Brief Summary

Labour Law — Strike action — Interdict against strike — Urgent application for interdict based on alleged unprotected strike — Applicant contending that wage agreement binding on employees — Respondent union claiming right to bargain — Court finding that NUMSA did not meet representativeness threshold for collective bargaining rights — Strike action deemed unprotected as it sought to amend terms of binding wage agreement — Interdict granted against strike action.

Comprehensive Summary

Summary of Judgment

1. Introduction

This was an urgent application in the Labour Court for interdictory relief in relation to contemplated strike action. The applicant was Wholesale Housing Supplies (Pty) Ltd (“WHS”), and the first respondent was the National Union of Metalworkers of South Africa (“NUMSA”), with the second respondents being the individual employees listed in annexure “A” to the notice of motion.

The matter was initially launched on 21 August 2017 for hearing the next day. By agreement between the parties it was postponed to allow the filing of further affidavits, and it was ultimately heard on 25 August 2017. Pending the court’s decision, the respondents gave an undertaking not to embark on strike action.

The dispute concerned the nature and permissibility of the proposed strike in circumstances where WHS had concluded a three-year wage agreement with another union (SACCAWU), had purportedly extended that agreement to non-parties under section 23(1)(d) of the Labour Relations Act 66 of 1995 (“LRA”), and where NUMSA sought to strike in respect of a “refusal to bargain” dispute linked to a prior CCMA advisory award. Central to the case was whether the strike was directed at obtaining bargaining/recognition rights (potentially permissible) or at reopening/amending wages regulated by a binding collective agreement (prohibited), or both.

2. Material Facts

WHS operated four distribution centres (Germiston, Pinetown, Port Elizabeth and Cape Town). At the Durban and Germiston centres, NUMSA represented less than half of the permanent workforce. Nationally, the papers indicated that SACCAWU had a significantly larger footprint than NUMSA, and WHS had concluded a “relationship agreement” in terms of which SACCAWU would be recognised as the collective bargaining representative provided it represented 30% of employees in each of the four centres.

A wage agreement was concluded with SACCAWU for the period 1 July 2016 to 30 June 2019. In June 2016 NUMSA referred a dispute to the CCMA alleging that WHS was refusing to bargain with NUMSA for wage demands, seeking an outcome that WHS should also bargain with NUMSA in wage negotiations. That dispute culminated in a CCMA verification exercise in November 2016 and the issuing of an advisory award in December 2016. The advisory award recorded, among other things, that NUMSA’s national representation was 17.13%, and it noted the relevance of section 18(2) of the LRA concerning the equal application of thresholds of representativeness. The award’s essence was that WHS was under no legal obligation to bargain with NUMSA, but that NUMSA could use industrial power to try to compel bargaining, consistent with the principle in Bader Bop.

After the advisory award, nothing material occurred until mid-2017. On 28 June 2017 NUMSA issued a strike notice, which was withdrawn on 30 June 2017, and later reissued in August. Shortly after the withdrawal of the first strike notice, WHS purported on 3 July 2017 to extend the three-year wage agreement to other employees under section 23(1)(d), asserting that SACCAWU then represented 50% of employees in the workplace.

WHS wrote to NUMSA on 28 July 2017, stating that the SACCAWU wage agreement constituted full and final settlement of wage demands for the three-year period, asserting that NUMSA was bound by the extended agreement, and warning that any strike would be prohibited in terms of section 65 of the LRA because the issues raised were regulated by the current wage agreement. NUMSA did not respond.

On 18 August 2017, NUMSA issued a further strike notice (served after normal business hours), stating that the industrial action related to the refusal to bargain dispute “in terms of wage negotiations” held in 2016, and referring to the CCMA advisory award and the certificate of non-resolution.

On the question whether SACCAWU was in fact a majority union at the time of extension, WHS put up payroll deduction schedules for July 2017, showing that across 514 permanent employees, 274 were SACCAWU members and 104 were NUMSA members. NUMSA argued that additional workers supplied by temporary employment services (144 workers) should have been included in determining representativeness. WHS countered with reference to the Labour Appeal Court decision in NUMSA v Assign Services and Others, and the point was not pursued further once it was noted that the status of that decision was affected by a pending Constitutional Court process.

