
the same status as an arbitration award, and the provisions of
sections 143
to
146
apply with the changes required by the context to
any such ruling”.
[14]
I turn now to the consequence of a court order setting aside a
dismissal award and ordering a rehearing of the disciplinary
matter.
I agree with the Applicant’s counsel that the
status
quo ante
is
restored. Once the dismissal is reviewed and set aside, it cannot
result in a dismissal remaining in force. The new arbitrator
is not
asked to confirm or set aside any existing dismissal. The act of
setting aside a dismissal award is the act of literally
setting the
‘conviction’ aside, it is akin to pretending it never
happened. It is a
rescission
in which the situation is restored to the state which previously
existed.
[15]
In this matter, the court order set aside the original decision to
dismiss the Applicant and
the original decision to dismiss him
effectively ‘vanishes’ and he is treated as if he had
never been dismissed.
The
order revived retrospectively the contract of employment between the
Applicant and the Respondent. In my view, this
must
be implicit in an order that sets aside, without qualification, a
decision to dismiss the Applicant. He thus reverts to his
status as
an employee on precautionary suspension.
[16]
The understanding above is fortified by a consideration of the powers
granted to the court under
Section 145(4)
of the LRA. This section
expressly gives the court the power ‘to
determine
the
matter in the manner it considers appropriate’ or to make
any
order
it considers appropriate about the procedures to be
followed to determine the dispute’.
[17]
In a review, as Grogan points out:
“
If an
award is
set aside,
therefore, the court has a range of options between
making
no additional order
–
in which case the
status quo
ante
the award revives –
and remitting the matter to the CCMA or bargaining council for a
fresh hearing. If the court decides
to
determine
the matter itself, it makes
the order the errant commissioner should have made”.
Claim for payments
[18] There is however a
twist to this case. In this application, the Applicant stated that he
took steps to mitigate his “damages”
in that, during
September 2012, being 3 months after his dismissal, he found
employment with Legal Aid where he remains employed.
[19] The Applicant
however did not tender his services to the Respondent, even as an
employee on paid suspension, but seeks certain
payments, calculated
from the date of his dismissal to date hereof. He claims that, but
for his dismissal, he would have been entitled
to receive this
remuneration. In this regard, he set out a schedule in his affidavit
which purports to record the monthly gross
remuneration he was paid
by Legal Aid from October 2012 to October 2015, the date he
instituted this action.
[20] The Respondent
submits that the Applicant has not proved his damages as he did not
attach payslips from Legal Aid.
[21] The Respondent takes
issue with the Applicant saying on one hand that he is their employee
and must be paid but on the other
hand not tendering his services and
in fact working for another employer.
[22] The Applicant’s
Notice of Motion indeed does not seek as relief that he be accepted
back into employment; an order directing
the Respondent to reinstate
him. The Applicant seeks only a remittal for a rehearing. The review
itself revolved around procedural
errors which denied him a fair
hearing on the merits and thus impacted on the substantive fairness
of his dismissal. It is an open
question how any theoretical, future
pre-dismissal hearing will take place but it will be on a
de novo
basis. This means that the new arbitrator could well decline to
dismiss the Applicant on the available evidence.
[23] Given my ruling
above that a review court’s setting aside of an arbitrator’s
award revives an employment contract,
I see no impediment to the
Applicant being paid what is essentially
backpay
[the use of
the term damages is incorrect] for the period between his dismissal
and the date of the review court’s decision.
This is to be
calculated as the difference between what he would have earned as an
employee of the Respondent and what he did in
fact earn at Legal Aid
between 4 June 2012 and 3 September 2015. Whether he tendered his
service at the Respondent for this period
is irrelevant because,
although this decision was later overturned, the legal position at
the time was that there was no contract
between him and the
Respondent. He was dismissed and the fact that he worked for another
employer during the time his contract
with the Respondent was
unlawfully terminated does also not disqualify his claim for backpay
that flows from the revival of that
contract under the review court’s
order.
[24] The next question is
whether the Applicant should be paid for any period
after
the
review court’s decision. In his Notice of Motion, the Applicant
only sought to be remunerated up until the date he instituted
proceedings (“hereof”); which was 26 October 2015.
Despite the fact that in his Heads of Argument he sought payment
up
until the date of judgment in this matter, there was no formal
revision of the relief sought. The 26 October 2015 is therefore
the
end date in respect of the claim for remuneration that I can
consider.
[25] In the circumstances
of this case, I am hesitant to attach significance to the failure of
the employee to formally tender his
services after the review court’s
decision was made. His attorney promptly contacted the Respondent
averring that his contract
with it had revived. The Respondent
dilly-dallied for a while but by 25 September 2015, it had very
firmly denied the Applicant’s
contentions, inter alia, that
going forward he was entitled to be remunerated by the Respondent. It
would be artificial to expect
the Applicant to resign from the other
employer where he had been able to mitigate his losses after his
unfair dismissal from the
Respondent so that he could fully press his
claims arising from that unfair dismissal. It is self-evident that a
tender of services
in so many words would have been rejected and this
gesture would have only added to losses he should not, as per the
review order,
have sustained in the first place.