The court treated as material that, on the evidence, at the time of the July 2017 extension, SACCAWU had majority support in the four-centre workplace and NUMSA did not meet a 30% threshold there, with the consequence (on WHS’s case) that the extended wage agreement bound NUMSA members employed by WHS.

3. Legal Issues

The court was required to determine, first, whether the matter properly warranted urgent relief with truncated time periods, specifically whether the peremptory requirements of section 68(2) of the LRA had been met.

The central substantive questions were whether, and to what extent, the contemplated strike would be unprotected under the LRA. This required determining whether the wage agreement had been validly extended under section 23(1)(d) so as to bind NUMSA members, and whether the intended strike was, in substance, a strike to amend or reopen matters regulated by that agreement (implicating section 65(3)(a)(i)) or instead a strike aimed at securing collective bargaining/recognition rights (a question involving the application of constitutional and statutory principles to the facts, including the characterisation of the strike’s purpose).

The dispute therefore involved a mixture of legal interpretation (notably the effect of sections 23 and 65 of the LRA), factual assessment (union representativeness at the relevant time and the purpose of the strike), and the application of law to fact (distinguishing permissible and impermissible purposes within a single contemplated strike).

4. Court’s Reasoning

On urgency, the court accepted that there was no real dispute about the urgent nature of the application, but emphasised that it still had to be satisfied that section 68(2) had been complied with. The court considered the timing and context of notice: NUMSA served its strike notice after business hours on a Friday and the strike was due to commence on Monday morning, and WHS notified NUMSA on the Sunday of its intention to approach court. Although Sunday notice would not ordinarily suffice, the court regarded the opportunity to be heard as reasonable in the circumstances, particularly given the respondents’ timing and the earlier correspondence warning that WHS considered any strike unprotected. The court accordingly held that the statutory requirements for a shortened notice period were met.

On whether the wage agreement bound NUMSA members, the court assessed the evidence of union membership at the time of the extension. It accepted WHS’s deduction schedules reflecting that, in July 2017, SACCAWU had majority membership in the relevant workplace (the four distribution centres) and NUMSA did not meet a 30% threshold there. It further adopted what it considered the “most natural interpretation” of section 23(1)(d): what matters is the union membership position at the time the agreement is extended, even where, as in this case, extension occurred about a year after conclusion of the agreement. On that footing, the court concluded that NUMSA’s members employed by WHS were bound by the wage agreement as extended, and that any strike aimed at amending or renegotiating the terms regulated by the agreement would contravene section 65(3)(a)(i) and be unprotected.

The court then addressed NUMSA’s contention that the strike was directed only at obtaining bargaining rights and not at substantive wage demands. It noted that the parties characterised the dispute differently: WHS treated NUMSA’s objective as reopening the 2016 wage negotiations, while NUMSA framed its objective as asserting the right to strike to secure a place in collective bargaining. The court found that the demands were “intertwined” but nonetheless distinguishable. It accepted that NUMSA was pursuing, at least in part, a demand to be recognised as a bargaining partner, and it reaffirmed that minority unions may strike in support of a demand for bargaining or organisational rights, consistent with the Constitutional Court’s position in National Union of Metalworkers of SA & others v Bader Bop (Pty) Ltd & another.

At the same time, the court emphasised that the right of a minority union to strike for bargaining rights does not displace the binding effect of agreements concluded by majority unions and extended under the LRA. In this regard, it relied on the Constitutional Court’s reaffirmation of the majoritarian principle in Association of Mineworkers and Construction Union and Others v Chamber of Mines of South Africa and Others, which underscored that extension under section 23(1)(d) does not unreasonably limit freedom of association or collective bargaining.

The court therefore rejected an “either/or” characterisation of the strike and held that the proper approach was to recognise the two strands within the contemplated industrial action. It held that, insofar as the strike was aimed at “undoing” the wage agreement concluded with the majority union, it was unprotected. Insofar as it was aimed purely at persuading WHS to recognise NUMSA as a collective bargaining representative (in effect, lowering or altering the threshold for participation in future bargaining), the court considered that demand unobjectionable given that the other statutory requirements for protected strike action had been met. This reasoning drove the form of the order, which separated the permissible and impermissible purposes.