[26] I do not wish to
downplay the general significance of a tender of services in contract
law where both parties have obligations.
The failure to tender
services after being reinstated or after an order of specific
performance can have very serious legal consequences
for an employee.
However, in the circumstances of this case, it strikes me that the
Respondent’s attitude towards the review
judgment was plain. It
wholly and totally disputed the legal basis on which the Applicant
based his claim both for payment for
the period before the review
court’s decision – and the period thereafter. The
Respondent regarded the legal position
to be that the Applicant was
still dismissed and consequently would not have accepted a tender of
services. I do not understand
the Respondent to now argue that they
would have acted differently had the Applicant resigned from Legal
Aid and arrived at their
door in September 2015 offering to work.
[27] It flows from this
that the Applicant is also entitled to remuneration calculated as the
difference between what he would have
earned at the Respondent had he
not been dismissed and to what he earned at LegalWise between 3
September 2015 to 26 October 2015.
[28] In respect of both
periods mentioned above, any accrued leave in terms of clause 8 of
the Applicant’s Employment Agreement
with the Respondent and
prayed for is also payable.
[29] This may all seem a
very steep price for the Respondent to pay for an action it took,
invoking
section 188A
, which was designed precisely to avoid long
delays in the resolution of disputes and the attendant risk of
backpay accumulating
in the event of an adverse finding.
[30]
As was noted in a slightly different context in
SATAWU
& Others v MSC Depots (Pty) Ltd
:
[1]
“
[19]
Section 188A
holds the promise of the expeditious resolution of
disputes about employee conduct and the swift imposition of a fair
sanction
for any proven misconduct. Regrettably, in this instance,
the CCMA has failed the parties, and frustrated the statutory purpose
that underlies the section. The ineptitude with which the
pre-dismissal arbitration was conducted resulted in a successful
review,
and an order that the matter be remitted to the CCMA for
re-hearing. The parties have been prejudiced, the respondent more so
since
it has had in the interim to carry the cost of the applicants’
wages. But that is a risk that an employer must run when it
decides
to place the function of workplace discipline in the hands of an
unknown third party. Ordinarily that risk may be worth
running. I
have referred to the significant cost savings to be had by avoiding
the duplication occasioned by elaborate in-house
disciplinary
enquiries and an inevitable arbitration hearing at which the same
allegations are tested in a de novo hearing. But
the integrity of the
system depends on the expertise of the arbitrator, and that is where
the first respondent’s initial
confidence in the system was
betrayed.”
[31]
Noting that the Respondent’s risk is to some extent on-going, I
can only say that, in my view, my hands are tied. I cannot
suspend
the legal consequences of the reviewing courts ‘setting aside’
of the
section 188A
dismissal because the effects seems rather
onerous on one party. This case seems to have wandered into something
of a legal no-mans’
land which might benefit from legislative
scrutiny in future and the careful crafting of relief sought when
reviewing
section 188A
decisions or when opposing such reviews.
[32]
As to backpay, I accept that the Applicant has not provided proof of
his earnings at LegalWise and that the Respondent may
be deprived of
the ability to interrogate the numbers provided in this matter. I
will address this in the ruling. Basically, the
Respondent can elect
to accept the figures put up by the Applicant and pay him accordingly
or it can require that the Applicant
put up documentary proof of
same. Should there be any dispute on quantum, I will be happy to have
that issue re-enrolled to be
heard by me, if possible, in Chambers.
Order
[33]
The Respondent is ordered to pay the Applicant the difference between
the remuneration he would have received between 4 June
2012 and 26
October 2015.
[34]
The Respondent must additionally pay the Applicant out any accrued
leave for the period mentioned in clause 1 above.
[35]
Should the Respondent not accept the amount claimed by the Applicant
in a schedule to his affidavit in these proceedings in
respect of the
difference in remuneration levels mentioned in clauses 1 and/or 2
above, it must notify the Applicant of this within
10 days of this
judgment.
[36]
The Applicant must then, with 10 days of this notification by the
Respondent, serve an affidavit on the Respondent and this
Court,
setting out in an affidavit how he calculated the difference in
remuneration levels and/or what payments he contends he
should
receive for accrued leave and benefits as at 26 October 2015.
[37]
The Respondent must then further, within 10 days of receipt of the
Applicant’s affidavit, serve and file an affidavit
setting out
its response to the Applicant’s affidavit on the remuneration
claim.
[38]
The Registrar is then ordered to set this issue down for a hearing
before me in Chambers by no later than 3 months after the
date of the
affidavit mentioned in clause 2.3 above.
[39] The Respondent is
ordered to pay the Applicant’s costs.
________________________________
Whitcher J
Judge of the Labour Court
of South Africa
APPEARANCES:
For
the Applicant: Adv M A Lennox, instructed by Schindlers Attorneys
For
Respondent: Adv K T Mokhatla, instructed by Madhlopa Incorporated
[1]
Case no: D449/2011, unreported, 16 June 2012.