5. Outcome and Relief

The court dispensed with the ordinary forms and service under the Labour Court rules and treated the matter as urgent in terms of Rule 8.

A rule nisi was issued calling upon the respondents to show cause on 10 November 2017 why a final order should not be made. The interim relief declared that the strike notified on 18 August 2017 (due to commence on 21 August 2017) was unprotected insofar as it supported any demand other than a demand that WHS recognise NUMSA as a collective bargaining representative. The individual respondents were interdicted from participating in the strike in support of any other demand, and NUMSA was interdicted from encouraging or inciting participation in the strike in support of any other demand.

The relief in the rule nisi operated as an interim order with immediate effect pending finalisation. The court ordered that each party pay its own costs in respect of the interim application, and made directions for service of the interim order on NUMSA by fax and on individual respondents through reading the order to those present, affixing copies on notice boards and entrances, and providing copies on request.

Cases Cited

Wholesale Housing Supplies (Pty) Ltd v National Union of Metalworkers of South Africa and Others (J1948/17) [2017] ZALCJHB 312 (29 August 2017).

National Union of Metalworkers of SA & others v Bader Bop (Pty) Ltd & another 2003 (2003) 24 ILJ 305 (CC).

Bader Bop (Pty) Ltd v NUMSA and Others [2002] 2 BLLR 139 (LAC).

NUMSA v Assign Services and Others (JA96/15) [2017] ZALAC 44 (10 July 2017).

Association of Mineworkers and Construction Union and Others v Chamber of Mines of South Africa and Others (2017) 38 ILJ 831 (CC).

Legislation Cited

Labour Relations Act 66 of 1995, section 18(2).

Labour Relations Act 66 of 1995, section 23(1)(d).

Labour Relations Act 66 of 1995, section 65(3)(a)(i).

Labour Relations Act 66 of 1995, section 68(2).

Labour Relations Act 66 of 1995, section 198A(3)(b).

Rules of Court Cited

Labour Court Rules, Rule 8.

Held

The court held that the application met the urgency requirements and that the requirements of section 68(2) of the LRA justifying a notice period of less than 48 hours were satisfied in the circumstances.

It held that, on the evidence, SACCAWU was a majority union in the workplace at the time WHS extended the wage agreement in July 2017 under section 23(1)(d), with the result that NUMSA members employed by WHS were bound by that wage agreement.

It further held that the contemplated strike could not be characterised as serving a single purpose. To the extent that it sought to undo or renegotiate the terms of the binding wage agreement, it was unprotected under section 65(3)(a)(i). To the extent that it pursued only the demand that WHS recognise NUMSA as a collective bargaining representative, it was not interdicted on the basis advanced, because minority unions may strike to pursue bargaining/organisational rights, subject to statutory compliance.

LEGAL PRINCIPLES

A court considering urgent strike interdicts must still be satisfied that the peremptory requirements of section 68(2) of the LRA are met, including that the respondent union has been afforded a reasonable opportunity to be heard, assessed contextually with regard to the timing of strike notices and litigation steps.

Where a collective agreement is extended to non-parties under section 23(1)(d), the relevant inquiry into majoritarian status is directed to the union’s representativeness at the time of extension, and once properly extended the agreement binds employees who were not party to it.

A strike is unprotected under section 65(3)(a)(i) to the extent that it seeks to compel an employer to concede demands that would amend or regulate matters already governed by a binding collective agreement.

A minority union may, in principle, pursue protected strike action to obtain collective bargaining or organisational rights (as affirmed in National Union of Metalworkers of SA & others v Bader Bop (Pty) Ltd & another), but this does not entail a right to strike to upset or reopen a binding agreement concluded with a majority union and extended under section 23(1)(d) (as underscored by the Constitutional Court’s affirmation of majoritarianism in Association of Mineworkers and Construction Union and Others v Chamber of Mines of South Africa and Others).

Where the contemplated strike has multiple intertwined purposes, a court may craft relief that distinguishes between permissible and impermissible objectives, interdicting participation only insofar as the strike supports demands that are barred by section 65.